Blue Fish Grill Business Strategies - Example

Executive Summary The paper brings forward a business plan for Blue Fish Grill which will look to serve sea food from Gulf Coast region. The business will be in a form of a restaurant and would look towards supplying fresh food cooked in ethnic style. The paper which highlights the feasibility based on technical, human resource, market and financial feasibility shows bright prospect for the venture. The market feasibility shows that the market is competitive but there is still a demand for sea food restaurant and would thereby provide an opportunity for the restaurant. The technical feasibility highlights that the business will use technology for training and procuring fresh products. The financial feasibility shows that the business would become profitable in the first year and will be able to ensure sufficient liquidity through which all the expenses will be met. The human resource feasibility shows that the business will hire the best talent which will include both trained and untrained employees so that the needs of the business is met. Thus, the overall prospect for the venture looks feasible and provides an opportunity through which the owner will be able to ensure good returns on the investment made. Table of Contents Introduction 3 About the Business 3 Market Feasibility 3 Technical Feasibility 5 Financial Feasibility 6 Human Resource Feasibility 10 Conclusion 11 References 13 Appendix 14 Introduction This report presents a complete business plan for a sea food restaurant which will specialize in serving Gulf Coast special food to its customer. The entire report looks into the feasibility study of opening up a new restaurant and has been divided into different parts. The study will look to provide the business idea, the technical feasibility, the market feasibility, the financial feasibility and human resource feasibility. This will thereby help the user to understand whether the venture will be a profitable one or not thereby enabling to take business decisions accordingly. The paper would thereby help to take useful decisions and would help to multiply the opportunities through which better potential for the business becomes possible. About the business The restaurant will start in the name of Blue Fish Grill which will serve shrimp, fish, oysters, chicken tender, and blue crab from the Gulf Coast. The different items will be served on different sized platters and will have different menu for different dates. The restaurant to attract people will also serve individual portions so that the appeal to different diners increases. The restaurant will look to provide complimentary products like coleslaw, pickled green tomatoes and French bread to accompany the main offerings. The price of the meals will be between $8 to $20. The restaurant plans to have around 116 seats for customers with another additional 10 seat in the bar section. The area which has been decided is a 3000 sq feet property which will have a parking capacity of around 50 vehicles. Since, service is the main concern so that business looks towards working on this dimensions and would look to have quality workforce capable of meeting the different needs of the customers. Market Feasibility The restaurant industry is highly competitive with service acting as a main element based on which people choose a particular restaurant. The sale for the restaurant business is expected to grow by 2.5%. The economic indicators are positive as consumer disposable income has increased which would thereby increase the number of people visiting a restaurant thereby increasing the opportunity to serve a large base of customers. It is further seen that out of the total expenditure made by consumers 48% is made on eating and drinking establishments. This provides an additional opportunity for the restaurant to bank on. Along with it 43% of the adult are of the opinion that dining outside is cost effective considering the cost of cooking and cleaning at home. People earning $30,000 or more are witnessing a rapid rise in income being spent on outside dining. People on an average tend to spend $2,634 on eatables outside their home which further increase for people having a higher disposable income (Alan, Sakhi, Arabella, Elizabeth, Karen, 2009). This is supported by changing lifestyle, economic growth and ethnic diverse population which has increased the overall hope. Blue Fish Grill looks to work on a different concept and tends to provide products from the Gulf Coast which would thereby attract more and more people as offering something new will enable them to use the opportunity for business growth. This is being supported by changing demographics where younger and working people prefer to dine outside their home as compared to the elderly. The elderly population is around 19% providing another 81% of the population who can be catered by Blue Fish Grill. People have started to prefer health conscious items and restaurants look to work in the same manner. The different sea food offerings cooked in organic base will provide the opportunity which the restaurant is searching. Further, since the products will be fresh and the organization will look to work on the fundamentals where quality is maintained it will act as a differentiating factor compared to other players. On the whole the market is competitive but since Blue Fish Grill is working on a different concept and the market is growing at a pace of 2.5% it provides an opportunity to tap the market. Ensuring high service standards, quality organic food cooked in ethnic style and a good ambience will ensure continuous supply of customers. Technical Feasibility Blue Fish Grill will look at having an increased use of technology and give importance to staff training through the use of technology. Since, the business will be governed by the mechanism of point of sale where the employee will directly come in contact with the customer so increased importance has to be given to employee training. The industry is also witnessing an increase in the use of technology and is growing by 30% (Dreezens, Martijn, Tenbu¨lt Kok & Vries, 2005). Most of the dining restaurants have website. It is seen that around two third of the dining restaurants have website and Blue Fish Grill will be looking to work towards the same. The website provides all information about the restaurant, menus, offers and provides a platform to gather maximum information about the restaurant. Blue Fish Grill will look to provide menu on the website so that people can understand the offerings as well. Further, Blue Fish Grill will look at ensuring that the restaurant has all the facilities and would look to provide Wi-Fi service to its customers. The procurement of raw materials will also be carried out through the use of technology so that high standards can be set while looking to purchase the materials. The organic ingredients which will be used will be tested based on technology requirements so that better quality products can be offered. In addition to it technology will be used for training the employees. Since, it is the most important fundamental based on which business is being developed so that model will look at ensuring that proper training is provided to the employees. The organization will thereby look at having proper mechanism aimed at using technology to the maximum extent possible so that better results can be achieved. Financial Feasibility To ensure smooth functioning of the business it is imperative that the business looks towards maintaining the required finance. Since, the business is a proprietorship business so the funds for the business will be mainly provided by the owner and the additional capital required will be borrowed in the form of loan. The owner of the business will provide $400,000 as self finance and will take another $677,675 as loan. To meet the yearly expenses the business will have to determine the break even sales and look to achieve the same so that all the cost which the business will incur in a particular year will be covered. The description of the break even cost and sale for Blue Fish Grill is as Break Even Analysis Fixed Cost Salaries 150000 Hourly Labour 269018 Employee Benefits 106100 Operating Expenses 78600 Music & Entertainment 3000 Marketing 39000 Utilities 51000 General & Administrative 72600 Repairs 21600 Occupancy Cost 169200 Interest 52547 Other Expense 2400 Loan Payment 46117 Total Fixed Cost 1061183 Variable Cost Cost of sales 552576 Hourly Labour 106368 Employee benefit 17340 Credit card expense 34956 Paper 20316 Total expense 1792746 Break even sales 1792746 Sales Break down Food 1354625 Liquor 78538 Beer 101090 Wine 258494 Total 1792746 The break even analysis shows that the business will have to earn $1792746 in a financial year to ensure that all the cost is covered. This means that $149395 in a week and $34476 in a day. The manner in which the demand for sea food is increasing it provides an opportunity to be meet the daily expenses which the restaurant will incur. The overall mechanism shows that the venture should be profitable which will be seen from the profit and loss statement for 3 years Profit & Loss Statement Year 1 Year 2 Year 3 Sales 1943098 1526962 1588040 Cost of Sales 598917 622968 647876 Gross Margin 1344181 1397964 1453778 Gross Margin % 69.2 69.2 69.2 Expenses Salaries & Wages 534311 555684 577911 Employee Benefit 124893 129888 135094 Operating Expenses 100623 103642 106751 Music 3000 3090 3183 Marketing 36000 37080 38192 Utilities 51000 52530 54106 General & Administrative Expense 110490 113805 117219 Repairs 21600 22248 22915 Occupancy Cost 177786 181342 184968 Depreciation 84038 84038 84038 Other (4800) (4944) (5092) Interest Expense 52547 49720 44574 Other expense 2400 2472 2546 Net Income before income tax 50291 68269 87382 The profit and loss statement shows that the business will become profitable in the first year as there is a demand for coastal food which will thereby help to ensure that the return for the owner improves. This will ensure that the overall cost will be covered and the business can look at mechanism to improve their business further. The cash flow statement for the business is as Profit & Loss Statement Year 1 Year 2 Year 3 Sales 1943098 1526962 1588040 Cost of Sales 598917 622968 647876 Gross Margin 1344181 1397964 1453778 Gross Margin % 69.2 69.2 69.2 Expenses Salaries & Wages 534311 555684 577911 Employee Benefit 124893 129888 135094 Operating Expenses 100623 103642 106751 Music 3000 3090 3183 Marketing 36000 37080 38192 Utilities 51000 52530 54106 General & Administrative Expense 110490 113805 117219 Repairs 21600 22248 22915 Occupancy Cost 177786 181342 184968 Depreciation 84038 84038 84038 Other (4800) (4944) (5092) Interest Expense 52547 49720 44574 Other expense 2400 2472 2546 Net Income before income tax 50291 68269 87382 Add: Depreciation 84038 84038 83048 Deduct: Loan payment 46117 49945 54091 Cash flow before income tax 88212 102362 117329 The cash flow statement highlights that the business is able to maintain sufficient liquidity which will help them to ensure that the daily expenses are easily met. Having a sound liquidity would mean that the business will not fall in a liquidity crunch and will thereby be able to carry out all the task. This will help to improve the mechanism through which different work is carried out and will help to improve the overall business efficiency. The overall financial feasibility shows that the business needs to achieve a break even so that all their cost are covered. Looking at the trends of similar other business it seems feasible and the business will be able to generate profits in the first year. Further the business will be able to ensure sufficient liquidity and carry out their daily operations. Overall the prospect looks bright and the financial aspect shows that the venture can be undertaken. Human Resource Feasibility The business works on the model of point of sale where final sale will take place at the interaction between the employee and the customer. Since the business works in the service sector so having a proper service standard will be a must. This will be achieved to a large extent by hiring experienced and skilled employees capable of understanding the needs and requirements of the customer. This will help to provide better services and ensure that the overall needs of customers are met. The business will look to hire around 40 to 50 employees. This will include both full time and part time employees. In addition to it the business will look to have both skilled and unskilled employees so that the different needs of the business are met. The salaries which the employees will get have been determined based on industry standards so that no issues arises on the same. The employees will also undergo the required training program from time to time so that their skills are shaped and they are able to carry out their role and responsibilities in a better way. The chart below presents the workforce requirements for the restaurant Personnel Need Full Time Part Time Range Manager 1 60000 yearly Kitchen manager 1 50000 yearly Asst. Manager 1 35000 – 40000 yearly Line cook 2 2 7 – 10 per hr Prep cook 3 2 6 – 8 per hr Dishwasher 3 2 6 – 7 per hr Server 12 8 2.18 per hr Bartender 3 3 3.5 – 5 per hr Bussers 3 3 5 – 6 per hr The overall need of the business with regard to employees has been identified in a manner through which the business will be carrying out the different business activities. Having employees capable of carrying out the different function is a must as which would require hiring the best people so that overall effectiveness in carrying out the different functions can be ensured. Conclusion The paper brings forward a business plan for Blue Fish Grill which will look to serve sea food from Gulf Coast region. The business will be in a form of a restaurant and would look towards supplying fresh food cooked in ethnic style. The paper which highlights the feasibility based on technical, human resource, market and financial feasibility shows bright prospect for the venture. The market feasibility shows that the market is competitive but there is still a demand for sea food restaurant and would thereby provide an opportunity for the restaurant. The technical feasibility highlights that the business will use technology for training and procuring fresh products. The financial feasibility shows that the business would become profitable in the first year and will be able to ensure sufficient liquidity through which all the expenses will be met. The human resource feasibility shows that the business will hire the best talent which will include both trained and untrained employees so that the needs of the business is met. Thus, the overall prospect for the venture looks feasible and provides an opportunity through which the owner will be able to ensure good returns on the investment made. References Alan, D., Sakhi, K., Arabella, H., Elizabeth, A., Karen, L., 2009. Nutritional quality of organic foods: a systematic review. The American Journal of Clinical Nutrition, 24 (5), pp. 187-194 Dreezens, E., Martijn, C., Tenbu¨lt P., Kok, G. & Vries, N. 2005. Food and values: an examination of values underlying attitudes toward genetically modified and organically grown food products. Appetite 44: 115–122 Appendix Start Up Source of cash Owner 400000 Loan 677675 Total 1077675 Use of cash Leasehold improvement 400000 Kitchen Equipment 175000 Furniture 75000 Professional service 19500 Organizational development 34475 Interior 66500 Exterior 48500 Pre opening expense 108700 Working capital 150000 Total 1077675 Read More