Study on Business Plan - Cafe Paradiso

Description
Brendan and Margaret Elliott have entered into negotiations to purchase a cafe business, called Cafe Paradiso, because of its great location in the Mountain Glen Shopping Centre with the highest number of passing shoppers which is supported by a large and growing local population.

Café Paradiso – Sample Business Plan
Business Plan
2007/2008
Commercial-in-Confidence
Date
Table of Contents
1.0 Executive Summary 1
1.1 Business Opportunity 1
1.2 Product/Service Offering 1
1.3 Marketing Plan 1
1.4 Management eam 1
1.! "inancial Plan 2
2.0 Business Opportunity 3
2.1 Business Opportunity 3
2.2 #ision and Mission 3
2.3 $oals and O%&ectives 3
2.4 'ature of t(e Business 4
3.0 Market Analysis 5
3.1 Situational ) S*O +nalysis !
Table 1: SWOT analysis and strategy development 5
3.2 ,ndustry +nalysis -
3.3 .ompetitor +nalysis -
Table 2: Analysis of competitors 7
Table 3: Analysis of competitors’ prodcts and services 7
4.0 Elements o Success !
4.1 arget Market /
4.2 .ompetitive +dvantage and 0ni1ue Selling Proposition /
5.0 Marketin" #lan $
!.1 Marketing O%&ectives 2
!.2 Marketing Mi3 2
Table !: "ale #ropositions $
!.3 +ction Plan 11
!.4 Sales +nalysis and "orecast 11
%igre 1 Sales forecast 11
%.0 &e"al Matters an' (isk Mana"ement 12
-.1 Business Structure and Business 'ame 12
-.2 4egistrations5 6icences and Permits 12
Table 5: &isting of registrations' licences and permits 12
-.3 .ontracts and +greements 13
Table &isting of contracts and agreements 13
-.4 4isk Management 14
Table 7 )is* assessment 1!
-.! ,nsurances 1!
Table + &isting of insrance policies 15
-.- ,ntellectual Property 1!
Table $ &isting of intellectal property o,ned 15
Table 1- &isting of permissions for se of intellectal property 15
).0 *uman (esource Mana"ement 1%
7.1 Organisational .(art 1-
1.1 Business Opportunity
Brendan and Margaret 8lliott (ave entered into negotiations to purc(ase a caf9 %usiness5
called .af9 Paradiso5 %ecause of its great location in t(e Mountain $len S(opping .entre
:it( t(e (ig(est num%er of passing s(oppers ic( is supported %y a large and gro:ing local
population. (ere are a limited num%er of caf9s :it(in t(e centre and :it( %ot( Brendan;s and
Margaret;s e3perience :it( (aving successfully operated and o:ned a num%er of cafes in
+ustralia and overseas t(ey :ill %e a%le to increase t(eir market s(are from 3!< to 4=< in 12
mont(s.
(e competitive advantages of t(e %usiness are>
• location
• 1uality of food and service
• kno:ledge and e3perience of t(e industry
• availa%le financial resources
1.2 Product/Service Offering
(e main activity of t(e company is t(e operation of t(e .af9 Paradiso. Business activities
include purc(asing5 storing5 preparing5 selling and serving our products to our valued
customers. *e e3pect to serve over -5=== customers ?@dine in; and @take a:ay;A per mont(.
(e .af9 is open from />==am to !>==pm Monday to Saturday and from />==am until midday
on Sunday. (e caf9 comforta%ly seats 3- persons.
(e mission of t(e %usiness is to satisfy customers; needs and :ants for (ig( 1uality coffee5
delicious nutritious meals and e3cellent service. Our main point of differentiation from ot(er
cafes and coffee s(ops in t(e .entre is t(at one of t(e %usiness o:ners is an internationally
trained c(ef o :ill %e a%le to produce fres(5 lig(t and (ealt(y meals eac( day as :ell as
develop ne: menu items to meet t(e c(anging needs and tastes of people o care a%out
at t(ey eat. (e (ig( 1uality coffee :ill target staff and s(oppers in t(e S(opping .entre
o en&oy good coffee t(at simply offers good value for money at (ig(ly competitive prices
1.3 Mareting Plan
(e o%&ectives of t(e company are to>
? maintain market s(are t(roug( t(e c(ange of o:ners(ip t(en gro: market s(are to
4=<5 and
? generate a %efore ta3 net margin of 2=<.
(e %usiness :ill ac(ieve t(ese o%&ectives %y>
? retaining t key staff mem%ers of .af9 Paradiso to maintain continuity of customer
relations(ips during t(e c(angeover
? upgrading signage to %e more visually appealing
? maintaining t(e e3isting price levels and controlling costs
? undertaking more aggressive marketing and promotion.
1.! Manage"ent Tea"
Brendan and Margaret 8lliott5 o:ners of Seavie: Pty 6td are %ot( e3perienced .af9
o:ners/managers (aving successfully operated a num%er of cafes in +ustralia and overseas.
Brendan is a 1ualified c(ef and (as previously rked for t(e Bilton and t(e Sofitel groups
%efore o:ning (is o:n caf9. Margaret (as a degree in Business Management ?BospitalityA
and s(e too (as rked for t(e Bilton group of companies and for t(e 4ydges group.
Brendan and Margaret :ill rk fullCtime in t(e %usiness5 retain t key staff from t(e
previous o:ner to maintain t(e continuity of relations(ips :it( customers during t(e transition5
and :ill employ an additional four staff. of t(ose staff :ill rk on a partCtime %asis.
.
1.# $inancial Plan
Our pro&ected performance is summarised %elo:>
urnover> Dear 1 E!3-5-!= Dear 2 E!/=5===
$ross margin E37/5-2= ?71<A
'et profit ?%efore ta3A of E1=25/-2 in t(e first year5 gro:ing to E131517! in t(e second year of
operation.
(e %usiness is cas( flo: positive from t(e first mont( of operation
BreakC8ven is estimated at a mont(ly sales level of E3=5/-2
4eturn on otal +ssets> 37.3<
4eturn on 81uity> !1.2<
(e purc(ase price of t(e %usiness is E17=5===. otal startCup cost (as %een calculated at
E2=25/1= and is to %e funded %y :ay of a E1=452=! %ank loan and e1uity in&ection of
E1=452=! from Brendan and Margaret. ,t is proposed t(at t(e loan %e paid %ack over a t
year period from cas( flo:.
2.= Business Opportunity
2.1 Business Opportunity
Purc(ase of an esta%lis(ed cafe :it(in t(e Mountain $len S(opping .entre t(at is part of a
large5 :ell developed master planned community ic( is still gro:ing5 incorporating a
regional s(opping centre5 residential5 retail and commercial development.
(e %usiness is ideally located for a .af95 %eing situated on t(e main mall :it( a (ig( passing
trade due to its close pro3imity to t national supermarket c(ains and a num%er of :ell
kno:n retail fas(ion clot(ing c(ains. (ere are a limited num%er of cafes :it(in t(e centre and
.af9 Paradiso (as t(e %est location5 :it( t(e (ig(est num%er of passing s(oppers.
.af9 Parisdo;s primary customers are s(oppers and staff :it(in t(e S(opping .entre o
take a %reak from t(eir s(opping or rk and en&oy fine coffee or ot(er %everages as :ell as
for people :anting a lig(t5 1uick and (ealt(y meal t(at provide a good alternative to t(e fast
food options. (e success of t(e %usiness is %ased on its e3cellent location5 1uality of
management and staff5 great @value for money; coffee and meals and superior service.
2.2 %ision and Mission
+ision C (e company;s vision is @to %e t(e .af9 of preference for Mountain $len S(opping
.entre customers;.
Mission C (e mission of t(e %usiness is to satisfy customers; needs and :ants for (ig(
1uality coffee5 delicious nutritious meals and e3cellent service.
2.3 &oals and Ob'ectives
$oal one> maintain continuity of customer relations(ips during t(e c(angeover %y>
• 4etaining t key staff mem%ers of .af9 Paradiso
• Maintaining t(e e3isting price levels
$oal t> maintain market s(are and sales t(roug( t(e c(ange of o:ners(ip t(en gro:
market s(are to 4=< in 1/ mont(s. (e strategies to ac(ieve t(is goal are>
• ,ncrease t(e num%er of customers
• ,ncrease t(e average sales siFe
• ,ncrease repeat trade from customers
• 0ndertaking more aggressive marketing and promotion
$oal t(ree> generate a %efore ta3 net margin of 2=< for t(e ne3t t financial years %y>
• 8liminating (ig( cost purc(ases
• ,mproving cost control
• ,mproving stock control
Page -
2.! (ature of t)e Business
.af9 Paradiso :ill serve take a:ay %everages ?especially fine coffeeA and moderately priced
good 1uality lig(t meals to t(e casual dining market :it(in t(e s(opping centre precinct. (e
caf9 is profita%le5 (as a strong positive cas( flo: and may %e seen as a strong via%le and
gro:ing %usiness.
Seavie: Pty 6td :as recently esta%lis(ed for t(e purpose of ac1uiring t(e e3isting caf9
%usiness kno:n as .af9 Paradiso5 located at t(e Mountain $len S(opping .entre. .af9
Paradiso :as one of t(e first s(ops to open at t(e centre and en&oys an e3cellent location
from ic( to operate. Seavie: Pty 6td :ill %e ac1uiring t(e %usiness name .af9 Paradiso.
Brendan and Margaret 8lliott5 o:ners of Seavie: Pty 6td are %ot( e3perienced .af9
o:ners/managers (aving successfully operated a num%er of cafes in +ustralia and overseas.
Brendan is a 1ualified c(ef and (as previously rked for t(e Bilton and t(e Sofitel groups
%efore o:ning (is o:n caf9. Margaret (as a degree in Business Management ?BospitalityA
and s(e too (as rked for t(e Bilton group of companies and for t(e 4ydges group.
Brendan and Margaret :ill rk fullCtime in t(e %usiness and :ill employ an additional four
staff. of t(ose staff :ill rk on a partCtime %asis.
Page 7
3.= Market +nalysis
3.1 Situational * S+OT ,nalysis

S,(E-.,* S,(A,E./
Sales 0 Marketin" G .urrently (olds largest
market s(are in t(e s(opping
Maintain and gro: market s(are %y
improving marketing and promotions %ot(
:it(in and outside t(e S(opping .entre
&ocation :it(in t(e S(opping .entre for
point of sales
Provide 1uality products and services to
generate rd of mout( endorsements and
repeat %usiness
Skills G kno:ledge5 skills and e3perience of
o:ners/managers in running successful caf9
%usinesses previously
rain and develop staff to deliver superior
1uality of products and services
1inancial G o:ners; access to financial
resources and strong cas( flo: from
operations
"und training5 marketing and develop ne:
menu items
2EA3-ESS S,(A,E./
&ocation G capped capacity due to floor
space
,nvestigate t(e option of negotiating
ac1uisition of additional floor space from
ad&oining s(ops
O##O(,4-5,/ S,(A,E./
Economy G *ell positioned to take
advantage of a strong economy5 lo: interest
rates and (ig( disposa%le income
83pand marketing and promotion and
maintain prices at current market levels
Social #atterns G Population gro:t(
?residential developmentA and increased
standard of living
,ncrease advertising and investigate
potential to increase floor space
#6ysical 1actors G ,mproved pu%lic
transport and infrastructure
,ncrease advertising in t(ese surrounding
areas to attract ne: clients
2EA3-ESS S,(A,E./
Environmental G ,ncreased cost of utilities5
suc( as :ater and electrical po:er
6ook at alternatives to develop capacity to
use gas and implement :ater saving
policies and practices
,a7le 18 S2O, analysis an' strate"y 'evelopment
See appendi3 for t(e situational analysis done on %ot( t(e internal and e3ternal environments
Page /
3.2 -ndustry ,nalysis
(e caf9 market is a competitive market :it( franc(ised operators starting to emerge in t(e
coffee s(op segment ?also offering lig(t mealsA5 ic( :ill over time increase concentration in
t(is segment. *(ile t(e level of competition is increasing5 t(e s(opping centre in ic( .af9
Paradiso :ill %e located (as capped t(e num%er of caf9s and coffee s(ops :it(in t(e comple3
?%y covenant in t(e 6ease +greementA. o t(is e3tent5 t(ere :ill %e limited competition and it is
anticipated t(at all caf9s and coffee s(ops :it(in t(e comple3 :ill %e 1uite profita%le.
Hey points a%out t(e caf9 and restaurant industry>
• $reater concentration in (ig(er t(an average (ouse(old income areas
• Sensitive to c(anges in real (ouse(old disposa%le incomes
• rend to:ards singles5 families and %usiness people meeting and eating out
• $ro:t( :it( (ouse(olds increasing purc(asing fre1uency and t(e amount spent in
eac( transaction in t(is area
(e current general trend is for cafes and restaurants to concentrate on offering value for
money :it( an emp(asis on family restaurants5 as :ell as franc(ised opportunities. (e
industry :ill continue to %enefit from (ig(er incomes and time constraints on some
(ouse(olds as :ell as lifestyle c(anges. (is :ill include more dining out or take a:ay food
consumption.
(ere are t(ree key success factors in t(e caf9 industry t(at are essential for t(e %usiness to
do :ell in order to %e competitive. (ese factors are %ased on t(e positioning of t(e %usiness
as :ell as its; place and p(ysical appearance>
• 6ocation of caf9 in terms of>
o Pro3imity to surrounding attractions
o S(ort distance to consumers
o .onvenience and accessi%ility
• P(ysical appearance in terms of>
o .leanliness of premises
o Iuality of food
o Iuality of service
• .lear market position
3.3 Co"petitor ,nalysis
Our t main competitors are .lu% .af9 and .offee 83travaganFa as t(ey %ot( (ave strong
%rand recognition5 :it( (ig( product 1uality and :ellCdocumented processes for (o: t(e
%usiness s(ould %e run ic( comes from %eing a national franc(ise %usiness. Bo:ever5 t(ey
(ave t(e operating %oundaries of t(e franc(isor t(at doesn;t give t(em t(e fle3i%ility to c(ange
menu items so easily. (is fle3i%ility is somet(ing .af9 Paradiso can take advantage of :it(
(aving a c(ef o can develop ne: menu items to meet t(e c(anging preferences of
customers. J(avargo;s .af9 is a%le to %e more fle3i%le to market needs attracting t(e price
conscious clientele :it( an average 1uality product %ut t(is is not t(e market space .af9
Paradiso is competing in.
Our competitors (ave no (istory of discounting and ilst t(e num%er of caf9s :it(in t(e
centre is capped5 pricing s(ould remain very sta%le. (e follo:ing ta%les outline an analysis of
t(e caf9;s competitors5 t(eir products and targeted customers>
Page 2
,a7le 28 Analysis o competitors
9ompany
-ame
Si:e
Sales Mix
;#ro'uct< Service=
/ears in
Business
(eputation (atin"
;1>10=
.lu% .af9 'ational
franc(ise C
2=< market
s(are
.offee5 :ine and %eers
and ot(er %everages5
lig(t meals5 cakes and
dessertsK li1uor licence
2 years C since
t(e centre :as
opened
/ C "ranc(ise c(ain
(as a sound
reputation
.offee
83travaganFa
'ational
franc(ise G
2=< market
s(are
.offee and ot(er
%everages5 lig(t meals.
"ocussing more on
coffee and %everages
2 years C since
t(e centre :as
opened
/ C "ranc(ise c(ain
(as a sound
reputation
J(avargo;s
.af9
6ocal
su%ur%an
caf9.
.offee and ot(er
%everages5 lig(t meals
2 years G since
t(e centre :as
developed
! G -. #aria%le 1uality
,a7le 38 Analysis o competitors? pro'ucts an' services
Marketing mix 9lu7 9ae 9oee Extrava"an:a @6arvar"o?s 9aA
#ro'uct Buality Big( Big( #aria%le
#rice 0pper end of t(e market 0pper end of t(e market 6o: end of t(e
market
#lace<Cistri7ution "ranc(ise G +ustralia
:ide. 6ocally only t(e
one outlet.
"ranc(ise G +ustralia
:ide. 6ocally only t(e one
outlet.
Only t(e local outlet.
#romotion S(op signage5 loyalty
cards5 side%oards and
:ell kno: %rand
S(op signage5 loyalty
cards5 side%oards and
:ell kno: %rand
S(op signage5
side%oards
#eople "ranc(isees and staff
trained up to t(e
standards of franc(isor
"ranc(isees and staff
trained up to t(e
standards of franc(isor
Only t(e local outlet.
#rocesses Locumented processes
and standards to
manage and get t(e
most value out of t(e
%usiness
Locumented processes
and standards to manage
and get t(e most value
out of t(e %usiness
Mainly in t(e (ead
of t(e o:ner
#6ysical evi'ence 8veryt(ing to t(e
standard of t(e franc(ise
from t(e 1uality of t(e
product5 service5 fitCout
of t(e premises and staff
uniforms etc
8veryt(ing to t(e standard
of t(e franc(ise from t(e
1uality of t(e product5
service5 fitCout of t(e
premises and staff
uniforms etc
Standards vary in
terms of 1uality of
products5 services5
staff and p(ysical
surroundings
.af9 Paradiso :ill need to maintain current marketing activities and a (ig( level of service and
product 1uality to ensure its competitiveness. ,t needs to (ave a clear market position to target
and promote t(e 1uality and value for money of products and services.
Page 1=
Page 11
4.= 8lements of Success
!.1 Target Maret
(ere is su%stantial population gro:t( in t(e area as residential development continues and
commercial development commences. (e master planned community attracts a (ig( socioC
economic demograp(ic :it( (ig( employment and (ig(er t(an average per capita income.
.af9 Paradiso customers are t(e passing s(oppers and s(opping centre staff of all ages o
en&oy a fine coffee ?dineCin5 or take a:ayA and a (ealt(y5 valueCforCmoney meal. (e ma&ority
of t(e general pu%lic consulted in t(e s(opping centre :ere families and young singles. (e
cafe :ill make it particularly easy for a young family to en&oy a meal %y providing a range of
c(ildren;s meals and activities. Our take a:ay %everages :ill also appeal to t(is group and
t(e segments made up largely of singles %et:een t(e ages of 1/ G 4= o s(op or rk
:it(in t(e s(opping centre precinct. (ey tend to (ave moderate incomes :it( (ig(
discretionary spending.
(e ma&ority of customers o purc(ase coffee from .af9 Paradiso are @social drinkers;5
follo:ed %y customers o :ant t(eir daily fi3 or a pick me up. (ey are :anting a
convenient5 friendly and rela3ing environment to @rec(arge t(eir %atteries; or socialise over a
fine coffee5 c(oice of %everages and 1uality fres(5 lig(t and (ealt(y meals t(at provide an
alternative to fast food options. (e market need %eing satisfied is %ased on convenience5
1uality and value for t(e coffee drinkers as :ell t(e (ealt( conscious consumer o is
concerned a%out at t(ey eat.
!.2 Co"petitive ,dvantage and .ni/ue Selling Proposition
Our first and main competitive advantage t(at :e possess is our location. .af9 Paradiso is in
t(e %est possi%le location for a caf9 and (as 3 years of t(e initial ! year lease to run5 plus t(e
option of anot(er ! years.
Our second competitive advantage is t(e 1uality and value of t(e :ide variety of lig(t and
(ealt(y meals offered %y t(e %usiness t(at cannot %e matc(ed %y ot(er %usinesses in t(e
centre. ,n addition5 one of t(e o:ners is an ,nternational .(ef o can create ne: menu
items overnig(t ic( gives t(e %usiness t(e fle3i%ility to sell products to meet t(e c(anging
preferences of customers.
Our t(ird competitive advantage is t(e industry e3perience and e3pertise of %ot( o:ners
running successful caf9 and restaurant %usinesses in t(e past.
(ese competitive advantages form t(e %asis of our uni1ue selling proposition :it( t(e slogan
of MParadiso;s G convenient5 lig(t and (ealt(yN and :ill also include :idely promoting t(e
culinary skills of our ,nternational .(ef.
Page 12
!.= Marketing Plan
#.1 Mareting Ob'ectives
(ere are t(ree key marketing o%&ectives>

• o ac(ieve sales of E!3-5-!= for t(e first year and E!/=5=== for t(e second year.
• o ac(ieve estimated 4=< market s(are ne3t 12 mont(s.
• o position t(e %usiness as a convenient place to eat lig(t and (ealt(y meals
o %e revie:ed in - mont(s.
#.2 Mareting Mi0
#(OC49,
Bealt(y and lig(t meals are t(e key point of differentiation for t(e %usiness %ecause t(e .af9
(as t(e capa%ilities and fle3i%ility to develop ne: menu lines to meet t(e c(anging needs and
tastes of customers5 ereas t(e t franc(ise %usinesses in t(e centre must conform to t(e
re1uirements of t(e franc(isor. *(ile t(e ot(er products5 in particularly fine coffee5 are not
uni1ue t(ey do offer e3cellent @value for money; t(at fill t(e price points %et:een t(e (ig( and
lo: ends of t(e ot(er coffee and caf9 %usinesses in t(e centre.
(e caf9 :ill provide t(e rela3ed and friendly environment t(at our customers seek en
searc(ing for a @dine in; meals5 %everages and cakes and desserts t(at offers e3cellent value
for money5 %ut do recognise t(at t(is is not uni1ue as s(o:n in ta%le 4 %elo:>
,a7le 48 +alue #ropositions
Rating: 1 = Lo! 10 = "ig#
#(59E
*e propose to offer (ig( 1uality food and service at a price comparative to our ma&or
competitors G :e :ill meet t(e market on price to retain market s(are if :e need to. Our
clientele (ave a medium to (ig( disposa%le income and seek (ig( 1uality products and good
service5 pricing :ill reflect t(e value of our products and services.
(e s(opping centre (as a @captive market; and given t(e limited num%er of caf9s in t(e
Page 13
Features Benefits Importance (1
to 10
!ni"ue#
$%&
Cafe en$ironment Rela% and ta&e a 'rea& 8 (o
)ine coffee *n+o,ment - social connector 7 (o
Be$erages Refres# and rela% . (o
)res# - lig#t meals "ealt# - ell 'eing 8 /es
0nternational c#ef 1ualit, and $ariet, of meals 8 /es
Ca&es - desserts Com2lements coffee - meals . (o
centre5 prices (ave not %een discounted in t(e market. (ere is no intention to discount to %uy
market s(are as .af9 Paradiso currently (olds t(e largest market s(are of appro3imately 3!<
and :e intend to take it to 4=<5 ilst maintaining e3isting margins.
#&A9E ;i.e. C5S,(5B4,5O-=
.ustomers access and purc(ase our products and services t(roug( our s(op front. (e
location of t(e caf9 is at t(e sout(ern end of t(e Mountain $len S(opping .entre. Mountain
$len is a very large regional s(opping centre dra:ing customers from up to 1! kilometres
a:ay and is surrounded %y a @market; of appro3imately 2!=5=== persons.
,t is situated on t(e main mall5 near t(e ma&or ?nationalA supermarkets and retail fas(ion
clot(ing c(ains. ,t (as a (ig( passing trade due to its close pro3imity to t national
supermarket c(ains and a num%er of :ell kno:n retail fas(ion clot(ing c(ains. (e caf9 is -=
mO and t(ere is t(ree years to run on t(e current ! year lease. +n option to take anot(er !
years is availa%le under t(e lease.
*(en t(e proposed commercial development goes a(ead5 t(e %usinesses located t(ere are
potential customers for a catering %usiness. (e %usiness plan :ill %e revisited at t(is time.
#(OMO,5O-
,n con&unction :it( Mountain $len .entre Management :e :ill %e undertaking a range of
promotions en :e take over t(e cafe promoting t(e ne: o:ners(ip of t(e caf9. (ese
promotions :ill include offers of discounted meals and coffee5 %ut t(ey :ill only run for t
:eeks. *e estimate t(at t(is :ill %e sufficient time to allo: a smoot( transition to ourselves as
ne: o:ners.
Our regular advertising :ill consist of s(opfront +Cframe advertising %oards5 :eekly
ne:spaper advertising and a t(ree mont(ly flyer drop in local mail %o3es. +s most of our
%usiness :ill %e passing trade5 s(op front signage :ill %e %rig(t and appealing. *e :ill
develop and offer a loyalty card sc(eme to increase repeat %usiness.
*ord of mout( advertising is very important and t(e %est advertising :e :ill %e providing is
t(e 1uality of our products and service.
#EO#&E
Bot( Brendan and Margaret 8lliott (ave %een successful o:ners and managers of caf9s.
Brendan is a "renc( trained c(ef and (is skills :ill %e used ne: product lines to meet t(e
c(anging needs and preferences of consumers ic( :ill %e a point of differentiation for t(e
%usiness Margaret :it( (er %usiness and (ospitality %ackground :ill %e responsi%le for t(e
day to day operations of t(e .af9.
key staff mem%er o rked :it( t(e previous o:ner :ill %e retained to (elp :it( t(e
continuity of e3isting relations(ips :it( customers.
#(O9ESS
Ma&or processes are flo:Cc(arted in t(e caf9;s procedure manual t(at are geared to providing
1uality and responsive services to clients as :ell as efficient and effective operations of t(e
cafe. (is includes sufficient num%ers of staff are rking during t(e peak periods to make
sure customers are served in a timely manner. "urt(er information a%out t(e processes in
place are detailed in section / of t(is %usiness plan.
#*/S59A& E+5CE-9E
(e caf9 is fully fitted out :it( ta%le5 c(airs and d9cor t(at pro&ects t(e desire image of 1uality
and value as :ell as aligns :it( t(e 0SP of @6ig(t and Bealt(y G .af9 Paradiso;. (is also
Page 14
applies to uniforms for t(e staff. (e cleanliness of t(e premise5 ta%les and c(airs :ill %e
maintained to a consistently (ig( standard at all times.
Page 1!
#.3 ,ction Plan
,n con&unction :it( Mountain $len .entre Management :e :ill %e undertaking a range of
promotions en :e take over t(e cafe promoting t(e ne: o:ners(ip of t(e caf9. (ese
promotions :ill include offers of discounted meals and coffee5 %ut t(ey :ill only run for t
:eeks. *e estimate t(at t(is :ill %e sufficient time to allo: a smoot( transition to ourselves as
ne: o:ners.
Our regular advertising :ill consist of s(opfront +Cframe advertising %oards5 :eekly
ne:spaper advertising and a t(ree mont(ly flyer drop in local mail %o3es. +s most of our
%usiness :ill %e passing trade5 s(op front signage :ill %e %rig(t and appealing. *e :ill
develop and offer a loyalty card sc(eme to increase repeat %usiness.
*ord of mout( advertising is very important and t(e %est advertising :e :ill %e providing is
t(e 1uality of our products and service. ,n t(is area :ill %e training t(e staff in customer
service skills
*(en t(e proposed commercial development goes a(ead5 t(e %usinesses located t(ere are
potential customers for a catering %usiness. (e marketing plan :ill %e revisited at t(is time.

#.! Sales ,nalysis and $orecast
Our sales analysis (as revealed t(at :e can e3pect on average -5=== customers
?transactionsA per mont( :it( a general mi3 of customers %uying only coffee5 usually @take
a:ay; and t(ose @dining in; %uying a lig(t meal and coffee. Our sales forecast is %ased on an
average industry selling price of E3.!= per cup for coffee and average lig(t meal selling price
of E13.==. *e e3pect t(at t(e mi3 of coffee to meals :ill %e appro3imately 1.!>1 and (ave
%ased t(is on t(e caf9s current figures. On t(is %asis :e (ave pro&ected sales of E!3-5-!= for
t(e first year and E!/=5=== for t(e second year. Sales :ill spike in t(e %uildCup to .(ristmas
and at times of seasonal cele%ration e.g. Mot(er;s and "at(er;s days5 8aster etc. Our Sales
"orecast %y 1uarter is s(o:n in t(e figure %elo:.
Sales performance :ill %e analysed on t(e %asis of sales ?EA per employee.
1i"ure 1 Sales orecast
Page 1-
-.= 6egal Matters and 4isk Management
1.1 Business Structure and Business (a"e
Seavie: Pty 6td (as %een esta%lis(ed to carry on t(e %usiness .af9 Paradiso5 :it(
Brendan 8lliott and Margaret 8lliott %eing t(e s(are(olders and management of t(e
company.
+.'. 111111111
+B'. 3/ 111111111
(e Business 'ame .af9 Paradiso is an e3isting registered %usiness name t(at is
%eing ac1uired %y Seavie: Pty 6td.
B'. 3333333
83pires. Septem%er 2==/
1.2 2egistrations3 4icences and Per"its
,a7le 58 &istin" o re"istrationsD licences an' permits
Cescription o
(e"istration<&icenc
e
Cate O7taine' Expiry Cate
4egistration of
.ompany
Puly 1st 2==7 Ongoing
4egistration of
Business 'ame
Puly 3rd 2==7 Puly 2nd 2==/
+ustralian Business
'um%er ?+B'5 "'5
P+D$5 $SA
Puly 4t( 2==7 Ongoing
"ood Business
6icence
.urrent licence G
Septem%er 2==-
3rd Septem%er
2==7
Page 17
1.3 Contracts and ,gree"ents
,a7le %8 &istin" o contracts an' a"reements
9ontract<A"reement 9ontract
or A"t
/es<-o
9urrent Status
Business Purc(ase .ontract Des +:aiting copy from vendor;s solicitor.
"ranc(ise 'o
S(op 6ease Des
Su%&ect to due diligence and finance
approval. 4efer Business Purc(ase
.ontract.
Plant ) 81uipment Purc(ase/
Maintenance
Des o %e ac1uired as part of t(e
%usiness.
+dvertising .ontracts 'o
,ntellectual Property 'o
Listri%ution 4ig(ts 'o
Purc(ase/Supply .ontracts 'o ,nformal agreements
Service .ontracts 'o
6oan Locumentation Des Bave (eld an initial discussion :it(
t(e %ank G a:aiting a copy of t(e
contract5 loan application
documentation and finalisation of t(e
%usiness plan.
+greements :it( .ustomers and
.ontractors 'o
.ooperative +greements :it(
ot(er Businesses
'o
Page 1/
1.! 2is Manage"ent
,a7le ) (isk assessment
?6Qlo:5 #6Qvery lo:5 MQmedium. BQ(ig(5 #BQvery (ig(A
(isk
Cescriptio
n
&
i
k
e
l
i
6
o
o
'
5
m
p
a
c
t
#
r
i
o
r
i
t
y
#reventative Action
9ontin"ency
#lans
"ire G loss
of
property/life
M B B ,nstallation of smoke alarms and
sprinkler system5 fire e3tinguis(ers
installed and regularly c(ecked5
regular staff training in emergency
fire procedures including
evacuation plans ?s(op ) centreA5
8nsure insurances including fire5
pu%lic lia%ility and %usiness
interruption are ade1uate and in
place
,mmediate
access to
personal
resources to
re%uild s(op
and %usiness
1uickly ilst
:aiting for
insurance
payments
.(ange in
suppliers
terms
M M M Maintain good relations(ips :it(
suppliers and maintain access to
personal cas( reserves
0tilise
alternative
suppliers or
increase
rking
capital ?from
personal cas(
reservesA
"ood
poisoning
#6 #B B 0se 1uality products5 correct
storage of food stuffs5 train staff in
(ygiene principles as part of a
Iuality .ontrol Process
Levelop a
complaint
(andling
process.
,nvestigate
source of food
poisoning and
remediate
Supplier
una%le to
supply
6 M M +rrange alternative suppliers5
evaluate su%stitute products
Purc(ase from
alternative
suppliers or
use suita%le
su%stitute
products
Ma&or
dispute :it(
centre
o:ner
6 M B 8nsure formal lease agreement is
in order. Levelop and maintain a
sound rking relations(ip :it( t(e
.entre Manager.
8ngage
la:yer for
advice
6oss of key
person
#6 M M ake out key person insurance5
effect kno:ledge and skill transfer
to ot(er staff
S(ort term
contract for
suita%le
replacement
?until
permanent
staff can do
t(e &o%A. .all
up insurance
policy
Page 12
1.# -nsurances
,a7le ! &istin" o insurance policies
,ype o
5nsurance
5nsurer an'
#olicy E
Annual
#remium
9ommencement
Cate
Expiry Cate
Business
Package
IB8 E 154== ,nsurances :ill %e
arranged upon
e3ecution of t(e
contract.
,ndemnity
,nsurance
IB8 E !== ,nsurances :ill %e
arranged upon
e3ecution of t(e
contract.
Hey Person
,nsurance
+MP E !== ,nsurances :ill %e
arranged upon
e3ecution of t(e
contract.
*orkers
.ompensation
*ork.over E 2== ,nsurances :ill %e
arranged upon
e3ecution of t(e
contract.
(e %usiness package :ill include pu%lic lia%ility5 fire5 t(eft5 %urglary and %usiness interruption
insurance. (e a%ove is %ased on 1uotes o%tained from our ,nsurance Broker. ,nsurances :ill
%e finalised once t(e contract (as %een signed.
Brendan and Margaret (ave life insurance and income protection policies already in place.
1.1 -ntellectual Property
,a7le $ &istin" o intellectual property oFne'
5# Cescription (e"istere' Gyes<no 9ommencement Cate Expiry Cate
(e %usiness does not (old any ,ntellectual Property at t(is stage.
,a7le 10 &istin" o permissions or use o intellectual property
5# Cescription (e"istere' Gyes<no 9ommencement Cate Expiry Cate
(e %usiness does not re1uire any permission for use of ,ntellectual Property at t(is stage.
(e caf9 :ill not %e providing eit(er live or recorded music.
Page 2=
7.= Buman 4esource Management
(e management of t(e %usiness comprises Brendan and Margaret 8lliott o %et:een t(em
(ave significant e3perience in t(e (ospitality industry. Brendan is a 1ualified c(ef and (as
successfully managed a num%er of restaurants %ot( (ere and overseas. Margaret (as
e3perience in t(e @front; and @%ack; offices of resort (otels and is (ig(ly respected in t(e
industry for (er management skills.
(e ma3imum staff re1uirement ?including t(e o:nersA is estimated at - employees. of
t(e employees :ill %e employed on a partCtime %asis. (e main skill sets re1uired are food
preparation5 sales5 customer service5 front counter5 stock control and management. ,t is
planned to retain t staff mem%ers from t(e previous o:ners(ip and recruit t more
appropriately 1ualified staff. *e :ill %e taking t(em t(roug( our inC(ouse induction program
prior to opening.
Salaries and :ages in t(e first year are estimated at E1/25=== and E2==5=== in t(e second
year of operation.
5.1 Organisational C)art
Staff at .af9 Paradiso :ill %e organised into t teams. eam 1 :ill %e (eaded %y Margaret
8lliott and :ill %e responsi%le for customer service and administration. Brendan 8lliott :ill
(ead eam 2 ic( :ill %e responsi%le for t(e food preparation and t(e kitc(en.
Margaret :ill (ave primary responsi%ility for staff5 accounting5 sales5 marketing5 and managing
t(e operation of t(e .af9. Brendan :ill %e responsi%le for B45 stock control5 t(e kitc(en and
food preparation.
Page 21
3ners/4anagers
5eam Leader 2 5eam Leader 1
5eam 1 5eam 1
5.2 O6ner/Operator Sills and 70perience
,a7le 118 Summary o oFners? knoFle'"eD skillsD HualiicationsD an'
relevant experience
-ame #osition 3noFle'"eD SkillsD
Bualiications an' Experience
Brendan 8lliott O:ner/ManagerK .(ef "renc( trained c(ef5 international
and local e3perience. 6ocal
restaurant and caf9 e3perience
Margaret 8lliott O:ner/ManagerK
Business ManagerK
responsi%le for t(e day
to day running of t(e
.af9
Legree in Business Management
?BospitalityA. *orked for t
national franc(ise c(ains5 :it( t(e
last role involving turning around
t(e underperforming restaurants
of t(e Botel/Motels
5.3 -ndustry 8no6ledge and 70perience of 8ey Personnel
,a7le 128 Cetails o personnel Fit6 speciic in'ustry knoFle'"e an'
experience
-ame
#osition 3noFle'"e<Experience
Staff Mem%er 1
.ustomer Service *orked :it( previous o:ners
Staff Mem%er 2
Staff M
.ustomer Service
.ustomer
*orked :it( previous o:ners
Page 22
5.! 9u"an 2esource 2e/uire"ents
,a7le 138 Analysis o 6uman resource reHuirements
(e
team of
staff
:ill %e
comprised of Brendan and Margaret5 plus t service staff ?counter and :aitingA5 one
assistant @c(ef;5 and one @kitc(en (and;. of t(ese staff :ill %e casual and :ill rk on a
partCtime %asis. (is e1uates to ! full time e1uivalents ?"8sA.
,a7le 148 Sta an' Fa"es estimate
-um7er o Sta
2a"es I
9urrent
/ear
-ext
/ear 1
-ext
/ear 2
9urrent
/ear
-ext
/ear 1
-ext
/ear 2
+dministration
Sales/Marketing 3 3 4 E/25=== E2=5=== E1==5===
Management 2 2 2 E1==5=== E11=5=== E12=5===
Production
Secretarial
O+6 ! ! - E1/25=== E2==5=== E22=5===
(e a%ove includes casual staff. Staff :ill %e employed under t(e Bospitality +:ard.
5.# b ;escriptions
0nder revie:.
5.1 7"ploy"ent Conditions
+s per Bospitality +:ard.
Page 23
1ull ,ime Sta #ermanent
#art ,ime
9asual Sta 9ontractors
eam 1 2 1
eam 2 2 1
.atering
otal 4 2
5.5 Training and ;evelop"ent
,a7le 158 Analysis o Hualiications<skills 0 competencies
Actual ;1>10= 1orecast ;1>10=
+dministration / /
+ccounting/ Bookkeeping / /
.omputer/8"POS 1= 1=
6egal Matters / /
Marketing/ Sales 2 C 1= 2 C 1=
Management 2 C 1= 2 C 1=
Personnel / /
Production/Process / /
4esearc(/ ec(nology / /
Secretarial 1 1
Strategic Planning / /
Ot(er
(e skills and competencies are largely covered %y Brendan and Margaret and professional
e3pertise :ill %e provided %y our e3ternal la:yer and accountant.
,a7le 1%8 External or internal on>t6e>Jo7 trainin" courses
Sta Mem7er
,rainin" 9ourse
Cetails
Cate Curation 9ost
+ll team
mem%ers ?!
"8A
,nduction .ourse Prior to
opening5
t(en as
re1uired.
2 days E254==
5.< +orplace 9ealt) and Safety
(e rkplace (ealt( and safety plan is %ased on t(e advice and guidance provided %y
*orkplace Bealt( and Safety Iueensland :::.rksafe.1ld.gov.au and t(eir fact s(eets for
t(e restaurant and caf9 industry.
Page 24
/.= Operations
<.1 Business Pre"ises and 4ocation
+t present t(e only facility :e :ill %e using is t(e caf9. ,t is ideally located :it(in t(e s(opping
centre to attract passing customers and is also relatively close to our main suppliers i.e.
grocer and %akery. (e caf9 is fully fitted out and is fit for purpose.
(ere is no need for a separate operating location at t(is point in time. (ere is an opportunity
to roast coffee %eans and manufacture t(e caf9;s o:n %lends at a later date. ,f t(is occurs5 it
may %e necessary to ac1uire operating premises to implement t(e idea.
<.2 Plant and 7/uip"ent 2e/uire"ents
Set out %elo: is a listing of t(e minimum plant and e1uipment items t(at are re1uired to
successfully operate t(e .af9. + sc(edule of t(e plant and e1uipment ?and t(eir valuesA
contained in t(e purc(ase price :ill %e included in t(e contract documentation and :ill %e
su%&ect to due diligence. (e purc(ase price of t(e plant and e1uipment items listed %elo: is
stated in t(e contract at E!=5===.
(e items to %e ac1uired in t(e purc(ase price are t years old and :ill %e su%&ect to a
Mortgage Le%enture .(arge as part collateral for t(e %ank loan.
*e :ill undertake routine maintenance and plan t(e replacement of plant and e1uipment
items on t(e %asis of annual condition assessments.
,a7le 1)8 &istin" o plant an' eHuipment
Page 2!
Cescription o #lant <
EHuipment 5tem
-um7er reHuire' 9ost an' 6oF
inance'
On"oin" costs an'
Maintenance
Iuality coffee maker 1 ,ncluded in t(e purc(ase
price.
0nder :arranty
Small commercial
kitc(en
1 ,ncluded in t(e purc(ase
price.
+nnual maintenance
c(eck
Benc(es ) cup%oards5
sinks/drains
,ncluded in t(e purc(ase
price.
4eplace as necessary
"urniture G .(airs )
ta%les
3- c(airs
1= ta%les
,ncluded in t(e purc(ase
price.
4eplace as necessary
Signs 3 ,ncluded in t(e purc(ase
price.
4eplace :it(in -
mont(s as part of
promotional strategy
.rockery5 cutlery and
linen
72 settings of
crockery and cutlery
,ncluded in t(e purc(ase
price.
4eplace as necessary
POS 81uipment
?including soft:areA5
computer
1 of eac( ,ncluded in t(e purc(ase
price.
0nder :arranty
<.3 Purc)asing and Supply
Brendan (as contacted all e3isting suppliers and (as negotiated supply arrangements on very
attractive terms. +t t(is point t(ere are no :ritten contracts alt(oug( t(ree suppliers (ave
indicated t(at t(ey are currently preparing contracts for e3ecution. *(ere suppliers do not
provide formal contracts :e :ill %e re1uesting an e3c(ange of letters to confirm t(e %asic
arrangements.
,n most instances local alternative suppliers e3ist. *(ere local alternative suppliers do not
e3ist5 :e (ave identified alternative suppliers from near%y regions o (ave t(e capacity to
meet t(e caf9;s needs in a timely manner at a reasona%le cost.
,a7le 1!8 &istin" o maJor suppliers
-ame
#ro'uct<
Service
+olume
#urc6ase'
,ra'in" ,erms Alternate Suppliers
Mountain $len
"ruit )
#egeta%le
Supplies
"res( fruit and
vegeta%les
E154== per :eek 3= days +lternative local supplier
@(e $reengrocer;
asty Meat )
Lelicatessen
Supplies
"res( meat5
manufactured
meat5 and
delicatessen
items
E!== per :eek 3= days +lternative local supplier
@Mavs Meat Supplies;
Mountain $len
Bakery
Supplies
"res( %read5
rolls5 and flour
etc
E152== per :eek 3= days +lternative local supplier
@(e Laily Bread;
.af9 Supplies
Pty 6td
Plant and
e1uipment
+s re1uired. 3= days 'o local alternative
supplier
,nterstate options
Bot S(ot
.offee
Supplies
.offee %eans E1!= per :eek 14 days 'o local alternative
supplier
,nterstate options
B*S ?Lrink
SuppliersA
*ines5 %eer5
soft drinks
E3!= per :eek 3= days
+ num%er of alternative
suppliers e3ist
#arious
0niforms 4 0s Staff uniforms )
%adges
4 per 1uarter 3= days +lternative local supplier
@*ork:ear;
.af9 Supplies
Serviettes5
ta%leclot(s5
promotional
material
3= days 'o local alternative
supplier
,nterstate options
Page 2-
<.! Operating and Production Processes
Our ma&or processes are sales5 food and %everage preparation5 ta%le service and stock
control ?ordering5 storing5 controllingA. Ma&or processes are flo:Cc(arted in t(e caf9;s
Procedures Manual. + copy of t(is is appended to t(e %usiness plan. (e processing of Point
of Sale ?POSA transactions is electronic5 :it( transactions %eing automatically posted into t(e
accounting system ?ic( incorporates a stock control systemA. (e ta%le %elo: represents
t(e current and t(e planned level of operation and t(e standard of t(ese operations.
,a7le 1$8 Analysis o operatin" acilities an' processes
Cetail 9urrent &evel
o Operation<
Stan'ar'
Meets 5n'ustry
Stan'ar'
#lanne' &evel
o Operation<
Stan'ar'
Meets 5n'ustry
Stan'ar'
Plant/Office .apacity @Line in; seating
for 3-.
Des 3- R May need
to increase floor
space
Des
Sc(eduling
?operation5
se1uences ) timingA
.urrent
sc(edules
rking :ell.
Des 8fficient5
effective )
economical
Des
81uipment/ooling
4e1uirements
81uipment
sufficient for our
needs
Des Maintain and
replace as
re1uired.
Des
6ayout of %usiness
premises
Premises :ell
designed and lay
out e3cellent.
Des 4evie: design
and lay out if
additional space
ac1uired
Des
Material
4e1uirements
+ll goods and
produce readily
availa%le at
reasona%le
prices
Des 'o c(ange
envisaged at t(is
time.
Des
6ocation 83cellent Des 83cellent
location
Des
Listri%ution .ustomers come
into t(e caf9.
Des .ustomers come
into t(e caf9.
Des
Iuality .ontrols I+ system
rking :ell
Des Ongoing
continuous
improvement
Satisfies all
industry
re1uirements
Staffing 6evels +de1uate at
present
Des. +ll
appropriately
trained
+ppropriate Des
Purc(asing lead times 83cellent. $reat
service from
suppliers
Des 'o c(ange
envisaged at t(is
time.
Des
Page 27
<.# Stoc or -nventory
+ll stock at t(is stage :ill %e stored @on site; at t(e caf9. "res( produce suc( as vegeta%les
are purc(ased in vacuum sealed %ags or cartons and meat in vacuum sealed packs. (ese
:ill %e stored in a small commercial refrigerator. Ot(er items suc( as coffee %eans5 canned
and packaged products :ill %e kept in t(e storage cup%oards.
Ot(er peris(a%les including cakes and c(eese cakes :ill %e kept in refrigerated display
ca%inets and :ill %e stored for a ma3imum of t(ree days.
On average5 :e e3pect to turn stock over once per :eek.
Stock :ill %e controlled using our stock control system5 ic( is a module of t(e accounting
soft:are package.
<.1 -nfor"ation Co""unication Tec)nology Syste"s
,. systems include t(e computerised 8"POS system5 linked to t(e accounting system. (e
8"POS system :ill process Lirect Le%it5 .redit .ard5 and .as( transactions directly to t(e
%ank and t(e accounting system. (e accounting system :ill process t(e payroll5 stock
control5 general ledger transactions and maintain t(e Buman 4esource records.
(ese systems effectively reduce manual accounting and processing to a minimum. (ey
provide real time reports5 t(us en(ancing productivity and management decision making.
<.5 Operational $orecast
*e (ave pro&ected sales transactions at 1752== for I4 15 125!== for I4 25 1!52== for I4
35 and 1/5-== for I4 4. Our average sale price is estimated to %e E7.4- :it( t(e average
cost of sales at E2.2=.
Our average num%er of employees is estimated at ! :it( - re1uired at peak times. (is
includes %ot( full time and casual employees.
Profit per person is pro&ected at E4544/ per mont(. Our target for client satisfaction is a rating
of /!< for t(e first year.
1i"ure 2 Operational tar"ets
Page 2/
,a7le 208 Analysis o operational perormance ;existin"<planne'=
Operational 1eature
(atin" out o 10
-otes > Met6o's or
5mprovement 9urrent
Expecte' ;in
next % mont6s=
.ost / 2 .(ange menu to matc(
seasonal availa%ility and cost of
food items
Iuality 7 2 Ongoing I+ audits and training
*astage / / Monitor stock control ?orders )
:astageA
"le3i%ility 2 1= *orkplace +greement
Skill 6evels 7 / On t(e &o% training5 mentoring
and coac(ing
Lependa%ility 1= 1= 'one at present
Sc(eduling 1= 1= 'one at present
Lo:ntime 1= 1= 'one at present
Safety
1=
1= 'one at present
Service / 1= rain staff and encourage
e3cellence in service
ec(nology 7 / On t(e &o% training for t(e
8"POS
,nnovation 7 2
8valuate c(anges in consumer
tastes and %e(aviour and
monitor t(e menus of t(e
leading restaurants and caf9s
(e current rating is %ased on our o%servation of t(e e3isting operation under t(e current
o:ner. *e propose to lift standards significantly :it(in a fe: mont(s of taking over. *e
%elieve t(at t(is is necessary and ac(ieva%le.
Page 22
2.= "inancial Plan
a%les attac(ed>
• Sales "orecast
• StartCup Budget
• +nnual Profit Budget
• Profit and 6oss Statement ?2 years pro&ectedA
• +nnual .as( "lo: Budget
• Balance S(eet ?2 years pro&ectedA
• BreakC8ven +nalysis
• "inancial +nalysis
=.1 Start>.p Budget
(e startCup %udget is estimated at E 2=25/1= %roken up into @one off; costs of E1/753== and
mont(ly e3penses in advance of E 225!1=. ,ncluded in t(e @one off; costs is good:ill valued at
E12=5=== and plant and e1uipment of E !=5===. (e startCup %udget is s(o:n in "igure 3
%elo:.
1i"ure 3 Start>up 7u'"et
Page 3=
Page 31
(e StartCup %udget is to %e funded %y :ay of e1uity in&ection of E1=452=! %y t(e o:ners and
a loan over t years from t(e %ank. (e %ank loan :ill %e repaid out of t(e %usiness; strong
cas( flo:. ,f cas( flo: is reduced for any reason5 Brendan and Margaret (ave personal
financial resources to more t(an ade1uately cover t(e loan repayment. + Mortgage Le%enture
over t(e %usiness is %eing offered as collateral along :it( t(e Lirectors personal guarantees.
=.2 ,nnual Profit Budget
(e pro&ected profit for t(e first year of operation is E1=25/-25 :it( t(e second year pro&ected
at E131517!. (ese pro&ections (ave %een %ased on t(e +nnual Profit Budget ?copy attac(edA.
"inancial Big(lig(ts over t(e 2Cyear period are summarised in t(e figures %elo:.
1i"ure 4 /ear 1 inancial 6i"6li"6ts
1i"ure 5 /ear 2 inancial 6i"6li"6ts


$ross Margin is calculated at 71< for Dear 1 and 71.!< for Dear 2. 'et Profit Margin ?Before
a3A is calculated at 2=.!<. for Dear 1 and 22.-< for Dear 2.
(e %usiness is 1uite profita%le and margins are sustaina%le over t(e medium to longer term.
Page 32
=.3 Cas) $lo6 $orecast
(e .as( "lo: "orecast pro&ects a very (ealt(y cas( surplus on trading for eac( mont( :it(
t(e endCofCyear @cas( from operations; calculated at E1=!5/47 and an ending cas( %alance of
E14!5-!7.
Brendan (as negotiated very favoura%le credit terms of 3= days from all suppliers for t(e first
12 mont(s5 alt(oug( in most cases t(ese arrangements are not in :riting. ,f all suppliers
reduced t(eir terms to 7 days cas( flo: for t trading mont(s5 t(e peak cas( s(ortfall uld
%e appro3imately E152== for a%out 2 mont(s.
Brendan and Margaret (ave significant li1uid assets to call upon s(ould t(is eventuate.
On t(e figures provided and t(e arrangements negotiated5 t(e %usiness (as a strong and
positive cas( flo:. "igure - %elo: s(o:s t(e pro&ected cas(Cflo: %y 1uarter.
1i"ure % #roJecte' cas6 loF 7y Huarter
-et 9as6loF
Bu'"et 7y B,(
=
1=5===
2=5===
3=5===
4=5===
!=5===
-=5===
IBudget
Budget !251/7 2!54=2 275247 125-/1
I4 1 I4 2 I4 3 I4 4
Page 33
=.! Balance S)eet
(e opening Balance S(eet s(o:s an e1uity position of E1=452=! gro:ing to E2145774 at t(e
end of Dear 1 and to E34!5242 at t(e end of Dear 2. By t(e end of Dear 2 t(e %usiness :ill %e
clear of any de%t and %e @cas(ed up; to take advantage of furt(er opportunities in t(e market
place.
1i"ure ) #roJecte' openin" 7alance s6eet an' year>en' 7alance s6eet
Page 34
=.# Brea>7ven ,nalysis
(e BreakC8ven point (as %een calculated at 413/ transactions at an average selling price of
E7.4-. (is e1uates to a contri%ution margin of E-.3/ per transaction and a BreakCeven sales
point of E3=5/-2 per mont(. (e pro&ected level of sales for eac( mont( is :ell a%ove t(e
BreakCeven level ?appro3imately 3=< a%oveA.
1i"ure ! Break>even analysis
Page 3!
Break
-
Even
$
Monthly Sales
Page 3-
Break-Even Chart
0
10,000
20,000
30,000
40,000
50,000
60,000
1,655 2,483 3,310 4,138 4,966 5,793 6,621
Monthly Unit Sales
$
Monthly unt sales
=.1 $inancial ,nalysis
(e 4eturn on O:ners 81uity calculated on t(e pro&ected end of year financial performance
and position indicates a return on investment of !1.2<. 4eturn on otal +ssets is calculated at
37.3<. $ross Profit Margin over t(e period is estimated at 71< :it( t(e 'et profit Margin
estimated at 2=.!<.
1i"ure $ 1inancial ratio analysis
(e a%ove ratios indicate a very solid financial performance over t(e period.
Page 37
(e .urrent 4atio and t(e Iuick 4atio ?+cid estA are %ot( very (ig( reflecting t(e fact t(at
t(e %usiness (as a very strong and positive cas( flo:. (is is due to sales %eing
predominantly cas(5 ilst purc(ases are %oug(t on largely on 3= day terms. 6i1uidity is
sound.
(e %usiness also en&oys a sound financial position :it( t(e Le%t to 81uity ratio calculated at
37.2< and Le%t to otal +ssets at 27.1<.
Assumptions
+verage sale price E7.4- per transaction
+verage cost E2.2= per transaction
Sales transactions range from !2== per mont( to 7!== in peak period
Bistorical gross profit margin of 7=< :ill (old.
Seasonal fluctuations G .(ristmas and 'e: Dear are peak periods of sales activity ?%uild up
from 'ovem%er5 t(e after 'e: Dear slo: to "e%ruaryA
(e %usiness operates on a cas( %asis for reporting and paying ta3.
P+D$ ?:it((oldingA is remitted mont(ly on t(e ,nstalment +ctivity S(eet ?,+SA5 :it( $S
remitted 1uarterly in arrears on t(e Business +ctivity Statement ?B+SA.
Page 3/
1=.= "inancial *orks(eets
(e follo:ing documents (ave %een attac(ed>
• Sales "orecast
• StartCup Budget
• +nnual Profit Budget
• Profit and 6oss Statement ?2 years pro&ectedA
• +nnual .as( "lo: Budget
• Balance S(eet ?2 years pro&ectedA
• BreakC8ven +nalysis
• "inancial +nalysis
Page 32
Page 4=
StartC 0p Budget


MO'B6D 8SP8'S8S
Pro&ected
Mont(ly
83penses
.as(
needed to
Start
< of
otal
Salary of o:nerCmanager E/5=== E/5=== 3./<
+ll ot(er salaries and :ages E75=== E75=== 3.3<
4ent/lease E252== E252== 1.=<
+dvertising ) promotion E2== E2== =.1<
Lelivery e3pense
Supplies ?stockCinCtradeA E351== E351== 1.!<
elep(one E3== E3== =.1<
Ot(er utilities ?electricity5 gas etcA E!== E!== =.2<
,nsurance
.onsuma%les E3== E3== =.1<
,nterest E4-= E4-= =.2<
Maintenance E2== E2== =.1<
6egal and Professional costs E2!= E2!= =.1<
Page 41
Miscellaneous
Su%total E225!1= E225!1= 1=.7<
One OffT .osts
"i3tures and 81uipment E!=5=== 23./<
"itout
,nstallation c(arges
Starting ,nventory E35=== 1.4<
Leposits for utilities ?electricity5 gas etcA E4== =.2<
6egal and professional fees E257!= 1.3<
4egistrations5 licenses and permits E15=== =.!<
+dvertising and promotion for opening E!!= =.3<
.as( E!5=== 2.4<
Ot(er E1245-== !2.4<
Su%total E1/753== /2.3<
Page 42
Page 43
Page 44
Page 4!
Page 4-
Page 47
Page 4/
Page 42
11.= +ction Plan
+ction Priority
Late
,nitiated
Late for
follo: up
Person/s
4esponsi%le
*ork/
Stages to %e
done
Leadlines
.omplete due
diligence
?including
purc(ase
contractA
1 May 1/t( May 2!t( +ccountant
6a:yer
Pune !t(
4evie:
insurances and
arrange as
re1uired
1 May 1/t( May 2!t( ,nsurance Broker Pune !t(
.(eck t(at all
necessary
licences and
permits are (eld
1 May 1/t(
May 2!t(
Brendan 8lliott Pune !t(
4evie: %usiness
plan
1 Pune 7t( Pune 1=t( +ccountant Pune 1=t(
Prepare finance
proposal
2 Pune 11t( Pune 1!t( +ccountant Pune 1!t(
Su%mit finance
application
2 Pune 1-t( Pune 1-t( +ccountant Pune 1-t(
+rrange
settlement date )
(andover
2 Pune 2!t(
Pune 2!t(
6a:yer Pune 2!t(
Page !=
12.= 4efining t(e plan
(is section uld not %e retained en presenting t(e %usiness plan to ot(er parties e.g. potential
lenders and investors.
Page !1
+ppendices for Business Plan
,ppendi0 1? Situational analysis @ e0ternal environ"ent
External Environment Opportunity ,6reat
5nluence
;1>10=
E9O-OM598
Stage of t(e economic cycle
Des 7
.urrent interest rate
Des 7
+verage disposa%le income
Des -
L8MO$4+PB,.
Population gro:t( and makeCup
Des !
Bouse(old structure ?e.g. singles.
familiesA
Des -
$eograp(ic distri%ution
Des /
6evel of education
Des 7
,E9*-O&O./8
,nnovations in t(e manufacturing
process
ec(nological developments ?su%stitute
productsA
SO.,+6/.0604+6
.orporate social responsi%ility
Des !
8nvironmentally friendly @green;
products
Des -
Standard of living
Des 7
Percentage of rk to leisure time
Des !
PO6,,.+6/68$+6>
4egulatory environment and legislation
.ompliance :it( standards and codes
E-+5(O-ME-,A&
.limate .(ange ) .ar%on rading
8coCefficient manufacturing
PBDS,.+6 "+.O4S>
.limatic conditions
*ater restrictions
Des -
,nfrastructure C transport5
communications and services
Des /
Page !2
,ppendi0 2? Situational analysis @ internal environ"ent
Page !3
5nternal Environment Stren"t6 2eakness
1actor
;1>10=
S,(A,E./
.ompetitive advantage C a%le to differentiate
Des 7
Hey drivers of t(e %usiness are kno:n
Des /
Strategy and resources for gro:t(
Des !
Letailed action plan
Des /
SA&ES 0 MA(3E,5-.
.lear evidence of market need for your
product/service
Des 7
Hno: your specific market ) competitors in
detail
Des /
Hno: e3actly o your target audience is and
%e a%le to descri%e t(em in detail
Des -
Spend more resources on your current and
most profita%le customers
Des 7
.ompetitive and profita%le pricing strategy
Des /
Dour marketing plan and %udget
Des /
Measure5 learn from and adapt your marketing
activities
Des 7
S,(49,4(E
Business structure G ma3imise :ealt( and
minimise risk ?e.g. sole trader5 company5
partners(ip5 trustA
Des !
Listri%ution and sales to target markets
Des 2
+re your %uildings and facilities ade1uateU
Des for current
level of demand
Des G limited
capacity for
e3pansion
7
,s your e1uipment effective and up to dateU
Des !
+%le to protect your ,P from %eing copiedU
S/S,EMS
,nformation and management systems ?e.g.
.4MA
Des !
Performance measurement and re:ards
Des !
Locumented processes and systems
Des -
Strong de%t collection systems
Des /
Purc(asing systems and inventory
management
Des /
S,A115-. 0 S35&&S
4ecruit t(e rig(t people
Des /
raining and development of staff
Des 7
Staff motivation5 satisfaction and remuneration
Des 7
Page !4
Page !!

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