THUNDERSTORM
BUSINESS PLAN
EXECUTIVE SUMMARY
This 2,981-word document is a business plan for a restaurant establishment. The name of the planned business venture is Thunderstorm Restaurant to be located at Commercial Street in Central, the main business street in Hong Kong. It is a location on the north shore of Hong Kong Island in Hong Kong. And since most of the main people in this area are generally staff from multinational financial services corporations and vacation tourists, then Thunderstorm Restaurant has great potential to be recognised by tourists, business clients, employees and business managers and owners. Restaurants located in Hong Kong are in abundance. In fact, there are plenty restaurants of corner, but the demand for excellent food and beverages is increasing in enormous number, thus the project for Thunderstorm Restaurant. The business aims to establish competitive advantage through providing clients with a unique Thunderstorm Restaurant experience each and every time they enter our restaurant, mainly through excellent dining services. The management team of Thunderstorm Restaurant will be consisted of four highly-qualified and success-driven people who will lead Thunderstorm Restaurant in its path to growth and sustainability. The main target market for the company is the business stakeholders and tourists who go to Hong Kong to experience food and beverages in its finest in the area. The secondary target market will be the locals, who have sustained the growth of the food and beverages industry through their continued patronage of restaurants in Hong Kong. The business needs to raise HK$ 2,000,000.00 though, and this document aims to assist in realising that objective. Said capital requirement will be used for start-up and operating costs to last for three years, specifically for the purchase of furniture, equipment and raw materials to be used for business operations.
TABLE OF CONTENTS
TITLE PAGE
Executive Summary ………………………………………………………………. 1
Table of Contents …………………………………………………………………. 2
The Business ………………………………………………………………………. 3
Management Team and Stakeholders ……………………………………………. 4
General Manager ……………………………………..……………………. 4
Senior Staff & Senior Manager ……………………………………………. 4
Local Staff & Overseas Staff ……………………………….………………. 5
Customer …………………………………………………….…………….. 5
Company Structure …………………………………………………….………….. 6
Industry Analysis ………………………………………………………………..… 7
Target Market …………………….……………………..………………… 9
Marketing Plan …………………….……………………………………………… 9
Product feasibility and Strategy ………………………………………….. 9
Pricing Strategy …………………………………………………………… 10
Channels of Distribution and Promotion and Advertising ……………… 11
Operation Plan ……………………………………………………………………. 12
Project Auditing and Completion ……………………………………………….. 12
Managing Obstacles to Success ……………………………………………………. 13
Appendices ………………………………………………………………………… 15
References ………………………………………………………………………… 18
The Business
The food-service industry in the Hong Kong, particularly the restaurant sector, has witnessed an impressive growth in the past several years, in parallel with the growing number of tourists who go to Hong Kong. The Food and Beverages industry in Hong Kong has been markedly flourishing in the past decades, leading to the sprout of the number of restaurant in the city.[1] The food service now in the country are in continues development and progress.[2] Currently, there are numerous numbers of restaurants in the said area such as Hong Kong Chinese Restaurant, Yung Kee Restaurant and Yu Restaurant but the number of consumers is still increasing.[3] To this end, this business project aims to establish the Thunderstorm Restaurant in business street in Hong Kong. The germ of idea of running a restaurant came up when the author was enjoying his meal in business street in Hong Kong and saw the steady stream of people going inside the establishment to have their breakfast, lunch or dinner. This proposal will cater to the growing need of food and beverages patrons to find a haven where they can just sit back and enjoy their food and drinks, either alone or with company. The business will be specifically designed to cater to the clients’ hearts desires and whims and make their Thunderstorm Restaurant patronage worth repeating over and over again. The business aims to establish competitive advantage through providing clients with a unique Thunderstorm Restaurant experience each and every time they enter our restaurant, mainly through excellent dining services and free live band performing while the guests are enjoying their food and drinks. Currently, the business is still in its preparation stage, and is looking out for sources of funds which would finance start-up costs and running capital. The desired business logo, mission and objectives are attached in the Appendices section of this paper (Appendix 1, 2 & 3).
Managing Team and Stakeholders
When running a business project, it is important to understand the values and issues that stakeholders have in order to address them and keep everyone on board for the duration of the project (Burke, R. 2003). Stakeholders are not always keen to participate but engaging them at this early stage of the project will help ensure success.
General Manager (GM)
The GM is the founder of Thunderstorm Restaurant, his management style should be likely as most traditional Hong Kong family business with centralised decision making and supporting paternalistic regulation. He should always emphasise that a successful company need have competitiveness in the market and maintains a certainly high level of efficiency, effectiveness. Since restaurants are both product and labour intensive, the cost of employee is in high ratio of total expense. On his role of general manager, he should have to balance between the profitability of shareholders and the loyalty of employee. The GM is neutral on the scheme, we do keep communicate with him to understand his intention and raise his faith.
Senior Staff & Senior Manager
They are advocates and supporters on the scheme, evidence collected with them which are:
Ø They should adjust working hour to accommodate with clients
Ø They should subordinate & themselves have a adaptive resting time for increasing energy and creativity
Ø It can achieve a healthy work-life balance, such as they can have breakfast with elder in the morning, foster children, send and pick up in-studying children
Ø They estimate it can boost their loyalty, productivity and collegiality, and enhance overall company’s image
Ø They are the key stakeholder group in the scheme, there should be a good relationship with them to motivate them supporting and advancing the scheme. Involve them in each stage and decisions.
Local Staff & Overseas Staff
Dispersed aptitude and opinion should be observed in this group. Some critics argue that:
Ø It can reduce their autonomy on their working time
Ø It cannot solve the problem of the long overtime working hour which is underestimated by managers
Ø increase their workload and affect their own performance if other colleague do not have good discipline
Ø Some of them can become our allies to influence others and neutralise the opposition.
Customer
The market can be segmented into three target populations:
- Local Individuals: people of Hong Kong that love to dine in restaurants.
- Families: a group of people, either friends or a group of nuclear relatives who eating and drinking together.
- Tourist: people that are not locally from Hong Kong but prefer and enjoy eating food delicacies of Hong Kong.
The Thunderstorm Restaurant customers are individuals between the ages of 21 and 50, making up 53% of Hong Kong. Age is not the most defined demographic of this customer base; all age groups including kids less than 10 years of age can enjoy Thunderstorm products since it also serve burger, pasta, hotdogs and patties. The most defined characteristic of the target market is income. Thunderstorm Restaurant stores have been very successful in high rent, mixed-use urban areas. These areas have a large day and night population consisting of business people and families who have household disposable incomes over HK$ 154,289.82.
Combining several key demographic factors, Thunderstorm Restaurant arrives at a profile of the primary customer as follows:
Ø Sophisticated families who live nearby.
Ø Young professionals who work close to the location.
Ø Pasta, burger, Asian delicacies lovers who patronise the excellent food and beverages.
Company Structure
Thunderstorm Restaurant developed the company’s organisational structure to reflect the company’s dedication to maintaining organisational morals, culture and processes. The Thunderstorm Restaurant organisation will serve as the base of its corporate activities. As seen in the organisational chart, (see Appendix 4 for the organisational diagram) there is no line pointing down, indicating that the lines of communication can go in both directions (upward or downward), which implies that the organisation intends to adopt a culture in where communication doors are always open. Also, the chart is a defining figure of how the lines of authority should be followed, and its simplicity would enable all organisational members to comply with it easily. This hierarchical-oriented organisation will promote unity to all Thunderstorm Restaurant management people and employees through adoption of a structure with hierarchical relationships between organisational members with the intention of disseminating corporate policy effectively and efficiently throughout the firm so that we could move in the same direction.
The organisation form will be a limited liability company, in where the owners would have limited personal liability for business debts, fringe benefits can be deducted as business expense and owners can split corporate profits among owners and corporation and overall tax rate is lower, as compared to other organisational forms. The management team is currently applying for the Thunderstorm Restaurant trademark, for it has immediate plans of expansion outside Hong Kong and it would not want to infringe any legal requirements of the law regarding the business. Also, the business logo, which will be the image representing Thunderstorm Restaurant, will be applied for copyright, as the management team would like to preserve the image as solely belonging to the Thunderstorm Restaurant.
Industry Analysis
The food and beverages industry in the Hong Kong is continually flourishing, as evidenced in the wealth of said establishments in the area. Basically, in global context, food and beverages is one of the largest commodities. Meaning to say, if Thunderstorm Restaurant sustains its development in Hong Kong market, the company can also achieve similar growth to other well known restaurants in Europe and United States. Aside from high class food, the restaurant also offers excellent coffee and beverages. Actually, an online encyclopaedia stated that the specialty coffee portion is almost billion and coffee is the number one beverage consumed in the world and it is a “recession proof” product.[4]
From the given report and researches, Thunderstorm Restaurant still needs to create an effective project plan for the business. In Thunderstorm Restaurant, the leadership of project managers always involves attempts on the part of a project leader to affect the behaviour of a follower or followers in situation. In addition, their management abilities focus on the techniques and expertise of efficient organisation, planning, direction, and control of the operations of a business. In this ever changing global business environment Thunderstorm Restaurant must be competitive and do everything it can to counter any threat from its competitors. Having a good project leader gives the company some edge in facing competition in the global business environment. Companies take part in strategic alliances to attain advantage over their competitors and for both companies to acquire benefits from each other. These strategic alliances won’t be successful if there is no leadership. Leadership gives many things to the company. It is an important aspect of a company. Although leadership can come from core intellectual assets practical application is also vital for the success of the company and for the company to be competitive in the global business environment.
Target Market
The main target market for the firm is tourists who go to Hong Kong to experience food and beverages in its finest in the region. The secondary target market will be the locals and business stakeholders, who have sustained the growth of the restaurant industry through their continued patronage of restaurant in Hong Kong. Specifically, the demographic profile of the market to Thunderstorm Restaurant will be the all-aged generation of customers, from the 1 to any age bracket. The food and beverage has been served in various ways thus making the market rather varied as well. It is also proposed that the target market on this context would also include the younger generations. A need to cater to a specific demographic has spawned the need to acquire a competitive advantage with the rest of the players in the market.
Marketing Plan
Product Feasibility and Strategy
The product that Thunderstorm Restaurant will offer is excellent food and beverages items and will increase in number as time passes. The names of the food and beverages are unique, so that customers may know that the products are uniquely Thunderstorm Restaurant’. Before the food and beverages were formally included in the official list of the business’ offerings, there were taste tests conducted in local supermarkets, and those that passed initial testing were given official names to establish identification. The cups were likewise pre-tested for their functionality and durability to withstand water heat (in case the beverage belongs to the hot variation. The tissues and utensil which would be used are manufacturer-guaranteed to be environment-friendly and safe for human use. The machines and equipment to be used are likewise tested in order to bring only the best-tasting food and beverages that is worth every dollar.
Pricing Strategy
The price will depend on the type of food and beverages. The prices would be in par with those existing retaurants in Hong Kong, with the business relying on the shop ambience, quality of dining service, and free live band performance to gain competitive advantage from rivals in the area. Using all the available information in this business plan, the pricing objective of Thunderstorm Restaurant would be to offer the best-tasting food and beverages in Hong Kong at relatively affordable price ranges. With that in mind, the pricing strategy included the cost of providing food and beverages to the customer (electricity costs, labour costs, raw materials cost, etc.)
The management team believes that Thunderstorm Restaurant products have unique and defensible attributes which could support a high price. However, since a sector of the target market involves young people, who commonly do not have a source of income of their own, Thunderstorm Restaurant will strive to keep costs at the lowest level in order to maintain a cheap price offering for all their food and beverages products. Also, since the Thunderstorm Restaurant aims to promote an image of affordability and quality all rolled into one, this pricing strategy would definitely help build and sustain that target image.
Channels of Distribution and Promotion and Advertising
On start-up, there will only be one restaurant located in Central, Hong Kong where clients could go to have their satisfying food and beverages. This is the main and only channel of distribution for the initial months of the business. However, if financial statements forecasts prove true, customers will soon see a number of Thunderstorm Restaurant bistros lined up in the thoroughfares of Hong Kong.
The main promotion and advertising objective of the business is to be able to spread the Thunderstorm Restaurant word without allotting too much on marketing costs. After all, what works well and what does not work at will depend mostly on the business, the product and service accompanying it, the community, the competition and the skills in how the marketing director will promote the business. As soon as possible, the new restaurant sign will be put up (including the name, type of shop, hours of operation and the opening date) in order to promote the business well before its opening. When the employment ads are posted in the local papers, the business will make sure to include Thunderstorm Restaurant’ name and location, as this inexpensive classified advertising will help promote the business.
There will be a card awarded free to the first fifty customers of the shop on the day that it opens. This card will serve as their Thunderstorm Restaurant Advantage Card and will avail them of all the benefits of being a Thunderstorm Restaurant Advantage Card holder. Discounts and freebies will be given on designated periods to all cardholders. However, those who were not able to avail of the card for free could still own one given a minimum amount membership fee (HK$ 200). The advertising part of marketing will consist only of a free taste booth in front of the restaurant during the first week, half dozen streamers around the area and a hundred flyers to be given away at supermarket doors. Also, one hundred business cards will be at hand, as they are a great way of advertising. The management believes that this is sufficient to advertise the business, and the rest will be left to word-of-mouth.
Operation Plan
The service blueprint diagram is a simple representation of the flow of service delivery of the Thunderstorm Restaurant. The blueprint presented in Appendix 5 presents the areas of operations of Thunderstorm Restaurant. Specifically, it presents the areas of operations in which the customer could see as well as the unseen areas. This marks down the areas in which the restaurant should look closely. Similarly it also provides the operational plan that the organisation should acquire the moment there are malfunctions in the operation. This is particularly seen in the delivery of the food and beverage to the customers. At this instance of failure, a return to the brewing step is in order. The diagram provides a representation of the process flow that the organisation intends to establish in its daily operations.
As of 2008, the economy of HK is one of the strongest in Asia; inflation, interest rates, and unemployment remain low (‘HK Economy’, 2008). Despite of the low unemployment rate in Hong Kong i.e. only 4.2% as of 2007, there are still potentials for Thunderstorm Restaurant to hire personnel needed for the business operation. This people will form part of the potential employees of Thunderstorm Restaurant (see Appendix 7 for list of employees required by the business). Customer support will be one of the main responsibilities of the store manager. Complaints and suggestions regarding the service or food and beverages quality could be made directly to the manager or written in a slip and dropped at a Suggestion/Complaint box in the cashier counter.
Project Auditing and Completion
With regards to the project auditing and completion, Thunderstorm Restaurant should do some evaluation regarding the completion of the whole project. The auditor should consider the implications of non-compliance in relation to other aspects of the audit, particularly the reliability of management representations (Abbott, P. & Sheldon, I. 1996). In this regard, the auditor reconsiders the risk assessment and the validity of management representations, in case of non-compliance not detected by the entity’s internal controls or not included in management representations. The implications of particular instances of non-compliance discovered by the auditor will depend on the relationship of the perpetration and concealment, if any, of the act to specific control activities and the level of management or employees involved (Arter, 2002). The auditor should, as soon as practicable, either communicate with those charged with governance, or obtain audit evidence that they are appropriately informed, regarding non-compliance that comes to the auditor’s attention. However, the auditor need not do so for matters that are clearly inconsequential or trivial and may reach agreement in advance on the nature of such matters to be communicated. If in the auditor’s judgment the non-compliance is believed to be intentional and material, the auditor should communicate the finding without delay. The auditor may conclude that withdrawal from the engagement is necessary when the entity does not take the remedial action that the auditor considers necessary in the circumstances, even when the non-compliance is not to the financial statements.
Managing Obstacles to Success
Based on the previous details, planning is a key resource of the organisation, together with people, finances and material assets. Thus, it is accepted to state that project plan is a business issue. The discussion above revealed that through effective project planning management of the organisation’s resources and systems, organisation administrators can add value to the services delivered to customers, reduce risks in the organisation’s business, reduce the costs of business development and service delivery and encourage improvement in internal business processes and external service implementation. On the other hand, it is recommended that when developing a project, it is better to build a report that is ideal for a specific need then to make a report based on a predefined concession.
APPENDICES
Appendix 1. Business Logo
Appendix 2. Business Mission
The Thunderstorm Restaurant aims to become the HK market leader in the restaurant industry and to have a solid base of pleased clients who will eventually spread the word of the business.
Appendix 3. Business Objective
Ø To satisfy our clients’ craving for best-tasting food and beverages.
Ø To provide an atmosphere where clients could have a place with friends and loved ones to spend quality time while enjoying our food and beverages.
Ø To provide our patrons service with a smile.
Ø To be socially responsible in the carrying out of business operations.
Ø To contribute to the economy of Hong Kong.
Ø To build an image that Hong Kong has some of the world’s best restaurants.
Appendix 4. Organisational Chart
Appendix 5. Service Blueprint Diagram
Appendix 7. Manpower Requirements
2 Store Managers ~ to oversee the day-to-day operations of the restaurant and to deal with customer concerns.
30 Baristas ~ to work behind the counter, concocting food and beverages as specifically ordered by the customer.
20 Massage Attendants (10 Masseuse and 10 Masseur) ~ to work in two alternating shifts, one during the morning and another in the afternoon. They will attend to massaging the customers for free upon request from them for a period of ten minutes per order.
8 Cashier ~ to take customer payments and allow discounts to Thunderstorm Restaurant Advantage Card holders when applicable.
30 Service Crews ~ to attend to delivering the output of baristas to the customer’s table and to give out freebies to Thunderstorm Restaurant Advantage Card holders when applicable.
8 Janitor / Messenger ~ To manage the cleanliness of the store for the comfort and health safety of the customers, and to occasionally deliver messages and documents outside the restaurant.
REFERENCES:
Abbott, P. & Sheldon, I. (1996). Industrial Organisation and Trade in the Food Industries. (Ed.) Boulder, CO: Westview Press.
Arter, D, (2002). Quality Audits for Improved Performance. ASQ Quality Press;3 edition.
Burke, R. (2003). Project Management: Planning and Control Techniques. (4th ed.). West Sussex, England: John Wiley & Sons.
‘HK Economy’. (2008). CIA Factbook. Accessed 22 April, 2008, from https://www.cia.gov/library/publications/the-world-factbook/geos/hk.html
[1] From http://www.marketresearchworld.net
[2] From http://www.sallys-place.com/food/dining_directory/asia/hong_kong.htm
[3] Ibid.
[4] From http://en.wikipedia.org/wiki/Coffee
Credit:ivythesis.typepad.com
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