XXXXX
Edmonton Canada
Business Plan
Table of Contents
Particulars
Page No.
Executive Summary
3
Market Research
5
Business Model
21
Marketing Strategy
38
Management Summary
44
Sources and Uses of Funds
47
Financial Plan
49
2
Executive Summary
3
Executive Summary XXXXX is a proposed startup restaurant that plans to establish itself in Edmonton, Alberta. The restaurant will be approximately 1,500 sq ft, on a single floor, with an upscale customer seating area offering good ambience.
$1.781 mn Net Present Value
The owners of the restaurant are applying for a Popeye’s Kitchen franchise. The restaurant will target casual eaters and foodies of all age groups. It will have state-of-the-art infrastructure and decor. The first choice for the location would be the south side of Edmonton, or on the west side near to the west Edmonton mall, with a third option being the Windermere Plaza.
85%
Internal Rate of Return
Edmonton has brand new commercial buildings located south side, near to the Calgary trail, a village-esque neighborhood in Edmonton’s rapidly growing Windermere community.
14%
Revenue CAGR
In 2017, growth in fast food continued to be driven by chained outlets. There was an overall increase in the number of outlets across most foodservice categories. With increasing competition and more options available to consumers, chained fast food restaurants can offer the same or similar menus, even in more affluent areas, thereby ensuring good quality food irrespective of location or size of restaurant
52%
Profits CAGR
The key financials are given below: (in CAD) Particulars
Year 1
Year 2
Year 3
Year 4
Year 5
Revenue
$
750,000
$
900,000
$
1,035,000
$
1,169,550
$
1,286,505
Gross Profit
$
487,500
$
585,000
$
672,750
$
760,208
$
836,228
Net Profit
$
38,114
$
92,074
$
121,552
$
167,091
$
204,595
Cash Balance
$
131,971
$
268,403
$
434,837
$
647,362
$
897,969
62%
Cash CAGR Note: CAGR – Compounded Annual Growth Rate
4
Market Research
5
Market Research Fast Food in Canada In 2017, growth in the fast food business continued to be driven by chained outlets. There was an overall increase in the number of outlets across most foodservice categories. With increasing competition and more options available to consumers, chained fast food restaurants can offer the same tastes, even in more affluent areas, thereby ensuring good quality food irrespective of location or size of restaurant. For example, a hamburger from McDonald’s at a downtown location would be similar to one in an outskirts location. In contrast, the prices of independent restaurants may be determined by rental costs in a given location. Another trend which could be observed was a shift towards healthier foods, with many restaurants having either altered their menus to include healthier options or including nutritional content as part of their menu listings to customers. Online ordering has also become more important and is set to continue growing in popularity. In 2017, fast food continued to record gains in current value terms, as well as for both the number of transactions and outlets. This was largely driven by chained outlets, with consumers particularly appreciating their convenient locations. Furthermore, existing chains have been investing in improving their image as well as their penetration. Chained Latin American fast food posted the strongest growth in terms of the number of outlets in 2017, registering an increase of 23%. This was primarily the result of Taco Bell opening almost 90 new outlets. The company also ran various promotions during the year to attract consumers. Source: Euromonitor International
6
Market Research Fast Food in Canada Asian cuisines have been growing in popularity in Canada, with this reflected in a 7% increase in the number of Asian food chain outlets in 2017, particularly in places like food courts. Chinese and Japanese varieties remained the most popular Asian cuisines. There is a considerable difference between the growth patterns of chained and independent restaurants, with the former outperforming the latter. Chained restaurants mainly serve pre-cooked food which is warmed up or cooked again with spices to enhance taste, whereas independent restaurants rely on preparing food from scratch. Chained restaurants mainly cater for the lunch requirements of workers who have both time and budgetary constraints. ‘Other’ fast food is an important category as it covers Indian and other South Asian cuisines. Many small independent restaurants have opened in large cities like Toronto and Vancouver to cater for the South Asian community. These restaurants typically offer curries and grilled items that are not found on the menus of chained restaurants. Their format is very different to chained fast food restaurants as they concentrate on dine-in clientele, with little or no home delivery or online ordering capabilities. They also tend to be familyowned businesses which focus on customer service, authenticity and taste to retain customers. Many operators are experimenting with menus for specific times of the day. Subway started selling subs from CAD 3.99 throughout the day to attract more customers during off-peak hours and cater for shift workers. McDonald’s offers a separate breakfast menu which is not available during the afternoon and evenings. Chained restaurants typically experiment with such offers to justify their staff to customer ratio, while maintaining quick service at all times of the day. Source: Euromonitor International
7
Market Research Fast Food in Canada Chained restaurants like McDonald’s, Domino’s etc. have introduced online and app-based services to enable customers to order food in advance and then pick it up to eat. This model has helped chains to better manage their dine-in operations, for example reducing their dining space so as to provide more storage space for food preparation and equipment. Chained fast food operators continued to add more options and flavours to their menus in 2017. Examples include the holiday menus offered by McDonald’s, Tim Hortons and Starbucks, with certain foods only available for a limited period of time. McDonald’s recently introduced the option to create customised burgers through kiosks available inside restaurants. It has also introduced special waffle cut fries which are only available during selected holiday seasons. Starbucks and Tim Hortons often add special flavours and drinks to their menus during the winter to cater for consumers looking for additional warmth and comfort. Takeaway is more popular in larger cities like Toronto and Vancouver, where customers are more inclined to order online and then pick up food so as to avoid having to queue. Drive-thru is an extremely important format for fast food chains in Canada, as many people seek to avoid the harsh weather conditions by ordering from their car. Third-party online ordering services are growing in popularity but have not been able to catch up with fast food chained operators like McDonald’s. Source: Euromonitor International
8
Market Research Restaurants in Canada Given the local visibility of restaurants and bars, the emergence of celebrity chefs, and the awareness that Canadians have about the restaurant industry – from the perspective of customer, employee, or supplier -- it’s not surprising that just over a third of Canadians (34%) have dreamed of opening up a restaurant or bar. What kind of restaurant or bar would Canadians choose to open? Casual or family style restaurants are most popular.
While the percentage of Canadians that have dreamed of opening a restaurant or bar remains fairly constant across the country, there are some regional differences in the type of establishment they would open. In Ontario, 41% would open a casual or family style restaurant, compared to 22% of respondents in Western Canada. In contrast, 34% of respondents in Western Canada would open a bar or pub, compared to only 21% in Ontario.
Source: Canadian Restaurant and Foodservices Association
9
Market Research Restaurants in Canada Restaurants bring people together. Just over 28% of Canadians choose going out to a restaurant as their preferred way to spend time with friends and family -- ahead of outdoor activities, going to the movies, or shopping. Another 7% would choose to go to a bar or pub. Added together, that’s 35% of Canadians who prefer to visit a restaurant or bar when going out with family and friends – far ahead of the second-favourite option, outdoor activities, selected by 23% of Canadians.
While Canadians aged 55 and older tend to dine out less often than younger age groups, they are the most likely to prefer going out to a restaurant compared to all the other activities listed. In fact, Canadians who are 55 and older are more than twice as likely as those aged 18 to 34 to rank eating out at a restaurant as their number one choice for spending time with family and friends.
Source: Canadian Restaurant and Foodservices Association
10
Market Research Restaurants in Canada Despite the proliferation of convenient, innovative, and quality meals and snacks at restaurants, the majority (63%) of Canadians still regard eating at a restaurant as a luxury. Only 16% of respondents said that eating out is a part of their everyday life. This aligns with other studies indicating that Canadians source an average of 1 in 10 meals from a restaurant, and that Canadian households spend just 24% of their food budget at restaurants.
The perception of restaurant meals as a luxury is likely due to sluggish growth in disposable income in Canada, and the relatively high cost of eating out, due in part to the fact that restaurant purchases are subject to the HST or GST, while most grocery purchases are tax-free. The majority of Canadians (60%) purchase a meal or snack at a restaurant once a week or more; but, a restaurant visit is a daily occurrence for just 1 in 15 Canadians, according to an Ipsos poll.
Source: Canadian Restaurant and Foodservices Association
11
Market Research Restaurant in Canada On average, Canadians purchase a meal or snack from a restaurant just 1.7 times a week. Due to a slightly higher rate of snacking, young people between the ages of 18 and 34 frequent restaurants for meals and snacks most often, with an average for this age group of two visits a week.
Due to a higher rate of snacking and eating on the go, consumers in Ontario and Atlantic Canada visit a restaurant an average of twice a week compared to 1.6 times in Western Canada and 1.4 times in Quebec. The perception that foodservice is a luxury may also reflect the current economic climate. Many Canadians are worried about their financial stability and their jobs. The Ipsos poll reinforces the strong correlation between income and eating out; as household incomes increase, the more likely it is that Canadians perceive restaurants to be a part of their everyday lifestyle.
Source: Canadian Restaurant and Foodservices Association
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Market Research Restaurants in Canada When asked what motivates them to visit a restaurant, Canadians are split between indulgence and convenience. Forty-three percent of Canadians say visit a restaurant as an indulgence or treat. However, Canadians are also driven by convenience. An almost equal number -- 40% -choose to eat out because they are “on the go,” while 34% agree that it either “saves time from having to cook” or they “don’t want to cook.” Those in the 18- to 34-yearold demographic state that they eat out because they are always “on the go.” Those aged 35 and older justify their eating out as an “indulgence or treat.” At the other end of the spectrum, only 11% of respondents eat out at restaurants because it provides “value for money,” and 7% say that it is an “inexpensive/affordable way to entertain guests and family.” These responses correlate with earlier findings that eating out is perceived as a luxury by most Canadians. Despite the weak economic conditions, most Canadians (60%) have not cut back on the frequency of restaurant visits in the past 12 months. In fact, 14% of respondents say they are eating out more often. One quarter of Canadians, however, are eating out less often. Of those eating out more often, convenience is the top reason, as cited by 54% of respondents. In contrast, a quarter of Canadians are eating out less often, primarily due to budget concerns. Three quarters of those who are eating less often say it’s because they are “watching their budget more closely.”
Source: Canadian Restaurant and Foodservices Association
13
Market Research Restaurants in Canada More than a third of Canadians could be described as “foodies,” as 39% say they love to try new foods and flavours, and 37% say they love to try new restaurants. This is especially true for Canadians between the ages of 18 and 24. One quarter (26%) of all respondents say that eating out is one of their favourite things to do, and nearly one in six Canadians are “hobby diners,” – trying new foods and restaurants is one of their favourite hobbies. In recent years, there has been a growing awareness around eating healthy. As a result, 29% of Canadians say that healthy choices are important to them when dining out.
Source: Canadian Restaurant and Foodservices Association
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Market Research Restaurants in Canada Restaurants Canada, the national association for the industry, estimated that total food service sales at the end of 2017 would reach CAD $78 billion (USD $58 billion), representing an increase of 5.3% from 2015. The industry is important to Canada’s economy as the sector accounts for 4% of the national GDP and employs 1.2 million Canadians. For many young Canadians, the food service sector offered them their first job. There are slightly over 94,000 food service units across the country and on average, Canadians make 17 million visits to restaurants per day. Steady growth for the industry is expected in the coming years.
Combined, Ontario and Quebec represent 57% of the total food service sales, with CAD $23.5 billion (USD $17.4 billion) and CAD $10.7 billion (USD $8 billion) for each province, respectively. These two provinces reflect the largest share of the market. In the last 12 months, British Columbia and Ontario posted increased revenue sales by over 5%, leading the country in sales growth.
Source: Canadian Restaurant and Foodservices Association
15
Market Research Local Market Research Edmonton is the capital city of the Canadian province of Alberta. It is located alongside the North Saskatchewan River and is the centre of the Edmonton Metropolitan Region, which is surrounded by Alberta's central region. The city anchors the north end of what Statistics Canada defines as the "Calgary–Edmonton Corridor�. The city had a population of 932,546 in 2017, making it Alberta's second-largest city and Canada's fifth-largest municipality. Also in 2017, Edmonton had a metropolitan population of 1,321,426, making it the sixth-largest census metropolitan area (CMA) in Canada. Edmonton is North America's northernmost city that has a metropolitan population over one million. Edmonton's historic growth has been facilitated through the absorption of five adjacent urban municipalities (Strathcona, North Edmonton, West Edmonton, Beverly and Jasper Place) and a series of annexations ending in 1982. Known as the "Gateway to the North", the city is a staging point for large-scale oil sands projects occurring in northern Alberta, and large-scale diamond mining operations in the Northwest Territories.
16
Market Research Local Market Research
17
Market Research Competitor Analysis When we think of fast food, visions of super-sized fries, grease-soaked paper bags, and mini ketchup packets dance in our heads. For years we’ve sacrificed fresh for fast, but a revolution is stirring in Edmonton’s quick-service restaurant industry. Weekday lunches have a whole new look — top-quality, carefully sourced ingredients, packaged as convenient to-go options. Here are four fantastic lunch spots that are redefining Edmonton’s fast-food scene. Rush: 12 pm to 12:45 pm Wait: 5 to 7 minutes Press’d has made it their business to impress customers with high-quality, made-to-order sandwiches. This Edmonton-born franchise combines out-of-the-box ingredients (like cumin brown sugar apples and raspberry chipotle honey mustard) with fresh-baked bread made from scratch. The result? A first-rate experience you wouldn’t expect from the fast-food realm. Of 16 sandwich varieties, customers most often choose the California Club (think classic BLT sandwich stepped up with chicken, Swiss cheese and house-made guacamole). Their Broccoli Crunch Salad (made daily) also deserves a shout out — customers can’t seem to get enough. Four locations: 10200-102 Ave; 10377-78 Ave.; 11214 Jasper Ave.; 3384 Gateway Blvd. Rush: 11:30 am to 1 pm Wait: About 5 minutes With their entire menu revolving around fresh vegetables, The Chopped Leaf proves processed fast-food lunches can be a thing of the past. About 75% of The Chopped Leaf’s busy lunch-time customers opt for a salad or whole bowl (a salad and brown rice combo), their top picks being the Popeye, Sunshine, and Bangkok salads. This popular lunch spot makes salad exciting with dressings like chipotle lime, chipotle ranch, and peanut cilantro, but some would say it’s their Chopped Water — water infused with fruit, veggie and herb combinations, like apple-orange-lemon, apple-basil, and cucumber-mint — that keeps them coming back. Two locations: 10155-102 St.; 3356 Gateway Blvd.
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Market Research Competitor Analysis Rush: 11:30 am to 12:30 pm Wait: 5 to 10 minutes Fifendekel is well-known in Edmonton as a favourite pie shop, but it’s their create-yourown sandwich counter, and made-fresh-daily soups and salads that make this quickserve restaurant a top choice for fresh, healthy fare. As a family-run business, Fifendekel serves the sort of home-style lunches your mom might make — almost every dish or ingredient from their kitchen is a family recipe. Roast beef and turkey are cooked and sliced in-house; egg, tuna, and chicken salad mixes are made from scratch each morning; and customers return again and again for their famous sunflower bread. Four locations: 3434-99 St.; 9154-51 Ave.; 10646-170 St.; 12028-149 St.
Rush: 11:30 am to 1:30 pm Wait: 5 to 7 minutes If you think salad bars went out with Sony Walkmans and Ernest P. Worrell movies, think again. It’s true, nowadays a good salad bar can be hard to find, but local downtown office professionals look no further than Sunterra Market. Sunterra’s discerning customers not only want a healthy lunch fast, but also appreciate variety. Salad bar selections range from classic toppings like chopped veggies, fruit, cheese, and hardboiled eggs, to unique options like pickled beets, olives, green chickpeas, tofu, and hot, carved meats like roasted chicken and beef (straight from Sunterra’s own farm). 10150 Jasper Ave.
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Market Research SWOT Analysis
Strengths
Weaknesses
• Huge demand for good food in the region • Growing number of millennials, resulting in increased business • Strong management team • Well-trained employees
• • • •
Opportunities • Expanding to healthy food segment • High quality adult oriented dining destination
S
W
O
T
New to the local market Limited local knowledge Limited brand presence Time and staffing constraints associated with a startup • Limited access to funding
Threats • Food and safety risks • Threat from new market entrants and established players
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Business Model
21
Business Model The Entity XXXXX is a proposed startup restaurant to be established in Edmonton, Alberta. The restaurant will approximately be 1,500 sq ft, on a single floor, with an upscale customer seating area offering good ambience. The owners of the restaurant are applying for a Popeye’s Kitchen franchise.
Business Summary Name: XXXXX Business: Restaurant
The restaurant will target casual eaters and foodies of all age groups. It will have state-of-the-art infrastructure and decor. The first choice for the location would be the south side of Edmonton, or on the west side near the west Edmonton mall, with a third option being the Windermere Plaza.
Location: Edmonton, Canada
Edmonton has brand new commercial buildings located on the south side near the Calgary trail, in the villagesque neighborhood in Edmonton’s rapidly growing Windermere community.
Target Customers: Casual eaters, and other foodies of all age groups
The company will tie-up with reputed brands like Sysco and Centennial Foodservice to help provide its services more efficiently.
Geographical Focus: Edmonton, Canada Management: XXXXX
Suppliers: Sysco and Centennial Foodservice Competitors: Press’d, The Chopped Leaf, Fifendekel and Sunterra Market
The company will compete with restaurants like Press’d, The Chopped Leaf, Fifendekel and Sunterra Market which are popular restaurants in Edmonton. XXXXX
XXXXX 50% Owner
50% Owner
XXXXX
22
Business Model Mission, Vision and Goals Mission and Vision Statements XXXXX will be a great place to eat, combining an intriguing atmosphere with delicious food. The mission is not only to have great-tasting food, but also to have efficient and friendly customer service (customer satisfaction is paramount). XXXXX intends to be the restaurant choice for the area’s working population and student population too. Employee welfare will also be important to our success. Everyone will be treated fairly, and with the utmost respect. The restaurant wants its employees to feel as though they are playing a large part in the success of the restaurant. Happy employees make for happy customers. Goals The following are the key goals of the organization: To become a market leader in the locality in the fast food space; To be a responsible corporate citizen and abide by all laws and regulations; To achieve a revenue of at least CAD $1 million in the third year; To sustain a 15% net profit in the long term.
23
Business Model Menu Offerings
24
Business Model Menu Offerings
25
Business Model Critical Success Factors
Branding One of the most critical success factors will be to establish the brand of the outlet. While the overall franchise brand has been established due to Popeye’s presence throughout Canada, the location-specific branding and signage need to be created.
Location Location is the MOST important factor for the success of the restaurant. The restaurant will be sited in a busy location, and will have signage in and around the restaurant that will promote the brand and entice people to visit the restaurant.
Ambience and Design The internals will include classic wooden design tables and chairs. The outlet will be perfect for relaxing, for friendly informal meetings, and for socialising.
This will help in generating a consistent and ubiquitous brand image in the minds of customers and employees alike.
26
Business Model Key Suppliers Sysco Corporation is an American multinational corporation involved in marketing and distributing food products to restaurants, healthcare and educational facilities, hotels and inns, and other foodservice and hospitality businesses. The company is headquartered in the Energy Corridor district of Houston, Texas. Sysco, an acronym for Systems and Services Company, is the world's largest broad line food distributor; it has more than 500,000 clients in a wide array of fields. Management consulting is also an integral part of their services. As of July 2, 2017, the company operated over 300 distribution facilities worldwide. The company was founded by Herbert Irving, John F. Baugh and Harry Rosenthal in 1969. It went public on March 3, 1970. On July 20, 2009, Fortune magazine ranked Sysco No. 204 in the annual Fortune 500 companies in the world, based on sales volume. Sysco is also the largest non-oil related company in Houston, and the third largest non-oil related company in Texas (Behind AT&T and Dell). Centennial Food Service Centennial Foodservice is Western Canada's leading seafood, poultry and premium meats foodservice and distribution company. Specialising in Centre of the Plate proteins as well as custom processing, they are the made to order provider of more than 17,500 high quality products. They operate from eight distribution centers that service all of Western Canada, from Southern Vancouver Island to Northern Saskatchewan. Centennial Foodservice is 100% Canadian owned and operated.
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Business Model
Customer
Operational Flows Exteriors
Ambience
Customer Arrives
Customer Walks In
Furniture Seated by the Host
Menu Views Menu Card
Staff Places Order
Receives and Eats
Customer Pays
Support Process
On Stage
Greeted by Staff
Receives Order
Delivers the Order
Informs Kitchen
Receives Items
Generates Bill
Line of Visibility Back Stage
Contact Person
Line of Interaction
Line of Internal Interaction
Prepares Food
Quality Checks
28
Business Model Floor Plan The actual floor plan would depend on the final location, after the lease agreement is signed. An indicative floor plan is given below:
29
Business Model Organization Structure CEO
CEO ▸ ▸ ▸ ▸ ▸ ▸ ▸ ▸ ▸ ▸ ▸ ▸ ▸ ▸
Direct and expand operations Network with prospective partners and suppliers Make investment decisions Devise and implement strategies Monitor performance on a regular basis Oversee the operations Direct and expand operations Supervise the floor Ensure controls are in place Build brand image Capture newer market segments Manage statutory compliance Manage financial reporting Manage working capital
Head Chef
Sous Chef
Servers ▸ ▸ ▸ ▸ ▸ ▸ ▸
Welcome guests Seat guests Clear tables Fill water glasses Serve orders Refill condiment containers Ensure that the place is kept clean
Head Chef ▸ Oversees operations ▸ Creates menus ▸ Prepare new recipes ▸ Train staff ▸ Deal with suppliers ▸ Purchase food and beverages ▸ Manage inventory ▸ Quality control ▸ Ensures controls are in place ▸ Prepares special items requested by customers Sous Chef ▸ Prepares dishes ▸ Monitors KOTs ▸ Adhere to customer requirements
Servers
Dishwashers Dishwashers
▸ Washes dishes ▸ Dries Dishes ▸ Arranges Dishes
Source: Management Information
30
Business Model Staffing Plan Particulars Designation Owner / CEO Head Chef Dishwasher Sous Chef Server Total Salary per person Owner / CEO Head Chef Dishwasher Sous Chef Server Total Annual Salary
Amounts in CAD
Year 1
Year 2
1 1 2 1 2 7
$ $ $ $ $ $
75,000 45,000 18,000 35,000 20,000 231,000
Year 3
1 1 2 1 2 7
$ $ $ $ $ $
75,000 47,250 18,900 36,750 21,000 238,800
Year 4
1 1 2 1 3 8
$ $ $ $ $ $
75,000 49,613 19,845 38,588 22,050 269,040
Year 5
1 1 2 1 3 8
$ $ $ $ $ $
75,000 52,093 20,837 40,517 23,153 278,742
1 1 2 1 3 8
$ $ $ $ $ $
75,000 54,698 21,879 42,543 24,310 288,929
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Business Model Business Strategies The business strategy will be to focus on long-term, sustainable and organic growth. The overall operational strategy will be designed to invest in low-cost growth initiatives that produce immediate cash-flow-positive results. Location is the most critical factor in the success of the business. Hence, the management will select a strategic location with maximum viewing ability that will attract a high level of customers.
Management • • • • • •
Establish menu options Build brand awareness Build relationships Use existing relationships of the management team to expand the business Be cost effective and efficient Market development
Operational
Management
• • • • • • •
Recruit qualified staff Structure business processes Cooperate with well-known service providers Initiate offline and online marketing Improve processes continuously Outsource non-core activities Cater to customers’ need for healthier food options
Operational
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Business Model Growth Strategies Cost Leadership A cost leadership management strategy involves being the lowest cost provider of the product offerings. For a restaurant, this involves achieving economies of scale. To achieve economies of scale, the company will need to generate a high volume of sales. This will allow the company to increase worker productivity through division of labor and save money by purchasing ingredients in larger quantities, giving it a greater ability to offer the products at a competitive price. Differentiation Differentiation is a non-price strategy. Instead of gaining customers by offering them the lowest price, the company will attract them with value-added features (eg: authentic food, unique flavors). The restaurant could also provide signature dishes, which are not available elsewhere.
Catch the Scent Smart restaurants open their doors wide when the weather permits, to advertise all that freshly-prepared goodness to everyone within smelling distance. It doesn’t cost anything to open the door for the company.
Social Media Engagement Forget the fancy equipment and the video budget, because most of us have a decent HD video camera on our cell phones. The company will constantly post HD videos and photos of the restaurant, the menu and interesting articles. This will generate a lot of buzz on Social Media, and improve the visibility of the venue.
33
Business Model Risk and Mitigation Strategies Risk
Mitigation Strategy
Food poisoning is a major cause of concern for all restaurants.
1. 2. 3.
Risk of fire, flood, or natural calamity.
1. 2.
Employee Theft
1. 2. 3.
Financial Management Risk
1. 2. 3.
All the staff will be adequately trained in food safety. All incoming materials will be thoroughly checked for quality and contamination. All stored and frozen food will be regularly checked for quality and expiry.
There will be adequate fire protection on the premises, including fire extinguishers and alarms. The entire property will be insured against risk of fire, flood, and other common natural calamities and disasters.
Video cameras will be installed at crucial locations to monitor activities. Detailed records of inventory will be kept, and checked on a periodic basis, to ensure there are no embezzlements. Strict in-house policies will be available that encourage honest behavior.
Proper budgeting and cost control systems will be set in place Internal checks and audit procedures will be adopted Fund management and cash flow planning will be assessed on a fortnightly basis.
34
Business Model Digital Presence Strategy The e-commerce aspects of the food business will be adopted by the franchisee to enable today’s tech-savvy generation to order online, increasing sales for their outlets. A few of the features will include: • • • •
User-friendly website Easy-to-navigate layout Access to menu and nutritional information Secure payment portal
The company will leverage technology (kitchen equipment, point of sale systems, order processing tools, etc.) to: • • • • • • • • • • • • •
Minimize labor and food costs Reduce waste Increase sales Improve business processes Support growth Maintain current operations Provide better meal experiences Gain an advantage over their competitors Ensure quality service Reduce customer waiting time Update order-processing systems Reduce food preparation time Make the experience more convenient for the customer
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Business Model Roadmap and Milestones First Year Milestones ▸ Establish business ▸ Recruit and train staff ▸ Spread the word about the restaurant in the local market (branding) ▸ Break even and achieve good profitability
Second and Third Year Milestones ▸ Achieve profitability every year ▸ Achieve at least 10-15% Year on Year growth ▸ Open an additional outlet at the end of the third year ▸ Build brand equity on both the ‘concept’ and the ‘brand’
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Business Model Roadmap and Milestones
Viral marketing Cross revenue targets Be profitable throughout the period
Expand team Branding strategy Ongoing marketing
2022 2021
2020
2019
Ongoing marketing Launching innovative menu items
Ongoing marketing Branding of the restaurant
2018
Business launch Employee recruitment and training Marketing strategies Supplier relationships
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Marketing Strategy
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Market Analysis Marketing Strategy Website The company will build a visually appealing website encompassing relevant features that make it stand out from the crowd. The website will have a mobile friendly interface, online reservations, automated marketing, social monitoring, social media integration, etc., in addition to featuring sufficient information about the restaurant, the menu, a gallery of specialty dishes of the restaurant, customer reviews, restaurant timings, location and contact details. Online Marketing Internet marketing is important because it aligns with the way consumers make purchasing decisions. Studies by analysts such as Gartner indicate that increasing numbers of consumers use social media and research on mobile internet to carry out their preliminary research on restaurants, menu options, prices, location etc. before making their final decision. The company will invest a considerable amount in online marketing to build relations with customers and prospects, through regular, low-cost personalised communication, reflecting the move away from mass marketing.
Food Photos The internet is being bombarded with food photos through social media, blogs, YouTube channels etc. Food porn is alive and well. This has become the new way to promote any food related business. High quality drool-worthy images of the food and ambience at the restaurant will be uploaded on the company’s website and social media pages, as well as other sites where the company has been referred to. The company will go all out and hire professional food photographers for this purpose.
Digital Marketing Unlike traditional advertising, digital marketing allows truly personalised marketing. Taking advantage of the opportunities found in the digital world, the entity plans to have in place digital marketing tools such as Google AdWords, Google Trends, Google Keyword Planner, Google+, Google Alerts, Email marketing etc., to reach out to the targeted audience in a cost effective and measurable way.
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Market Analysis Marketing Strategy TripAdvisor The company will ride on the popularity of TripAdvisor and create an account and be proactive on this site. TripAdvisor is very popular especially in the food industry. Users are also active and give feedback once they visit a restaurant. The company will politely respond to such feedback and work to correct any negative feedback. The company will strive to have a strong backing of positive reviews for its restaurant, which is sure to attract more customers.
Google Account As a part of search engine optimization, the company will create a Google+ account and regularly update the page and link it to the company’s website and other social media pages. It will also encourage users to provide reviews on the Google+ account. The benefit of all this is that, Google’s Knowledge Graph provides the business’s details in the sidebar when you search with the name of the business. Google’s Knowledge Graph gathers a large chunk of its info from Google+, so having the restaurant appear via Google’s Knowledge Graph allows for more prime search real estate (for free). The Knowledge Graph also aggregates Google user reviews.
Taking advantage of the publicity that the company receives through TripAdvisor, it will add attractive photos of the food, as well as the restaurant, upload the latest menu along with a price range of the items, give a map of the location, mention the restaurant working hours, along with other facilities available; like parking, Wi-Fi, outdoor seating etc. Search Engine Optimization (SEO) The entity will have SEO in place, to ensure that all keywords relating to the business and its activity lead to the entity’s website, online portals where it is listed and all its social media pages. This will shoot up the number of visitors to the website.
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Market Analysis Marketing Strategy Social Media Social media is one of the most cost-efficient digital marketing methods. The entity will create a strong presence for itself on social media websites such as Facebook, Instagram, and Twitter to share special discounts, exclusive coupons, photos of the newest dishes, and promote the business’ own news accolades. This way, the company will syndicate content and increase the business' visibility. The company will also be active on social media by using social media management tools like Hootsuite; a one-stop dashboard for keeping tabs on all social media networks; create custom streams, schedule posts and more. Instagram Instagram requires a special mention in the case of food related business since the website is all about the visuals. Having a strong Instagram presence is an important marketing strategy for the restaurant. The company will promote the restaurant by showing off itself through visually appealing photos. The company will get up close with its top dishes, and use Instagram as a main stage to play around with the brand identity. The company will be proactive on Instagram with funny hashtags that are sure to trend on Twitter as well.
Partnering with Online portals and apps The company also has plans to partner with several popular online portals and applications such as food service apps, travel websites such as TripAdvisor, booking, Expedia etc., to get its business listed on these. Share Positive Press The company will make sure to share all positive press coverage about the restaurant on its website, social media pages, google accounts, etc. The press coverage could be through newspapers or magazines. Fans will spread the word, and newcomers will be encouraged to visit in person when they see trusted sources celebrating the restaurant. Google Alerts The company will set-up Google Alerts to notify the management when the company’s name or the brand’s name appears in a new piece of content on the web. This will make it easy to keep tabs on who is talking about the restaurant and respond to the same.
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Market Analysis Marketing Strategy Brand Building The Popeye’s brand is more than a logo, name or slogan — it’s the entire experience the customers have throughout their visit to any Popeye’s restaurant. The brand strategy will define what the company stands for, the promises they make, and the personality they convey. And while it includes logos, colour palette and slogans, those are only creative elements that convey the brand. Instead, the brand lives in every day-to-day interaction that the management and staff have with the customers. The company will strive to make Popeye a loved brand and make it hugely popular across the globe. Loyalty Programs The restaurant will offer loyalty programs to customers, such as a free dessert or a glass of wine for the nth visit; or a 50 CAD coupon on the 5th visit; or a reward for a certain number of visits. The restaurant will ensure that guests come back again and again.
Sign Boards Signage is simply the best, most effective form of advertising. Signs attract new customers and alert them to the existence of the restaurant. The company will place an attractive sign board outside to make its appeal to passersby.
Issuing Handouts The entity will issue handouts to the targeted audience, specifying the uniqueness, the specialty dishes, booking, location and address. Word of Mouth Marketing Word-of-mouth marketing is a powerful way to spread your company message and create an enhanced brand. Hence, the entity will focus on obtaining customer confidence. Source Local Ingredients Customers love to hear that they are eating local, and sourcing local ingredients from nearby. This can do a lot to boost the brand’s fan base and give it a positive reputation in the community.
The company will also introduce B2B loyalty cards for lunch trade from local business employees.
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Management Summary Marketing Mix
Price The restaurant will adopt a medium pricing strategy to capture a hefty market share. Since it is relatively new to the area, pricing will be set around 10%-15% lower than market rates in order to attract large numbers of new customers.
Place The place is one of the critical success factors (CSF) for those engaged in the restaurant business. The first choice for the location would be the south side of Edmonton , or the west side near to the west Edmonton mall, and third one is in the Windermere plaza.
Promotion Promotion is the key to capturing the market. The restaurant will market through various modes such as Google AdWords, Print Media, Social Media, Signage and discount coupons/offers.
Product The restaurant will focus primarily on appetizers, lunch items, salads, burgers, and steaks
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Management Summary
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Management Summary XXXX XXXXXX is the Franchisee/Owner of Subway in Rotterdam, Netherlands since October 2011. She has been responsible for all ownership duties relating to operating the Subway franchise store in Rotterdam.
Skills
Some of these included negotiating leases, contracting construction and remodeling, hiring and training staff and management, and employing third parties such as students. Her other responsibilities included day to day operations such as supply ordering, weekly inventories, scheduling, and preparing for monthly evaluations.
• • • • • • •
Since taking over the Subway store in 2011, she has turned it around from loss making to a profit making business. She achieved 40% sales growth right in the first year and has shown stable growth since then. The restaurant has grown so profitable that she were able to remodel the store in two years after taking over.
Executive team leadership Staff/ training policy management Marketing/product line development Effective time-management skills Open to advice and guidance Good motivator Organized
She has also gained experience with attracting qualified and reliable staff. She has earned critical acclaim for the restaurant. She is also skilled at anticipating the restaurant’s needs and ordering ingredients and food at accurate volumes to ensure as little waste as necessary. She started out as an assistant store manager in Subway at their Delft, Netherlands outlet. And was promoted to a store manager position within three months. During this tenure, she demonstrated skills such as: leadership, organization, ability to work and manage others, communication and attention to detail.
She did a Bachelor in Computer Science in India (2004-2007) and Post Graduate Diploma in Computer (2007-2008).
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Management Summary XXXXX XXXXX has ample expertise working in fast-paced, high tech environments requiring strong leadership and team building skills. He communicates effectively with individuals, groups and through presentations; and demonstrates excellent interpersonal skills working as team member He is capable of troubleshooting and solving problems by analyzing situations and making innovative suggestions. His technical expertise includes advanced computer skills and operating industrial machinery. He is proficient at visualizing systems in an innovative and detail oriented manner using design software. His education includes Mechanical Engineering Technology 3 year (Co-op) Diploma Program from Georgian College, Barrie, Ontario (2008-2013).
Achievements • September 2008 Auto Show – Member of Team Skoda • Sports – played basketball and shot-put at the district level in high school • Completed W.H.M.I.S training and Passport to Safety online training • School Representative of boarding school
His work experience includes the following: Period
Designation
Organization
Location
2014 – Present
Steel Detailer
WF Steel and Crane Ltd.
Nisku, Alberta
Mar – Oct 2012
Line Operator
TS Tech Canada Inc.
Newmarket, Ontario
Jan – May 2010
Process Engineering Technologist
Deco Automotive
Toronto, Ontario
Apr – Aug 2009
Technical Dept – Metal Stamping
City Metal Manufacturers
Toronto, Ontario
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Sources and Uses of Funds
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Sources and Uses Sources and Uses of Funds Particulars Uses of Funds Interiors Furniture & Fittings Kitchen Equipment Business Setup & Legal Computers Contingencies Total Sources of Funds Equity Total
Amount CAD ($) $ $ $ $ $ $ $
$ $
150,000 25,000 50,000 10,000 2,000 50,000 287,000
287,000 287,000
Uses of Funds
17% 1% 4%
Interiors
52%
17% 9%
Furniture & Fittings Kitchen Equipment Business Setup & Legal Computers Contingencies
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Financial Plan
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Financial Plan Projected Income Statements Particulars Revenue Revenue Less: COGS
Amounts in CAD Year 4 Year 5
Year 1
Year 2
Year 3
$ $
750,000 $ 262,500 $
900,000 $ 315,000 $
1,035,000 $ 362,250 $
1,169,550 $ 409,343 $
1,286,505 450,277
Gross Profit
$
487,500 $
585,000 $
672,750 $
760,208 $
836,228
Expenses Manpower Rent & Utilities Administrative Expenses Marketing Repairs & Maintenance Professional & legal Depreciation
$ $ $ $ $ $ $
Total
$
439,857 $
469,907 $
Net Profit before tax Tax Net Profit after tax
$ $ $
47,643 $ 9,529 $ 38,114 $
115,093 $ 23,019 $ 92,074 $
231,000 70,000 10,000 75,000 15,000 5,000 33,857
$ $ $ $ $ $ $
238,800 73,500 10,500 90,000 18,000 5,250 33,857
$ $ $ $ $ $ $
269,040 77,175 11,025 103,500 20,700 5,513 33,857
$ $ $ $ $ $ $
278,742 81,034 11,576 116,955 23,391 5,788 33,857
$ $ $ $ $ $ $
288,929 85,085 12,155 128,651 25,730 6,078 33,857
520,810 $
551,343 $
580,485
151,940 $ 30,388 $ 121,552 $
208,864 $ 41,773 $ 167,091 $
255,743 51,149 204,595
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Financial Plan Projected Cash Flows Year 1
Amounts in CAD Year 4 Year 5
Particulars Inflows Revenue Equity Total
$ 750,000 $ $ 287,000 $ 1,037,000 $
Outflows COGS Manpower Rent & Utilities Marketing Repairs & Maintenance Professional & legal Taxes Interiors Furniture & Fittings Kitchen Equipment Business Setup & Legal Computers Total
$ $ $ $ $ $ $ $ $ $ $ $ $
262,500 231,000 70,000 75,000 15,000 5,000 9,529 150,000 25,000 50,000 10,000 2,000 905,029
$
763,569 $
868,566 $
957,025 $ 1,035,898
Opening Balance Surplus Closing Balance
$ $ $
$ 131,971 $ 131,971 $
131,971 $ 136,431 $ 268,403 $
268,403 $ 166,434 $ 434,837 $
434,837 $ 212,525 $ 647,362 $
$ $ $ $ $ $ $
Year 2
Year 3
900,000 $
1,035,000 $
1,169,550 $
1,286,505
900,000 $ 1,035,000 $ 1,169,550 $ 1,286,505
315,000 238,800 73,500 90,000 18,000 5,250 23,019
$ $ $ $ $ $ $
362,250 269,040 77,175 103,500 20,700 5,513 30,388
$ $ $ $ $ $ $
409,343 278,742 81,034 116,955 23,391 5,788 41,773
$ $ $ $ $ $ $
450,277 288,929 85,085 128,651 25,730 6,078 51,149
647,362 250,607 897,969
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Financial Plan Financial Charts
Financial Charts
Structure of Expenses
1,400,000
1,200,000
1,000,000
11% 800,000
11% % 2%
COGS
39%
11%
Manpower Rent & Utilities Marketing
600,000
35%
Repairs & Maintenance Professional & legal Taxes
400,000
200,000
0 Year 1 Revenue
Year 2 Gross Profit
Year 3 Net Profit
Year 4
Year 5
Cash Balance
Amounts in CAD
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Financial Plan Key Performance Indicators Key Financial Indicators NPV @10% IRR Revenue CAGR Profit CAGR
CAD
Value 1,781,365 85% 14% 52%
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