Feasibility Study for French-Style Restaurant - Example

Number: paper: Executive summary The following feasibility study is conducted in order to understand whether Vue de Monde, a French restaurant in Melbourne has the ability to adopt the franchise concept for developing and expanding its business to other parts of Australia. Vue de Monde offers its customers the most authentic French food, which are prepared from European ingredients. The speciality of the restaurant is that it offers a comfortable ambience to the customer who likes to visit it repeatedly. The feasibility study had depicted the fact that Vue de Monde is successful in catering the needs and desires of the customers in Melbourne to a great extent. The promotional and pricing strategy of the restaurant had underlined the fact, that the restaurant has given its best effort to satisfy upper, middle and lower income groups of customers in Melbourne. The study had also depicted that the restaurant business in Australia has reached new heights with the establishment of French style restaurants. In such a competitive market, Vue de Monde have succeeded in satisfying the population with its authentic French foods; thus, it can be stated that with the growing needs and desires for French food among the mass, Vue de Monde has the opportunity to adopt franchise concept to expand its business to other parts of Australia. Table of Contents Introduction 4 History of business 4 Market analysis 7 Suitability for franchising 9 Legal requirements 11 Conclusions and recommendations 12 References 14 Appendix 16 Introduction Feasibility study aims at analysing and examining potential of a project. This particular study lays emphasis on extensive research and investigation on the project that needs to be undertaken. The research helps in collecting information and details of the project that will highlight the feasibility of the project. The decision making process regarding the acceptance or rejection of the project is based on the feasibility study and if there is lack of adequate information the project is not accepted for completion. The main purpose of this study is to ensure that Vue de Monde, an Australian restaurant, has the ability to open franchises in other parts of Australia apart from Melbourne. The market analysis of the Australian restaurant industry elaborates the present trend in needs and demands of the Australian consumers pertaining to restaurant foods. According to the research conducted during the feasibility study, it was observed that there are many fine dining restaurants in Melbourne, which posses threat to the existence of Vue de Monde (Vue de Monde, 2014a). SWOT analysis of restaurant industry in Australia is conducted in order to examine the condition of the market; following the feasibility study, recommendation pertaining to franchising of Vue de Monde is depicted. The main limitation of the study is that it focuses on the external factors of the restaurants; however, the internal factors are not considered as there is lack of such information. History of business Vue de Monde is a French style restaurant situated on a quirky terrace building in Melbourne, Australia. It started its operation in 2005 in main business district of Melbourne (Vue de Monde, 2014c), where the population love French food and have the fascination towards experimenting new French dishes. The restaurant offers its customers fine dining experiences and presently they have relocated to 55th floor of iconic Rialto Building in Melbourne. The restaurant is designed beautifully reflecting the history of Australia and Melbourne, emphasising on gold rush and cultural icons. The stunning neon concept of restaurant attracts attention of the customers and they have the desire to visit it again to enjoy the calmness of restaurant ambiance and its delicious food. The restaurant is not too old but within this short period of time it has succeeded to get recognition internationally due to its delicious foods and ambience. The restaurant has opened a bistro named Bistro Vue, which also offers classical French cuisines like Vue de Monde but at a cheaper price. The bistro is decorated with rich colours and has opulent textures. The low lighting of the bistro presents a gloomy atmosphere to the customers. The dishes offered by the bistro are inspired by the classical French preparations. Besides, bistro offers a number of appetisers that includes caviar and oyster along with main courses such as meat, fish and vegetables. The French style dining experience is successful in attracting attention of the customers to a great extent and thus it has concentrated in improving structure and ambiance of restaurant so that it can override the competition of the market (Vue de Monde, 2014c). For promotional purposes, Vue de Monde distributes leaflets with details of the restaurant to the individuals in Melbourne, with the help of newspapers and magazines. Even the customers of the restaurants are given leaflets when they leave the restaurant after dining. These leaflets include all the details of the food offered by both the restaurants Vue de Monde and Bistro Vue. Moreover, in order to promote their foods and wines, Vue de Monde offers a glass of wine to every customer for free once a week along with a delicious French salad (Vue de Monde, 2014b). Apart from that, the Vue de Monde also offers Escofficer dishes to the customers every week for free, which reflects the historical inspiration of French dining style. The side dishes of the restaurant are designed complementing the main courses. The desserts are served in a very simple manner so that it looks sophisticated and delicious. Vue de Monde relies on technical precisions in order to operate successfully. A cheese trolley is offered to every customer along with desserts that is basically complementary to the customers (Vue de Monde, 2014b). Vue de Monde also organises wedding receptions for the customers and makes the occasion special for the bride and the groom with its authentic French dishes. The cocktail parties are famous in Melbourne as it offers the best brands to its customers. The pricing strategy of Vue de Monde and Bistro Vue are different. The foods offered by Vue de Monde are expensive as it aims at serving best quality and ambience to the customers in order to maintain its standard among the elite class. Thus, the restaurant follows premium pricing strategy for pricing its food items and cocktails (Vue de Monde, 2014b). It aims at serving the upper rich classes of Melbourne and gives them the maximum benefit during parties and events. However, Bistro Vue offers classical French foods at a reasonable price that can be afforded by the middle and lower class people of Melbourne. Hence, it can be stated that Vue de Monde and Bistro Vue cater the need and desires of both upper and lower income group by offering a wide range of food products. The owner of Vue de Monde is Shannon Bennett has revived the classical touch of French cuisine in present scenario. He has chosen to use European ingredients to become the master of French classical cuisines. The works of arts for decorating the ambience of restaurant is decided by Anna Schwartz and Shannon Bennett. Anna Schwartz is the co-owner of the restaurant. Both of them had taken a challenging decision to relocate the restaurant to 55th floor of iconic Rialto Building in Melbourne, where the main attractive feature is its open kitchen. His team included a number of successful personalities, which included both chefs and managers. Chris Martin, the manager of the restaurant has the responsibility to make the customers in the restaurant as comfortable and attend their issues. He has a good sense of humour, which makes the customers laugh; apart from that he trains the waiters and staffs in such a manner that they can satisfy the customers with the services and solve their problems instantly (Vue de Monde, 2014e). Cory Campbell, the Head chef of the restaurant aims at serving the best food in Melbourne by constantly working on its recipes and builds a sense of trust among his customers. He believes that the customers walk into the restaurant with a silent agreement to get served with unique recipes and he ensures that the customers relishes the food and encounters the reality during the duration of stay in the restaurant (Vue de Monde, 2014f). He trains the chefs in such a manner that they can bring variation in the food items and make it more delicious. He encourages the junior chefs to innovate new dishes according to the taste and preferences of individuals in Melbourne. Market analysis The restaurant industry in Australia has experienced growth in 2013 (Carter, 2013). The constant change in consumer preferences has led to adaption of new strategies, which can balance the demand for quality food in the Australian restaurant market. Apart from changing the taste and preferences of food of the population, the industry has also encountered extensive competition due to the rise in sophisticated restaurants (Tourism Victoria, 2013). It is noticed that food lovers of Australia preferred to hire good chefs and make them cook the delicious food items at their home. However, the dinning habit in Melbourne has also changed with the increase in number of good cafes, restaurants and bars in the heart of the city (Carter, 2013). The festive season usually starts from November onwards, in Australia, which calls for Christmas vacations for students. During this festive season, the population in Australia likes to spend quality time with their dear ones in restaurants. This encourages the restaurants to prepare special dishes during this season so that they can satisfy the customers with new dishes. Hence, the restaurants aim at providing seasonal food to the customers so that they can relish the same once a year and wait for the season to again next year. This long wait actually creates a sense of excitement mainly among the children. In Melbourne, the restaurants serve the customers with the seasonal sea food that is favoured by the latter. During the festive seasons, the restaurant in Melbourne offers its best seasonal food to its customers and also takes care of the taste and preferences of the same (Taix, 2014). There are many French restaurants in Melbourne, which have gained popularity over the years by serving the customers with authentic French cuisine. Few competitors of Vue de Monde are La Cassolette, Mr Mason, France- Soir and Madame Sousou. La Cassolette serves both traditional French and European food to the customers (La Cassolette, 2014). The food prepared in these restaurant tastes like that of the food prepared at home. The authentic French food and warm welcome in La Cassolette have the ability to threat the existence of Vue de Monde in Melbourne (La Cassolette, 2014). Mr Mason, is a French restaurant, which has simple dining, outdoor terrace and lounge area situated at the heart of Melbourne in 530 Collins Building. The speciality of the restaurant is that it changes its cuisines every week and reflects rustic flavours. It gives a tuff challenge to Vue de Monde (Mr Mason, 2014). France- Soir is another French restaurant, which is favoured by the customers in Melbourne. The main attraction of the restaurant apart from the food is the rock star and celebrities who attend different events of the restaurants and also enjoy the delicious food (France-Soir, 2014). Madame Sousou is a unique French inspired restaurant that targets its customers with the pure and authentic French cuisine that have become obsolete over the years in Melbourne (Madame Sousou, 2014). Thus, it can be stated that the restaurant industry of Melbourne is crowded with a number of renowned restaurants, which is a challenge for Vue de Monde as it also aims at targeting its customers with authentic French food items. All the above mentioned restaurants are direct competitors of Vue de Monde; whereas there are many indirect competitors too, such as the popular take away stores and cafes. These indirect competitors have also gained prominence over the years with the rise in busier work life of individuals. With the increase in work pressure, the individuals are not getting enough time to spend at cooking food at home; instead they prefer to bring food from restaurants or take away stores. The SWOT analysis of restaurant industry in Melbourne is provided in the Appendix. Suitability for franchising Franchising is defined as the leasing practice that is valid for certain period of time (Spinelli & Rosenberg, 2004). During this period, a company’s successful brand and business model can be used for earning profit. Vue de Monde is a renowned French restaurant in Melbourne which is serving its customers with the best authentic French food. In order to judge the ability of Vue de Monde to give franchises in different parts of Australia, the success of the business in Melbourne is examined. From the above discussion it can be stated that Vue de Monde in spite of being a small restaurant on a quirky terrace building, have succeeded to win hearts of hundreds of customers in Melbourne within a short span of time. It has not only restricted their operation in providing dining experience in the restaurant but it also organises wedding parties and other occasions and successfully serves its guests with authentic French food. As the restaurant was becoming famous among the population in Melbourne, the owner, Shannon Bennett took the challenge of relocating the restaurant to a new height for dining experience. Hence, it can be depicted that following the success of the restaurant in Melbourne, the owner can take the decision for opening franchises in other parts of Australia so as to cater the needs of maximum number of customers in the region. Franchise is a successful concept for well-known businesses operating globally. There are different types of franchise structures that are common among the above mentioned businesses. Vue de Monde can implement product franchise structure, which will help it to provide delicious French foods not only in Melbourne but also in different parts of Australia. Vue de Monde has developed strong reputation in Melbourne by offering the best quality foods as well as wine to the customers and it is expected that it will also be successful in Australia. Through product franchise structure, Vue de Monde can add value to the business by providing them delicious and authentic French food in other regions of Australia (Charles Elena, 2014). By implementing the franchise structure, Vue de Monde can enjoy a number of benefits; among which expansion of business is the primary one. However, it can be stated that the franchises should reflect the culture and value of Vue de Monde as the restaurant is famous for its foods and services. Eventually, growth will only take place if the franchise structure is maintained properly and the values of the main restaurant are employed successfully. Vue de Monde should give the right of franchising only after evaluating the ability of the franchisee to successfully run the business. It can be stated that under the leadership of Shannon Bennett, several franchises around Australia can be developed to expand the operation of the same. However, the growth of franchises will depend on its performance and ability to draw customers. The support services are crucial for the franchises; thus Vue de Monde should provide appropriate support services to the franchises so that the latter become familiar with the operating pattern of the former. The following supports services will be provided to the franchises: 1. Proper space to develop a successful restaurant and maximum population in the target market. 2. Train staffs to adopt the culture and values of the restaurant so that they do not disappoint the customers. The quality of services and foods should be maintained so as to develop a sense of trust among the target customers in the new market. In order to maintain the reputation of the restaurant, Vue de Monde should train the employees of franchise so that they can live up to the expectation of the customers. Legal requirements The franchises should follow the definite Code of Conduct that is specified under the Australian regulation, which are defined as follows: Under the Franchising Code, the franchisor should provide few documents within 14 days before the actual agreement is signed and non-refundable money is exchanged. The documents include final copy of the franchise agreement and franchising code. Australian Competition & Consumer Commission (ACCC) have the authority to investigate whether the franchise have breached the code of conduct of the agreement. This particular code investigates the disputes that arise from the contractual issues that are involved with the franchise concept (Australian Competition & Consumer Commission, 2014). Franchise is advantageous for the franchisees if they abide by the rules and regulations encrypted in Franchising Code of Conduct (Australian Competition & Consumer Commision, 2014a). Conclusions and recommendations The old dinning patterns in Melbourne have continued to raise its standards by providing high quality experiences to the customers whereas the new ones have challenged the existence of the former with new dinning styles and patterns, which have become the current trend. Diffusion dinning has become famous in Melbourne with the rise of a number of leading restaurants such as Cumulus Inc and Cafe Di Stasio (Tourism Victoria, 2013). This restaurants have informal set ups but provides high quality dining experience to the customers. The restaurants in Melbourne use the rooftop spaces for developing a cafe or restaurant and offer the customers with a different experience. The underground bars in Melbourne provide its customers with artisan cocktails, which are prepared with the help of house-made liquors and herbs. Italian heritage has a strong influence on the restaurant industry in Melbourne. The restaurants and cafes in the city uses homemade cheeses that are obtained from local farmers and thus these farmers play a popular role in enhancing the eating habits of the population (Tourism Victoria, 2013). In 2013, the restaurant industry in Australia has collected revenue of $ 1.2 billion, which indicated annual growth of about 3.6% over the last five years (IBIS World, 2014). Moreover the industry is predicted to achieve a growth rate of further 2.0% during 2014-2015 (IBIS World, 2014). The busier lifestyles and longer hours at office have shortened leisure times of an individual and as a result they have selected restaurants as the place for relaxing with their dear ones. The drastic increase in demand for fine dining experience in Melbourne has increased with the change in social needs of the population (Carter, 2013). The trend of working till late hours in offices has become famous globally, which has given chance to the restaurants and cafes to earn profit. The restaurants have helped the office goers to avoid spending a lot of time in preparing food at home (IBIS World, 2014). From the above mentioned details regarding the Australian and Melbourne restaurant market it can be recommended that Vue de Monde should adopt the franchise concept for expanding its business beyond Melbourne. It is expected that the franchises will encounter success if the value and culture of Vue de Monde is followed and the same business model is adapted. References Carter, B. (2013). Trends in Australias restaurant industry. Retrieved from http://www.hospitalitymagazine.com.au/food/news/trends-in-australia-s-restaurant-industry Charles Elena. (2014). Melbourne’s top 10 best hidden food spots & restaurants. Retrieved from http://www.charleselena.com.au/our-culture/melbournes-best-restaurants/ France-Soir. (2014). Home. Retrieved from http://www.france-soir.com.au/home IBIS World. (2014). Restaurants in Australia: Market Research Report. Retrieved from http://www.ibisworld.com.au/industry/default.aspx?indid=2010 La Cassolette. (2014). About Us. Retrieved from http://www.lacassolette.com/about-la-cassolette-restaurant-melbourne-seafood-happy-hours Madame Sousou. (2014). Home. Retrieved from http://www.madamesousou.com.au/madame_about.html Mr Mason. (2014). Welcome to Mr Mason. Retrieved from http://www.mrmason.com.au/ Taix, C. (2014). French Chefs Wake Up To Australia’s ‘No Boundaries’ Cuisine. Retrieved from http://www.gmanetwork.com/news/story/353586/lifestyle/food/french-chefs-wake-up-to-australia-s-no-boundaries-cuisine Tourism Victoria. (2013). Media Release. Retrieved from http://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0CDAQFjAA&url=http%3A%2F%2Fwww.tourism.vic.gov.au%2Fcomponent%2Fedocman%2F%3Fview%3Ddocument%26task%3Ddocument.download%26id%3D481&ei=AFsRVJPkE5CHuASg74KwBg&usg=AFQjCNG1UrJozL41VXQCN0AcsVUSEe9lBA&sig2=MHxPY_jrl6Kl_PMhKn03eg Vue de Monde. (2014a). Vue de Monde. Retrieved from http://www.vuedemonde.com.au/vue_de_monde_overview Vue de Monde. (2014b). Wine experience. Retrieved from http://www.vuedemonde.com.au/menu_wines Vue de Monde. (2014c). Bistro Vue. Retrieved from http://www.vuedemonde.com.au/bistro_vue Vue de Monde. (2014d). Vue de Monde. Retrieved from http://www.vuedemonde.com.au/vue_de_monde_overview#3 Vue de Monde. (2014e). Chris Martin. Retrieved from http://www.vuedemonde.com.au/index.php?action=imagegallery&form_name=view_album&aid=239#2 Vue de Monde. (2014f). Cory Campbell. Retrieved from http://www.vuedemonde.com.au/index.php?action=imagegallery&form_name=view_album&aid=239#1 Spinelli, S. & Rosenberg, S. (2004). Franchising: Pathway to Wealth Creation. New York: FT Press. Australian Competition & Consumer Commission. (2014). Franchising Code of Conduct. Retrieved from http://www.accc.gov.au/business/industry-codes/franchising-code-of-conduct Australian Competition & Consumer Commission. (2014a). Franchising. Retrieved from http://www.accc.gov.au/business/franchising Appendix Strength Provide fine dining experience to the customers, who do not get enough time to cook at home due to work pressure at office. The customers get to taste the authentic French, European and Italian food at a price which s quite affordable. In Melbourne, the people come from different cultures. Multicultural population has forced the restaurant industry to diversify their food items and cater the needs of every individual. Weakness French and Italian foods are not liked by different cultured people in Melbourne such as Muslims they consume only halal foods. The restaurants invest huge amount in setting an appropriate for the dining purposes and if it does not succeed in attracting customers then the whole investment is wasted. Imposition of higher amount of tax has become a burden for most of the restaurants in Melbourne. Opportunity There is increased demand for French cuisine in Australia. Cater the needs of authentic French food lovers in Melbourne. Threat Competition is the main threat in this industry in Melbourne. Change in taste and preferences of the population, which may alter the trend of dining experience in Melbourne. Read More