Business Idea for Gulf Restaurant - Coursework Example

Business Plan Table of contents Contents Table of contents 2 Executive Summary 3 History of my Business Idea 4 About me and my partner 4 Product & Service 5 The Market 6 SWOT Analysis 7 The Business Strategies 8 Risks and Mitigations 9 Bibliography 12 Executive Summary The city of Manchester provides a strategic position for establishing fast food restaurants as is observable from the increasing new franchises opening the city centre. The increased population of students and working people in the town constitutes an extensive market for the success of a restaurant establishment. This opportunity, combined with the increased foreign population from the Middle East coming to Manchester for business, working or studying reasons presents a chance for the establishment of restaurant with a difference (Market Growth Potential, 2012, p 80). Gulf restaurant incorporates services of highly qualified and proficient staff from the Middle East to facilitate the preparation of products and services. The management team consists of my partner and me as joint directors of the business. He will head the finance and human resource department while I manage the marketing, sales and operational activities. Since we are the sole owners, we provide the entire capital for investing in the business. We both bring in our exceptional expertise, in the various fields of academic qualification for the success of the business. The mission statement of Gulf restaurant is a fair profit margin and a rewarding place for employees and customers. The objective is to become leading fast food franchise, serving high quality food products to the esteemed customers. Within the forecast, the business expects to begin slowly, but catch up as it matures. The expected sales will range, with expectations of between $300 to $1000 at the start, and $800 to $3000 when the business gains grounds in the market. The profit margins are marginal as they represent the mission of the business venture. To tackle the desires of the market, we feature in a calculated business strategy for facilitating services to the customers, which will help the business achieve its objectives. History of my Business Idea Gulf restaurant is an idea conceived from my visit to the Arabic gulf, particularly when I visited The United Arabs Emirates in the past two years. In the city of Dubai, there are several western and European restaurants, offering ready restaurant services including cuisines, desserts and main dishes among other recipes on their menu. To my dismay on arriving to this place, the tourist, business people alongside all other people of different colours, flocked various restaurants all requesting for the local foods of the Arabic origin. This caught my attention, creating an interest to establish the secret to the success of western restaurants in the Arabic Gulf. Luckily, a close relative operates one such restaurant; hence, I went to her for advice on the secret of succeeding in the restaurant business in the United Arabs Emirates. It was then I realised that the Arabic recipes offered the best and delicious food recipes that always leave the customers satisfied yet willing to eat an extra plate. Therefore, I decided to establish my own restaurant, offering these Arabic food recipes in my hometown, the city of Manchester. I posed the proposal to a close friend who got the interest and we decided to establish a partnership. This is since, running a partnership business will allow us to share costs, resources and contribute in skills. The name of the restaurant will be Gulf restaurant, and it will be at the centre hub of the city, along oxford road. The restaurant will be one of its kinds in the city, bringing a new flair and list of foods in the menu for customers to explore. About me and my partner Personally, stumbling at the idea when I visited the United Arabs Emirates was not a coincidence; rather, it was from experience. We visited a restaurant, ordered food only to realise it had pepper, thus, uneatable for a person who does not take pepper. Nonetheless, there are several recipes without pepper, thus, along with my partner, we intent to establish a paradise of Arabic food in Europe, to grow from a single store restaurant to a chain of restaurants within Manchester and the entire European countries network. Currently, as a marketing student, I have several skills that can foster the success of the business idea into reality. This restaurant will be a test of effectiveness of skills learnt from school. Moreover, I happened to attend a catering camp, where I learnt several skills in catering, and as such, I can make some delicacies for customers to enjoy. In addition to my skills, my partner has academic qualifications in the field of Human Resource Management and has several certificates in accounts. Thus, he will bring his expertise in these fields to the business, allowing us to combine the skills for the future success of our restaurant business. Product & Service As a local restaurant offering foreign products and services, we intend to establish a quality and classical restaurant setting that facilitates services to the satisfaction of the customers. The restaurant will specialise entirely on food and beverage services, particularly fast foods since the city centre consists of busy people; thus, they would not want to spend much time in a restaurant. The menu will include appetizers, desserts, main dishes, salads and soups. It will also have some beverage category to address the needs of the customers. The beverage will include coffee, tea and drinks such as fresh juice alongside other products. The cuisines will feature items such as vegetables, dairy and grains products, such including ingredients such as cucumbers, eggplant, zucchini, dates, wheat, yogurt, butter, cream and beef. There will be no pork as it is a prohibited food according to Arab Muslim beliefs (Albukhitan & Helmy, 2013, p 461). The services will feature a menu of products such as Hummus, Manakeesh, grilled Halloumi, Falafel, Fattoush, Umm Ali and Shanklish among other recipes. The menu will contain detailed explanation of the names to ensure customers ask for what they know. There will be the incorporation of few western foods as an alternative for those who prefer such. The Market The consumer expenditure in England remains on a rising trend over the past few years. The city of Manchester remains the leading centre for the growing establishments of fast foods and fancy restaurant franchises (Eating Out Review- UK, 2013, p 23). There is a towering population of citizens that readily flock these restaurants in search of something to eat. The market needs more services and a break from the monotonous western menu. Thus, the target market for this business entails people along the classes of age, family, gender and income. It will appeal to the young people, who are single and enrolled in college or high school, as well as, the young working people of up to 50 years of age. The restaurant will also appeal to families as it provides an opportunity for families to explore foreign foods locally. The menu targets both sexes, with particulate attention to females due to their dietary concerns. Moreover, it will also appeal to medium income people lower income bracket included as it will offer affordable products and services. The young people whether working or learning will constitute a larger percentage of the market. The restaurant will service the entire Manchester town centre, which is the centre of activity in England. The local people will constitute the larger percentage of customers with expected customers from the outskirts of the town also visiting the restaurant. The people of European origin will form the larger base of customers since they are more in the area. However, those people from the Middle East will also constitute a significant customer base once they learn of a restaurant offering their home food services. The competition will mainly be from the local rising fast food franchises that already established their presence in the market. However, with proper marketing skills and quality food services, the business will flourish beating all the competition accordingly. SWOT Analysis Strengths The most notable strength is that, as a new restaurant, customers will flock initially to taste its services, a factor that will allow us to capitalise on retaining them. Secondly, the organisation structure, in which the two owners will be direct managers, bringing their skills to work, will build the business success opportunity. Additionally, since the restaurant offers a diversity and variety of products, this is strength as it eliminates the monotonous competition in the market with those restaurants offering traditional western services. Moreover, the promotional activities as the business opens will facilitate advantage to the restaurant, as it will encourage customers to come. Moreover, the pricing on the menu will ensure that we deliver quality at affordable pricing; thus, customers stick to the restaurant. Weaknesses The restaurant will face limitations such including, the foreign labour that we will source to do the cooking. They will require guidance to acclimatise to the western cultures. Secondly, the costs of getting supplies due to factors such as transport costs and acquisition of such products from the United Arab Emirates. Moreover, as we start, we may have to rely on manual record-keeping system for stocks and sales, which will influence the working of the restaurant. Opportunities The opportunities for the business include that, being a new entity; it provides alternative food products, creating diversity. Secondly, the food products it offers apply high dietary standards; hence, confers with the trends of healthier eating, giving it an advantage over competitors. Moreover, with time, the business will incorporate delivery services and capitalise on the afternoon traffic, as these are opportunities for the business growth. Further, it also has an opportunity for expansion as it will be among very few of such restaurants in the city. Threats The threats to the business include that the local established restaurants would bring stiff competition, especially considering that they offer known services while mine are foreign. Moreover, the increasing number of restaurant businesses presents a threat as they create options for customers to dine. The high pricing of products and services due to increased economy will also limit the growth of restaurant. Moreover, being a foreign restaurant, policies on food product importation and labour force will influence my business since we will source labour and supplies from the United Arab Emirates. The Business Strategies The key objective of this business is to establish presence as a local restaurant with fast food outlets and gain substantial market share. Moreover, we also have a vision of expanding into other outlets in the future to grow the business. The mission of the restaurant is to become the leading fast food franchise serving high-quality food and a great value. Therefore, to succeed, the key lies in creating an inimitable, innovative and compelling menu that will distinguish Gulf restaurant from the others (Miller & Washington, 2013, p 510). Secondly, the business intends to sell products of the highest quality, maintaining excellent service level while controlling the costs at all time. Thus, the business will implement a conservative approach policy for growth. To achieve this level of success as we envision, the business will incorporate unique blending of the local recipes with a fusion of the Arabic recipes as a signature move. Additionally, we will recruit and establish friendly staff; in addition to partnerships with the supporting merchandise suppliers that support our vision on quality. Innovativeness in serving and packaging is the leading practices to achieving our goals of quality services and customer satisfaction. The marketing aspect of the business will incorporate a combination of local media and technology based strategies. Since Gulf restaurant is the first outlet we are establishing, this will form the market tester for the business. Therefore, executing the concept of the business is a critical element for the success of a business. The generic strategy of pricing is a feature, for the business to grow as we incorporate the average spending power of the target market. Branding as a strategy will feature brand names on the menu for foods as well as a brand logo for the business (Pride & Ferrell, 2010, p 78). These aspects will give the company competitive advantage for success. The marketing programs that the business will employ include the notable word-of-mouth in the restaurant, spread by our esteemed customers. We will also incorporate low budget marketing on the local media such as services of newspapers and radio. Others will include wall posters and notably, the grand opening promotion on which we intent to capitalise on marketing the business. We will produce brochures for further advertising, as well as, internet services such as social network platforms including face book and tweeter among others (Richard & Kelli, 2013, p 112). The sales strategy will also include promotional sales. Thus, the business intends to achieve its objectives through this action plan, executing the action plan with precision and care. Risks and Mitigations The risks to the business include, the high start up costs, considering that we have limited capital to finance the business until it picks. To mitigate this risk, the business will initiate few staff as it starts, in which my partner and I will be service people; thus, we will only employ the chefs. Moreover, we will initiate the business on a low budget and grow as we proceed. Another risk is the chances of the market accepting the products, considering that we are offering Arabic food services at mainly. To mitigate this risk, we will work towards breaking the cultural barrier by providing explanatory messages on the various foods on the menu. This will give customers confidence to try something new from the restaurant. Moreover, the business runs the risk of acquisition of supplies considering that most supplies we will import. Although we are exempt from taxes, the factor remains the costs of transport and quality of products. However, I will coordinate with the relative in Dubai who owns a restaurant there to help me in acquiring supplies. Financials (Spreadsheet attached) The capital for starting the business will amount to around $ 200,000. Currently, my uncle provided me with $75000 while I have savings of another $ 50,000 to invest. My partner agreed to provide $ 80,000; thus, we meet the projected startup costs. The managers will not receive pay for the first year. Additionally, my partner volunteered to serve as the cashier for the first and second year of business. The net profit after sales and expenses for the first year may present a loss to the business. However, from the second year, the business expects to start making a considerable margin profit. Personel Plan year 1 year 2 year 3 managers $0 $50,000 $100,000 cashier $0 $0 $100,000 cooks $100,000 $ 140,000 $195,000 delivery person $40,000 $55,000 $70,000 total people 7 10 15 total payroll $150,000 $245,000 $465,000 START-UP COSTS start-up expenses $20,000 start-up assets $15, 000 costs for setting the space $15,000 liabilities and licences $$15,000 miscelleniuos $7,000 total costs $72,000 CAPITAL CONTRIBUTION David Lu $80,000 Eric Yam $125,000 total capital $205,000 Break Even Analysis Monthly recurent costs $55,000 monthly Revenue expected $30,000 Estimated Monthly Fixed Cost after Revenue $25,000 ESTIMATED PROFIT AND LOSS MARGINS expenses year 1 year 2 year 3 direct cost of sales $60,000 $80,000 $100,000 Pay Roll $150,000 $245,000 $465,000 Marketing promotion $10,000 $10,000 $10,000 Utilities $3,000 $2,000 $5000 Tax incured $0 $0 $0 Depreceation $0 $0 $0 Net Profit $170,000 $425,000 $750,000 Net Profit after sales and expenses $-53,000 $85,000 $135,000 Bibliography Albukhitan, S, & Helmy, T 2013, ‘Automatic Ontology-based Annotation of Food, Nutrition and Health Arabic Web Content’, Procedia Computer Science, 19, p. 461, Supplemental Index, EBSCOhost, viewed 27 March 2014. ‘Eating Out Review- UK- June 2013’ 2013, Mintel Oxygen Reports EBSCOhost, viewed 27 March 2014. ‘Market growth potential’ 2012, Restaurant, Food & Beverage Market Research Handbook, pp, 79-87. Hospitality & Tourism Complete, EBSCOhost, viewed 27 March 2014. Miller, R, & Washington, K 2013, ‘Distinguished Restaurants’, Restaurants, Food & Beverage Market Research Handbook, pp. 508-520. Hospitality & Tourism Complete EBSCOhost, viewed 27 March 2014. Pride, W. M., & Ferrell, O. C. (2010). Marketing. Australia, South Western Cengage Learning. Richard K., m, & Kelli, W 2013, Restaurant, Food & Beverages Market Research Hadnbook 2013 [N.P.]: Richard K. Miller & Associates, Discovery eBooks, EBSCOhost, viewed 27 March 2014. Read More