Executive Summary
For coffee addicts, a good and ambient atmosphere is necessary for relaxation. A Java Culture coffee place in as a handy necessity when it comes to a place where people will get to relive their lives’ stresses, meet their friends. As for the book worms, this place, they will be able to read a book of their choice comfortably a coffee sip being the only interference. There is an ever increasing coffee demand by coffee lovers and the like in the market. This coffee shop will come in very handy to offer the highest quality of well brewed gourmet coffee possible, a great service to all customers and comfort. Java Culture coffee place will take advantage of being in close proximity to University of California and is determined to lay its basis on an essential group of customers who will take coffee there repeatedly. Whatever that will make this coffee place very unique and stand out is that its customers will be offered a book for reading and while they take their coffee. The coffee will also be served with freshly baked pastries which will compliment the sweet taste of gourmet coffee. The combination of the comfort, ambience, pastries and gourmet coffee will make this place very enjoyable to all the patrons who will visit.
The Java Culture coffee place is set to operate in a premise that measures 2,500 square foot. This place will be accessible by car and one can also walk the distance from the University of California. A four year lease has helped the planners of this idea to get the space and there is great deal of probability that the lease can be extended. In addition to that, the owners have given out $ 150,000 out of the $ 201,100 funds that are required for starting the business. The remaining $51,100 will be obtained as a commercial loan that is will be given by the Bank of America.
Businesses are expected to make a revenue target and evaluate the acheivement and variances from the targeted results (Arkebauer 2). In the financial year of 2010, the business is expected to generate revenue from sales valued at $242,550 and it is projected to grow to $ 4,042,500 in the next three financial years. This business will strive to ensure that the gross profit margin does not go below 60%. Java Culture coffee place is also expected to operate within operating expenses that are justifiable and reasonable. If all this can be achieved, the net profit of this company is set to grow from $-154,750 to $665,250 at that same duration.
Objectives
The goals for Java Culture coffee place during its first year in business are:
- To be ranked as one of the best coffee bars in the area in accordance with the local guide for coffee bars.
- To be able to make profits during the initial month of operation. To see that the business’ gross margin is maintained at 60%.
Means to Success
The means to succeed will be:
- The interior and outside decoration will be made to be visually attractive and enticing to the patrons.
- The operations will be carried out in such a way that there will be very fast and efficient services delivered.
- All the employees will be offered training to ensure that they know all the coffee preparation methods.
- The marketing strategies that will be put in pace will ensure that they get to build a firm foundation of loyal patrons and in doing so, maximize sales of products like espresso coffee that have a high profit margin.
Mission
Java Culture Coffee place will use all its efforts to ensure that this place will offer unique and best services in town. The place will be designed in such a way that the patrons will socialize, relax in the ambient environment and at the same time enjoy their gourmet coffee.
This place is set to offer the clients a place where they will reduce their daily stresses due to its proximity to college. The Java Culture Coffee place will also have a service that is customer friendly and give services and products of the highest quality possible. The business intends to use its income to make the employees to be satisfied in their work and give good returns to the owners.
Management and Organization
The main owners of Java Culture Coffee place are xxx and yyy. Java Culture is majority-owned by Arthur Garfield and James Polk. Mr.xxx is a graduate of University of California’s business school. He has majors in business administration. Foe close to 10 years now, he has worked as a business consultant for several upcoming businesses. He has also operated a cab business in California known as Cleanor which he sold off last year. Due to his business operation and attending of college in California, he has got several business contacts. Miss yyy holds a Bachelor’s in Psychology from the University of Oregon. He has worked as a successful operations manager in a French restaurant Bon Appetit in Richmond area. During his tenure ate the restaurant, the profit margins expanded greatly while the operating expense reduced.
Conversely, due o the commitment of the investor’s in other interests, they will hire a professional manger who will be responsible for making management decisions and overlook the operations. He will be paid an annual income of $35,000 and three full time baristas who will be paid $25,000 annually. The baristas will be charged with the responsibility of preparing the coffee. After the end of the third financial year, another barista will be hired due to the projected annual increase of sales. Because of the investors’ other commitments they will not be involved into the daily management decisions at Java Culture. A professional manager ($35,000/yr) will be hired who will oversee all the coffee bar operations. Two full-time baristas ($25,000/yr each) will be in charge of coffee preparation. Four more part-time employees will be hired to fulfill the staffing needs. In the second and third year of operation one more part-time employee will be hired to handle the increased sales volume.
Management Team
There will be a full time manager who will be hired to overlook the day to day transactions at the coffee place. The manager to be hired has experience in running the same business in California. His key roles will be staff management, making inventories, and handling the suppliers. Other responsibilities include creation of a marketing strategy. On the basis of operational outcome of the initial year of operation, the manager may be included in an arrangement where he shares the profit with the major shareholders.
Management Team Gaps
In spite of the experience that the manager to be has and the owner’s of Java Culture coffee place have, they will have to retain the consultancy services of International Espresso Inc. This is the company that carved out the idea for this business. This company is credited with having about 15 years of experience while operating in the retail industry of coffee. During this tenure, they have assisted in starting of around 20 coffee bars in the US alone and about 10 in the major metro cities in the world. They have also assisted in evaluation of business opportunities. Other areas are carrying out of market research with customer satisfaction surveys being inclusive.
Personnel Plan
The table below illustrates Java Culture Coffee place’s personnel outline:
Product Service Plan
The customers to this coffee place will be served the best coffee drinks in town. To prepare this high quality coffee, the baristas will be trained to adhere to the preparation recipes. The plan of the store, the prices on the menu and all the marketing features will be done in such a way that the sales of espresso coffee will be maximized. Other drinks which will be served are freshly brewed coffee, tea and other beverages that will refresh the clients. There will also be pastries, sandwiches sold to the customers to compliment the coffee. For those gourmets coffee addicts who prefer to prepare their coffee at home, the Java Culture Coffee place will also sell coffee beans.
In addition to the beverages and pastries, there will also be free journals and books for patrons to read while in the coffee place.
Product Description
The coffee place will have a menu that is firmly based on the espresso coffee beverages. These include the cappuccino, lattes and Machiatto’s. These drinks will be served together with soy milk. Other varieties of milk available will include whole or skimmed milk. All the espresso drinks will be prepared using the special espresso machine. There will be great adherence to the preparation guideline such that the amount of coffee used to prepare each “shot “ is measured well, water and temperatures appropriate. This is because any small deviation in the ingredients can cause serious variances in taste.
Sales Literature
Two weeks prior to the opening of this coffee place, there will be distribution of marketing and awareness materials. These include flyers and postcards which will be distributed to the offices.
Market Analysis Summary
Intake of coffee among US residents has increased steadily. Of all kinds of coffee drinks, the consumption of gourmet coffee has had the most stable and ever-increasing growth. The coffee drinkers in California are well known for their strong prevalence of gourmet coffee and also insist on being given good services. The Java Culture coffee place will use all its resources to ensure that it meets the taste of the customers in terms of service and satisfaction.
Market Segmentation
According to the market research that has been conducted, the, customers will be segmented as follows: teenagers in the University of California environs, the students, workers and faculty of the University. The market was segmented into those areas because the intake of gourmet coffee relies on the level of education of a person and income.
Target Market Segment Strategy
Java Culture Coffee place’s aim is to meet the needs of persons who want to get their day to day cup of coffee in an ambient atmosphere. The customers with such demands have different ages. The location of the coffee place near the University of California implies that most patrons will be students and faculty members. Market research for this business pointed out that most people tend to go for places where they will relax and get coffee that soothes their taste buds. Besides that, most university students and the faculty members love to meet in such places with their friends or class mates.
Operation Analysis
The marketing strategy fro this business will target on maintaining of patrons, retaining current and attraction of new clients. If the Java Culture coffee place will be able to maintain a stable client foundation, then it will be easy for those customers to be able to refer new clients to the place. This will make the business to generate and maximize the sales.
Competitive Edge
Java Culture coffee place will have facilities and service that will give it an advantage over other competitors in the market. Theses facilities include: comfortable and well decorated sofas. There will be light that is dim enough for those who are socializing while other tables will have reading light for those who would want to read a book. The pastries and sandwiches offered will be of great taste and quality. The music will be relaxing and tailored to the taste of the customer. All these features will be designed to help the customers to relax coupled with a cool and ambient atmosphere.
Sales Strategy
The baristas will be responsible for transacting any sales. Two more employees will be hired to help in serving the clients. A computerized system will be used to make the sales and this is where al the information concerning the sales will be stored. This information can be used for marketing functions.
To create customer awareness on the coffee place, there will be use of cross promotions with other businesses like supermarkets. Other means will be the use of fliers and customer referrals. The Java Culture coffee place will also come up with a unique program that will be aimed at retaining clients.
Growth Plan
In the Restaurant business, the coffee shop is the fastest growing business in the world today with the US being the leader. As of the end of the financial year 2009, there were about 32,000 coffee shops in the US alone. The growth of population and the subsequent demand for coffee can clearly explain the success of this restaurant chain. The growth of coffee sales in this sector is directly related to the U.S economy. It also indicates the disposable income that every consumer at all levels posses. Therefore Java Culture coffee place plans on capitalizing on these demographic and demand trends to ensure that the business expands from a single retail restaurant to a multi retail restaurant.
Financial Plan
Financial plan is attached in the spreadsheet file.
Reference
Arkebauer, Joseph. The McGraw-Hill Guide to Writing a High-Impact Business Plan: A Proven Blueprint for First-Time Entrepreneurs. 1st ed. New York, NY: McGraw- Hill, 1994.