Chinese Buffet Development Plan - Case Study Example

prepared CHINESE BUFFET BUSINESS PLAN I. EXECUTIVE SUMMARY Oriental Buffet is a Chinese Restaurant that offers ic authentic Chinese cuisine. It is inspired by the classic Chinese food stores in mainland China and Hong Kong, with its recipes lifted from age-old sources passed on to generations of food loving Chinese people. While it offers set menus that may be ordered ala carte, it is more popularly known for its buffet food, whereby dim sums, dumplings, noodles and main courses may be unlimitedly enjoyed at a reasonable cost. Anyone who wishes to have a good and hearty Chinese meal would definitely enjoy the wide array of dishes offered by Oriental Buffet. Oriental Buffet will operate as a corporation, with its investors to contribute in raising the capital needed. However, this is a non-profit organization whose goal is to raise funds in favor or St. Luke’s Hospice’s Free Palliative Care Program. As such, investors will have to agree that they will just essentially break even on their investments. All returns will be in favor of St. Luke’s Hospice. The company will also be open to “stock holders” who will also be donors to contribute to the cause. The restaurant will open along Regent’s Park in London and will be open for to serve lunch, afternoon snacks and dinner. II. BACKGROUND The idea of coming up with a Chinese buffet came from the fact that the organizers like Chinese food and believe that there is a room for one more restaurant of this kind in London. This concept also comes from the fact that there is a need for a good project to sustain support for St. Luke’s Hospice’s Free Pallative Care Program for its cancer patients. Since a food business is always promising, the organizers thought of coming up with a Chinese Restaurant with a twist. This way, there will be an edge over the rest of the competitors and there will be a good chance that it will achieve its objectives. III. THE BUSINESS OPPORTUNITY There are more than ten big Restaurants in London specializing in Chinese cuisine, and a few remarkable ones within London’s China Town (London-Eating 2010). Needless to say, there is one too many choices for a Chinese Restaurant already. However, not one of these restaurants offer Chinese buffet in their menu. Chinese buffet is usually found in specialty buffet restaurants that are not really exclusive to this type of product line. Moreover, these restaurants are more grand scale in nature. They cater to business groups and tourists who have the paying capacity for set menus/ ala carte servings. These restaurants have seating capacities of up to 500 guests, indicating that these are grand in size and structure (Wong Kei 2010) The menus are a lot more complex than the usual and management has the freedom to play on their product lines depending on the target market’s preferences., With all these food stores offering similar products, Oriental Buffet will come as not exactly competing heads on, but will play on the lighter, more upbeat Chinese-inspired food restaurant. This way, it will target a slightly different market, and will have more opportunities to thrive and grow amid the many competitors. Oriental Buffet will create a fast food ambiance, in contrast to the stiff sit-down meal settings from other Chinese restaurants. IV. THE PRODUCT/SERVICE A. DESCRIPTION Oriental Buffet will serve its menu buffet style, once during lunchtime and during dinnertime. Buffet is open from 11:00 AM to 2:00 PM and 6:00 PM to 8:00 PM. During this period, customers can enjoy an eat-all-you-can setup for a fee of £ 17.95. There will be four variations of appetizers per serving, with two of the main dishes alternately being served daily. There will also be options for noodles and deserts. Patrons may fill up the plates as much and as many as they can. There will be separate charges for drinks, but service tea and water will still be offered. The restaurant will reflect that of a fast food branch, hip and light, giving the impression that customers may come in, enjoy their meals at their own pace, and leave the place very satisfied. Unlike the usual Chinese Restaurant setting, Oriental Buffet will showcase the modern Chinese interior designs, featuring focal points that suggest simplicity, indicating roominess and a light atmosphere (Chinese Interior Design Essentials 2010). There will be minimal Chinese ornaments, giving the place an east-meets-west interior design. It will cater mostly to the younger people – students, young professionals, and young couples – who want to satisfy their cravings for great Chinese food minus the formality that Chinese Restaurants usually exude. The food will be classical. Classic Chinese Recipes of Steamed Dumplings, Beef and Vegetable in Oyster Sauce, Peking duck recipes, Pork Roast Stew and variations of noodles will be served on schedule. A Chinese Chef specializing in this kind of recipe line will be hired to ensure that the dishes bear the authentic Chinese recipe taste. B. NOVEL FEATURES AND BENEFITS FOR USERS Oriental Buffet will appeal to customers who are always on the go, as the food to be offered is already served, and they will have little time to wait for their ordered food. This set up is best for busy students, young professionals and young married couples who have the buying capacity and would want to enjoy classic Chinese food without the frills and fuss offered by the usual Chinese restaurants. C. ACHIEVEMENT TO DATE The organizers have already made initial implementation plans targeting university students. The initial plan was to bring the buffet set up to the universities, complete with a few dine in amenities to bring the product closer to the target market. But as we acknowledge that there is a greater need for a more structured business to sustain the efforts for St. Luke’s Hospice, the organizers thought of making the effort bigger through the construction and implementation of Oriental Buffet Restaurant. D. TECHNOLOGY DEVELOPMENT MILE STONES Oriental Buffet will advertise thru the Internet. The technological advancements that the World Wide Web brings will definitely be helpful in the marketing aspect of the business. E. OPPORTUNITIES FOR FURTHER DEVELOPMENT/EXPANSION Expansion will be in the form of opening another branch or satellite branches in other locations, most probably within university areas. One target expansion project is to be able to bid for a business space in major universities, encouraging the student body and university management’s support by providing us with low rental costs and the participation of student volunteers. Eventually, a program for students taking up Hotel and Restaurant Management who will perform volunteer work for the business will be able to get extra credits in their academics. Oriental Buffet management will do this by tying up with targeted student organizations and the universities themselves. V. THE MARKET A. MARKET STRUCTURE Oriental Buffet aims to come in to create additional competition to the already existing Chinese restaurants in London. It hopes to get a remarkable share of the target market by creating products that are practical and reasonably-priced. B. MARKET TRENDS AND DRIVERS With the presence of so many competitors, Oriental Buffet is confident of attracting its own group of loyal customers to be able to create additional revenues. In the food business, there are always a lot of direct competitors, but the novelty that Oriental Buffet presents will surely tap the interests of the target market. The key is to get the target market to sample the products, so they will be enticed to continue patronizing the restaurant. C. MARKET SEGMENTATION Our target segmentation scheme is divides the target market into three general groups. Primary targets are the university students. Second are young professionals, and third are young couples. All of three are considered to have purchasing power, yet they do not have the luxury of time to sit down waiting while their food is being prepared for them. These people are always on the go. D. TARGET MARKETS 1. KEY CHARACTERISTICS Oriental Buffet targets the young crowd with its East meets west and fast food concept. These are people who are always on the go, and would most likely appreciate food being served fast. In this case, they can choose their dishes from among the wide array of food products being served buffet-style. 2. SIZE AND FUTURE GROWTH ESTIMATES London is home to approximately 378,000 students, 1/3 of which come from The University of London (Education 2010). The population continues to grow annually with the arrival of immigrants who wish to apply in any of the universities. These much people are the primary target market of Oriental Buffet. VI. THE COMPETITION A. KEY COMPETITORS Oriental Buffet considers the following as its main competitors: 1. China Tang Menu is a mix of Anglo Cantonese while the atmosphere is likened to the 1930s of Mainland China (China Tang 2010) 2. Hakkasan The Restaurant is best fit for night time dining, due to its dim lights and romantic atmosphere. Reviews say that it has good dim sum menus and is popularly known for its Jasmine tea-smoked pork ribs (Hakkasan 2010). B. BARRIERS TO ENTRY There are no known barriers to entry for Oriental Buffet Chinese Restaurant. C. OUR COMPETITIVE ADVANTAGE Our advantage over other Chinese Restaurants is the fact that we are the only ones offering exclusively Chinese food buffet style. We are focused on creating sumptuous Chinese dishes, and create a carefree and relaxed atmosphere for our clients. VII. COMMERCIALISATION PLAN A. BUSINESS OBJECTIVES 1. To gain positive revenue after the first 12 months of operations. After one year, all start up expenses should already be covered for. 2. To raise funds to support St. Luke Hospice’s Programs. All net gains will be allocated for this cause. B. OVERALL BUSINESS STRATEGY Our market entry strategy is to provide alternative and cost-efficient means for our target market to satisfy their cravings for authentic Chinese food. To support this, the buffet style of food serving will be implemented, giving our customers the chance to enjoy food minus the waiting and serving time. They will also have the liberty to choose their food and corresponding quantities. With this, Oriental Buffet will be friendly to those who are always on the go. C. MARKETING STRATEGY As a startup company, Oriental Buffet will rely on non traditional media and below the line advertising to make its presence known in the market. There will be very minimal above the line advertising. There will be merchandising activities along nearby roads and villages using announcement banners and streamers where applicable. These materials shall already be in full display two weeks prior to launch. The company will seek the assistance of two or three media personalities who will announce the store in their media appearances in exchange for privileges in the store. This way, traditional media may still be tapped despite limited funds for advertising. There will also be newspaper advertisements one week prior to the launch. This is to be able to announce the launch date and the concept, and spark interest among the local market. The ads will not be sustained anymore with more print ads due to limited number of resources. The internet will be an important tool to captivate the market. There will be an official website for the company which will feature the menu choices. Periodic promotional programs such as raffle and discounts will also be implemented. There will also be thematic celebrations such that customers will be given value added products and service in celebration of certain occasions such as Thanksgiving, Christmas, Valentines and the likes. Other merchandising and points of sale materials such as shirts, caps, pens and other premium items will also be available. These will be used as gifts for loyal customers and may also be sold from time to time. D. PRODUCTION AND OPERATIONS Food production will be handled by the kitchen crew composed of one senior chef and one kitchen assistant. Since serving would be in the form of buffet, cooking time is structured and scheduled. All cooking activities will be done only once in the morning and one in the afternoon. E. RISK ANALYSIS The management identifies no any other risk than not being able to capture the target market prior to the launch and during the first three months of implementation. VIII. MANAGEMENT A. THE CURRENT TEAM AND THEIR ROLES Management Team is composed of two main investors who will oversee overall operations of the Restaurant. One will concentrate on store operations, which will include the food production and dine in areas. He will monitor Finance and quality control. The other one will oversee marketing and administrative support. He will be in touch with local media to implement the marketing strategies for the store. The Operations Head is a graduate of Business Management, and has the essential know how in operating a food service business. The Marketing and Administration Head, on the other hand, has a Bachelor’s Degree in Marketing and has worked on two other food service businesses. These two will not work full time on the business but will relay on hired mid management personnel to run the business. The Operations Head has two other profit oriented businesses while the Marketing Head works a Professor in a University. They will use their current connections to gain additional patrons for Oriental Buffet. B. FUTURE MANAGEMENT NEEDS Prior to store opening, a senior Chef will be hired to plan, execute and oversee food production and ensure the quality of dishes being cooked. There will also be an operations manager who will supervise the dine in area, and one cashier. There will be one marketing and admin officer who will provide support to the Marketing and Administration Manager. IX. PROFIT AND LOSS First Six Months   Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Projected Gross Income Balance Carried Over   -£ 89,500 -£ 82,500 -£ 72,500 -£ 78,500 -£ 70,500 Food 8,000 8,000 10,000 10,000 12,000 12,000 Drinks 3,000 3,000 4,000 4,000 5,000 5,000 Total Projected Gross Income £ 11,000 -£ 78,500 -£ 68,500 -£ 58,500 -£ 61,500 -£ 53,500 Projected Expenses Equipment and Materials             Store Construction and Architecture 50,000           Store Equipment and Furniture 10,000           Registration and Rental Costs             Business Registration Costs 2,500           Store Space Rental 25,000       5,000 5,000 Manpower Costs 3,000 3,000 3,000 3,000 3,000 3,000 Ads and Promo Costs 5,000     10,000     Others 1,000 1,000 1,000 1,000 1,000 1,000 Total Project Costs £ 96,500 £ 4,000 £ 4,000 £ 14,000 £ 9,000 £ 9,000 Food 3,000     4,000     Drinks 1,000     2,000     Total Projected Expenses £ 100,500 £ 4,000 £ 4,000 £ 20,000 £ 9,000 £ 9,000 Net Income -£ 89,500 -£ 82,500 -£ 72,500 -£ 78,500 -£ 70,500 -£ 62,500   Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Projected Gross Income Balance Carried Over -£ 62,500 -£ 4,000 £ 14,000 £ 15,000 -£ 2,000 £ 19,000 Food 15,000 15,000 15,000 18,000 18,000 18,000 Drinks 7,000 8,000 9,000 10,000 10,000 12,000 Total Projected Gross Income £ 22,000 £ 23,000 £ 24,000 £ 28,000 £ 28,000 £ 30,000 Projected Expenses Equipment and Materials             Brochures/ Flyers/ Business Cards             Store Equipment and Furniture             Registration and Rental Costs             Business Registration Costs             Store Space Rental 5,000 5,000 5,000 5,000 5,000 5,000 Manpower Costs 3,000 3,000 3,000 3,000 3,000 3,000 Ads and Promo Costs 10,000     10,000     Others 1,000 1,000 1,000 1,000 1,000 1,000 Total Project Costs £ 19,000 £ 9,000 £ 9,000 £ 19,000 £ 9,000 £ 9,000 Food 4,000     7,000     Drinks 3,000     4,000     Total Projected Expenses £ 26,000 £ 9,000 £ 9,000 £ 30,000 £ 9,000 £ 9,000 Net Income -£ 4,000 £ 14,000 £ 15,000 -£ 2,000 £ 19,000 £ 21,000   Month 13 Month 14 Month 15 Month 16 Month 17 Month 18 Projected Gross Income Balance Carried Over £ 21,000 £ 18,000 £ 37,000 £ 59,000 £ 55,000 £ 81,000 Food 20,000 20,000 22,000 25,000 25,000 25,000 Drinks 7,000 8,000 9,000 10,000 10,000 12,000 Total Projected Gross Income £ 48,000 £ 46,000 £ 68,000 £ 94,000 £ 90,000 £ 118,000 Projected Expenses Equipment and Materials             0             Store Equipment and Furniture             Registration and Rental Costs             Business Registration Costs             Store Space Rental 5,000 5,000 5,000 5,000 5,000 5,000 Manpower Costs 3,000 3,000 3,000 3,000 3,000 3,000 Ads and Promo Costs 5,000     10,000     Others 1,000 1,000 1,000 1,000 1,000 1,000 Total Project Costs £ 14,000 £ 9,000 £ 9,000 £ 19,000 £ 9,000 £ 9,000 Food 10,000     12,000     Drinks 6,000     8,000     Total Projected Expenses £ 30,000 £ 9,000 £ 9,000 £ 39,000 £ 9,000 £ 9,000 Net Income £ 18,000 £ 37,000 £ 59,000 £ 55,000 £ 81,000 £ 109,000   Month 19 Month 20 Month 21 Month 22 Month 23 Month 24 Projected Gross Income Balance Carried Over £ 109,000 £ 107,000 £ 134,000 £ 162,000 £ 157,000 £ 188,000 Food 28,000 28,000 28,000 30,000 30,000 30,000 Drinks 7,000 8,000 9,000 10,000 10,000 12,000 Total Projected Gross Income £ 144,000 £ 143,000 £ 171,000 £ 202,000 £ 197,000 £ 230,000 Projected Expenses Equipment and Materials             Store Construction and Architecture             Store Equipment and Furniture             Registration and Rental Costs             Business Registration Costs             Store Space Rental 5,000 5,000 5,000 5,000 5,000 5,000 Manpower Costs 3,000 3,000 3,000 3,000 3,000 3,000 Ads and Promo Costs 5,000     10,000     Others 1,000 1,000 1,000 1,000 1,000 1,000 Total Project Costs £ 14,000 £ 9,000 £ 9,000 £ 19,000 £ 9,000 £ 9,000 Food 15,000     18,000     Drinks 8,000     8,000     Total Projected Expenses £ 37,000 £ 9,000 £ 9,000 £ 45,000 £ 9,000 £ 9,000 Net Income £ 107,000 £ 134,000 £ 162,000 £ 157,000 £ 188,000 £ 221,000 WORKS CITED “Chinese Restaurants in London” London-Eating. May 2, 2010. http://www.london-eating.co.uk/cuisines/chinese.asp “Wong Kei” May 2, 2010. http://maps.google.com/maps/place?rlz=1T4TSHB_enPH339PH339&um=1&ie=UTF-8&q=chinese+buffet+london&fb=1&gl=ph&hq=chinese+buffet&hnear=london&cid=14719068809035994326 “Education” Wikipedia. May 3, 2010. http://en.wikipedia.org/wiki/London “China Tang” Squaremeal.co.uk. May 4, 2010. http://www.squaremeal.co.uk/restaurants/london/view/83839/China_Tang “Hakkasan.” Squaremeal.co.uk. May 4, 2010. http://www.squaremeal.co.uk/restaurants/london/view/80677/Hakkasan “Chinese Interior Design Essentials.” Ezine Articles. May 4, 2010. http://ezinearticles.com/?Chinese-Interior-Design-Essentials&id=633134 Read More