Business Plan on the Restaurant
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In the current report business plan is prepared on the restaurant. There is huge competition in the relevant sector and due to this reason it is very important for the new entrants to develop some competitive advantage factor in the business so that it can compete with the rivals. Main focus will be on cost control and making efforts to attract more and more footfalls from customer’s side. In this regard only from specific suppliers raw items will be purchased regularly so that more amount of discount can be received on same. Apart from this, small monument of waterfall will be prepared so that there will be center of attraction for the customers in the restaurant and in this way more customers will be attracted towards restaurant.
Restaurant business is one that is increasing at rapid pace in the UK. In the current business plan restaurant business related discussion will be carried out. Restaurant will be established in the Greenwich area of London in order to satisfy needs of the people. Tourism is the one of the major industry in the UK and every year number of tourists comes inbound and outbound which include businessman, students and those who like visit different place. Taste of people is different and due to this reason multiple cuisine restaurant will be opened. Under this variety of products will be made available to the customers at single place and in this way needs of all sort of people will be satisfied. One of the main challenge will be to ensure that good quality of edible item is available to the customers. In this regard an attempt will be made to ensure that best chefs are available to the business firm. At same time it will be important to control cost of the business. Hence, in this regard intern students will be kept by the firm as employees and by doing so cost of employee will be kept low in the business. This is the perfect strategy that can be followed to control and curtail cost in the business. In the current time period there are number of restaurants that are operating in the UK and are offering variety of dishes. Main thing that is observed is that in the London in most of restaurants specific sort of dishes are made available to the customers. For example if the restaurant is Indian then in that case it will offer only Indian dishes. Thus, strength of the current business plan is that at same place wide variety of dishes will be provided to the customers. This will act as USP or unique selling proposition for the business firm.
Before opening a branch in the new business it is very important to understand the industry nature and conditions that are currently existing in relevant domain. In this respect there are number of tools that are used by the business firms like Porter five forces analysis etc. Porter five forces analysis for Redington restaurant is given below.
In the current time period, competitive rivalry is increasing at rapid pace in the London. It can be observed that due to increase in tourism rivalry also increased at rapid pace because in order to capitalize available opportunity people are opening many new restaurants (Mc Donald five forces analysis, 2017). Due to this reason competitive rivalry is increasing at rapid pace in the nation. It can be said that for Redington restaurant it will be very difficult task to open and operate new restaurant successfully in the highly competitive environment.
There is high bargaining power of the buyers because already number of alternatives are available to them. If they identified that high price is charged by the one restaurant then they can approach other restaurants for getting food items at affordable price. Same thing applied in case of product quality, if customer will not get products up to required quality then in that case it can shift to another restaurant (Hyun, 2010). Hence, it can be said that bargaining power of customers is very high in the industry and it will be difficult for the Redington to create and retain customers in the business.
Bargaining power of suppliers is weak because there are number of entities that are supplying same sort of products to the customers. Thus, in case specific supplier sold raw items at high price then in that case firm can purchase same items from the other suppliers. All these things reflects that suppliers bargaining power in respect to Redington restaurant is very low and firm can purchase raw items from them at very low price.
Threat from substitutes is very high in case of the business firm. This is because there are wide variety of dishes that are available in the market in respect to Chinese, Indian, Mexican and British food. Thus, customers have lots of choices and according to same they can approach any sort of restaurant to eat fast food items. There is need to control threat of substitutes from the side of the business firm because in case there are large number of substitutes of the products it become difficult to capture the market in proper manner (Ramanathan and Ramanathan, 2011). Thus, it is very important to ensure that there are less number of substitutes of the product. In this regard some innovation can be done in the food items and by doing so different tests can be created.
Threat from the new entrants is very high in the relevant industry. As it can be observed that there are ample opportunity that are available in the market. With entry of new restaurants opportunity for existing firms reduced to some extent. It can be said that there is very high threat from the new entrants. It is the innovation in product line or trick to attract customers by using which this threat can be reduced to some extent by the Redington restaurant.
Restaurant industry growth is largely dependent on the same of the tourism industry. This means that if tourism industry will grow at rapid pace then in that case restaurant business growth rate will also accelerated at rapid rate. In the current time period tourism industry cover 9% of the UK GDP. Apart from this, inbound and outbound tourism is also increasing at fast rate. Along with this, student’s tourism is also increasing. On basis of all these facts it can be said that in the upcoming time period resultant business will increase at fast rate because tourism industry is on growth track.
All sort of people will be customers of the business firm whether they are children, youngsters or old people. This is because eating habits of the people does not changed significantly with change in age factor (Beckinsale, Ram and Theodorakopoulos, 2011). Fast food is preferred by the old and young people to great extent. Thus, due to this reason all sort of the people will be target customers of the business firm. In order to make any business successful it is important to have some value proposition in the business. In this regard first of all availability of food items will be value proposition for the business firm. This is because it is planned that varied sort of dishes will be made available to the people at single place. Thus, who wants to taste different sort of food items can come in the Redington restaurant. It can be said that it is the one of the unique feature of the restaurant that makes it different from the rivals. Apart from this, the other value proposition factor is that small waterfall type architecture will be build up in the restaurant and under this some attractive stones will be purchased and through pumps that water will be fall from the stones. Size of the monument will be moderate and this will create pleasant environment in the restaurant and customers will feel better and will observe congenial environment for taking lunch or dinner with family members. It can be said that it is the one of the main factor that will attract number of people towards restaurant in large number within short time period. Thus, there is probability of achieving huge success in the business in short time period. It can be said that there is huge significance of these factors for the restaurants.
In the initial stages there are no huge amount of cash flows in the business. Thus, it is very important to choose method of advertisement that lead to generation of less cost in the business. In the current time period different sort of marketing strategy can be followed by the business firm and some of them are explained below.
In the social media site like the Facebook restaurant will post dishes it served regularly. Photos that will be uploaded in the social site will be of very attractive in nature and it will help firm in persuading people to take lunch or dinner in the restaurant. It can be said that there is a huge importance of social media for the firm.
The product will be advertised on the newspapers that are published at local or national level in the country. By doing so across the nation people will be informed about the restaurant name and its products. Restaurant name will be advertised regularly so that people remember its name for long time period. This will promote word of mouth marketing of the firm name among the people and will increase memory retention value of its name among the people of London for long time period.
In the magazines that are related to the leisure name of the restaurant will be published along with attractive advertisement. By doing so those type of people that make heavy expenditure on leisure and preferred to take lunch in high level of restaurants will be attracted easily. It can be said that there is appropriate strategy by using which customers can be targeted in better way.
Redington restaurant will open its restaurant in the Greenwich at Goddard’s at Greenwich, 22 King William Walk SE10 9HU, United Kingdom. In the current business there will be two chefs which will be intern students. This is done to control the employee cost in the business. As it is very costly to keep two chefs in the business which are highly qualified and knowledgeable person with wide years of experience. Such kind of chefs charge a very high fees for their services. New business cannot afford to keep such kind of chefs in the restaurant. Office premises will be taken on rent because it is not possible to build up new premises. Apart from this, raw material will be purchased from the few suppliers on contract basis. Means that contract will be inked with the suppliers and under this all products or raw items will be purchased from these suppliers every time. In return heavy discount will be given by the suppliers to the business firm. This strategy will lead to control of cost of purchase and production in the business. It can be said that current business plan is prepared in proper manner by the business firm. This operational plan will ensure that all items are available on time and at low cost. Thus, business firm will be able to perform its operations smoothly.
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In the organization there will be one manager and that will be owner of the business firm. This is done in an effort to control cost in the business. If any individual is hired as manager by the business firm then in that case firm have to pay very high fee to it. Thus, owner will be taken as manager in the business. In the company there will be two chefs that will be intern students. Apart from this, there will be two servants in the business. All these members will manage entire business operations in proper manner. This will be entire company structure in the Redington restaurant.
In order to operate every business there are some of the resources that are required to perform the business operations. Some of these resources are explained below.
HR is the one of the important resource that any business firm have in its venture. As mention above in Redington restaurant there will be one manager, 2 chefs and 2 servants. There will be 5 employees in the restaurant. In case business will increase at rapid rate then in that case workforce will be increased at relevant level. It can be said that appropriate plan is prepared to control employee cost in the business.
In case of finance firm will approach relevant banks and financial institutions. Under this majority part of the capital investment will be taken from the banks at low discount rate. Business plan will be presented in front of the bank managers and detail discussion will be carried out on plan. In this way, bank managers will be convinced to allocate fund at low interest rate.
Apart from the finance and human resources raw material is another important resource that any business firm have in its business. It can be observed that raw material will be purchased from the suppliers which will be very few. By doing so it will be ensured that raw material will available in the business in abundant quantity.
Project will be financed from the banks and other financial institutions. Under this specific amount of debt will be taken from the banks at low interest rate. 10% of the amount by which business will be finance will be taken from the business friends. Apart from this, 20% amount of the fund will be personal savings. It can be said that in this way 30% of total requirements will be financed from the internal requirements. 70% portion of entire fund requirement will be taken from the bank as debt amount. It can be said that in best way allocation of finance resources is done in the business. It is very hard task to raise funds from the banks as they do varied level of chekings in order to access the risks that are associated with the business plan (Hingley, Lindgreen. and Beverland, 2010). On that basis they determine interest rate that will be charged on the bank loan amount. In the current time period, business conditions are uncertain and due to this reason existing firms are facing lots of problems in their business. Hence, banks are charging heavy interest rates. It became very important to ensure that business plan is presented in systematic way so that bank manager think that business idea is viable in nature. If manager will think such kind of thing then in that case it will charge low interest rate on bank loan amount.
There are number of risks that are associated with the current business plan. One of the major risk is that consumer behavior of the people keeps on changing consistently with passage of time. It can be observed that before last 5 or 10 years trends were different. This happened because with passage of time people like to try something new and different and due to this reason there preference keeps on changing consistently. Restaurants have to prepare food items by taking in to consideration the consumer behavior of the people so that raw material can be purchased with full control. If same will be done then in that case there will be less inventory in the business. This will lead to control in inventory cost in the business. Thus, elevation in inventory storage cost is the one of the main risk.
Other risk that is currently associated with the current business is that already there are large number of competitors of the business firm. It will be very difficult for Redington restaurant to create its positive image among the customers. Thus, there are chances that in the initial year firm face heavy loss in its business. This situation can be control by following proper plan and under this as mention above there is need to make available innovative products to the customers (Lane, 2010). By doing so at fast rate new customers can be created in the business. Apart from this it is very important to make available products at low price to the customers. By doing so also firm can create its distinct image among the customers and can attract them at rapid rate. The other strategic option that is available to the firm is to develop attractive offers by using which at least moderate profit can be generated in the business. It can be said that by doing so large number of customers specially those who like to visit restaurant in group can be attracted. Thus, in single time period large number of customers can be served by the firm. These were some of the strategic options that must be followed to manage risk.
There is a number of milestones that will act like a success factor for the business firm. Selection of the intern students will acts as milestone in the firm success because compliance with this strategy will lead to cost control in the business. In the case of most restaurants, it is observed that they keep experienced and talented chefs at the kitchen. Redington will select highly qualified interns and by doing so the cost will be controlled and profit will be enhanced. The other key milestone in the current business plan is that raw material will be purchased from the specific suppliers regularly. This will again lead to cost control in the business which will ultimately lead to enhancement in the profitability of the business firm. Apart from this, small waterfall type monument will also build up in the restaurant which will be the center of attraction for the people and will create its different image among the people. This will create positive image of the restaurant among the people. Moreover, positive word of mouth marketing of the firm will be promoted among the people which will lead to enhancement in number of customer footfalls the restaurant.
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