Business Strategies - Mega Byte Restaurant in South Australia - Example

Cover Letter This is a business report developed for the establishment of a restaurant venture in the Australian economy. The report is a medium business venture plan that outlines the key components requirements for the establishment of such an enterprise. The report builds on the concepts of the merits and economies of small and medium business enterprises in its planning approach. Business Plan: Mega Byte Restaurant Name: Course: Tutor: Institution: Date: Executive Summary This is a business plan for the proposed Mega Byte Restaurant in South Australia. Mega Byte Restaurant is a Partnership business co-owned by two university graduates from Yale and Melbourne. It has not yet been registered by the Australian registrar of companies, as such, this business plan is meant to solicit funds as well as act as a guide for Mega Byte Restaurant as it makes its entrance into the market. The proposed business location will be in Adelaide, the capital of South Australia. If all goes well, Mega Byte Restaurant is expected to start trading on September, 1st. Dr. Mark Curbchankar and Mr. Howard Cooper are the co-owners of the proposed Mega Byte Restaurant. Dr. Curbchankar is a holder of a masters' degree in Hotel Management while Mr. Cooper is a bachelors' degree holder in Foods and Beverages. The restaurant will be specializing in Italian, Chinese, French and Thai cuisines. The targeted market is the youthful middle class of Adelaide as they are excited and outgoing more than their elder counterparts. Mega Byte intents to make a triumphant entry into the market by incorporating a promotion mix that involves use of advertisements and public relations to create awareness as well as demand for its services. The restaurant is determined to provide high quality services to its esteemed customers in order to evoke loyalty. Table of Contents Cover Letter 1 Table of Contents 4 1.1 Background and Description of the Business Concept 5 1.2 Our Vision 6 1.3 Our Mission 6 1.4 Objectives 6 2.0 Industry Analysis 7 2.1 Trends and Characteristics 7 2.2 Gaps in the Market 8 3.0 The Market 8 3.1 Market Description 8 3.2 Customer Segments 9 3.3 Competitors 10 3.4 SWOT Analysis 10 3.5 Marketing Strategies 11 4.0 The Organization 12 5.0Finances 13 5.1 Start up Costs 13 5.2 Sales Forecast and Breakeven Analysis 14 5.3 Expected Cash flow Statements 14 5.4 Balance Sheet Forecast 15 5.5 Critical Risks 15 5.6 Assumptions 15 Appendix 17 1.0 The Business 1.1 Background and Description of the Business Concept Mega Byte Restaurant is the proposed partnership business that is to be located in Adelaide, South Australia. The idea is the brainchild of Dr. Mark Curbchankar, a holder of a masters' degree in hospitality management from the University of Melbourne and Mr. Howard Cooper, a graduate from Yale University with a bachelors' in foods and beverages. Curbchankar and Cooper came up with the business idea in response to the growing demand for relaxation facilities of social gatherings and it seemed viable considering the state of the pre-existing restaurants, which did not meet the market demand. In this regard, Mega Byte Restaurant is expected to address the various customer needs through the provision of services that are up to the expectations of the residents in South Australia. Furthermore, the idea is aimed at increasing the quality of services offered by existing restaurants by posing competition in the restaurants market in the southern region of Australia. This part of Australia is characterized by a high population that comprises of youthful people who are excited about the idea of eating out and attending get-together meetings in places other than their residence. These people are also outgoing and have a great desire for different delicacies that are only prepared in restaurants and hotels. The proposed Mega Byte Restaurant is will comprise of four segments in the same building whereby each segment will be serving a separate cuisine. The cuisines include Italian, Chinese, French and Thai delicacies. This way, it will be possible to capture the market needs for a variety of tastes. 1.2 Our Vision To provide high quality services to our esteemed customers in ways that not only meet, but also exceed customer expectations. To ensure that our customers are satisfied with the meals and delicacies served at our restaurants through the carrying out of consumer surveys that is aimed at accessing feedback, comments and compliments. To provide products and services that is in compliance with the regulations put in place that pertains to our service provision. To operate in an ethical and socially responsible manner through engaging in corporate social responsibility programs in the local area. We will offer a variety of services that interplay to satisfy not only the health, but also the taste preferences of our esteemed customers. 1.3 Our Mission To provide an exceptional "Mega Byte" experience by combining the rich elegant atmosphere of the city of Adelaide with the serene environment that has been innovatively developed to specifically appeal to the outgoing population of Adelaide. At Mega Byte, our skilled team is committed to serving the interests of our customers with selfless diligence and collaboration. Our staff is ready and willing to combine efforts to deliver the promises embodied in our vision statements. 1.4 Objectives The following are the long-term and short-term goals that Mega Byte Restaurant hopes to achieve in the course of its operations in the market. Establish a wide market reach within the first five months in operation Develop a customer relationship management system that will help the restaurant raise loyal customers who will in turn help the company attain its financial goals. Increase market share by 14% in Adelaide within the first one year in the market Create lasting relationships with key suppliers in the business. Increase revenues by 15% in the first six months of operation. Boost employee commitment by incorporating motivational strategies. 2.0 Industry Analysis 2.1 Trends and Characteristics The hotel industry is known to be one of the most competitive in the market. This is because of the rate at which hotels and restaurants are sprouting up, almost on a daily basis. The hotel and restaurants business is considered more lucrative compared to other industries such as the communication and energy industries, which are technical and monopolistic in nature. Considering the high rate of growth experienced in the recent past, the hotel and restaurants industry has witnessed an unprecedented number of new entrants into the market thus, stepping up the competition and consequently the quality of services offered. Today, the industry is characterized by day-to-day innovation as communication and technology take centre-stage as the main drivers of the global economy. The inception of mobile banking coupled with social media advertising have seen hotels and restaurants realizing new unexploited opportunities in the market. For instance, today, hotels and restaurants are hosting more international visitors than ever before, thanks to the advancements made in the field of information and communication technology. The industry has experienced significant expansions in the market reach as it facilitates affordable advertisements as well as online bookings for visitors from distant regions. The use of social media has found profound application in the industry as hotels and restaurants make use of social media accounts to carry out online consumer surveys. Most importantly, dynamic consumer preferences have been a characteristic trend in the hotel and restaurants industry in the 21st century. 2.2 Gaps in the Market Adelaide is a developed city in southern Australia with an estimated population of 1.2 million people. It is the capital city of south Australia. This means Adelaide acts as the nerve centre of economic activities in the whole region of south Australia. In this regard, the city is served with major transport and communication channels that facilitate trade activities in the country. The hotel industry is directly linked to the tourism industry, the largest revenue earner in Australia (Durmaz, Platt & Yigitcanlar, 2010, p.198; Verbeek, Bargeman & Mommaas, 2011, p.45; Rahman, Haque & Khan, 2012, p.115). The city of Adelaide is highly populated. In addition, due to the highly publicized tourism sector of Australia, the country receives high numbers of international visitors each year. The existing hotel and restaurants industry is sometimes overwhelmed by the high demand created by the population and the annual international visitors. In this regard, there is a gap that Mega Byte Restaurant strives to fill. This gap is the excess demand for hotel and restaurants services by the incoming visitors and the locals of Adelaide city. 3.0 The Market 3.1 Market Description Market refers to the potential customers who have both the willingness and ability to purchase. Considering the status of the Adelaide city, it can be inferred that the populous southern Australian city provides good market for the hotel and restaurants industry. A significant percentage of the population is comprised of the working members of society. In addition, the favourable economic conditions prevalent in South Australia mean that most of the people are employed with good income that enables them to invest and still have high disposable income. This is evidenced by the high living standards of the people and the more than half of the population is categorized under the middle class segment. Furthermore, the Australians market is generally affluent as evidenced by the statistics revealing an investing habit among the dwellers of the Adelaide city. The city also receives regular international visitors who patronize most of the city's hotels and restaurants. 3.2 Customer Segments These are the sections of the population that are targeted by the products and services provided by the company. The Australian market is comprised of a working population whose level of disposable income is enough to give them purchasing power. However, the fact that people have enough disposable income is not guarantee that they will have the demand for a product. This is why it is important for a business to carry out a study that would identify the target market for its products and services. The proposed Mega Byte Restaurant is targeting the youthful middle class of Adelaide as well as the enormous numbers of international visitors who frequent the country on an annual basis. This segment is a reliable source of market for Mega Byte Restaurant especially because of the outgoing nature of the youthful middle class and the consistent international visitors. In addition to that, Mega Byte Restaurant is targeting the increasing population of emigrants from France, Italy, China and Thailand (Cadeaux, 2004, p.26; Juho, 2013, p.14; Caldwell & Cherikoff, 2007, p.64). 3.3 Competitors Due to the lucrative business conditions prevalent for the hotel and restaurants industry, there is high competition as various companies strive to remain afloat in the industry. The hotel industry in the world over is characterized by a high number of players and South Australia is not exempted from this statistic. In this regard, the entrance of Mega Byte Restaurant is just one among the many other entries that are made on a regular basis. Mega Byte will have to put up with the competitive industry by devising mechanisms to enable it remain relevant and operational. The established restaurants in Adelaide such as Peel St and Ruby Red Flamingo are the competitors as they are renown in South Australia for their high quality service fostered by experience and a long time in the market. However, Mega Byte understands the fact that necessity is the mother of innovation. In line with this, Mega Byte is determined to compete favourably in the highly competitive industry. 3.4 SWOT Analysis SWOT refers to the internal and external analysis that is carried out to determine the feasibility and viability of a business before implementation. The analysis involves the evaluation of the internal and external factors that influence the implementation of a business plan. In the SWOT analysis, the company's strengths, weaknesses, opportunities and threats are all weighed against one another and a conclusive report is established at the end. In terms of strengths, Mega Byte Restaurant is better placed based on the fact that both Curbchankar and Cooper are graduates in the field of Hotel Management and Foods and Beverages. They have the knowledge to outcompete their rivals such as Peel St and Ruby Red Flamingo. The restaurant will also be able to make use of modern technology to enhance customer service. The two entrepreneurs have been in Adelaide long enough to know their customers. Mega Byte has an opportunity to address the unmet needs of the market by offering services that have not been provided before by the competitors. The other opportunity for Mega Byte is the prospect of being the new entrant in the market. This means that the public has no information about it. It is upon the business to make the first impression not only to be a lasting one but one that gives potential customers a reason to come back again. However, it is important to note that there are threats and weaknesses existent in the industry that Mega Byte has got to face. These include lack of consumer awareness and a low brand power. 3.5 Marketing Strategies The proposed Mega Byte Restaurants is set to run a high budget marketing strategy because of big size and the nature of the hotel and restaurants industry which is highly competitive. The restaurant will specialize in four major cuisines, which include Italian, French, Chinese and Thai. These delicacies represent the most sought after cuisines in the world because they are considered to be not only delicious but also healthy. The fact that these cuisines have an outstanding reputation in the industry, Mega Byte will spend less finances in marketing them. Product pricing is an important tool in the marketing of a new product or service in the market (Mounter, Grant, Fleming & Griffith, 2011, p.300; Lamont & Dowell, 2008, p.253). This is based on the fact that businesses compete using price wars to secure top positions in the market. Mega Byte Restaurant will charge pocket-friendly prices for its portions in order to attract as many customers as possible. The other marketing strategy to be adopted by Mega Byte is product promotion. The promotion mix for the restaurant will be a communication model that makes use of advertisements and public relations to create awareness about the new restaurant in the market. About the place, the restaurant is dedicated to serving the interests of its customers, as such, it has gone out of its way to come right to Adelaide, the capital of South Australia. The restaurant seeks to provide products and services that set it apart from the rest of the restaurants in the industry. 4.0 The Organization According to the regulations regarding the structure of any business in Australia, directors and entrepreneurs are expected to be specialized in the field in which they are venturing into. Both Curbchankar and Cooper have met this requirement because they are graduates in the fields of Hotel Management and Foods and Beverages industries. In addition, since it is a single business unit, it will be headed by two directors that double as the chief executives. The human resource management will be held responsible for the hiring and firing of staff in the restaurant. The department will be expected to determine the appropriate number of staff members to work in the restaurant. The restaurant is dedicated to establish stable relationships with its suppliers. 5.0Finances In developing the business venture, the expected start up costs as enumerated under the appendices balance sheet analysis is $0.7 M, with a sales forecast of 0.5 million on the third year. The business breakeven point is expected at 5 years of operation. 5.1 Start up Costs 5.2 Sales Forecast and Breakeven Analysis 5.3 Expected Cash flow Statements 5.4 Balance Sheet Forecast 5.5 Critical Risks On the execution of the s business venture, the venture faces critical risks with regard to increased financial inflation rates in the global market making profits and profit margins increasingly unpredictable. In addition, the venture faces the risk of increased market cost leading to increased risk of reducing profitability margins A combination of these factors risk the failure of the attainment of a breakeven point as anticipated in three years of operation 5.6 Assumptions In developing the propped venture financial forecasts the report adopts a range of assumptions including Constant inflation rates Absence of unforeseeable influencing factors Lack of abnormal Australian Currency fluctuations References Cadeaux, J. 2004, "A Commentary on Hunt and Arnett's Paper: Market Segmentation Strategy, Competitive Advantage, and Public Policy: Grounding Segmentation Strategy in Resource-Advantage Theory", Australasian Marketing Journal, vol. 12, no. 1, pp. 26-29. Caldwell, M. & Cherikoff, V. 2007, "South Australia", Nation's Restaurant News, vol. 41, no. 15, pp. 62-62,64,66. D.H.P. Verbeek, Bargeman, A. & Mommaas, J.T. 2011, "A sustainable tourism mobility passage", Tourism Review of AIEST - International Association of Scientific Experts in Tourism, vol. 66, no. 4, pp. 45-53. Durmaz, B., Platt, S. & Yigitcanlar, T. 2010, "Creativity, culture tourism and place-making: Istanbul and London film industries", International Journal of Culture, Tourism and Hospitality Research, vol. 4, no. 3, pp. 198-213. Juho, A.P. 2013, "Information and communications technology and market segmentation in tourism: a review", Tourism Review of AIEST - International Association of Scientific Experts in Tourism, vol. 68, no. 2, pp. 14-30. Lamont, M. & Dowell, R. 2008, "A process model of small and medium enterprise sponsorship of regional sport tourism events", Journal of Vacation Marketing, vol. 14, no. 3, pp. 253-266. Mounter, S., Grant, B., Fleming, E. & Griffith, G. 2011, "Latecomers: Charting A Course For The Wine Industry In The New England Australia Region1", Australasian Journal of Regional Studies, vol. 17, no. 3, pp. 300-329. Rahman, M.S., Haque, M.M. & Khan, A.H. 2012, "A Conceptual Study on Consumers' Purchase Intention of Broadband Services: Service Quality and Experience Economy Perspective", International Journal of Business and Management, vol. 7, no. 18, pp. 115-129. Appendix Appendices 1: Attach Copy of CV Appendices 2: Others Attach copy of testimonials Read More