Product Idea: Sports Bar & Grill - Case Study Example

Outline The Locker Room Bar & Grill By Berry L. Chaney Product Idea: Sports Bar & Grill 1.1 Objective & Mission There exists a high potential in this industry. Growth is rapid and return on investment gives a positive cash flow. With these in mind, the following objectives have been established: automated computer controls, high quality management team, maintain tight control on costs, have positive cash flow from the very first year. The promoters recognize that the success of any business lies in effective financial management and cost control. Quality food coupled with efficient service would be adhered to at all times. The promoters are confident of being able to reap cash profits from the first year itself. 2. Business Idea The Locker Room, Bar & Grill will comprise of two pool tables, 5 televisions and one large projection TV to begin with. Individual game playing screens would be available at the bar as well as at some tables. The tables would also have state-of-the-art table-top audio controls so that the customers can watch the programs of their choice. It is expected to be premier sports theme restaurant. We want to be ahead of competition and provide for the discerning clients to have fun during their leisure time. Menu selection and ambience would be such that it would attract the business crowd also apart from the sports minded individuals. At the same time, the company would focus on sport based themes. 2.1 Focus will be on themes of mass appeal. The pub will display and sell collection of sports memorabilia apart from other retail products. The interiors would be done by renowned architects and give it the right ambience appealing to the target audience. High quality food would include cuisine ranging from sandwiches, wraps, pizzas and appetizers, variety of pasta dishes, fish and chips, roast chicken to grilled salmon. Current food items would be added subsequently like roasted red pepper aioli on a chicken tender wrap; broccoli rabe sausage in spicy sausage orecchiette. Variety of salads would be available. Prices would be moderate to suit all pockets. Trained service manager would be employed to ensure quality service to match the food quality. 3. Market and Customers The basic target is the youth within the age group of 21-35 years- the single sports minded individual who cannot live without the Monday night game. Business will not be limited to the youth though. Other facilities would be available to attract business meetings and social functions. In nutshell, the sport enthusiast, the Monday night reveler, the business traveler, as well as families dining out can all enjoy The Locker Room experience. We expect to cater to the needs of the customer, give them an experience to remember. The location of the proposed Pub has its own advantages, as there are limited places for dining and entertainment around. 4. Initial Investments Preparation of the initial start up costs along with projected expenses and sales figures have been give to experts as they involve legal and accounting principles. Our major bankers would be M&T Bank, although initially we do not plan to go in for loans. 5. Location The proposed Pub will be located in a leased building in the area which has strip mall type complex. This complex includes retail stores and movie theatres. The area is across the street from Minor League Baseball Camp and hence is expected to attract a large number of sports enthusiasts. The complex itself is expanding and even adding hotels, which should increase the food sale for the Pub. The area is well connected to the different areas of town through regular transport. 6. Operations Strategy 6.1 Marketing strategy Initially local media would be used but gradually event marketing would be tried. Publicity would also me made through the retail stores within the complex. Free publicity is very effective and all efforts would me made to concentrate on this initially to keep initial investments low. As sales increases, print media would be taken up. Youth are more conscious of the happenings around and hence the initial target would be the age group 21-35. Competition is not a threat but keeps us guarded. 6.2 Pricing Strategy We want to keep the menu prices low to attract customers and also to ensure longer stay. The right ambience would encourage longer stay and longer stay itself would mean increased sales. 6.3 Promotion strategy The focus would be to promote sports extensively. Each client would be made to feel special and he would able to watch the program of his/her choice. 6.4 HR Strategy Initially, a small team would be trained to deliver quality food and service. Maintenance would be given out on contract instead of hiring them. The management itself would be involved in day to day operations till smooth sailing starts. Picking trained staff may be costly except for the Chef and the service manager. Other staff would be fresh trainees. Retention and motivation strategies would be followed which in the long run keeps recruitment costs low, while service standards are maintained. 6.5 Investment strategy Initial capital will be introduced by the management and their friends and associates. Part of the funding would also be taken care through the credit extended by the vendors and equipment suppliers. As the unit starts generating cash, bank loans would be introduced to enhance the working capital. This would help in stepping up the publicity and thereby generating more business. As business grows, services and facilities too would be added. The number of television sets and the audio control systems would be enhanced. Earnings will be reinvested initially so that the Pub grows as envisaged. The owners too would draw salaries like paid employees. 6.6 Sales Strategy The sales figures are projected and based on the existing pubs of similar nature, who are running profitably. These figures are being incorporated by the special team who are preparing the projected investments, expenses, and sales for the first five years. The total sales would include sale of food, drinks and sale of sport memorabilia. Initially all sales would be made in cash. 6.7 Corporate Social Responsibility The social and economic concerns play a significant role in the success of any business. We intend to contribute positively towards this. 7 Sales Forecast and projected profits Taking into account a very modest sales figure of $ 10,000,000 in the first year of operation, the expected gross margin is $ 4,500,000 with a net margin of approximately 15% after deducting expenses like the payroll, sales and marketing expenses, depreciation, utilities, and taxes. 8 Permits Necessary permits are being obtained from the issuing authorities. These include bar and restaurant license, clearance from the Police department, the basic trade license to operate the business, fire license, environmental safety license. The responsibility has been handed over to the experts to complete the permits within the stipulated time. 9 Design and Interiors Architects have been hired to create the right atmosphere for a pub with the most suitable lighting arrangements. The initial design would be approved by the management team, enabling the architects to proceed. 10 Equipment and Furniture Items, which require heavy investment like televisions, audio systems, coolers, freezers, grills, coffee machines, tables, and chairs, would be taken on lease. Other items like kitchen and service cutlery, aprons, garbage cans, table salt and pepper shakers would be purchased. The financial consultants are preparing the investment lay out on these items. 10 Legal Expenses There will be no cost incurred for legal expenses as a lawyer would be engaged who would be an investor in the Pub. He will be shared shares of the pub in lieu of his services. 11 Insurance Metlife or USAA would be used to insure the Pub, its equipments and all fixed assets. The employees would also be insured and discussions are on to insure the clients for the time that they are using the Pub. The approximate expense on insurance is expected to be $ 100,000. Summary The Locker Room, sports Bar & Grill will be a multi cuisine pub offering services to the customers’ satisfaction. It will have no direct competition, as it is one of its kinds in the area. The market survey and strategy promise success of this venture. Only fresh food products would be used to prepare food. The Pub will be strategically located to attract a large number of sports enthusiasts. Initial investment will be through own sources and kept minimum. The owners are hopeful that within three years it would be well established in this industry. Read More