Arabic Food and Drinks Restaurant in Cambridge City - Research Proposal Example

Market Research of a Business Start-up Market Research of a Business Start-up Executive Summary This report describeshow a sole proprietorship that intends to open an Arabic food and drinks restaurant in Cambridge City will conduct market research. The report has discussed observation and survey as the two main techniques that will be used to collect primary data. The discussion has also indicated that it will collect data from all secondary sources of information. This will help in gathering all the essential information that will be available from relevant sources. The report has also discussed the competitors, target customers, and market segment of the company. The methods of promoting products such as free lunch, low prices, and advertisements have also been discussed in the next section. The last section summarizes the report and provides recommendations. Contents 1.0 Introduction 4 2.0 Details of the Product/Service 4 3.0 Evaluation of Proposed Market Research Methods 4 3.1Primary Research 5 3.1.1 Survey 5 3.1.2 Observation 5 3.2 Secondary Research 6 4.0 Significance of Market Research 6 5.0 Competitors 8 6.0 Market Segment 8 7.0 Target Customers 9 8.0 Promotion 9 9.0 Summary 10 10.0 Recommendations 11 11.0 References 12 1.0 Introduction Market research is essential for an organization that aims to start producing goods or providing services. This is because research enables the owners of the organization to determine numerous factors, for example, availability of market, raw materials, level of competition in the market, and environment of the location for the start-up. This paper aims at evaluating market research methods and competitors, customers, and market segment of a start-up that aims at setting up a restaurant for selling Arabic foods, desserts, and drinks in Cambridge City. 2.0 Details of the Product/Service The enterprise whose model is a sole proprietorship aims at producing products that include Arabic dishes, desserts, and coffee. The venture also aims at producing Turkish coffee, which is a substitute of Arabic coffee for customers who prefer this brand to Arabic coffee. The organization aims at setting up a store in Cambridge City Centre; numerous of the restaurants in this region specialize in producing other types of foods and drinks apart from Arabic brands. 3.0 Evaluation of Proposed Market Research Methods There are numerous methods of carrying out market research; however, the techniques are classified based on the type of data that they collect. There are two main classifications, which include primary and secondary research (Mueller, Volery, & Von, 2012). The research aims at using methods that collect the two types of data to get inclusive information of the business idea. The next sections will evaluate these two methods to find out their strengths and limitations. 3.1Primary Research Primary research is a technique that collects first hand data from the field. The data may be collected from potential customers, suppliers, and other stakeholders who may have an influence in the organization when it starts running (Mueller, Volery, & Vod, 2012). The research aims at collecting data using surveys and observation. 3.1.1 Survey Survey is a technique that involves administering questionnaires to respondents so that they may fill in their responses. The entrepreneur will administer the questionnaires to the respondents physically, by email, or social media depending on the most suitable method for the respondent. The use of surveys to collect primary data will enable the sole trader to save time and funds (N.A., 2014). This technique will also help in collecting precise responses from respondents because the questions will be precise. The major limitation of the survey method is that it will involve spending of funds on travelling, printing questionnaires, and calling and emailing potential respondents (Mueller, Volery, & Vod, 2012). This technique will also consume time because the interviewer has to identify potential respondents and convince them to fill the documents. 3.1.2 Observation The research will also use observation technique to collect essential data. For example, the sole trader will travel to various restaurants in Cambridge City Centre and watch them and record data. Data that will be recorded include size and arrangement of the stores, quality of food and drinks, and how they are presented to customers. This technique will help in collecting data that respondents may not be able to provide, and it will eliminate bias that may be found in the survey method (N.A, 2014). The only limitation with this technique is that it will consume time because the researcher has to be present in the location from where data will be collected (N.A , 2014). This means the sole trader will incur costs of travelling, eating, and purchasing materials for recording data. 3.2 Secondary Research Secondary research involves collecting data from published materials such as newspapers, magazines, books, encyclopaedias, and the internet (Entrepreneur staff, 2014). The research will collect data from any published material that will contain ideas about how the business may be set up. This means that there is no limitation of the source of secondary information. This will enable the entrepreneur to collect all the available data that may help in setting up the business. This technique will consume time because the researcher will have to read through every source that promises to provide information. The investigator may also have to spend funds on borrowing books, journals, and magazines from libraries or purchasing them directly from the bookshop (Entrepreneur Staff, 2014). 4.0 Significance of Market Research Market research is essential because it will help in identifying the needs of potential customers (Queensland Government, 2014). The potential customers who will take part in the survey will convey messages about the Middle Eastern foods and drinks that they prefer over others. This will then help the sole trader to produce Arabic foods that are preferable to numerous consumers in Cambridge City. The research will help the sole trader in identifying the availability of raw materials in the region. This will be through observation and surveys (Bygrave, & Zacharakis, 2014). Suppliers who will fill in the questionnaires will be asked to identify the raw materials that they produce. The investigator will also visit the locations of the potential suppliers and observe the kind of products that they sell, and the prices and quality of these products. The market research will also help the business to determine the average size of the market (Bradenburg, 2013). This will be by identifying the number of Arabic consumers who will take part in the survey. This information will also help the sole trader in determining the average amount o food and drinks to produce when the business starts running to avoid wastage and losses. The research will also help the organization in determining the level of competition in the market, and the strategies that competitors use to attract and retain customers (Queensland Government, 2014). The information of competitors that the sole trader will identify through observation includes pricing, location of businesses, packaging of food, and arrangement of stores. This information will help the start-up to determine the techniques to use to arrange, price, and pack food and drinks. The ultimate need of the research is that it will help the sole trader in concluding about the viability of the business (Bradenburg, 2013). The sole trader will make this decision after determining all factors such as expected number of customers, sales, profits, and availability of resources to run the business. If the business is found to be viable, it will be started immediately, but if it is not found to b viable, it will not be set up. 5.0 Competitors There are numerous competitors of the proposed business in Cambridge, which mostly include restaurants and cafes. Some cafes specialize in producing foods and drinks that match with specific needs of consumers; for example, St. John’s Chop House produced British food and drinks, Don Pasquale specializes in Italian foods, The Rainbow Cafe specializes in vegetarian foods, and La Mimosa specializes mainly in various brands of coffee. There are no competitors who specialize in producing Middle Easter foods and drinks in Cambridge City Centre. This means that the organization will be the first to produce these products, and this will give it a unique competitive advantage (N.A., 2014). 6.0 Market Segment A market segment is a group of individuals whose product and service needs are similar. This means that the segment is a portion of the entire market, and it indicates that a market may have numerous segments (Fogel, & Lewis, 2010). The sole proprietorship will serve mainly two market segments. The first segment is made up of consumers who demand Arabic food and drinks such as coffee; while the second segment includes customers who demand Turkish coffee. The Arabic market segment will be larger than the Turkish because the organization will focus on it more than the other one. The market segment of the organization may also be said to be geographical because it consists of consumers who eat in Cambridge City Centre. Most of these consumers are the ones who live in Cambridge City and a few who visitors of the city. 7.0 Target Customers The business targets customers who are mainly of Arabic and Turkish origin because they are the ones who mainly require the products that will be produced and sold. The organization also targets high, middle, and low income earners. This is because among the Turkish and Arabic consumers, some of them may be earning high incomes; while others earn middle and low income. The organization will produce foods that each group of these target customers demand. The firm will then put price tags that favour each group of target customers (Fogel, & Lewis, 2010). The target customers will also mainly be residents of Cambridge City. This is because these are the individuals who will be able to access the location of the business more easily than others. 8.0 Promotion The organization will use numerous promotion techniques for example, free lunch and coffee in the first two days. The free food will help in attracting customers to the restaurant; the customers may then become loyal when they like the food. This form of promotion will also help to attract Non-Arabic customers who love Arabic food and Turkish coffee to the organization. This will help in increasing sales and profits for the start-up business (Aggarwal, & Kumar, 2013). The other promotion technique that the company will use is that of offering products at a low price in the first month. During this period, customers will enjoy cheap foods and drinks. Those who will develop loyalty towards the products they love may continue visiting the store even when prices of their favourite products increase from the second month (Johnson, 2013). The start-up will also promote its business by advertising products through the media such as television, radio, billboards, and posters (Johnson, 2013). Billboards and posters will be fixed in various locations in Cambridge and on the roads that lead to the city from other regions. The information on these media will include the exact location of the business and the products that it produces; these will lead customers to the business (Aggarwal, & Kumar, 2013). The company will also use social media such as Face book, Twitter, and Blogs to advertise its products. The company will open a Face book page, blog, and Twitter hurdle that will provide all information about the organization. These media will attract customers especially the youths because they are the ones who mainly use the internet to search information (Aggarwal, & Kumar, 2013). 9.0 Summary The market research for the Arabic food and coffee business will use primary and secondary data. Primary data will be collected using survey and observation methods. The survey will consist of questionnaires that will be filled in by respondents. The sole trader will conduct observation by visiting locations of competitors physically and recording observations that will be then be analyzed to give meaningful information. Secondary data will be collected from relevant sources that will be found to contain essential information. The market segment and target customers of the organization mainly consist of Arabic individuals who live in Cambridge environs. 10.0 Recommendations The sole trader should utilize entrepreneurial skills in carrying out the market research and setting up the business. These skills include time management, leadership, efficient communication, and analytical skills. Efficient communication and time management will help in communicating with respondents clearly using the shortest time possible. Analytical skills, on the other hand, will help the sole trader in interpreting raw data into meaningful information that will help in making a decision about how to set up the business. The investigator should consult secondary sources such as government publications to help in determining the number of Arabic people who live in Cambridge City. The businessperson may also consult the internet because it is a cheap, easy, and quick method of finding relevant information. The investigator should pay attention to the responses of the respondents to be able to determine their needs. The entrepreneur should also be creative in developing advertisements that are capable of attracting customers. 11.0 References Aggarwal, K. K., & Kumar, A., 2013. An inventory decision model for new products when demand depends on dynamic advertising expenditure. International Journal of Logistics Systems and Management, 15, 4, 424-444. Bradenburg, E., 2013. Why market research is so important for a start-up business. smallbusiness.co.uk. [Online]. Available at http://www.smallbusiness.co.uk/starting-a-business/ideas-and-business-planning/2371778/why-market-research-is-so-important-for-a-startup-business.thtml [Accessed 15th Dec 2014]. Entrepreneur staff, 2014. Conducting market research. Entrepreneur. [Online]. Available at http://www.entrepreneur.com/article/217388 [Accessed 15th Dec 2014]. Fogel, G. K., & Lewis, L. F., 2010. Target Marketing and Ethics Brand Advertising and Marketing Campaigns. International Journal of Social Ecology and Sustainable Development, 1, 4, 10-25. Johnson, J. P., 2013. Targeted advertising and advertising avoidance. The Rand Journal of Economics, 44, 1, 128-144. Mueller, S., Volery, T., & von, S. B., 2012. What Do Entrepreneurs Actually Do? An Observational Study of Entrepreneurs Everyday Behavior in the Start-Up and Growth Stages. Entrepreneurship Theory and Practice, 36, 5, 995-1017. N.A, 2014. Food and drink. Visit Cambridge and beyond. [Online]. Available at [Accessed 15th Dec 2014]. n.a, 2014. The five basic methods of market research. Allbusiness. [Online]. Available at http://www.allbusiness.com/marketing/market-research/1287-1.html [Accessed 15th Dec 2014]. Queensland government, 2014. Market research for your business. queensland government. [Online]. Available at [Accessed 14th Dec 2014] Read More