Company Summary
The business will operate with the name of Cuban Coffee. It will be a small coffee shop set within the university for the students, lecturers and other staffs. It will also provide access to all news within the university and in international margins.
Business Ownership
The restaurant will start as a sole proprietorship that will be owned by its founders.
Startup Summary
The founders of the business are Mr. Hungary Wood and Ms Amanda Lorie. Hungary will be focused much on the financial issues and Amanda will address personal issues. The location of the business has been found and they will be able to set up the Coffee shop in time to ensure it turn back a profit by the end of the first five months and be profitable by the first one year. The place has already been equipped as a restaurant and there are plans to come up with almost $ 30,000 in terms of capital plus $ 120,000 in terms of guaranteed loan. The total capital for the Shop will be $ 150,000 (Zimmerer, Scarborough, & Wilson, 2002).
Marketing Plan
The coffee shop is expected to generate sales revenues from $ 567,000 in 2016 to $ 680,000 in 2017. A gross profit margin of 65 per cent for the company will be expected, however, reasonable operational expenses shall be maintained. The net profit will grow from $ 120,000 to $ 160,000 during the period.
Objectives
Cuban Coffee objectives for its first years of operation are:
- The best selected Coffee Bar within the University
- Turn the profits from its second month in operations
- Be able to maintain a 65 per cent gross profit margin
Key to Success
- A store design that will be attractive to the customers with fast and efficient operations
- Offer training to the employees to make sure it has the best coffee preparation techniques
- Have the best marketing strategies that will aim at building a better base to attract loyal customers. As well, this will enable the company to maximize the sales
Products
Cuban Coffee will offer the customers with the best tasting coffee within the area. This will be easily achieved by its capacity to offer and use highly quality ingredients. In its efforts to maximize sales, the company shall emphasize store layout, the menu listing, and the marketing activities. The shop will as well offer some products such as refreshment beverages, pastries, salads and sandwiches (Karlsson, & Honig, 2009).
Market Segmentation
The marketing activities of the company shall strive to reach the university lecturers, students, young people as well as the rest of the university staff. Consumption of coffee is universal all over differentiated income groups but much depend on the level of education and proximity to the University that will offer access to the target customers of the shop (Abrams, 2014).
Target Market Segment
The business strategies will have to consider some important key areas of business. One of the few focus is the product market. This incorporate the underlying capabilities that are part of implementation of product market strategy among them the level of technologies, market access held by the firm and the processes (Gomes, Yasin, Lisboa, & Small, 2014). They address the business and its key success factors that are within its environment.
The relaxed environment of the Cuban coffee shop shall form the basis of attraction to the target market. Such client’s will vary in ages. However, the location being close to a university indicates that most of the client will be university students and the faculty members. According to market research, this discerning customer base is gravitated toward having the best tasting coffee. As well, most of the University Student considers the coffee shop as best and convenient places where they can study and meet with their peers without paying for any other cover-up costs (Abrams, 2014).
Market Need
The recent consumer development and growth in coffee quality in the US formed the basis for the market need. This coffee shop shall fill the market need by providing unique, exotic and best quality coffee for small indulgencies desired (Abrams, 2014).
Buying Pattern and Competition
According to research that was conducted in year 2012 by Food Services Group, Astemil has established 45 stores that offered snacks and other non-alcoholic beverages with a total sale amounting to $12.3 million. Various establishments offer limited and general services in their restaurants. Coffee shops within the University environs will be the direct competitors. They will include Starbuck, the Other Food Services, and UOB Bookstore among others. Starbuck will be the major competitor given its established operation and marketing policies coupled with its strong financial position.
Despite the company entrenched market position in coffee industry, there are large number of customer who are always in favor of the small coffee shop that has cozy environment and quality coffee at an affordable price (Gomes, Yasin, Lisboa, & Small, 2014). Starbucks is estimated to possess only 32 per cent of the market share. The shop will have to cater for the customer needs in terms of bodies and minds that will assist the shop to grow its market shares within the competitive market (Abrams, 2014).
Global Positioning
Cuban Coffee shop can in the future enter more markets to enhance its market share as well as its competitiveness. This will also enable it to expand its business risks. In the same regard, this strategy will help to gain access to more customers (Deevi, 2012). As a result, it will also be in a position to enhance its sales, hence its profitability.
In the same regard, the company will also invest more and more in research and development (R&D). Specifically, it will allocate more funds to R&D to benefit from this initiative. This will also enable it to counter strategies employed by its competitors with ease. Likewise, the company will also enhance its online presence. The demand for products offered online has been increasing in the recent past. This can be attributed to the fact that people want to shop at their convenience. The current advancements in internet technology are likely to increase the demand even further. The company will capitalize on the same to enhance its competitiveness (Deevi, 2012). Essentially, this will give it the opportunity to attract many customers on not only the local market but also the global arena.
Start up Budget
The startup budget of the shop is estimated at $150,000 where it will be broken up into “one off” costs of $87,000 and other monthly expenses paid in advance of $33,000. Included in the cost is goodwill that is valued at $45,000 and other equipments of $15,000. The budget will be a shown below.
References
Abrams, R. (2014). Successful Business Plan: Secrets & Strategies (6th Ed.). Palo Alto, CA: Planning Shop.
Deevi, S. C. (2012). Repeatability: Build Enduring Businesses for a World of Constant Change. Research-Technology Management, 55(2), 1249-1275.
Gomes, C. F., Yasin, M. M., Lisboa, J. V., & Small, M. H. (2014). Discerning competitive strategy through an assessment of competitive methods. Service Industries Journal, 34(12), 974-998.
Karlsson, T., & Honig, B. (2009). Judging a business by its cover: An institutional perspective on new ventures and the business plan. Journal of Business Venturing, 24(1), 27-45.
Zimmerer, T., Scarborough, N. M., & Wilson, D. (2002). Essentials of entrepreneurship and small business management. Upper Saddle River, NJ: Prentice Hall.