Business Plan Assessment - Assignment Example

Business Plan Name Institution Date 1.0. Summary of the proposal The business will be a Chinese fine dining restaurant located in Gold Coast Southport China town. The restaurant will mainly offer high quality Chinese cuisines to the customers. The name of the business will be Xing Shing restaurant. It will be large and it will occupy two storeys and it will have a total of 200 tables. This will enable the restaurant to serve up to 300 customers at the same time. The region is frequented by the Chinese tourists as well as the Chinese people living and working in Australia. It is due to the high number of Chinese people that the region has been named China town (Smith, 2011). The Chinese people will be the main target of the business. However any other customer will be welcomed to taste the Chinese cuisines. This will offer the local people with an opportunity to enjoy the Chinese cuisines. The industry is currently undergoing a lot of growth and development. However, there are only a few restaurants that are offering the Chinese cuisines. This has created a gap in the market which has made it difficult for the Chinese customers to enjoy their favourite Chinese Cuisines. The value proposition at the company will involve providing an alternative and differentiation to the market as the number of Chinese restaurants is low. The experience of the customers will be enhanced by high quality and unique products at the restaurant. All the products of the company will be sold at affordable prices as part of the value preposition. The number of Chinese people is also on the increase. About 160,000 Chinese migrants visit the country every year (Smith, 2011). There are currently about 1 million Chinese people living in the country. Some o the Chinese people who are not used to the local food find it difficult to eat at the local restaurants and have to travel long distances before they can find the Chinese cuisines. The unique value proposition will be offering only the Chinese cuisines to the customers. This is rare in the region as most restaurants only serve the western cuisines. The high number of people as well as the unique value proposition will be useful in ensuring that the business is able to succeed. A business with unique products and services usually achieve a competitive advantage in the market. Competitive advantage in the market guarantees profitability for a business organization. 2.0. Aims of business 2.1. Goals and objectives To offer high quality Chinese cuisines to the customers. To provide the local people with a taste of Chinese cuisines. To be the market leader in the industry in terms of serving the Chinese cuisines. To offer high quality services to the tourists visiting the region. To provide high quality services to the customers visiting the premises. 2.2. Anticipated sales volumes and market share The business is expects to be the market leader with up to 50% of the market share at the time of its establishment. However, as the business grows, it is expected that the market share will increase to 70%. This can be attributed to the low levels of competition in the market. The number of customers is also expected to increase every year due to the new arrivals. It is anticipated that the sales volume will increase every year with the increase in the market share of the company. The market volume is also expected to be high when the tourists visit the country. This can be attributed to the high number of customers in the market. The business is expected to run under full capacity throughout due to the high number of customers in the market. It is anticipated that most of the customers will make bookings in advance. 2.3. Customer satisfaction The main priority of a business is to satisfy the customers (Brooks, 2014). Customer satisfaction determines the success or failure of the business. The business will collect feedback from the customers from time to time in order to promote customer satisfaction. Any complaint by the customer will be handled with the highest level of professionalism. The notion that the customer is always right will be fully applied in the business. All the employees will undergo training on customer care in order to promote professionalism and customer satisfaction. The employees will be required to provide the customers with high quality services. This includes the event when the customer is wrong. The employees will be forbidden from arguing with the customer and will instead be required to use a polite language at all times. 3.0. Management plan The business owner will double up as the Chief Executive officer. This is due to the experience in the industry as well as the need to be fully in control of the business. Other members of the management team will be hired. This will include the Human Resource manager who will be in charge of all the aspects human resource. Issuer related to the employees will be handled by the human resource manager. The holder of the position must possess a Bachelors degree in Human resource management or related course. A financial officer will also be hired at the restaurant and will be in charge of finance and accounting at the restaurant. A Bachelors degree in accounting will be required of position holder. An information technology officer with a bachelors degree in information technology will also be hired as part of the management team. Information technology is increasingly becoming important in business and hence the need for personnel. A chief chef with experience in cooking the Chinese cuisine will also be part of the management team. The Chief Chef must have at least a diploma an experience in cooking the Chinese cuisines. All the members of the management team will undergo training before assuming their roles. This will equip them with the skills that are required to carry out their duties. A part from the business owner, all the members of the management team should be fluent in English and the Chinese language. This is because they will be interacting with the customers as well as the employees from time to time. The middle level management team will be comprised of the supervisors who will be in direct contact with the employees. All the supervisors must have at least a diploma education and fluency in English and Chinese language. The management team will be comprised of local as well as Chinese citizens. The efficiency of the management team is important in ensuring that the goals and objectives of the business are met. The employees will mainly be comprised of the Chinese citizens as well as Australians with who are able to speak the Chinese language. This is due to the nature of the target customers. The employees will also be trained in order to improve their knowledge and skills. 4.0. Marketing plan The products that will be sold at the restaurants will be Chinese cuisines. This will include the Chinese food and drinks. The Chinese dishes that will be prepared at the restaurant includes Anhui, Cantonese, Fujian, Hunan, rice, noodles sauces, vegetables, sautéed chicken with pepper, seasonings, Jiangsu, Shandong, Zhejiang and Sichuan. The drinks that will be served at the restaurant includes green tea, baijiu liquour, milk, sinkiang black beer, pearl milk tea, electrolyte water, tieguanyin, salt soda water and fermented sweet rice wine. The marketing plan will mainly be used for the purposes of ensuring that the products are promoted in the market. The promotional activities will mainly involve advertisements. The use of advertisements is a common promotional strategy that informs the customers in the market about the products and services being offered (Ulrich, 2013). The television is one of the advertisement channels that will be utilized by the restaurant. This will mainly be used in order to attract the local customers in the region. Local channels at Gold Coast Southport China town will be utilized. The print media such as the local newspapers will be utilized. In order to facilitate the promotional activities, about 10% of the profit will be used for carrying out the promotional activities. The marketing efforts at the company will be intensified every year in order to ensure the company is able to attract more customers. The online methods will also be involved in the marketing of the products of the company. This mainly includes advertising the products through the use of internet. Social media will play an important role in the online advertisement of the products of the company. The business will have a website and social media pages that will be used to promote the products. This will mainly target the international customers including the Chinese tourists. The use of social media is likely to reach a high number of people from different parts of the world (Ulrich, 2013). The advertisement will position the company as a place of choice for the Chinese people as well as anyone who intends to taste the Chinese Cuisine. The advertisements will also play an essential role in terms of building the brand image of the company. The advertisements will provide the customers with information about the prices of the products. 5.0. Financial plan Pro forma profit and loss Year 1 Year 2 Year 3 Sales 500000 1000000 1500000 Direct cost of sales 100000 150000 200000 Other cost of goods 0 0 0 TOTAL COST OF SALES 100000 150000 200000 Gross margin 400000 850000 1300000 Gross margin % 25 17.65 15.38 Expenses Payroll 60000 100000 200000 Marketing 5000 50000 75000 Depreciation 1000 2000 3000 Rent 10000 10000 10000 Utilities 500 1000 1500 Insurance 2000 2000 2000 Payroll taxes 500 1000 1500 Other expenses 3000 5000 10000 Total operating expenses 82000 171,000 303,000 Profit before taxes 318000 679000 1197000 Taxes 10000 50000 20000 Net profit 308,000 674000 1177000 Annual forecast statement for the next three years Month Cash generated January 10000 February 15000 March 20000 April 25000 May 30000 June 35000 July 40000 August 45000 September 50000 October 55000 November 75000 December 100000 Monthly cash flow for the first year Capital required to start the business is $ 300,000. The amount invested for capital will be recovered within one year of operation .The business will only be able to make little profit in its first year of operation. More profits will however be made after the first year of operation. The capital for the business will be raised through various means. The owner intends to contribute $ 150,000 from personal savings. A total of $ 50,000 will be borrowed from family members and friends. The money borrowed from friends and relatives is considered as a soft loan and it is more flexible than the bank loan in terms of repayment (Kotler & Armstrong, 2013). The rest of the amount will be obtained through a bank loan. The bank loan will be repaid within one year and the same will also be applicable for the amount borrowed from friends and relatives. The profitability of the restaurant will therefore be important in ensuring that all the money is paid on time. Priority will be given to the bank loan in order to avoid any form of penalties. 6.0. Operations plan Before the business opens up for operations, all the employees will undergo training for a period of three days. This will prepare them for the duties. Training of the employees is important in ensuring that they are fully aware of their roles and how to handle the customers. The restaurant will be open to the customer on a daily basis twenty four hours a day. The employees will be divided into three shifts. This will involve the night shift as well as the day shift. Rotation of the employees will be carried out every week so as to ensure all the employees are able to work in different shifts. The employees will be required to work for a period of eight hours. The supervisors will be responsible for supervising the employees and coordinating their activities. This is for the purposes of ensuring that all the activities are run smoothly. Cash handling will be carried out by the finance officer. All the activities that requires cash has to go through the finance office for approval. The restaurant will also insure the business for the purposes of dealing with risks. It is expected that the Chief Chef will be knowledgeable of all the Chinese cuisines that will be prepared at the restaurant. As such the Chief Chef will be consulted during the procurement process. This is considering that some of the ingredients will have to be imported from China. Only the original Chinese ingredients will be used for the preparation of the food and hence the need for importation. The human resource manager will deal with all the aspects that affect the employees. This includes the welfare of the employees as well as issues of recruitment and termination of service. Close consultation as well as teamwork will form an important aspect of operations at the restaurant. 7.0. Project schedule The restaurant will be opened after several measures have been put in place. Clearance is also required from the government and other authorities. The first step will involve obtaining the relevant licenses from the authority. The registration process is likely to take a period of two weeks. A building that will house the business has to be selected. This will however take less than one week since the business premises are readily available in the region. However, the building has to be modified and decorated in order to meet the requirements of the business. This process will last for a period of about three weeks. This is considering that the modification and decorations will require the importation of some of the materials from china. A contract has to be entered with the owner of the building in order to carry out the modification. The interior and exterior design has to reflect the brand image of the company. The restaurant however has a long term plan of purchasing its own building to house the business. The recruitment of the employees will be carried out within a period of one month. A consultancy company will be hired for the purpose of carrying up the recruitment process. This is because the business will not have the capacity to do so at its establishment. The training of the employees will be carried out after the training and recruitment process. The process will therefore last about two months before the business is fully operational. The employees will be required to perform several functions based on the job description as indicated below: Hostess Welcoming the customers when they are entering the premises. Promote the good public image of the restaurant through the social media. Cook Preparing the meals under the direction of the chef. Ensuring that the food is cooked to the required quality. Providing any necessary assistance to the chef. Waiter/ Waitress Taking the order of the customers. Serving the customers. Removing the plates and utensils from the table after meals. Setting the table. Disk jockey In charge of music at the restaurant. Bar tender Manning the bar. Ensuring that all the drinks are available to the customers. Cleaner Ensuring that the restaurant is clean at all times. Kitchen assistant Washing the dishes. Assisting the cooks. Sustainability business case Sustainability is mainly about environmental protection and it is increasingly becoming useful to most of the organizations. Environmental pollution as well as improper use of energy is among the factors that impacts negatively on sustainability (Charlesworth, 2014). The business will put in place measures to ensure that its activities do not cause damage to the environment. The wastes generated from the restaurant will be well managed in order to avoid improper disposal. The company will develop a recycling plant to manage some of the wastes. Some of the wastes generated from restaurant cannot be managed through recycling. A waste management company will therefore be contracted to handle such wastes. The company contracted will be required to collect the wastes on a weekly basis. This is for the purposes of ensuring it does not accumulate as it may lead to environmental pollution. The use of electricity at the restaurant will also be modified in order to promote sustainability. The restaurant will ensure that all its equipment is energy saving. The use of energy saving equipment ensures that a low amount of electricity is consumed and hence promoting sustainability (Doh, et al, 2013). The modification of the building will ensure that the solar panels are fitted at the building. Solar is considered as green energy and it has positive impacts on sustainability. Solar energy will mainly be used for heating the water as well as operating some of the equipment at the restaurant. The environmental aspects will be monitored closely to ensure that the restaurant is compliant with the laws that are in place. Environmental sustainability measures are important to a business. It promotes a good public image of the business as indicates that the organization is responsible. The customers prefer associating with an organization that is socially responsible. Risk analysis Risk Likelihood Impact Strategy Failure to attract customers Moderate High Marketing will be carried out to inform the potential customers about the business. Failure to obtain the bank loan Moderate High The business plan will be presented to the bank with all the potential indicated. Failure to find reliable suppliers from China Moderate High The restaurant will work closely with the well known and credible suppliers from China. Expiry of the food before sale High High The restaurant will only prepare food based on the order from the customers. Destruction of the business as a result of fire Likely High The restaurant will be insured as a measure to caution it. SWOT Analysis Strength Financial stability. High number of customers. High market potential. Availability of insurance policies. Weaknesses High cost of operation. Lack of availability of some ingredients. Opportunities Growth and expansion of the restaurant. Opening of more branches. Threats Risks associated with natural calamities and human activities. Delays by suppliers from China. Most of the products expire within a short period of time Every business is likely to face risks and uncertainties at its time of operation (Brooks, 2014). It is therefore important to ensure that measures are put in place to caution the business from the risk. The restaurant will be fully insured in order caution it from different forms of risks. An insurance policy is important for a restaurant due to the nature of activities such as use of fire for cooking and high voltage electricity to operate some equipment. The risks may also have a direct negative impact on the employees. Injuries and deaths of the employees can result from the risks. This may have negative impacts on the restaurant. Training of the employees will be conducted in order to equip them with the knowledge of the risks. Close consultations with the stakeholders is useful in ensuring that the impacts of the risks are mitigated. References Smith, P. (2011). China biggest Source of migrants to Australia. Financial Times Australia. Brooks, W. (2014). The International Business Environment. Prentice Hall. Ulrich, D. (2013). Human resource champions: The next agenda for adding value and delivering results. Harvard Business Press. Kotler, P., & Armstrong, G. (2013). Principles of Marketing 15th Global Edition. Pearson. Charlesworth, A. (2014). Digital marketing: A practical approach. Routledge. Doh, J. et al. (2013). Ethics, Corporate Social Responsibility, and Developing Country Multinationals. Business Ethics Quarterly, 23(04), 638-639. Read More