Coffee Cafe - Business Plan [PDF]

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Financial Planning: Business Plan

2013

2013 Financial Planning: Business Plan

Group 5 | BBF3-9S` Coffee Café 10/9/2013

Coffee Café

Financial Planning: Business Plan

2013

Business Plan

Business name:

Coffee Café/

Owners:

Delos Reyes, Vanessa Joyce Espinase, Geraldine Ortega, Ivanne Ron Paner, Brian Joseph Sarabia, Melissa Daphne

Prof. Fabregas

Coffee Café

Financial Planning: Business Plan

2013

Table of Contents Executive Summary .......................................................................................................................4 Objectives ................................................................................................................................................ 4 Mission ..................................................................................................................................................... 5 Keys to Success ..................................................................................................................................... 5 Marketing plan................................................................................................................................6 Market Segmentation............................................................................................................................. 6 Market Analysis ...................................................................................................................................... 7 Target Market Segment Strategy......................................................................................................... 7 Market Needs.......................................................................................................................................... 7 Competition ............................................................................................................................................. 8 Buying Patterns ...................................................................................................................................... 8 Products..........................................................................................................................................9 Product Description................................................................................................................................ 9 Sales Literature....................................................................................................................................... 9 Strategy and Implementation Summary ................................................................................... 10 Competitive Edge ................................................................................................................................. 10 Sales Strategy....................................................................................................................................... 10 Sales Forecast ...................................................................................................................................... 11 Management Summary ............................................................................................................... 12 Management Summary ....................................................................................................................... 12 Management Team .............................................................................................................................. 12 Personnel Plans ................................................................................................................................... 12

Coffee Café

Financial Planning: Business Plan

2013

Executive Summary Coffee Cafe is determined to become a daily necessity for local coffee addicts, a place to dream of as you try to escape the daily stresses of life and just a comfortable place to meet your friends or to read a book, all in one. With the growing demand for high-quality gourmet coffee and great service, Coffee Café will capitalize on its proximity to the universities and offices to build a core group of repeat customers. Coffee Café will offer its customers the best prepared coffee in the area that will be complimented with pastries, as well as free books that its patrons can read to enjoy their visit.

Highlights

Year 3

Net Profit Year 2

Gross Margin Sales

Year 1

-

1,000,000 2,000,000 3,000,000 4,000,000

Objectives Coffee Café’s objectives for the first year of operations are:   

Become selected as the "Best New Coffee Bar in the area" by the local restaurant guide. Turn in profits from the first month of operations. Create a solid concept in the industry and track performance in order to begin expanding to other markets within six months. Coffee Café

Financial Planning: Business Plan

2013

Mission Coffee Cafe will make its best effort to create a unique place where customers can socialize with each other in a comfortable and relaxing environment while enjoying the best brewed coffee and pastries in town. We will be in the business of helping our customers to relieve their daily stresses by providing piece of mind through great ambience, convenient location, friendly customer service, and products of consistently high quality. Coffee Cafe will invest its profits to increase the employee satisfaction while providing stable return to its shareholders.

Keys to Success The keys to success will be:    

Store design that will be both visually attractive to customers, and designed for fast and efficient operations. Employee training to insure the best coffee preparation techniques. Marketing strategies aimed to build a solid base of loyal customers, as well as maximizing the sales of high margin products, such as espresso drinks. Highly trained and friendly staff.

Coffee Café

Financial Planning: Business Plan

2013

Marketing plan Market Segmentation Coffee Cafe will focus its marketing activities on reaching the students, people working in offices located close to the coffee bar and on senior citizens. Our market research shows that these are the customer groups that are most likely to buy coffee and pasytry products. Since gourmet coffee consumption is universal across different income categories and mostly depends on the level of higher education, proximity to the universities on the proximity area will provide access to the targeted customer audience.

Coffee Café

Financial Planning: Business Plan

2013

The chart above and table below outline the total market potential (in number of customers) of coffee drinkers in Coffee Café – Quezon Ave.

Market Analysis Year 1 Customers Office Workers Students Seniors Others Total

Growth 3.0% 1.0% 2.0% 0.0% 1.2%

20250 11250 9000 4500 45000

Year 2 20857.5 11362.5 9180 4500 45900

Year 3

Year 4

21483.225 22127.7218 11476.125 11590.8863 9363.6 9550.872 4500 4500 46822.95 47769.48

Target Market Segment Strategy Coffee Café will cater to people who want to get their daily cup of great-tasting coffee in a relaxing atmosphere with a deep satisfaction in the aroma of our pastries. Such customers vary in age, although our location close to the University campus means that most of our clientele will be college students and office workers. Our market research shows that these are discerning customers that gravitate towards better tasting coffee. Furthermore, a lot of college students consider coffee bars to be a convenient studying or meeting location, where they can read or meet with peers without the necessity to pay cover charges. For us, this will provide a unique possibility for building a loyal client base.

Market Needs General trend toward quality among consumers definitely plays an important role in the recent growth in coffee. Additionally, such factors as desire for small indulgencies, for something more exotic and unique, provide a good selling opportunity for coffee bars. Our market is made up of consumers who have busy schedules, a desire for quality, and disposable income. As much as they would like the opportunity to sit in an upscale coffee house and sip a uniquely blended coffee beverage and read the morning paper, they don't have the time. However, they still have the desire for the uniquely blended beverage as they hurry through their busy lives. Coffee Café

Financial Planning: Business Plan

2013

Competition There are general competitors in Coffee Café market. They are the national specialty beverage chains, such as Starbucks and Coffee Bean, local coffee houses--or cafes-with an established clientele and a quality product, fast food restaurants, and convenience stores. Patrons to a Starbucks, or to one of the local cafes, are looking for the "experience" of the coffee house. They want the ability to "design" their coffee, smell the fresh pastry, listen to the soothing music, and read the local paper or visit with an acquaintance. It is a relaxing, slow paced environment. Patrons of the fast food restaurants or the convenience stores are just the opposite. They have no time for idle chatter and are willing to over-pay for whatever beverage the machine can spit out, as long as it's quick. They pay for their gas and they are back on the road to work. Although they have the desire and good taste to know good from bad, time is more valuable to them.

Buying Patterns The major reason for the customers to return to a specific coffee bar is a great tasting coffee, quick service and pleasant atmosphere. Although, as stated before, coffee consumption is uniform across different income segments, Coffee Café will price its product offerings competitively. We strongly believe that selling coffee with a great service in a nice setting will help us build a strong base of loyal clientele.

Coffee Café

Financial Planning: Business Plan

2013

Products Coffee Cafe will offer its customers the best tasting coffee beverages in the area. This will be achieved by using high-quality ingredients and strictly following preparation guidelines. The store layout, menu listings and marketing activities will be focused on maximizing the sales of higher margin espresso drinks. Along with the espresso drinks, brewed coffee and teas, as well as some refreshment beverages, will be sold in the coffee bar. Coffee Cafe will also offer its clients pastries, hot chocolates and teas.

Product Description The menu of the Coffee Café will be built around espresso-based coffee drinks such as lattes, mochas, cappuccinos, etc. Each of these coffee beverages is based on a 'shot' of espresso, which is prepared in the espresso machine by forcing heated water through ground coffee at high pressure. Such espresso shots are combined with steamed milk and/or other additives like cocoa, caramel, etc., to prepare the espresso-based beverages. Proper preparation techniques are of paramount importance for such drinks. A minor deviation from the amount of coffee in the shot, the size of the coffee particles, the temperature of milk, etc., can negatively affect the quality of the prepared drink.

Sales Literature Flyers will be distributed in the adjacent neighborhood, on the University campus, at the malls and in the selected office buildings within two weeks prior to the opening of Coffee Cafe. Subsequently, free postcards with Coffee Cafe endorsement will be printed to increase the company visibility among the patrons.

Coffee Café

Financial Planning: Business Plan

2013

Strategy and Implementation Summary Coffee Café’s marketing strategy will be focused at getting new customers, retaining the existing customers, getting customers to spend more and come back more often. Establishing a loyal customer base is of a paramount importance since such customer core will not only generate most of the sales but also will provide favorable referrals.

Competitive Edge Coffee Café will position itself as unique coffee bar where its patrons can not only enjoy a cup of perfectly brewed coffee but also spend their time in an ambient environment. Comfortable sofas and chairs, dimmed light and quiet relaxing music will help the customers to relax from the daily stresses and will differentiate Coffee Cafe from incumbent competitors.

Sales Strategy Coffee Cafe baristas will handle the sales transactions. To speed up the customer service, at least two employees will be servicing clients--while one employee will be preparing the customer's order, the other one will be taking care of the sales transaction. In order to build up its client base, Coffee Café will use banners and fliers, utilize customer referrals and cross-promotions with other businesses in the community. At the same time, customer retention programs will be used to make sure the customers are coming back and spending more at the coffee bar.

Coffee Café

Financial Planning: Business Plan

2013

Sales Forecast The chart and table below outline our projected sales forecast for the next four years

Monthly Sales Php1,200,000

Php1,000,000 Php800,000 Php600,000

Php400,000 Php200,000

Php0

Beverages

Pastries

Coffee Café

Financial Planning: Business Plan

2013

Management Summary

Management Summary Coffee Café is owned by the partnership of Bachelor in Banking and Finance alumnus of Polytechnic University of the Philippines, Manila. They are: (1) Vanessa Joyce Delos Reyes, (2) Geraldine Espinase, (3) Ivanne Ron Ortega, (4) Brian Joseph Pañer, and (5) Melissa Daphne Sarabia. A professional manager (Php 192,000/yr) will be hired who will oversee all the coffee bar operations. One full-time barista (Php 180,000/yr each) will be in charge of coffee preparation. Four more part-time employees will be hired to fulfill the staffing needs.

Management Team A full-time manager will be hired to oversee the daily operations at Coffee Cafe. The candidate (whose name is withheld due to his current employment commitment) has had three years of managerial experience in the definitely industry in Manila. This person's responsibilities will include managing the staff, ordering inventory, dealing with suppliers, developing a marketing strategy and perform other daily managerial duties. We believe that our candidate has the right experience for this role. A profit-sharing arrangement for the manager may be considered based on the first year operational results.

Personnel Plans The table below outlines the personnel needs of Coffee Café.

Manager Barista Employees(4) Total People Total Payroll

Year 1 PhP192,000 PhP180,000 PhP624,000 6 PhP996,000

Year 2 PhP198,000 PhP180,000 PhP624,000 6 PhP1,002,000

Year 3 PhP198,000 PhP192,000 PhP648,000 6 PhP1,038,000

Year 4 PhP204,000 PhP198,000 PhP672,000 6 PhP1,074,000

Coffee Café

Financial Planning: Business Plan

2013

Coffee Café