Halal Restaurant Business - Example

Business Plan Table of Contents Section 4 Executive Summary 4 Business and what follows 4 Section 2 5 Business and the management5 Mission 5 Objectives 5 Activities 6 The management team and the skills required 7 Advantage and disadvantages of the options and legal structure 7 Section 3 7 The Product or Service description 7 Readiness for Market 8 Features of the product and benefits to customers 8 Comparison of Meemo’s product from other restaurants product 9 Product Lifecycle 10 Section 4 10 Market and Competition 10 Overview of Primary and Secondary research undertaken 10 Customer needs 11 Market segment size and growth 11 Short term and long term market projections 11 Comparative analysis 12 Section 5 12 Competitive business strategy 12 Suppliers and cost 12 Pricing Policy 12 Advertising and promotion plan (SMART action) 13 Consideration of place and distribution channels 13 Market share projection 13 Appraisal of factors effecting strategy using SWOT analysis 13 Section 6 14 Operations 14 Staffing requirements 14 Quality control of products / services and business processes 14 Policies and procedures required to ensure compliances and potential best practices 14 Section 7 15 Forecasts and financial data 15 Sales Forecast 15 Cash Flow Statement 15 Profit and Loss account 15 Balance Sheet 15 Break-even Analysis 15 Sensitivity Analysis 15 Assumptions 16 Reference List 17 Appendix 1 – Sales forecast 18 Appendix 2- Cash Flow statement 18 Appendix 3 – Profit and Loss account 19 Appendix 4- Balance Sheet 20 Appendix 5- Break even analysis 20 Section 1 Executive Summary Business name, description and what follows The business plan is about opening a Halal based restaurant in Liverpool. The name of the restaurant will be Meemo’s. The restaurant’s distinctiveness from other halal based restaurants lies in the fact that it is a family oriented buffet restaurant. It will be a self-service restaurant, where customers can eat any food item of their choice as much as they desire. There will be a play zone for children, another distinct feature of the Meemo’s, which is neglected by other halal based restaurants currently. The restaurant’s other unique selling points are; economical price rates for food items served, a list of 100 food items on the menu, excellent quality of kebabs and steaks. The restaurant will boast of an experienced and trained set of management and will be located near the port area. This will help the restaurant to gain customers in the form of families as well as business classes who visit it. The restaurant, if run on the basis of plans prepared beforehand, has a wonderful business opportunity. It will be a profit making business, provided it runs according to the goals chalked out by the management. Section 2 Business and the management Mission The Halal restaurant (Meemo’s) will be a premium restaurant in Liverpool. The restaurant’s soul aim will be to please the customer with premium services that it provides. It will not only serve a variety of delicacies, but will also act as a medium of entertainment for customers. The restaurant’s target will be to attract customers from all age groups, ranging from old aged to children. Objectives Short-term Keeping revenue of 42% from cost of the food. Keeping revenue of 11-12% from labour cost. Keeping things automated to a large extent by using computer/internet so as to provide quick services. Long-term To grow at the rate of one restaurant for the first three years of operations. So, expansion is a primary motive of the restaurant. Average sales of 2 to 3 million dollars to be kept every year. To maintain cost as lower as possible. Activities The activities of the organisation will be prepared in such a way that they are at par with organisational objectives. The main motto of the organisation will be to strive hard for the much needed success. The company for this purpose will try hard to lower unnecessary costs and heighten the revenue. Expanding at a rate of one restaurant for first three years of the restaurant’s operations, will be the target. The constant growth can be achieved by providing same quality of service to customers throughout. The employees should also be kept satisfied, by offering them incentives for good work and extra hours of service. The restaurant will also try to earn revenue of 42% from the cost of food, so that it can grow as a restaurant and open new branches in future. The restaurant for this purpose needs to maintain a steady quality of food offered by it. The restaurant will keep revenue of at least 11-12% from the labour cost, which is a necessity. This can be achieved by offering a salary that will be more than the labourers’ expectation, thereby ensuring that they are not at a loss or dissatisfied by the employers. (Liverpool China Town, 2014). The average sales will be kept at a range of 2 to 3 million dollars every year. For this purpose, the restaurant should continue to provide superior services and maintain sales unshakeably. It should aim at creating new dishes and savouries as well as continue to capture and satisfy taste buds of customers. Prices of the food items served in Meemo’s would be quite cheap so as to attract a large number of customers. The above-mentioned activities are needed to be achieved by the organisation in order to fulfil the objectives. The management team and the skills required The management team will be chosen from the best layer of managers, who have a degree in Hotel/Hospitality management or a MBA. They will consist of experienced as well as fresher, so that a mix of both can result into development of new ideas for enhancing business of the restaurant. Considering a well-educated team, they would have an ample amount of skills to deal with all types of customers and labourers, effectively handle customer grievances and make proper use of computer/internet to manage databases. Yet, a formal training programme will be carried on key skill areas by the senior management team for juniors for a week or two. In this way, skills of the employees would be polished and rectified, if needed (Saunders, 2003) Advantage and disadvantages of the options and legal structure The legal structure of the restaurant will be such that there are different policies for the management team in the form of health insurances and other types of insurances, thereby safeguarding employees from being hampered in any way. Besides that, there will be insurance against the restaurant, so that the business does not face damages through negative circumstances (Tomal, 2010). Section 3 The Product or Service description The product to be served by the restaurant would be any food item other than pork. As the name of the restaurant indicates, it is a halal based restaurant. Halal refers to the food item that the Muslim individuals are allowed to eat as per Islamic Shari’ah. Also, the food must come from a supplier, who practices halal as well. In Liverpool, this would not be a problem as customers will get both vegetarian as well as non-vegetarian food items on the menu, other than pork. There will be different forms of kebabs on the offering, which the Scousers have never tasted before. Delicious steaks will also be served to customers, besides other items on the menu. It is a port city, comprising wide range of people. This will result into attracting not only people of Liverpool, but also Indians and people from the Muslim community, who have faith in halal based food. There will be 100 types of food items on the offering. The variety would be maintained as much as possible (Ahlstrom and Bruton, 2009). Readiness for Market The product would be served in least possible time. There will be a number of chefs ready to serve the product. The product quality will be given equal amount of importance. The restaurant will serve the product, keeping into account two things; product quality and readiness with which it is served. The food will be served at most economical rates (Cherunilam, 2010). Features of the product and benefits to customers The restaurant will be a halal based one; serving halal based non-vegetarian as well as vegetarian platters. Halal is the food that people of Muslim community are allowed to eat, according to Islamic Shari’ah. The food must come from a supplier who also practices halal. The restaurant would, therefore, serve any non-vegetarian item, other than pork and any beverages, except alcohol. It will cater to the food needs of Liverpudlians as well as Indians and those from the Muslim community, who do not visit assorted restaurants, as those do not serve halal based food (Ferrell and Hartline, 2010). Comparison of Meemo’s product from other restaurants product The Meemo’s will be one of the top restaurants of Liverpool because of the restaurant’s casual family oriented atmosphere, long list of food in offering and minimal price points. Meemo’s will compete with the other halal based restaurants, but its speciality lies in its buffet based format (Hansen and Solgaard, 2004). The competitive features of Meemo’s, the halal based restaurant, against the casual ones, will be: A very reasonable price for a complete meal. If the person is a steak lover, then he would need to pay a lower price, compared to any theme based restaurant in Liverpool. The kebabs will also have most economical rates. It will serve elaborate buffet meals as compared to other restaurants in Liverpool, which are not generally family oriented and provides breakfast and smaller menu for lunch and dinner. There will not be any need for tipping by customers, as Meemo’s will be a self-service restaurant. In this way, here customers can save their cost of dinning by 10-12%, unlike in small halal based restaurants in Liverpool. The speed of service will be given the ultimate amount of importance. The steaks, dry kebabs, beverages (other than alcohol) and deserts will be served as promptly as possible, so that customers need not wait. The restaurant will serve both English as well as halal based food. Everything will be freshly prepared and served in the shortest possible time. Therefore, unlike other halal restaurants, which are not mostly family value oriented and without buffet, Meemo’s will create a difference (Stewart and Kamins, 2003). The portions that will be served by Meemo’s would be any amount that the customer desires, since this restaurant is all about “as much as you can eat”. It does not consider the predetermined amount that an average person can eat. The restaurant believes that the portion size should meet needs of individual customers, unlike in other halal based, non-buffet serving restaurants (Dess, Lumpkin and Eisner, 2009). Product Lifecycle The product lifecycle will be as short as one day and extend to maximum of two days. The non-vegetarian products, like, chicken, mutton and beef, will be grilled in front of customers. All food items will be freshly cooked and served. The unused vegetarian items per day will be disposed off regularly. The restaurant will avoid using any stale food, which would hamper the customers’ health. Section 4 Market and Competition Overview of Primary and Secondary research undertaken The restaurant offers great appeal to food lovers as indicated by our primary data. Going by our market research, families who were asked to give their opinions about the family-oriented, buffet restaurant seemed excited about the prospect. All the Scousers as well as people from other communities and culture, residing in Liverpool, showed positive interest in favour of the restaurant (Leahey, 2007). Even when randomly selected people, from the port area of Liverpool, were interviewed regarding opening a halal based, buffet meal serving restaurant in Liverpool, they were excited and highly elevated and opined in favour of the same, which is quite a rare in this city. As per the secondary data, almost 75% of the people of Liverpool are non-vegetarians. They do intake meat and it is quite central to their diet. There are also a small bunch of people who are vegetarians. Hence, opening a halal based restaurant in Liverpool will be a success. Customer needs The restaurant management team will consist of experienced and trained personnel, who will handle customer needs and grievances, if any. The children visiting the restaurant with their parents will be well-treated, taken to play zone (as and when they wish to) and handled with care. The management will assure that they can provide customers with an ambience, which is quite homelike, friendly and clean. The restaurant should be well-decorated and serve healthy and tasty food in order to make customers feel elevated, happy and willing to visit again. Market segment size and growth The restaurant will majorly try and attract family. Any other group of people or individual can also come and visit the restaurant. As it will be located near the port area, even groups of business class people can easily avail the restaurant. Also, the restaurant will be able to attract customers of different religions, culture and tastes, given the halal theme and the appropriate mix of both vegetarian as well as non-vegetarian platters. Therefore, market size and segment of the restaurant will be quite large. Short term and long term market projections The short-term market projection is based on tastes and preferences of the residents in Liverpool; whereas, the long-term projection will be carried out based on the former and sales of the restaurant (Baines, Fill and Page, 2011). Comparative analysis The following elaborates the comparative analysis: In Meemo’s, guests will be able to view the menu in a convenient way as it will be constantly displayed on a LED screen inside the restaurant, a rare sight in restaurants of Liverpool. There will also be a small play zone for children, which is again not found in any halal restaurants of Liverpool. The food will be freshly served and extra food at end of the day will be disposed off, unlike many halal restaurants that store extra food for the next day (Ayres and Nalebuff, 2003) As it will be a self-service based restaurant, the manager will always be present to solve customer grievances as and when required. Section 5 Competitive business strategy Suppliers and cost The supplier of Meemo’s will be Liverpool Halal Meats. It is a wholesale based market in Liverpool, which sells both halal meat and fish. Besides that, Liverpool China Town will be another supplier of vegetarian foods. Buying foods in wholesale will help to cut down extra costs. Pricing Policy The pricing policy will be competitor based. Every food item served will be at least 10 dollars lower than that of the competitors. Advertising and promotion plan (SMART action) The advertising and promotional plan will be based on SMART action. SMART is a MBO concept. The word expands into the following: specific, measurable, attainable, realistic and time-bound. The business goals, as stated in the long-term objectives, are to expand the business by one hotel per year for at least three consecutive years of operation; and to keep sales at 2-3 million dollars every year. These are the specific, measurable and attainable objectives or plans of the restaurant. This will help to find out how the methods have worked to give the projected results. The time bound is a very important measure for growth of the business. The promotion of the restaurant will be done by few paid agents. They will distribute attractively designed leaflets with a description of the best food items, which are served in Meemo’s. These will be distributed on busy roads, ports and doorsteps of the residents of Liverpool (Macinnis and Folkes, 2009). Consideration of place and distribution channels The place of the restaurant will be near the port. For the purpose of obtaining meat, fish, vegetables, there will be an agent, with responsibility to collect food items daily from respective wholesale shops and supply it to the restaurant. So, the channel of distribution will comprise the chosen wholesaler and an agent. There will be no other middlemen involved in the supply of products to the restaurant. Market share projection In future, as compared to other halal based restaurants, Meemo’s would aim at least 2% of the total market share out of 100%. Appraisal of factors effecting strategy using SWOT analysis The Meemo’s is a family-oriented, halal based restaurant, which is the strength of the restaurant. In coming years, there can be more of such halal based, family-oriented restaurants, which can turn out to be a weakness and threat to Meemo’s. Therefore, to avoid the same, Meemo’s should expand the chain of restaurants based on other criteria. This will again extend the business’ opportunity (Jane, 2010) Section 6 Operations Staffing requirements Meemo’s does not require any extra staffs other than few management executives, agents and labourers. It is a self-service based restaurant, which makes extra staffs unnecessary. Quality control of products / services and business processes The products, as already stated, will be fresh. Any stale products will be disposed off regularly. The quality of the products will be strictly maintained so as to retain their customers. The services provided will be most satisfying and pleasant. The business process will be quite simple, as already stated above. Policies and procedures required to ensure compliances and potential best practices The policies to be applied in order to ensure best practices are: The employees can take 8 days of leave, provided that they give a two day prior notice. The employees will be responsible for any complaints made by customers regarding quality of the food. Any additional policies will be laid down, as per future requirements. Section 7 Forecasts and financial data Sales Forecast There will be sales of 2-3 million dollars for the first year and a possible 12% steep rise in the second year; followed with a fall, due to entry of new competitors, from the third year. However, the sales growth has been anticipated to be steady in later years. Cash Flow Statement The cash flow statement shows a positive year-end cash balance. Hence, it can be inferred that the business will be robust throughout the year. Profit and Loss account The profit margin is seen to increase over three years. Balance Sheet The net worth of the restaurant business is expected to be $10000. Break-even Analysis The revenue of the company will be more than the cost incurred. Sensitivity Analysis Sensitivity Analysis Year 1 Year 2 Year 3 Sales 30000000 33000000 36960000 The above table elaborates the change in sales over the three years with an expected value of 10%. Assumptions The rent will remain same for all the three years. The tax rate is 30 % The sales will increase steeply at 12 % in the 2nd year, while it will diminish in the 3rd year, due to entry of competitors. Even so, sales growth is assumed to be steady at 12 % for the next three years. The depreciation rate has been assumed to be 4% It has been assumed that no other investment will be made in the next four years. The loan amount would be paid off in a time span of five years. Reference List Ahlstrom, D. and Bruton, G. D., 2009. International management: strategy and culture in the emerging world. Connecticut: Cengage Learning. Ayres, I. and Nalebuff, B., 2003. In Praise of Honest Pricing. Sloan Management Review, pp. 24-28. Baines, P., Fill, C. and Page, K., 2011. Marketing. Oxford: Oxford University Press. Cherunilam, F., 2010. International business: Text and cases. New Delhi: PHI Learning. Dess, G., Lumpkin, G. T. and Eisner, A., 2009. Strategic Management: Text and Cases. 3rd ed. New York: McGraw-Hill Education. Ferrell, O. C. and Hartline, M. D., 2010. Marketing strategy. 5th ed. Connecticut: Cengage Learning. Hansen, T. and Solgaard, H., 2004. Strategic pricing: Fundamental considerations and future perspectives. The Marketing Review, 4, p. 99-111. Jane, S., 2010. Eastern Food Store Ltd. [online] Available at: [Accessed 12 February 2014]. Leahey, E., 2007. Not by Productivity Alone: How Visibility and Specialization Contribute to Academic Earnings. American Sociological Review, 72, p. 533– 61. Liverpool China Town, 2014. Wholesale Fruit, Vegetable & Flower Market. [online] Available at: < http://www.liverpoolchinatown.co.uk/fruit_&_veg.php > [Accessed 12 February 2014]. Macinnis, D. and Folkes, V., 2009. The disciplinary status of consumer behaviour: A sociology of science perspective on key controversies. Journal of Consumer Research, 36, p. 899-914. Saunders, M. 2003. Research Methods For Business Students. 3rd Ed. Noida: Pearson Education India. Stewart, D.W. and Kamins, M.A., 2003. Secondary Research: Information Sources and Methods. London: SAGE. Tomal, D.R., 2010. Action Research for Educators. Maryland: Rowman & Littlefield. Appendix 1 – Sales forecast Appendix 2- Cash Flow statement Appendix 3 – Profit and Loss account Appendix 4- Balance Sheet Appendix 5- Break even analysis Break Even Analysis   2013 2014 2015 Sales 30,000,000.00 33,600,000.00 37,632,000.00 Cumulative Cost 176,400.00 202,950.00 228,040.00 Read More