2013

Café di Nofà David Simon

BUSINESS INITIATION PLAN This plan is created for the sole purpose of guiding the initiation of Café di Nofa from concept to operations and to provide insight to how this will be accomplished for investors who have an interest in ownership in this cafe.

LEGAL PAGE

NON-COMPETE, NON-SOLICITATION, NON-DISCLOSURE AGREEMENT

________________________________________________________________________________________________

This NON-COMPETE, NON-SOLICITATION, NON-DISCLOSURE AGREEMENT (the

"Agreement") is made and effective in the State of Kuwait on_________________by

and between:

Mr. David M. Simon "Owner", in his capacity as the General Manager and the minority owner of DarNofa General Contracting & Trading Company (the "DGCTC"), and

_____________________________________________, "Counter-party", in his capacity as___________________________________________________________

on behalf of Mrs. Nouf Al-Shatti, the majority owner of the DGCTC.

Both hereafter called individually as a "Party" or collectively as the "Parties".

RECITALS

WHEREAS, Owner has identified certain potential transactions, business endeavors, or other

business opportunities, as set forth in this Business Plan (collectively, the "Opportunities") and wishes to come to a mutually beneficial agreement to pursue the Opportunities;

WHEREAS, Owner wishes to discuss a potential working relationship with respect to the

Opportunities with Counter-party; and

WHEREAS, Owner will not discuss the Opportunities unless and until Counter-party enters into this Agreement;

NOW, THEREFORE, in consideration of the promises and the covenants, conditions and agreements contained herein, the Parties hereto agree as follows:

ARTICLE 1 - Definitions: As used in this Agreement, the following capitalized terms shall have the meanings set forth below:

"Person" means an individual, a corporation, a limited liability company, a partnership, an

association, a trust or other entity or organization, including, without limitation, a government or political subdivision or an agency or instrumentality thereof.

"Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with the first Person.

ARTICLE 2 - Purpose of the Agreement: Counter-party acknowledges to entering into this

Agreement in order to induce Owner to provide information with respect to the Opportunities in

anticipation of working together to pursue the Opportunities and to protect a legitimate business

interest of the Owner. In entering into this Agreement, the Parties are contemplating that they will

come to a formal arrangement with respect to pursuing the Opportunities together. Counter-party agrees not to pursue the Opportunities other than in conjunction with Owner.

ARTICLE 3 - Non-Compete Covenant: Counter-party agrees that, from the date hereof until the fourth anniversary of such date, Counter-party will not;

a) pursue the Opportunities, either directly or indirectly, for Counter-party's own account, or for

the account of any other Person in the capacity of an officer, director, manager, employee or

contractor of such Person, in any business that will pursue the Opportunities (except in either case

as a stockholder holding less than a one percent interest in a corporation which is traded on a

national exchange or over-the-counter); or b) solicit, or attempt to solicit, directly or by assisting

others, any Person to pursue the Opportunities other than Owner.

ARTICLE 4 - Non-Disclosure Covenant: Counter-party agrees to hold in confidence at all times

after the date hereof the Opportunities, together with all pricing, bidding and other strategic

information developed in conjunction with pursuance of the Opportunities and shall not disclose,

publish or make use of the Opportunities at any time after the date hereof, without the prior

written consent of the Owner. In all cases, both Parties affirm that they shall implement this Agreement in good faith and shall take all necessary steps to see its proper execution.

ARTICLE 5 - Term and Termination. This Agreement shall terminate on the fourth anniversary of the date of this Agreement.

ARTICLE 6 - Severability: If any provision contained in this Agreement shall for any reason be

held invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability

shall not affect any other provision of this Agreement, but this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.

ARTICLE 7 - Equitable and Alternative Relief:

a) Counter-party acknowledges that Owner may be irreparably harmed by any breach of this

Agreement. Counter-party agrees that DGCTC shall be entitled to injunctive relief requiring specific performance by Counter-party of this Agreement, and Counter-party consents to the entry thereof.

b) Counter-party agrees to pay to Owner a commission equal to 25% of the gross profits that

Counter-party derives, either directly or indirectly, from pursuing the Opportunities without Owner, in contravention of this Agreement.

ARTICLE 8 - No Waiver: No failure or delay by the Owner in exercising any right, power, or

privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power, or privilege preclude any other or further exercise thereof.

ARTICLE 9 - No Further Obligation: This Agreement does not obligate either the Owner or

Counter-party to enter into the Transaction. At any time prior to the execution of a definitive

agreement between the parties with respect to the Transaction, either Party may voluntarily

withdraw for any reason from discussions with the other Party concerning the Transaction by giving

the other Party written notice to such effect; provided, however, in any event, the Counter-party

shall remain subject to the obligations set forth in this Agreement. This Agreement may be modified or waived only in writing signed by both parties.

ARTICLE 10 - Successors and Assigns; Third-Party Beneficiaries: This Agreement is binding

on Owner and Counter-party and their respective successors in interest. Neither Counter-party nor

Owner may assign its rights and obligations under this Agreement without the prior written consent

of the other Party. There are no third-party beneficiaries of this Agreement, and any intention to afford any right or benefit under this Agreement to any third party is specifically disclaimed.

ARTICLE 11 - Enforceability: If one or more provisions of this Agreement shall be held

unenforceable, such unenforceability shall not affect any other provision of this Agreement, which

shall be construed as if such provision had never been a part hereof.

ARTICLE 12 - Choice of Law: THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN

ACCORDANCE WITH THE LAWS OF KUWAIT. THE PARTIES AGREES THAT ANY ACTION OR

PROCEEDING ARISING OUT OF OR RELATED IN ANY WAY TO THIS AGREEMENT SHALL BE

BROUGHT SOLELY IN A COURT OF COMPETENT JURISDICTION SITTING IN KUWAIT CITY,

KUWAIT.

ARTICLE 12 - Counterparts: This Agreement may be executed in several counterparts, each of which is an original and all of which constitute one and the same Agreement.

ARTICLE 13- Proper Handling: This plan must be returned to the Owner after 72 hours of

receipt unless otherwise noted by the Owner on the signature page of this agreement. Accordingly

the contents of the plan must be kept confidential with the person(s) in authorized possession of

this plan as annotated and signed on the following signature page. Re-printing, copying, or any

other such duplication or re-creation, whether in part, or in whole, is absolutely prohibited with

applicable sanctions and penalties to be pursued to the fullest extent of the local law as well as stated herein.

[Only Signature Page to Follow.]

-----------------------------------SIGNATURE PAGE----------------------------------------

___ DS

___ ___ This Agreement has been review and corrected by both parties.

___ ___ Both parties agree the Agreement is sound and equitable.

___ ___ Both parties agree to be bound by its terms.

This Agreement is considered binding and official, as signed on this ______ day of __________

2013, in the presence of the below witnesses. Date of return of plan is NO LATER THAN the End Of

Day, on the ______ day of __________, 2013.

________________________ ________________________

David M. Simon

General Manager

DarNofa GCTC

________________________

Nouf Al-Shatti

Chairman & Owner

DarNofa GCTC

________________________ ________________________

Witness: Witness:

Civil ID: Civil ID:

Phone: Phone:

This is a business plan. It does not imply an offering of securities or entitlements.

Plan number _____ of _____

Table of Contents

Page 1

1.0 Executive Summary .................................................................................................................... 1

Chart: Highlights .......................................................................................................................... 2

1.1 Objectives .................................................................................................................................... 3

1.2 Mission .......................................................................................................................................... 3

1.3 Keys to Success ........................................................................................................................ 3

2.0 Company Summary ..................................................................................................................... 3

2.1 Company Ownership ............................................................................................................... 4

2.2 Startup Summary ..................................................................................................................... 4

Table: Startup ............................................................................................................................... 5

Chart: Startup ............................................................................................................................... 5

3.0 Products ........................................................................................................................................... 6

4.0 Market Analysis Summary ........................................................................................................ 6

4.1 Market Segmentation ............................................................................................................. 7

Table: Market Analysis ............................................................................................................... 8

Chart: Market Analysis (Bar) ................................................................................................... 9

4.2 Target Market Segment Strategy ...................................................................................... 9

4.3 Industry Analysis .................................................................................................................... 11

4.3.1 Competition and Buying Patterns ............................................................................ 12

5.0 Web Plan Summary ................................................................................................................... 15

5.1 Website Marketing Strategy ............................................................................................... 16

5.2 Development Requirements ............................................................................................... 16

6.0 Strategy and Implementation Summary .......................................................................... 18

6.1 SWOT Analysis ........................................................................................................................ 18

6.1.1 Strengths ........................................................................................................................... 20

6.1.2 Weaknesses ...................................................................................................................... 21

6.1.3 Opportunities ................................................................................................................... 21

6.1.4 Threats ............................................................................................................................... 22

6.2 Competitive Edge ................................................................................................................... 22

6.3 Marketing Strategy ................................................................................................................ 23

6.4 Sales Strategy ......................................................................................................................... 23

6.4.1 Sales Forecast.................................................................................................................. 27

Chart: Sales Monthly ............................................................................................................ 27

Chart: Sales by Month ......................................................................................................... 28

Table of Contents

Page 2

Chart: Sales by Year ............................................................................................................. 28

6.5 Milestones.................................................................................................................................. 29

Table: Milestones ....................................................................................................................... 29

7.0 Management Summary ............................................................................................................ 30

7.1 Personnel Plan ......................................................................................................................... 36

Table: Personnel ......................................................................................................................... 39

8.0 Financial Plan ............................................................................................................................... 40

8.1 Startup Funding ...................................................................................................................... 41

Table: Startup Funding ............................................................................................................ 41

8.2 Important Assumptions ....................................................................................................... 41

8.3 Break-even Analysis .............................................................................................................. 41

Table: Break-even Analysis .................................................................................................... 42

Chart: Break-even Analysis ................................................................................................... 42

8.4 Projected Profit and Loss ..................................................................................................... 42

Table: Profit and Loss ............................................................................................................... 43

Chart: Profit Monthly ................................................................................................................ 44

Chart: Profit Yearly .................................................................................................................... 44

Chart: Gross Margin Monthly ................................................................................................. 45

Chart: Gross Margin Yearly .................................................................................................... 45

8.5 Projected Cash Flow .............................................................................................................. 45

8.6 Projected Balance Sheet ...................................................................................................... 48

Table: Balance Sheet ................................................................................................................ 48

8.7 Business Ratios ....................................................................................................................... 48

Endnotes .................................................................................................................................................. 8

Cheap Imported Labor Induced Customer Service Death ................................................... 9

Quality vs. Cost = Value ................................................................................................................. 11

Memberships ........................................................................................................................................ 16

Emerging Markets Opportunities.................................................................................................. 17

SOP's, PR&LL, TTPs .......................................................................................................................... 18

1.0 Executive Summary

Introduction

Café di Nofà is opening under the operation as a combination Italian Cafe & Espresso Bar, geared

towards high quality VIP style service and premium Food & Beverage (F&B) offerings, where customers

may choose to enjoy themselves in a sit down and slow dine, or pick-up-and-go express style setting.

It is the purpose of this business plan to lay the foundations of the cafe's mission, vision, and values

as well as the strategy to the cafe's principal investors on how we will guide the development of the cafe through initiation to sustained operations with the quickest Return On Investment possible.

The Cafe

The store will be located in a very high traffic area such as the Avenues Mall, the 360 Mall, or other like location.

The store will offer high quality F&B offerings that are demanded in the market and exist currently

without high competitive saturation.

We expect a high degree of expertise and enthusiasm from our team and to ensure we will obtain this,

management will implement training programs, empowering policies, employee development, and incentive programs geared towards retention of the best employees.

Sourcing is critical for any enterprise, especially a F&B operation. The Mokito brand offering the

Mokito Bianco, Mokito Verde, and the Mokito Rosso Italian brand of coffee, a premium range of Italian

roasts, will be our product of choice for our coffee drinks.

Additionally we will utilize Italian brand ingredients imported at no additional cost through name brand Supply Chain Managers and Food Distributors.

The Market

Consumer expenditures for coffee, baked goods, and F&B offerings in general are on the rise in Kuwait

and we expect this trend to continue as budget surpluses continue in the economy and employment is peaking around 98% in Kuwait.

Also, through our research, we have found the breakfast category especially under-represented and

will direct a large portion of our strategy and focus towards an optimal breakfast menu in order to

capture this valuable segment in order to lead it to our more quality food offerings later in the day.

We expect sales to increase steadily as Kuwait's population grows as well as our target market segment.

Café di Nofà

Page 2

Trends are also in our favor. There are four major trends at work in our market:

Socializing on the Rise, as more people seek non-conventional opportunities people are becoming

more social and open in Kuwait.

Gourmet coffee and food offerings are seeing a rise in demand as people are losing the luster for

large brand name chains.

The gourmet European coffee trend is catching on exponentially in the Middle East as well as the

Italian style is completely unrepresented.

Our main market segment for marketing purposes are Women (Ages 20-38) as they are

substantially under-represented in Kuwait. We believe marketing to this segment will be a key performance requirement necessary to really propel our bottom line.

Financial Projections

Café di Nofà expects to start posting profits in the second Fiscal Year (FY2) while following the plan described herein.

Café di Nofà aims to finance the entire startup operations with a financial investment partner(s) so no

loan interest will be incurred or heavy loan repayment schedules necessary.

The following are critical assumptions that are calculated in this business plan:

A positive economy with continued budget surpluses in Kuwait

A continued 98% employment rate

Adherence to a well-planned cost and risk mitigation strategy

Purchases using value management techniques

Modest growth, positive cash balance, and reinvestment of profits

Chart: Highlights

Café di Nofà

Page 3

1.1 Objectives

At Café di Nofà our objectives are simple:

1. We will establish an Italian style cafe and coffee bar with authentic Italian F&B offerings.

2. We will strive to obtain the highest customer service rating in Kuwait from our customers.

3. We will strive to obtain the highest satisfaction for Cost vs. Quality, of our F&B offerings.

1.2 Mission

Café di Nofà's mission is to provide the best dining experience to its customers by providing authentic Italian food and coffee with exceptional customer service in an atmosphere rich with culture.

1.3 Keys to Success

We believe our the keys to succeeding in this venture are:

1. To offer premium Italian coffee and high quality Italian food offerings not found in Kuwait.

2. To provide a truly comfortable, inviting, and soothing environment based on Italian decor.

3. Maintaining a reliable well trained staff with prior experience in Italian Cafes and operation as well as authentic Italian food preparations.

4. Offering exceptionally quick and highly streamlined service in Kuwait, to all of our customers, during

operational hours.

5. Detailed planning and focused preparation on our objectives, goals, mission, and ultimately our vision.

2.0 Company Summary

Café di Nofà's is a startup business venture initiated in order to address the less than

satisfactory F&B service that exists in Kuwait, the lack of authentic Italian F&B offerings,

and close the gap on targeting, catering to, and promoting of women in Kuwait.

The Cafe will be co-owned by Nouf H.M. Al-Shatti, David M. Simon, as well as a possible third

parties.1

This venture will be funded through either conventional means of bank loans, private loans, or

personal investment funding which may result in further shared ownership, or a combination of all of these above.

We are seeking to move fairly quickly on this venture, financing, and investment, in order to open and be operating by the summer of FY 2013.

Café di Nofà

Page 4

2.1 Company Ownership

Café di Nofà is owned by Nouf H.M. Al-Shatti, Chairman of the Board (DarNofa Company), and David M. Simon, General Manager (DarNofa Company).

If an investor would like to seek an opportunity to be part of this offer we can provide to them such an

opportunity for a capital investment to fund the start-up cost of this venture.

Ms. Nouf H.M. Al-Shatti owns no less than 51% interest in the cafe.

Mr. David M. Simon owns no less than 4% interest in the cafe.

Possible third party investors (up to 45%) in the cafe.2

**The investment required for any person will total no less than 100,000 Kuwait Dinar.3

The investment and ownership is decompiled as follows:

David M. Simon, Chief Executive Officer (CEO), investment is sweat equity in the first and second year

of employment as the CEO, valued at 150,000 Kuwait Dinar.

Nouf Al-Shatti, General Manager (GM), investment is sweat equity in the first and second year of

employment as the GM valued at 60,000 Kuwait Dinar.

Third party investor/owner may carry up to 45% ownership for between three-quarters to full capital investment.

(Upon start of the fourth year distributions may be awarded as no greater than 50% of the net profits.

Additionally a 5 year buyout period is in effect requiring all parties to commit for five full years before requesting to be bought out. Buyout schedule to be determined between stakeholders at a later time)

2.2 Startup Summary

Café di Nofà will require sufficient capitalization to prepare for the first year of sales and

service. There is a substantial amount of UP-FRONT investment for those looking to invest as this is a

premium F&B company which will require all current and long term assets to be purchased prior to

commencing operations and generating sales revenue. Further information on startup, capitalization

and financing, are contained later in this plan. (See Financial Plan, pg. 40, for details)

The majority of the Cafe's assets will reside in current and long term assets. The opening day cash on

hand shall be KWD 1000 with a KWD 14,000 cash availability in the financial account belonging to Café di Nofà.4

We feel our estimates on startup costs, which based on personal investigation, currently reflect a +/-

of 15% margin of error and will resolve their accuracy through consultation with IPSOS or other like

Market Research Companies upon further progress and action of this plan.

As shown below we have provided our projections for successful startup operations expenses which we believe allow Café di Nofà to be self-sufficient and profitable at the end of year two.5

Café di Nofà

Page 5

Table: Startup

Startup

Requirements

Startup Expenses Consultant Fees (Market Study) KWD 3,000 Consultant Fees (Product Offerings, Italian Authenticity, Supply Chain Management)

KWD 2,000

Consultant Fees (Secrets of Italian Pastries and Coffee)

KWD 2,000

Legal Fees KWD 3,000 Licensing & Permits KWD 2,000 Interior Design (Plan & Rendering) KWD 5,000 Interior Design (Fitting Out) KWD 200,000 IT (Point of Sales System) KWD 8,000 IT (Other IT Systems) KWD 6,000 Key Money KWD 250,000 Stocking & Purchasing KWD 20,000 Training & Certifications KWD 4,000 X,Y,Z Items (Unidentified Expenses) KWD 25,000 Total Startup Expenses KWD 530,000

Startup Assets Cash Required KWD 15,000 Startup Inventory KWD 10,000 Other Current Assets KWD 35,000 Long-term Assets KWD 15,000 Total Assets KWD 75,000

Total Requirements KWD 605,000

Chart: Startup

Café di Nofà

Page 6

3.0 Products

Café di Nofà offers premium Italian coffee, fresh-made authentic Italian pastries and panini, as well as specialty plates, and VIP meal offerings.

Our coffee:

Mokito Bianco Espresso, Whole Bean Coffee, 2.2-Pound Bag available on import

Mokito Verde Espresso, Whole Bean Coffee, 2.2-Pound Bag available on import

Mokito Rosso Espresso, Whole Bean Coffee, 2.2-Pound Bag available on import

Our Pastries:

Fresh Ingredients, Made-Fresh, Authentic Italian recipes and style.

Our Panini:

Fresh Ingredients, Made-Fresh, Authentic Italian recipes and style.

Our Specials:

Top notch value, fresh ingredients, Authentic Italian Specials offering you the most satisfaction for your money.

Our VIP Courses:

Menu Prepared by Award Winning Italian Chef, with only the highest quality and freshest ingredients available in the region.

4.0 Market Analysis Summary

Café di Nofà has learned by owner experience in the local market there exists several niche

groups key to this business success. In the following sections we will highlight and discuss

these groups as well as provide a detailed analysis of why we think each segment represents a vital marketing point.

Our selected micro level target market segments are:

1. Financially well-to-do women

2. Financially wannabe well-to-do women

3. Modern / progressive women

These groups provide a unique opportunity to target three segments of the market that have not been addressed in Kuwait .

Café di Nofà

Page 7

The first group accounts for a small target audience but will represent a larger amount of sales revenue through customer management and top notch customer service and products.

The second group represents a larger target audience than the first and a smaller amount of per unit sales revenue but higher volume total cash sales.

The last group represents the largest market for which we hope to capture the remaining number of

unclassified target audience who will range in between both ends of the spectrum described above.

As you will see in our Market Segmentation as well as our Target Market Segment Strategy (pg.

10) we provide a description as well as analysis on what the significance is for each segment and why we are sure this market strategy will succeed.

4.1 Market Segmentation

Our Market Segmentation is divided into Total Kuwaiti Population, Kuwaitis (Age 20-38 both

M/F), Married Kuwait Females (Age 20-38), Single Kuwait Females (Age 20-38), Single

Kuwait Females (Age 20-38)(Affluent), Single Kuwait Females (Age 20-38)(Wannabe), Single Kuwait Females (Age 20-38)(Modern/Progressive).

Total Kuwaiti Population (TKP) - the entire population of Kuwait Citizens living in Kuwait, from ages 1-80.

Kuwaitis, Age 20-38 (KA20-38) - the entire population of Kuwaitis ranging in ages 20-38.

Married Kuwait Females, Age 20-38 (MKFA20-38) - the entire population of Married Kuwait Females ages 20-38.

Single Kuwait Females, Age 20-38 (SKFA20-38) - thie entire population of Single Kuwait Females

ages 20-38 which we are targeting.

SKFA20-38 (Affluent) - Socially affluent Single Kuwaiti Females between the ages of 20-38. They represent the far right range of wealth on the micro level of the SKFA20-38 segment.

SKFA20-38 (Wannabe) - Social wannabe affluent Single Kuwaiti Females between the ages 20-38. They represent the left range of wealth on the micro level of the SKFA20-38 segment.

SKFA20-38 (Modern/Progressive) - Socially moderate Single Kuwait Females between the ages of

20-38. They represent the range from extreme left and right and everything between on the SKFA20-

38 segment.

STATISTICAL ANALYSIS

According to CIA Handbook, Local Kuwait Government Census, and Samples of the Local Populace, the

rate of Kuwaitis within our target market are continuing to grow due to several factors. (This growth trend in our target market is expected to continue to grow for the next 5-10 years)

Café di Nofà

Page 8

Below are the factors we have found that will add to the growth of our target market:

Women's Suffrage: Women's rights in Kuwait have seen a rise in more opportunistic movements

for women which have resulted in more equality being granted to them which has had a very large

impact on the ability of the younger generation to pursue lifestyles that were not available to their

parents. This has directly resulted in the delay of marriage as there is no longer a requirement for

women to marry for financial stability which has left them open to pursue their dreams and desires.

College Degree Significance: There is an increasing demand for college educated individuals

(certifications) in Kuwait much like what was experienced in America from 1995 until 2010. This

push for degree's and certification is bringing women in contact with more schooling which requires

more focus and time which is resulting in a delay of marriage, or a divorce from early marriage in some small instances.

Modernization of Kuwait: Kuwait is modernizing its country with development in ideologies and

practices currently used in the Western world which include things like project management,

human resource management, knowledge and information management, and many other styles of

business and economic tools and practices. This modernization if putting more opportunity and

demand for educated, innovative individuals, which is resulting in the full time efforts of young

women to fill these spots and needs.

Education of Youth: The education of youthful women has directly resulted in their being

afforded more economic opportunity as well as alternate lifestyle choices which has also, indirectly,

raised the age of marrying and child bearing. They are becoming more in tune with their abilities,

their desires, and their drive to succeed which is placing maternal needs secondary to other more

immediate needs.

(For these reasons it is expected the growth rate of single women will continue to rise from between 5-8% annually for the next 3 - 5 years.)

According to the table our figures show by spending a marketing effort to 91, 000 targeted individuals

we will be able to drive the market of 535,000 individuals to our doors as you will see explained in the

Target Market Segment Strategy (pg. 10).

Table: Market Analysis

Market Analysis

2013 2014 2015 2016 2017 Potential Customers Growth CAGR

TKP 4% 1,190,841 1,232,520 1,275,658 1,320,306 1,366,517 3.50% KA20-38 6% 534,503 566,573 600,567 636,601 674,797 6.00% MKFA20-38 5% 148,546 155,973 163,772 171,961 180,559 5.00% SKFA20-38 7% 91,045 97,418 104,237 111,534 119,341 7.00% SKFA20-38 (Affluent) 6% 13,656 14,475 15,344 16,265 17,241 6.00% SKFA20-38 (Wannabe) 14% 18,209 20,758 23,664 26,977 30,754 14.00% SKFA20-38 (Modern/Progressive)

4% 59,180 61,488 63,886 66,378 68,967 3.90%

Total 4.57% 2,055,980 2,149,205 2,247,128 2,350,022 2,458,176 4.57%

Café di Nofà

Page 9

Below is a visualization of the total market in Kuwait that would likely patron our Café as well as a comparison against the whole population of Kuwaitis to the target segment:

Chart: Market Analysis (Bar)

4.2 Target Market Segment Strategy

Our Targeted Marketing Plan is developed with the understanding and analysis of

interaction within the local F&B market in Kuwait which is, relatively speaking, like no

other.

As shown in our figures we are going to focus our marketing efforts and attentions on 91,000 SKFA20-

38 customers in order to obtain a capture of 535,000 total customers as our main market.

The way we will be able to perform expending marketing efforts on such a small group to obtain such

an exponentially larger customer capture works in line with Social Network Theories. In our plan

the assumption which drives the success is men prefer to eat at a cafe where pretty single women

eat. In order to drive the men to our restaurant we will cater to the women. There are many reasons

this form or marketing will work which must be left outside the scope of this plan due to reasons of

privacy, security, and sensitivity.

As mentioned in the Market Segmentation section, the market segment that we will target first is single women between the ages of 20-38; and secondly all other women between the ages of 20-38.6

Café di Nofà

Page 10

1. Single Women (Ages 20-38) - We feel this target audience is the most powerful because it is a

driving force behind purchasing and patronage at F&B locations in Kuwait. It also happens to be a

very poorly represented target audience because of past rules of thumb which are increasingly outdated and becoming lost with new generations.

2. Women (Ages 20-38) - Although not of the female segment aged 20-38 will be single we know

the illusion of availability is equally as powerful a driving purchasing or patronage choice in Kuwait.

We want to ensure we capture all of the female population as they make up a large portion of

purchasing power that is quite underappreciated currently.

METHODOLOGY

We calculate by combining these two segments in the market and targeting them with our marketing

strategy, our dining experience, and our customer service, we can drive a significant portion of the

male segments to our Cafe with little effort spent on marketing to them. This would drastically reduce expenses while generating a nominal effect for customer capture.

From a psycho-social standpoint, men generally will continue to go places and do things they might

not otherwise prefer in pursuit of Maslow’s Hierarchy of Needs. Conversely, women will not entertain venues or services they do not prefer in the pursuit of their needs.

By providing an atmosphere that is women first, and men second, we will attract the female clientele as our primary function and the male clientele will be a reaction to the first.

SOCIAL ANALYSIS OF REPRESENTED MARKET SEGMENTS

Total Kuwaiti Population (TKP) - This is an important figure to have as a baseline for customers on

the outlying ranges. By showing this total population we can see how much of this segment is made up of by its female population.

Kuwaitis, Age 20-38 (KA20-38) - the entire population of Kuwaitis ranging in ages 20-38 is what

we are hoping to attract through a careful segmented marketing strategy on a micro level targeting

the groups that have the most influence on a macro level. We feel it is not necessary to market to the whole segment if you can get part of the segment to exert influence over the other.

Single Kuwait Females, Age 20-38 (SKFA20-38) - this is the market segment we are targeting

under the assumption their needs are not being represented and they will respond to a restaurant who

recognizes those needs and provides for them to be met.

In order to affect macro-level influence we have targeted the micro level segments represented below.

We feel these three groups give excellent micro level insight into the segments of the Single Kuwait Females in Kuwait ages 20-38.7

These segments and understanding their significance are essential in order to dominate a macro level

influence with minimum expenses in marketing and targeting. The more details regarding these

segments are addressed in the Marketing Strategy (pg. 22) and the Sales Strategy (pg. 23)

Café di Nofà

Page 11

SKFA20-38 (Affluent) - These women are the pinnacle of the pyramid...The top of the food chain

so to speak and the most desirable customers for the sheer attention they bring when seated

having a meal. All the men see them, and all the men want to date them. They hang out in droves

and stare without shame as these women walk in, sit down, and eat. Not only will these women

stand out, they will go out of their way to be recognized for their status. Which is why we have offered a VIP menu and sitting area for these women and their friends.

SKFA20-38 (Wannabe) - Although not the real deal like the Affluents, these women try their

best, and put on a very good showing of being someone of affluence. They buy the same expensive

clothes, purses, jewelry, and mimic them in every way. For them however you can tell in the places

they dine, and the cars, and homes they keep. However our objective is NOT to distinguish them

as a wannabe. Instead our goal is to bring them in, sit them in the same restaurant as the affluent

women, give them the same great service as the affluent women, and even offer them Specials

from the regular menu as well as the express bar with panini and coffee so they can eat and enjoy without breaking the bank.

SKFA20-38 (Modern/Progressive) - These women care little for looking affluent or for looking

too casual. They range in between both ends of the spectrum and will usually be affluent and not

care to show it, or not as well off and not attempt to hide it. Either way they are looking for quality food, exceptional customer service, and attention to their needs, which we will provide.

4.3 Industry Analysis

In analyzing the local F&B industry in Kuwait we have determined there are two re-occurring themes

existing here. These themes best represent what is wrong with the service industry which are poor

customer service and low value experience. Overall the F&B industry is incredibly non-flexible in its offerings, pricing, accommodations, etc.

For instance if you are looking to add or subtract items from certain meals, or perform a product

substitution you cannot. You are forced to buy the meal and an-add on. This results in literal metric

tons of food being wasted every year in Kuwait because people are given both what they do not want,

and what they want.

Additionally if you pay for a glass of soda, or juice, you are not entitled to a free re-fill, or even a cost

reduced refill. This is by definition part and parcel of expected service in the Western

Hemisphere. The reason for this is it ensures a higher amount of unit sales because it is enticing to

know you have either unlimited or cost reduced re-fills. It is estimated this results in a loss of nearly

18% in most restaurants beverage sales.

Another excellent example is the lack of adaptability in the food offerings from restaurant to

restaurant. For instance if you are at a pizza shop, you might find it a 5 minute ordeal talking to the

waiter, then the cook, then the manager just to get a pizza made that is not on the menu. This is

completely in-congruent with the very underlying principle of the F&B industry which is service.

As well you may walk into a restaurant that is completely or nearly empty where certain tables are

reserved for customers that "never show up" in order to create a show of importance and privilege

where there is none. The making of desirability through exclusivity is more than just putting a

reserved sign on a seat in an empty restaurant. That only serves to drive people away with your lack

of business acumen.

Café di Nofà

Page 12

Worst of all is what we refer to the "Tough Guy" syndrome permeating Kuwait. This consists of a Cafe

filled with men staring at every female that walks by with such audacity it makes the air tangible

around you. This syndrome prevents most of our target market from going to a cafe and enjoying herself without having to constantly be looked at, whispered about, and propositioned by the men.

The two categories we feel fit best for the above examples are explained further in detail below.

Poor Customer Service - This is a repeating theme in Kuwait. The service here is quite terrible. The

reason is exceptionally easy to understand. Cheap labor imported labor. There are a multitude of

reasons why hiring "Cheap Imported Labor" is the underlying cause to the terrible customer service

experienced in the F&B industry in Kuwait which can be found in the Appendix for further

understanding. (See 'Cheap Imported Labor Induced Customer Service Death' for more details)

Low Value Experience- This may seem hard to gauge but the formula which exists is quite

simple. Quality vs. Cost = Value. The quality of the F&B experience provided in Kuwait following one

of the following categories. High Quality, High Cost which results in Moderate Value; or Low Quality,

High Cost which results in a Negative Value; or Low Quality, Low Cost which results in a Moderate

Value. There is not place in Kuwait that offers High Quality, Low Cost which will result in a High

Value. Café di Nofà will be the first. In order to understand this concept please see Annex "Quality

vs. Cost = Value"

After reviewing the Quality vs. Cost = Value appendix we will then have the assumption fixed that

people will chose to optimize their value every time. If this is true, then by providing a higher

value to the customer we will increase customer base, revenue, and eventually maximize our profits. This is the heart of our plan.

(During the four years of living in Kuwait as an ex-patriate, and having operated in the F&B industry in

America, the owner sought to fill the a need existing in Kuwait for VIP treatment of its customers that is commonly found in high end restaurants around the U.S.)

(Additionally it was found through research of virtually every F&B provider in Kuwait, there are less

than 10 restaurants claiming to be Italian in nature, and only one of them that has F&B offerings anything remotely close to what you would experience in Italy.)

(Also it was found through trial of venues that nowhere existed a high tech solution for

ordering & paying on a mobile device, being able to charge your mobile device while you eat, or even use wi-fi for free while you eat.)

(Finally it was found through observation at all of the 60+ restaurants attended by the owners, all of

the restaurants failed to cater to women. In fact, it is quite the contrary whether intended or unintended, as they produce a hostile atmosphere to women through their marketing effort.)

4.3.1 Competition and Buying Patterns

In order to create a cafe that will be truly remarkable we must understand the failures of

the local market F&B providers and review and understand the mistakes they make. We

must also understand what people buy and why as well as how we can compete with those

already in our market.

Café di Nofà

Page 13

BUYING PATTERNS

The buying patterns for Kuwait have been studied by the company owners in great depth.8 These

patterns consist of "whatever is fashionable/trendy" which is a relative term.

Let us take a look at an excellent example of a local F&B organization in Kuwait which demonstrates

this very principle we will avoid. Please observe the photographs below.

This photograph was taken in June, on the 28th, a Thursday around 630pm.

This photograph was again taken on a Thursday, at 630pm, January 10th.

Now do you notice anything about the two photographs? One photo is packed with people waiting in

line to get food and tables packed to full. Another photo has nothing but workers standing around.

Why is this you might ask? The opening of other trendier restaurants happened in November at the

Avenues Phase III with the Grand Avenues. In depth analysis of this failure is contained in the Annex

for your review. (See the 'So Sorry Shake Shack' Story for details)

Café di Nofà

Page 14

In short the Shake Shack failed to provide a) Good Customer Service and, b)Value.9

For a new restaurant it can afford to ride the trendy wave and so long as it stays trendy it will continue

to enjoy higher than average revenues. However if it stops being trendy then it must rely on its Value

to the Customer. If its value is low, but its trend is high, it can sustain. If its trend is low, and value

low it will go out of business.

Our goal is to break this cycle of customer capture. We aim to build our clientele not through hype or

trend. We do not plan to provide a plethora of brand name offerings and frivolous showmanship and

branding imagery to lure our customers. Instead we will use a unique, warm, customer service

oriented, premium dinning experience that caters to an ignored market segment.

COMPETITION

Our competition consists of the following categories which will be explained further in detail: Large

Western Chain Cafe's; Small Regional Chain Cafe's; Small Independent Cafe's.

1. Large Sized (Western Chains) are those chains which are classically categorized as franchises or

similar which include cafe's like Starbucks, Caribou Coffee, and Columbus Cafe. These chains make a

large variety of coffee drinks with lots of artificial flavorings and ingredients. The food offerings are

also heavily processed and very unhealthy and un-enjoyable. These are the most inefficient cafe's in

regard to value to the customer and probably come in at Low Quality, Low Cost, or even Low Quality,

High Cost on the Quality vs.. Cost Matrix. These chains focus solely on profit margins which ultimately

yields them a large profit per customer but limits their customer base because of their lack of value in

service, quality, and enjoyment. So only a small amount of the total pool of customers makes this

their choice.

Price Point per Unit (KWD): Min-0.750 Avg-1.850 Max 3.500

2. Medium Sized (Regional Chains) are those that do not have an international presence and as

such are mostly regionally held whether in the Middle East or any other region but not

internationally. These chains include cafe's such as Cafe Blanc, Laduree, Lino's Coffee, etc. These

chains make a large claim about their quality, authenticity, and uniqueness, usually using the good will

of another brand name or imported brand name product to generate their like-ability and value. They

are moderately to severely over-priced for their offerings. They usually offer a variety of coffee drinks

with lots of artificial flavorings and ingredients as well as local and regional drink styles. The food

offerings are also heavily processed and very unhealthy and un-enjoyable. They are just large enough

in their size so as lose the personal touch of in their customer experience while being too small to be

able to justify their prices through brand name and brand loyalty.

Price Point per Unit (KWD): Min-1.000 Avg-2.450 Max 6.500

3. Small (Independent Cafe's) are those that are locally owned with no inter country domination,

influence, or importance such as Fashion Cafe, Diva' s, The Early Bird, and etc. These Cafe's offer a

variety of coffee drinks with artificial flavorings and ingredients. The food offerings are usually also

heavily processed or out-sourced by another bakery or local vendor. Few if any of them offer in store

fresh baked goods or quality ingredients. These places usually have to charge way too much for their

food in order to pay for the overpriced rent and overpriced food as they are not large enough to buy

in bulk for savings. They often charge VIP fees for non-VIP service and food.

Price Point per Unit (KWD): Min-1.250 Avg-3.500 Max 14.000

Café di Nofà

Page 15

5.0 Web Plan Summary

We plan to build our website slowly in phases in order to accommodate our growth. In year

1, Café di Nofà plans to develop its web site and establish its web presence, while in year 2

& 3, Café di Nofà plans to add online ordering and then e-commerce as a value added feature to our customers and to supplement our operations.

The intent of our slow building progression is to allow for our name and reputation to catch up in the

local market before we push further into online sales or reservations. However these are two aspects

we have envisioned for the future.

The Café di Nofà website will mirror the image and branding elements showcased in the Cafe and at

the same time, keep up with the latest trends in user interface design. The key to the website strategy

will be combining a well-designed front-end, with a back-end capable of capturing "hits" and customer data for use in future marketing endeavors.

In the First Year Café di Nofà website will be serving as a virtual business card and portfolio for the

company, as well as its online "home." This is simply to establish its online presence and provide information easily to the customers at any time of the day.

The website will display pertinent information such as our mission, vision, values, as well as address,

number, etc. We will also showcase the food and beverage products offered available for purchase in

the cafe. Additionally we will offer a feedback form in which to capture customer information and

issues in hopes to resolve them.

In the Second Year we will provide an online ordering service for our imported Italian coffee and

offer recipes and ideas on how to best brew and enjoy the authentic Italian Coffee. To further enrich

our website we will provide a resources area, offering articles, research, product information and website links of interest to its customers.

In the Third Year we will provide an e-commerce functionality, by which you can order coffee, and

other imported offerings featured in our cafe as a direct sale functionality. As we will be importing

these items to our store we fill it will be a logical step to include sales of these specific offerings directly to customers who wish to have them for their home or office.

Café di Nofà

Page 16

5.1 Website Marketing Strategy

Internet retail business depends on recognition of expertise by the consumer which we believe will be developed properly in our 3 year approach.

Our website marketing strategy is developed with slow steady progress in mind in order to maximize

the entry of our name into the market with the quality of the web site and content. We do not wish to enter too strong with a simple website and instead we will pursue a slow buildup of our web presence.

For the first two years we will be passive in marketing our strategy unless growth outperforms our

expectations. In year three we will really focus on driving customers to our website through an aggressive marketing campaign specifically for the website.

In the First and Second Year our marketing strategy will mostly consist of referrals by our staff to

customers to visit our site and leave feedback and recommendations. We will not be providing any budgetary allotments for this type of marketing in these years.

In the Third Year we will be aggressively marketing our products, e-commerce, and online

interactivity with your website. In this year our target will be to conduct a marketing campaign with a

budget of 2.5% of our gross profit in order to further drive our name into the market and lead

customers to our site which we expect will lead to nominal increase in sales revenues.

5.2 Development Requirements

Glens Park will providing our website design as we currently have an excellent working relationship

with them on previous web site designs. Our Development Requirements for the website will break

down into a yearly requirement schedule. Each year will progress the previous year's developments

and continue to move forward to a modern e-Commerce site capable of capturing customers in order

to maximize value.

Year 1 (Y1)

1. Static Website

2. Basic Front End Elements

a. Flash

b. Search Bar

c. Main Pages

d. Sub Pages

e. Hyper-linking

f. Pic Viewers

g. Map Imbedded

3. Customer Feedback System

Café di Nofà

Page 17

Year 2 (Y2)

1. Dynamic Website

2. Back End continuing production

3. Add-ons

a. Pictures

b. Videos

c. Affiliates

d. Online Ordering

e. Customer Registration & Memberships

Year 3 (Y3)

1. Fully Dynamic Site (Complete)

2. Fully Functional Back End (Complete)

3. Add-ons

a. e-Commerce functionality

b. Reservation System / Scheduling

c. Data-basing

d. e-Payment

Café di Nofà

Page 18

6.0 Strategy and Implementation Summary

At Café di Nofà our goal can only be reached with a very in depth, detailed, realistic Analysis of our

Strengths, Weaknesses, Opportunities, and Threats. By analyzing these four categories we set

in writing, before we begin, an outline of what we know we do good and how we can exploit this, and conversely, what we need to stay focused on in order to mitigate negative impacts.

Additionally we need to analyze what gives us the advantage over other F&B organizations. While we

have performed our own analysis on what exactly it is that makes us better we can say we have

remained objective and realistic in this review. If we were not to remain objective our business would

fail due to our failure to identify the true Strengths, Weaknesses, Opportunities, and Threats, and to perform the steps necessary to exploit or mitigate them.

Also we have provided a high level Marketing Strategy which we feel is a good start to showing

which direction we will take with our marketing campaign. As the project is accepted through receipt

of financing a more detailed marketing plan will be provided during the making of the project plan for all three project phases.

We have also included a detailed Sales Strategy which we believe put into words early on will help

guide everyone in this process to envision what we want to accomplish and how we want to

accomplish it. This will serve as an early on road map in the development of the more detailed project

plans for each phase.

Most importantly we have addressed a very detailed Management Plan which demonstrates our

ability to visualize the future and where we would like to go, and how we plan, through talented

managers, to get there. It is not our goal to get there. We know we will accomplish this part; instead

our goal is to get there, while being efficient and effective, making service and our customer come

first.

6.1 SWOT Analysis

The SWOT analysis provides us with an opportunity to examine the internal strengths and

weaknesses Café di Nofà must address. It also allows us to examine the opportunities presented to Café di Nofà as well as potential threats.

STRENGTHS

We identified our strengths as having Knowledgeable Management, Up-Scale Ambiance, Customer Service, State-of-the Art Technology, and Quality Italian Coffee & Food.

We believe we will be able to strategically utilize our strengths to our benefit through our marketing

campaign, where we feel word of mouth will be one of our most advantageous means of spreading

good will. In order to exploit this we will ensure we have a customer incentive program to recognize

customers who provide new members to our membership offering programs to benefit them for spreading the word.

Café di Nofà

Page 19

WEAKNESSES

In examining our weaknesses we came up with our Cost Factor associated with the State of the art

Hardware/Technology, the Italian Barista, and Italian Baker, and Executive Chef; as well as Lack of Adaptability once the cafe is designed as our major weaknesses.

In order to mitigate the weakness of having an exceptionally high cost for technology which is state of

the art, and in the cost of keeping it that way, we will seek out technologies companies who offer,

lifetime service, help, or warranties; provide upgrade-able hardwares; or are looking for new markets

to emerge into with requirements as shown in the Appendix. (See 'Emerging Markets

Opportunities' for more details)

In order to mitigate the effect the lack of adaptability for our cafe once the plan is finished will have on

our operation we will conduct a thorough market analysis by Ipsos, a renowned Market Analysis &

Research company which provides an excellent resource to ensure this is a sound plan to move forward with.

OPPORTUNITIES

Our review of the opportunities we identified leads us to believe the most advantage will be gained

from the Lack of Quality Customer Service. Additionally we have assessed our Target Market will

continue to Grow in Size of the next 5 years. We also have found through market studies we have a

niche that is not highly represented in the local market which is Italian F&B Offerings, which we believe

will lead to our ability to Vend certain Italian Products such as coffee and other Italian beverages in an

Authorized Reselling Capacity.

THREATS

In our assessment a few threats exist such as Emerging Local Competitors, Bad Publicity, and Negative

Wasta or Outside Factors of Influence, which we have determined can be mitigated or avoided with the appropriate strategy, location, attitude, and attention to detail.

In order to mitigate or avoid negative impact brought on through emerging competitors we must

ensure our customers are identified and tracked through our membership process and feedback

avenues. We must also select a high traffic, easy to access venue to operate from. We will also have to

provide the highest level of customer satisfaction in order to keep the customers returning for our offerings.

It is naive to assume a new restaurant with out approach will be received by other restaurateurs with

open arms. We acknowledge these locations and owners will have ties to the local media and VIPs

within Kuwait, and once threatened, will exert any influence possible whether in the form of Bad Publicity or Negative Wasta in an attempt to neutralize our customer capture and retention.

In order to overcome this we will target small online media outlets, such as bloggers, critics, foodies,

and other such forums where we will invite them to a meal or two on the house. We also intend to

perform all of our licensing and administrative filings to the letter of the law, with the support of a

licensed and highly regarded legal representative, as well as to hire a local F&B consultant to work with

us to ensure our "ducks are in a row". We believe this will mitigate any negative wasta or baseless bad publicity.

Café di Nofà

Page 20

6.1.1 Strengths

Knowledgeable Management: We have one of the most highly experienced young American entrepreneurs as the CEO and a very smart and talented Kuwaiti GM.

Our CEO lived and worked in Italy for 3 years, has previously started up 4 companies, and has 10

years experience in the F&B industry. He is also a certified Project Management Professional, Vice

President of the Association of the U.S. Army in Kuwait, Director of Performance for the Board of

Directors in the Project Management Institute chapter of Kuwait, and is a member of the American

Business Council in Kuwait. He is extremely well qualified to ensure the initiation, planning, and

execution of this company's startup operations are a success in order to turn them over for continuing operations to the GM.

Our GM is Kuwaiti and has a deep understanding of the market as well as the knowledge of

commercial procedures and business laws and requirements in Kuwait. She has a degree in

Information Technology and is highly competent in regard to ongoing sales, customer service, and

team development. She served for over 10 years in a customer service position moving to F&B from

the IT field. She also has the coaching and mentoring and support of the CEO in her continued operations after completion of the startup.

Up-scale Ambiance: When you walk into Café di Nofà you'll feel the comfort as you pass through the

sculpted arch with hanging plants and twisting vines that give you a refreshing feel. As you move into

the cafe with the mahogany wood, imported Italian tile floors, and sculpted Venetian plaster walls your

first thought will bring you to Tuscany Italy on a warm spring day. You will be relieved to be greeted at

the front door like a person and not like a customer. As you find your way to either the express coffee

bar or to a relaxing booth you will notice that both were created to ensure your comfort and

convenience. The up-lighting in the entry way on towards the seating area creates a feeling of ease as

you feel your tensions melt away for a good morning, a good meeting, a good time, enjoying what it is

you love to do, whether reading a newspaper or texting your friends before you head on your way to

go shopping, you will notice that every thing has been thought of to ensure you have a great start to your day.

Customer Service: Our customer service will be BAR-NONE. This means we will have the best

customer service in Kuwait. Period. No if's. No and's. No but's. Period. We will do whatever it takes to

make sure the people who come to Café di Nofà feel as if this cafe was built especially for them, to

serve only them, and as if they were the only people in the cafe that day.

State-of-the Art Technology: Part of the Café di Nofà allure is its up to date, cutting edge

technology add ins which supplement the value of the experience while dining for breakfast or lunch with us. We will have technology that no one has in Kuwait.

Quality Italian Coffee & Food: One of the most important things is our authenticity and quality.

There are handfuls of restaurants claiming to be Italian but are nothing more than Italian in name or

brand. Authentic Italian is more than just the name. It is the style of preparation, the method of

creation, the spirit and the love. These are things missing from every other business and we have it and this will show through with our quality and service.

Café di Nofà

Page 21

6.1.2 Weaknesses

Cost factor associated with keeping state-of-the-art hardware: Keeping up with the technology

of the Internet is an expensive undertaking. Café di Nofà needs to balance technology needs with the other needs of the business. One aspect of the business can not be sacrificed for the other.

Cost factor associated with employing Italian Barista and Baker: In order to keep the

authenticity and style of Italy we will need to employ an Italian Barista and Baker. The Italian Barista

will be responsible for operating for one year as well as training the other Barista how to make Italian

style coffee. The Italian Baker may need to be employed for 2 full years in order to ensure other

Bakers know how to bake using Italian methods. Additionally an Italian F&B consultant may need to

be brought in to guide in the process of Supply Chain Management to ensure the best ingredients are used for the food offerings.

Lack of adaptability once plan is finished and cafe is designed: Due to the heavy branding and

themeing of this restaurant it is not very adaptable if any part of the plan should prove not work out as

predicted. For example if customers are not receptive to the Italian theme or F&B offerings it would be unlikely any restructure could be attempted once the plan has been initiated.

6.1.3 Opportunities

Growing population of our Target Market: The target market we are aiming at is forecasted to

produce steady growth over the next 5-10 year which means a continued source of new customers and also the opportunity to make more return customers.

Poor Customer Service in Kuwait: The lack of great customer service ensures that our Cafe will be

one of the best in Kuwait to dine at. This is a great opportunity to stand out from the crowd with our premium offerings and excellent service.

Lack of Authentic Italian Cafe's: There is most definitely a lack of Italian Cafe's in Kuwait with real

Italian prepared offerings. This ensures we will be the leading Italian Cafe in Kuwait. Until such time another cafe opens and can challenge our customer service and quality of food.

Strategic Offerings: While offering Italian food and coffee at our shop we may be able to pursue the

exclusive representation of brand name Italian items when our Cafe becomes well known for its coffee, food, and service.

Café di Nofà

Page 22

6.1.4 Threats

Emerging Local Competitors: Although it is highly unlikely that a Cafe will emerge that can

compete with our offerings and service it remains a possibility. If this should happen it would most

likely affect those customers whose desire for trend and "something new" outweighed their loyalty to

our cafe.

The reason we have determined the emergence of local competitors to be an insubstantial threat to our cafe is is best examined through the perspective of both the customer and the business owner.

Customer Perspective: from a customer perspective remains in the cultural mentality of Kuwait

and its citizens who are desensitized to the current state of poor customer service. They, the

citizens, expect it as the norm rather than rejecting it as the exception to the rule. Therefore,

because the citizens expect bad service, it is allowable for a restaurateur to provide cheap imported

labor and have the poor service overlooked. There is no driving force pushing the owner to provide

better customer service.

Owner/Operator Perspective: the reason it is equally unlikely to see competition from

a business operator's perspective is exemplified in how the owners focus on maximizing profit

margins on small segmented market shares. This maximizing of profit margins is performed by

utilizing low quality labor and low quality ingredients. Therefore from the business owner/operator

perspective, it is quite unlikely for current operating businesses or emerging business to be able to

pay higher costs for quality even if they should want to. In other words they prefer higher margins

and believe the less paid to the labor force the more profit available. They do not account for the

negative impact this operational strategy brings about.

Bad Publicity & Feedback: It is possible, due to personal vendettas or other trivial matters, people

may attempt to destroy the image or reputation of Cafe di Nofa through bad reviews, word of mouth,

false advertisement, or other means whether free of charge or on payment of another competitor. For those who have never tried our cafe this may present a problem.

Negative Wasta & Outside Forces: We understand in Kuwait there are often many parties looking

to prosper directly or indirectly from entrepreneurs as they sit in key positions for which licenses,

paperwork, signatures, and other elements are needed to legally operate. In these situations,

operating outside the legal framework becomes a huge problem when relying on someone to continue to provide you protection while you are not legally operating or in violation of rules or procedures.

6.2 Competitive Edge

Our competitive edge which will come from the offerings we provide and the manner by

which we provide them all in a convenient and easy to access location.

PRODUCTS: Sourced through Italy and other high quality vendors, our ingredients will be of the

highest quality to value ratio. This will give us an edge over other cafe's in Kuwait as they consistently offer over priced, under quality, food and coffee.

EMPLOYEES: Our employees will will be trained by real Italian experts in their fields. This will give

our employees insight into how to bring authenticity of Italy to Kuwait. Additionally they will all be

trained in customer service by competent Western Training Programs which will ensure our customers receive the best service over any other cafe in Kuwait.

LOCATION: Our location in the Avenues Mall will offer us the high traffic flow required to build an

initial customer base that will be instrumental to our long range success with minimal

advertisement. This location will be an advantage over other cafe's in Kuwait that do not have

strategic locations.

Café di Nofà

Page 23

6.3 Marketing Strategy

Our high level requirements for our Marketing strategy are to; Create Awareness of our

Cafe, Brand ourselves as an Authentic Italian Cafe offering exceptional food and customer

service, and Bring Loyal Customers through our archway. In order to accomplish these high level objectives we will focus on the following marketing strategies.

1. Print Ads - We will saturate the local neighborhoods identified in our target market with printed

marketing ads (flyers & brochures) in order to force the name in front of our customer prior to the

Grand Opening. We also plan on running limited space ads in the local newspapers to keep our

name and phone number in front of the consumer.

2. Press Releases - We will seek out the food critics for local papers and magazines and introduce

them to our soft opening and food offerings. Then we will ask them for a press release to

announce our Grand Opening.

3. Grand Opening - A Grand Opening is the most successful of any in-store promotions. We will

obtain the support of the American Business Council and the U.S. Embassy in order to have a high

publicity Grand Opening inside the Avenues Phase III mall.

4. Website Advertisement - We will advertise our Cafe with a small boutique website which shows

our mission and vision, our menu, our business information, and our location, as well as a way to

contact us.

5. Online Critic Reviews - We will register with online food reviewing critics such as Yelp, Four

Square, Zagat, and other such online food reviewing sites in order to demonstrate our ability to be

rated and receive feedback.

6. Online Delivery - We will register with 6alabat in order to provide our panini and other

meals delivered by their network as an added value to our customer.

7. Word of Mouth - By giving first-time customers great service and a fair price, the word is sure to

spread. In order to help that along we plan on instituting membership programs and referral

programs to help reward this word of mouth approach. Also, the many industry and restaurant

contacts that we already have in the area will prove to be most beneficial in spreading the word.

All marketing decisions with regard to specific media choices, frequency, size, and expenditures will be conducted on an on-going basis with careful considerations of returns generated.

6.4 Sales Strategy

The sales strategy for our cafe consists of identifying our main focus areas which are

detailed below. We believe by picking a few things and doing them exceptionally well we will be able to close the deal with our prospective customers.

THE CUSTOMER

The customer is addressed first because we believe they are the most important part. For this

reason we will approach every customer as if they are a VIP customer and offer them luxuries and

amenities they would not have available at other locations. For those who request the actual VIP treatment they will be offered something never seen before in Kuwait.

All sales associates will be trained and encouraged to assist customers in a personal manner, utilizing

first names and asking the questions needed to provide the customers with the services they

desire. Additionally we will attempt to gather key customer information in an effort to further engage their needs in order to ensure their return business as well as positive feedback.

Café di Nofà

Page 24

The customer information will be stored in the Point Of Sale system we purchase and will assist us in the following ways:

Targeting our marketing efforts more effectively.

Increase awareness of Café di Nofà within the marketplace.

Developing food offerings tailored to our clientele in order to increase sales.

Developing added value services that enhance the dinning experience.

Training and developing servers in order to effectively service the customer.

Develop future expansion opportunities that allow for continued growth of the business.

THE FOOD

In order to provide the customer with the highest quality food items and coffee we will select only the

finest ingredients in order to prepare our food offerings with freshly each day. We will attend F&B

trade shows and events, subscribe to popular printed and electronic mediums, and interact within the

F&B community in order to ensure we are staying in tune with the best techniques and using the best

ingredients in the business.

To stay abreast of market and product trends, we will utilize the following trade publications to reinforce and expand our knowledge base:

Food & Beverage International

Food & Beverage World

Food & Drink Magazine

Taste Italia Magazine

La Cucina Italiana Magazine BeanScene Magazine

ATMOSPHERE

In order to maintain a kind comfortable atmosphere we will provide sections for each customer

according to their segmentation. These sections will be divided in order to provide each segment their

style of atmosphere according to their purchase.

VIP Section - This section, also known as "The Terrazzo" is a mezzanine style elevated floor which,

when entering the restaurant winds out to both the inside and the outside of the restaurant. It is literally a terrace, that is elevated, so that they may look down upon the others around them.

Main Room - This section is the interior of the restaurant and is for those who are interested in

dinning more casually, less ostentatiously, or cheaply, whatever the case may be. The interior is just

off the Terrazzo and these two rooms are joined by not shared.

The Ex-presso Bar - This room is a stand up, move through the line, pay first, grab your ticket, step

up to the window, give the ticket and your order, get your coffee, pastry, and panini line. It is quick, it is cheap, it is effective. The best way to get what you want quickly.

The Spazio - The spazio is the space outside and around the Cafe. It is where the people from the Ex-presso Bar may go to sit and enjoy their coffee, pastry, or panini.

Café di Nofà

Page 25

PRICING

It is the goal of Café di Nofà to offer style and quality at a value to the consumer. Our pricing structure

will support a minimum 65% gross margin while in some cases a much larger margin will be

achieved. This pricing will support categories of food offerings and dinning experiences to all three

sub-segments of the SFA2038; the affluent, the wannabe, and the modern/progressive.

In this way those who have more money to spend will be targeted with higher margined offerings and

those with less money to spend will be targeted for the maximum spending potential they have

available. In this way we intend to maximize the spending potential of each segment of the targeted

market with customized experiences and food offerings.

UPSELLING/CLOSING SALE

Upon receiving a customer and offering them a seat, if they are a group of women, mostly women and

one man, one woman and one man, or any combination where the women are equal or greater than the man the VIP up-service area "The Terrazzo" will be offered for upselling.

The Terrazzo will also accompany an offer to register them for the Fine Diner's card which will help

capture their personal information. This can be used later on for e-commerce and other such services when they are developed.

PROMOTIONS

Seasonal promotional offers, annual anniversary events, and Special/VIP events, will encourage

additional sales and goodwill. We will also offer special desserts for those with a birthday and can

even cater for large size events like this from our location. We will also utilize a Frequent Visitor Card to encourage repeat customers especially with regard to the coffee.

OUR EMPLOYEES

Employees of Café di Nofà will obtain formal F&B training to include POS, customer service,

serving techniques & etiquette, and Italian Specific training for Barista and Bakers in order to ensure

the authenticity of the food items. Employees will not interrupt the atmosphere of the patrons at any

time and will use the anticipation approach to serving all patrons in order to avoid asking customers if

they "need anything" a hundred times in one sitting. All employees will be developed for growth and advancement, and compensated fairly.

Additionally we will reward good customer service for our employees as well as top number in sales.

TECHNOLOGY

As we enter the 21st century, proper technology is becoming key to meeting the customer's

expectations. Café di Nofà has chosen to pursue all the cutting edge technological advantages available on the market.

For the Point Of Sales (POS) system we will us Harbor Touch as our management software. After

careful consideration of FUTURE POS and POS Guys and other well known POS, Harbor Touch was

selected for its superior customer service, low install cost, and wide array of functionality for mobile

devices and technology interface.

Café di Nofà

Page 26

Additionally we will be providing the following technological advances as well:

Portable devices for menus which are capable of being used to view the menu and order food as

well as to pay.

Wi-fi at no cost to our members dinning in through a temporary two hour code provided to them on

their receipt at the register.

Wireless power recharge solutions at our tables to ensure the cell phones and mobile devices of our

customers can be recharged without the need of wires.

In table buzzers to call the wait staff so there is no more need for yelling, waving, etc.

Café di Nofà

Page 27

6.4.1 Sales Forecast

The following table and chart provide a run down on forecasted sales. We have based our forecast on

a modest percentage of 20% increase in Annual Sales Revenues which we feel is very conservative for the first two years of growth.

Chart: Sales Monthly

Sales Forecast

2013 2014 2015

Unit Sales Drinks (Coffee/Tea) (Min .500 Max 2.000) 23,325 59,775 74,613 Drinks (Other) (Min .500 Max 2.500) 10,936 31,703 39,628 Food (Panini) (Min 1.500 Max 2.750) 9,794 26,598 33,248 Food (Pastry) (Min 500 Max 1.000) 13,071 35,501 44,377 Food (Plate) (Min 2.250 Max 4.000) 6,560 19,016 23,770 Food (Specials) (3.500) 7,774 19,893 24,866 Food (VIP) (Min 4.750 Max 12.000) 3,000 9,951 12,439 Total Unit Sales 74,460 202,437 252,941

Unit Prices 2013 2014 2015 Drinks (Coffee/Tea) (Min .500 Max 2.000) KWD 1.25 KWD 1.25 KWD 1.25 Drinks (Other) (Min .500 Max 2.500) KWD 2.25 KWD 2.25 KWD 2.25 Food (Panini) (Min 1.500 Max 2.750) KWD 0.75 KWD 0.75 KWD 0.75 Food (Pastry) (Min 500 Max 1.000) KWD 3.25 KWD 3.25 KWD 3.25 Food (Plate) (Min 2.250 Max 4.000) KWD 3.50 KWD 3.50 KWD 3.50 Food (Specials) (3.500) KWD 7.00 KWD 7.00 KWD 7.00 Food (VIP) (Min 4.750 Max 12.000) KWD 0.00 KWD 0.00 KWD 0.00

Sales Drinks (Coffee/Tea) (Min .500 Max 2.000) KWD 29,156 KWD 74,719 KWD 93,266 Drinks (Other) (Min .500 Max 2.500) KWD 24,606 KWD 71,332 KWD 89,163 Food (Panini) (Min 1.500 Max 2.750) KWD 7,346 KWD 19,949 KWD 24,936 Food (Pastry) (Min 500 Max 1.000) KWD 42,481 KWD 115,378 KWD 144,225 Food (Plate) (Min 2.250 Max 4.000) KWD 22,960 KWD 66,556 KWD 83,195 Food (Specials) (3.500) KWD 54,418 KWD 139,251 KWD 174,062 Food (VIP) (Min 4.750 Max 12.000) KWD 0 KWD 0 KWD 0 Total Sales KWD 180,967 KWD 487,184 KWD 608,848

Direct Unit Costs 2013 2014 2015 Drinks (Coffee/Tea) (Min .500 Max 2.000) KWD 0.15 KWD 0.15 KWD 0.15 Drinks (Other) (Min .500 Max 2.500) KWD 0.45 KWD 0.45 KWD 0.45 Food (Panini) (Min 1.500 Max 2.750) KWD 0.11 KWD 0.11 KWD 0.11 Food (Pastry) (Min 500 Max 1.000) KWD 0.81 KWD 0.81 KWD 0.81 Food (Plate) (Min 2.250 Max 4.000) KWD 0.70 KWD 0.70 KWD 0.70 Food (Specials) (3.500) KWD 2.10 KWD 2.10 KWD 2.10 Food (VIP) (Min 4.750 Max 12.000) KWD 0.00 KWD 0.00 KWD 0.00

Direct Cost of Sales Drinks (Coffee/Tea) (Min .500 Max 2.000) KWD 3,499 KWD 8,966 KWD 11,192 Drinks (Other) (Min .500 Max 2.500) KWD 4,921 KWD 14,266 KWD 17,833 Food (Panini) (Min 1.500 Max 2.750) KWD 1,102 KWD 2,992 KWD 3,740 Food (Pastry) (Min 500 Max 1.000) KWD 10,620 KWD 28,845 KWD 36,056 Food (Plate) (Min 2.250 Max 4.000) KWD 4,592 KWD 13,311 KWD 16,639 Food (Specials) (3.500) KWD 16,325 KWD 41,775 KWD 52,219 Food (VIP) (Min 4.750 Max 12.000) KWD 0 KWD 0 KWD 0 Subtotal Direct Cost of Sales KWD 41,059 KWD 110,156 KWD 137,679

Café di Nofà

Page 28

Chart: Sales by Month

Chart: Sales by Year

Café di Nofà

Page 29

6.5 Milestones

The accompanying milestone chart highlights our plan with specific dates. This schedule

reflects our strong commitment to organization and detail while providing a higher level

milestone chart for investment purposes.

If we miss the milestones due to lack of financing we will re-baseline the project, likely for the summer

of FY 2014. The reason for this is due to both the summer heat and Ramadan, which will occur in July of 2013 and late June of 2014.

The temperatures in the summer in Kuwait are so hot, most people choose to leave the area. This

means we will have less people in the country which might seem bad. However, because of Ramadan,

food sales actually increase during this time, so we will serve less people while also making more in sales.

Table: Milestones

Milestones

Milestone Start Date End Date Budget Manager Department Acquisition of Financier or Investment Partner

2/4/2013 3/1/2013 KWD 0 CEO Admin

Confirmation of Project Team

3/1/2013 3/28/2013 KWD 0 CEO PMO

Confirmation of Location 3/1/2013 3/28/2013 KWD 0 CEO, GM, PR PMO Confirmation of Project Plan

3/1/2013 3/28/2013 KWD 0 CEO, GM, PR PMO

Initiation of Cafe Fitout 4/1/2013 5/1/2013 KWD 0 CEO PMO Initiation of Purchasing 5/1/2013 6/1/2013 KWD 0 CEO, GM OPS Completion of Fitout 6/1/2013 8/1/2013 KWD 0 CEO PMO Initiation of Stocking 7/1/2013 8/1/2013 KWD 0 CEO, GM,

Team HR

Completion of Purchasing 6/1/2013 7/15/2013 KWD 0 CEO, GM OPS Completion of Stocking 7/1/2013 8/1/2013 KWD 0 GM, Team HR Integration of Sytems 7/1/2013 7/23/2013 KWD 0 CEO, GM HR, IT, OPS Trainup of Sytems 7/23/2013 8/1/2013 KWD 0 CEO, GM,

Team HR, OPS

Soft Opening 8/1/2013 9/1/2013 KWD 0 ALL ALL Grand Opening 9/1/2013 10/1/2013 KWD 0 ALL ALL Retirement of Project to SusOps

10/28/2013 1/1/2014 KWD 0 CEO&GM to EC Department

Totals KWD 0

Chart: Milestones

Café di Nofà

Page 30

7.0 Management Summary

The Management Summary includes our detailed account on not only the process by which

we will follow in order to manage this business but also the people involved as well as their

role in the process.

THE PROCESS:

Café di Nofà will be managed through 3 distinct phases with each carrying their own

management structure. These three phases will be the Start-Up Operations

(StartOps) phase, the Transition to Sustainment Operations (TransOps) phase, and the Sustainment Operations (SusOps) phase.

Of these phases the most critical will be the StartOps phase as this includes the most risk and

possibility for failure. For this reason the CEO will carry the project in StartOps into TransOps phase

and through to Mid-Range SusOps. This will ensure the integrity of the project from start to completion through to retirement.

Start-Up Operations phase will be structured with a 5 phase plan according to the Project

Management Body of Knowledge and will follow the Project Management Framework according to the

Project Management Institute. This project will consist of owner/managers which will provide either

capital or sweat equity to the project. They will begin with the project initiation and charter once a financier is acquired through this business plan.

The project will continue into the planning phase once the financier has been dedicated. The planning

phase will consist of the further research and fact finding (Ipsos Analysis), obtaining information

requirements, defining activities, estimating costs and schedule, planning quality and resources plan, as well as risk managing and planning the procurements.

Generally this project will last from between 6 months to 1 year depending on the work-ability of Outside Factors of Influence (OFoI).

Once the full project plan is developed and the operations begin to execute the entire operation will be

followed as per the project plan which will then be monitored to ensure costs and schedule are

adhered to in order to ensure a timely soft opening and grand opening as per the milestones requirements of this plan.

This will entail a lot of due diligence, planning, and hard work in order to meet consistently, build the

project plan, and execute it. The management team will work together to meet the milestones built in

this business plan. This major milestones in this phase according to this Business Plan will consist of

the Acquisition of the Financier, the Development of the Project Plan, the Fit-out of the Cafe, and the Soft & Grand Opening. However these will be subject to refinement in the Project Plan.

After the openings have occurred per the plan the closeout of this phase and the project will

commence which will entail a full review of the project, verify the scope, and update the PR & LL in

order to use later for the TTPs. This closing phase will signify the opening of the next phase which will be the TransOps phase.

Café di Nofà

Page 31

Transition to Sustainment Operations phase will consist of the phase out of the StartOps Project

(starting up the cafe) and the gradual phase into continued operations. During this phase the

owner/managers will be involved with running and operating the business, developing Standard

Operating Procedures (SOPs), training the staff, monitoring and controlling the early stage operations,

and developing Tactics, Techniques, and Procedures (TTPs) based on Performance Reviews & Lessons

Learned (PR&LL) which will provide the sturdy foundation for the completion of the transition into the

hand-off for SusOps. (See SOP's, PR&LL, TTP Annex for more details)

This phase will also be governed as a project but with a less formal framework and approach. A

summarized project plan will be created with a few higher level deliverables to be used as a framework

to guide the incoming managers and workers who will continue to build the project plan with the

oversight and supervision of the CEO and GM. A more Agile methodology will be applied to the

Transition Phase in order to ensure a proper fit of the early SOPs, TTPs, and thorough understanding and utilization of the PR&LL while adjusting to the consumer's demands.

This phase will generally last between 2-4 months, but will carry on until it is determine the incoming

managers and personnel are adequately trained and all processes, procedures, and other systems are working in sync and at no less than 80% efficiency10 and 99.7% effectiveness.11

Sustainment Operations (SusOps) phase will generally commence when the procedures of

operations have cured enough to be developed into written SOPs and the owner management team is

satisfied they can hand off the program in part or completely to the incoming non-owner managers. It is estimated this will be around the 18-24 month mark.

Sustainment Operations will continue with outside oversight and influence from the Owners & Board

Members in order to further develop and grow Café di Nofà into an F&B business that can be replicated

in another location in Kuwait and possibly other gulf states in the medium to long term of the business life.

THE PEOPLE:

The management team of Café di Nofà will have distinct and separate structures as it progresses through the phases as well in maturity and development.

In order to manage each phase successfully with the lowest cost we intend to use bare-bones

management for each phase. This use of only the crucial managers will help reduce the startup costs

associated with most F&B businesses who have bloated payroll expenses prior to Sustainment Operations by hiring their managers and personnel through the startup process.

We will be utilizing a "whisker' s width" phase-in for each position in order to reduce or eliminate paid

retainment periods. Because we will not be hiring managers on retainer through StartOps we will

ensure we have multiple options for each position so when the time is ready to bring people directly

aboard into their position they will be available.

Café di Nofà

Page 32

During the StartOps phase we envision the management team will consist of:

2 - Active Managers, and possibly 1 - Passive Manager, and 1 - Consultative Manager.

Active Managers - The active managers will be the CEO and the GM. They are referred to as active managers because they will be heavily involved in the 5 phases of the project cycle of StartOps.

Passive Manager - The passive manager will be the Chief Financial Officer if such a position is

determined from the output of financial investment. He is referred to as a passive manager because

he will not be highly involved in the either the Startup Operations or Continued Operations. However

he will be given oversight of both operations for quality audit purposes as well as investor management and development for the long term business model which will be developed in Y2 & Y3.

Consultative Manager - The consultative manager, should there be one for sweat equity

investment, will be the Business Development Manager. He is referred to as a consultative manager as

initially he will perform in a consultative capacity to help form the supply chain management process,

ensure the integrity of the Italian Branding & Authenticity in Food Offerings, and recommend

developmental processes for Startup & Continued Operations. He will be heavily relied upon in the

Startup Operations for the Design & Fitting Out of the Cafe. Additionally he will continue to be involved in Sustainment Operations to ensure the authenticity of the Cafe.

During the TransOps phase the management team will likely consist of:

4 - Active Managers, 1 - Passive Manager, and 1 - Consultative Manager.

Active Managers - The active managers will be the CEO, GM, Executive Chef (EC), and the Service

Manager (SM). They are referred to as active managers because they will be heavily involved in

the planning and execution with inputs from all managers until completion of the transition. The AGM

will be training for the GM position and will be taking over in lieu of the GM so the GM will be able to

move onto other projects once this one is stabilized.

Passive Manager - The passive manager will be the CFO.

Consultative Manager - The consultative manager will be the Business Development Manager. In

the next phase he will be either phased out completely to inactive status or moved to a full-time active

management status. His duties should be transferred to the respective incoming active managers of the next in SusOps.

During the SusOps phase the management team will consist of:

4 or 5 - Active Managers, and 3 - Passive Managers.

Active Managers - The active managers will be the Executive Chef, Administrative & Accounts

Manager (AAM), Food & Beverage Manager (FBM), SM, and possibly the Business Development

Manager (BDM). They are referred to as active managers because they will be heavily involved in the ongoing execution of Sustainment Operations.

Passive Manager - The passive managers will be the CEO, the CFO, and the GM as they will have

switched to mostly a higher level management of the mission, vision, and values while planning to

expand into other areas.

Café di Nofà

Page 33

THE EXPERIENCE:

Café di Nofà has a very strong, experienced, and professional management team with strengths in all the areas needed to ensure the success of this project.

David M. Simon, CEO, Partner - Project Management, Development, Operations, & Finance

David is a very highly experienced business professional with the drive to succeed in all that he

does. He has a gift for knowing which combinations of elements will add up to make a successful

design, product, or service. David has a talent for knowing what people want and will pay good money

for. With this talent he has been able to successfully build up his construction company in Kuwait as well as the companies of his family members and friends across the world.

He has lived and worked in Italy for 3 years and previously started up 4 companies, and has 10 years

experience in the F&B industry. He is also a certified Project Management Professional, Vice President

of the Association of the U.S. Army in Kuwait, Director of Performance for the Board of Directors in the

Project Management Institute chapter of Kuwait, and is a member of the American Business Council in Kuwait.

David specializes in the skills of Project Management, Development, Operations, & Finance and will be

deeply involved in all aspects of this operation. He is extremely well qualified to ensure the initiation,

planning, and execution of this venture' s startup operations are a success in order to turn them over for continuing operations to the Executive Chef.

Nouf Al-Shatti, GM, Partner - Marketing & Sales

Nouf is a business savvy Kuwaiti who has a deep understanding of the market as well as the

knowledge of commercial procedures and business laws and requirements in Kuwait. She has a degree

in Information Technology and is highly competent in regard to ongoing sales, customer service, and

team development. She served for over 10 years in a customer service position moving to F&B from the IT field.

She has studied very carefully the local market regarding F&B operations and has developed a plan

with the help of the CEO to ensure this venture is successfully deployed in accordance with the norms

and requirements of the local community.

????, CFO, Partner - Investor Relations, Strategic Over-site & Development

(Insert Credentials)

????, BDM, Partner - Project Management & Business Development

(Insert Credentials)

Café di Nofà

Page 34

AUTHORITY:

Decision-making for the cafe will be divided as follows.

CEO - David

Marketing & Advertising

Planning, Development, & Instruction

Operations & Accounting

Software & Computer Systems

Web Development: Front End

Web Development: Back End

GM - Nouf

Merchandising & Purchasing

Marketing & Advertising

Purchasing & Numerical Analysis

CFO - ????

Purchasing & Numerical Analysis

Operations & Accounting

BDM - ????

Space Design & Development

Theme & Decor

Vendor Selection

Purchasing & Merchandising

Menu Approval

Café di Nofà

Page 35

Shared

Hiring & Firing

Employee Development

Standard Operating Procedures

Company Policies

Customer Services

Menu Selection

OPERATIONAL SCHEDULE:

Once in SusOps the hours of Café di Nofà will be as follows

Operating Hours

7am-10pm Customers

Shift Schedules

2am-8am Baker Shift

6am-12pm Shift 1

11am-5pm Shift 2

4pm-11pm Shift 3

Café di Nofà

Page 36

7.1 Personnel Plan

In order to ensure quality personnel the following positions have been identified and explained.

Executive Chef: The Executive Chef (EC) becomes the top management position within Café di Nofà

and overall responsible for the SusOps phase success or failure. He will manage and oversee all

aspects of the SusOps phase and ensure policies are being followed and failures are being addressed and corrected.

The EC will perform quality assurance through audits of the quality processes in place used to control

and ensure quality of the Cafe offerings. The EC will be required to strictly adhere to the Quality Management Plan and ensure all procedures for controlling quality are being followed.

The EC will update all PR&LL into the SOPs, TTPs, and update company policies if necessary. Prior to

any changes of organizational process assets the EC will confirm with the CEO and GM in order to ensure all changes are in line with the Mission and Vision.

The EC will be required to provide monthly: sales reports, purchase reports, inventory reports, as well

as keeping the budgets and forecasts updated and current. Additionally he will be responsible to make

updates to the P&L and Balance Sheet, as well as any other pertinent financial report adjustments

as required by the Board of Directors. He will also provide review and correction to the reports generated by the Administrative & Accounts Manager in order to ensure they are accurate.

Responsibilities include

The daily operations of Café di Nofà. Overall responsible for success or failure.

Developing the Menu

Ensuring the Menu is approved through the BDM

Assisting in the Development and Implementation of the Employee Development Plan

Assisting in the Development of the TTPs

Assisting in the Refinement of the SOPs

Assisting in the Review of the PR&LLs

Developing the Back of the House Plan

Developing the Stock & Inventory Plan

Developing the Front of the House Plan

Developing the Employee Development Plan

Developing the Staff & Service Management Plan

Developing the Financial Management Plan

Developing the Accounting Plan

Developing the Marketing Plan

Developing the Management Plan

Developing the Organizational Process Asset Update Plan

Developing the Customer and Knowledge Management Plan

Café di Nofà

Page 37

Administrative & Accounts Manager: The Administrative & Account Manager (AAM) is the 2nd in charge when the TransOps phase completes.

The AAM will be responsible for the administration of policies, procedures, and other practices. He will

be the subject matter expert on the SOPs, and TTPs, and the PR&LL as these will be his main

focus. His life will to be ensure these policies and procedures are relevant and realistic. If they are not he will ensure the become relevant and realistic.

The AAM will be help govern and develop team members alongside the EC. He will also develop and implement policies and procedures designated by the EC.

The AAM will also track all accounts and financials. He will be instrumental working with the F&B

Manager to ensure all inventory is cross checked and cost of goods is accounted for as well as any

expenses outside of the F&B Managers scope. The AAM will be overall responsible for the timely

accounting of all accounts and briefing and dissemination of this information to the EC. Additionally

the AAM will review the finalized monthly reports of the EC to ensure they match up with the

accounting data and other section managers reports.

The AAM will also be the 3rd tier dispute resolution point of contact for customer dissatisfaction and quality failures.

Responsibilities include

The daily administrative actions of Café di Nofà.

Developing Financial Reports

Reviewing Financials for Accuracy

Reviewing Financials with Service and F&B sections

Ensuring Accounting Accuracy across Service, F&B, and Admin Sections

Assisting with Development of Organizational Process Assets

Assisting with Development of the Organizational Plans

Development of the SOP, TTP, and in the PR&LL process

Assisting with the Establishment of New Accounts Back of the House Hiring & Firing

Food & Beverage Manager: The Food & Beverage Manager (FBM) is the 3rd in charge when the

TransOps phase completes. The FBM is overall in charge of the Food and Beverage Offerings, the

Inventory Control, the Receiving & Stocking, and also doubles as a Shift Leader. Although it is not

REQUIRED that he perform sales actions like his team it is highly encouraged if times become extremely busy.

During down times while on shift the FBM will ensure all the inventory is stocked as per the Stock &

Inventory Plan (S&IP), all Orders are filled and called in, and all incoming shipments are coordinated

and confirmed. If any inventory or stock is lacking the FBM will correct it immediately according to the S&IP.

The FBM will also be responsible to assure quality of the F&B operation by conducting

quality audits against the planned processes for quality and those observed in action. The FBM will

also conduct quality controls against any F&B offerings which could be or do have defects in quality. It is of the utmost importance the FBM ensure the highest quality F&B offerings to the customers.

The FBM will be required to generate weekly reports of Sales vs.. Cost of Goods Sold, Inventory

Reports, as well as update the weekly budget and forecast. The FBM will also assist the EC with

the Monthly Inventory Report, Monthly Sales Report vs... Cost of Goods Sold Report, as well as

Inventory and Budgets and Forecasts. This assistance will be solely in the reviewing and auditing capacity to ensure the EC's reports are accurate. The FBM will also cross-check reports of the SM.

Café di Nofà

Page 38

The FBM will also be the 2nd tier dispute resolution point of contact for customer dissatisfaction and quality failures.

Responsibilities include

The Food & Beverage Offerings of Café di Nofà. Overall responsible for success or failure.

Assisting in the Menu Development

Developing SOP for purchasing of authentic Italian ingredients

Ensuring timely deliveries of all F&B elements/ingredients

Ensure Weekly Specials are Forecasted

Ensuring the Weekly Specials are Published

Tracking all inventory and goods

Ensuring quality of inventory

Ensuring proper rotation of stock

Ensuring regulatory compliance of F&B offerings

Service Manager: The Service Manager (SM) is the 4th in charge when the TSusOps phase

completes. The SM is overall in charge of the Service Team, to include Team Development and

Counseling, Scheduling, and Training as well as Floor Staff are Trained and Cross Trained. The

SM also doubles as a Shift Leader. Although it is not REQUIRED that he perform sales actions like his

team it is highly encouraged if times become extremely busy.

During down times while on shift the SM will ensure all the Floor Staff are in uniform, neat, clean, and

serving with a smile. If at anytime any of these are not in accordance with the Staff and Service Management Plan (S&SMP) he will perform the required actions in order to correct the failure.

Additionally the SM will monitor and control the Front of the House (FotH) in order to ensure it is neat,

organized, clean, and in accordance with the Front of the House Plan (FotHP). During his duties if he

observes any inconsistencies, failures, ineffectiveness, or inefficiencies, he will make note of those observances and document them on the issues log.

The SM will be required to generate weekly sales reports, analyze by person sales, and make

recommendations based off his analysis to the EC on how to exploit the strengths of each Service Team Member regarding their Sales Ability. The SM will also cross-check reports of the FMB.

The SM will also be responsible to assure quality of the service operation by conducting quality audits

against the planned processes for service quality and those observed in action. The SM will also

conduct quality controls against any Service Team Member actions which do have defects or could lead

to defects in quality. It is of the utmost importance the SM ensure the highest quality service to the

customers.

The SM will also be the 1st tier dispute resolution point of contact for customer dissatisfaction and

quality failures.

Responsibilities Include

The Service and Customer Satisfaction of Café di Nofà. Overall responsible for success or

failure.

Ensuring Employee Development per the Employee Development Plan

Training and Cross Training

Ensuring the Weekly Specials are disseminated and understood

Setting the Schedule

Dispute resolution and crisis management

Front of the House Hiring & Firing

Café di Nofà

Page 39

Chef de Cuisine: The Chef de Cuisine is in charge of all things related to the kitchen, which includes

menu creation, management of kitchen staff, ordering and purchasing of inventory, and plating design.

He will work with the SM, the FBM, and the AAM, in order to execute the direction as designated by the EC.

Chef de Partie: The Chefs de Partie will act as the chef and management over their individual

sections. The Panini & Pastry Chef is an example of a specialized Chef de Partie. These individuals will

be highly specialized in their lines, and will report to the Chef de Cuisine to ensure they are prepped

and ready for operations daily.

Service Shift Leaders (SSL): There will be two Service Shift Leaders, one for the morning and one

for the evening. shifts will overlap Their In lean times the shift leaders interim will be the SM and the

FBM. However the SSLs should be separate positions and during exceptionally busy times the SSLs can act a position lower as Service Team Members with the SM and FBM acting as ad-hoc SSLs.

The SSLs will serve as an extension of the SM to their team to help motivate, direct, and guide their

Service Team Members to follow the policies and procedures, apply corrective actions as directed by the SM, and train and cross train them.

Barista Leader (BL): This will be an imported, premium, top-notch Italian Barista who will be responsible for the morning rush and evening rush coffee offerings.

The BL will coordinate with the SSL to ensure there is a designated Barista Assistant on each Shift that

will be available for back up on the morning and evening rushes. The BL will train and educate the

Barista Assistant (BA) on the proper Italian Coffee Protocols (ICPs). The BL will ensure the BA follows all techniques and protocols for the proper presentation and offering of the products.

Pastry & Panini Chef: This will also be an imported, premium, top-notch Italian Pastry Chef and

Panini Maker. He will be responsible for all the Pastries and Panini. The week by week daily specials

will be the responsibility of the EC. However the PPC will also cross train with the EC in order to

ensure variety and authenticity in the offerings.

Table: Personnel Personnel Plan

2013 2014 2015

Chief Executive Officer (1) (KWD 0) KWD 0 KWD 0 General Manager (1) KWD 0 KWD 0 KWD 0 Business & Team Development Manager (1) (KWD 0) KWD 6,000 KWD 6,000 Executive Chef (1) KWD 0 KWD 9,000 KWD 10,000 Administrative & Accounts Manager (1) KWD 0 KWD 4,800 KWD 5,200 Food & Beverage Manager (1) KWD 0 KWD 4,800 KWD 5,200 Chef de Cuisine (1) KWD 3,300 KWD 7,200 KWD 7,600 Chef des Partie, Demi Chefs des Partie (Back of House) (10)

KWD 14,850 KWD 34,000 KWD 36,000

Pastry & Panini Chef (1) KWD 1,925 KWD 4,500 KWD 4,800 Barrista Lead (1) KWD 1,925 KWD 4,500 KWD 4,800 Barrista Team (2) KWD 1,925 KWD 4,200 KWD 4,200 Service Manager (1) KWD 1,925 KWD 4,500 KWD 4,800 Service Team Leads (3) KWD 2,025 KWD 8,100 KWD 9,000 Service Team (Front of House) (9) KWD 9,900 KWD 21,600 KWD 21,600 Storekeeper (1) KWD 1,100 KWD 1,200 KWD 1,200 Busers, Dishwashers, & Helpers (9) KWD 7,425 KWD 8,100 KWD 8,100 Cleaning Crew (5) KWD 2,499 KWD 3,000 KWD 3,000 Total People 0 0 0

Total Payroll KWD 48,799 KWD 125,500 KWD 131,500

Café di Nofà

Page 40

8.0 Financial Plan

Café di Nofà will finance the entire startup operations with the financial investment partner. This person will invest for ownership with a dividend authorized starting in FY4.

In the interim Y1 will be further capitalized with sweat equity of both the CEO and the GM to ensure

the business is properly initiated and well rooted before turning it over to salaried management.

The following are critical assumptions that are calculated in this business plan:

The Economy: This could not be a better time to start a business as the economy reaches its

lowest point of the business cycle worldwide and begins its trek back up. Consumer spending is up.

Additionally Kuwait continues to post year, and quarter end budget surpluses which are extremely

critical to the expansion and growth of the country.

Owner Experience: A shorter learning curve will be brought to the business by David and Nouf

due to their extensive backgrounds and in-depth market knowledge.

Managed Costs: A clear understanding of the need to manage costs and forecast future needs so

that the business is not "broad-sided" by the unexpected as well as a clear risk management and

mitigation strategy will ensure unexpected costs are in fact expected and budgeted as well as

unexpected costs.

Wise Purchases: Finding the right product, at the right price, and utilizing the Sultan Center and

its promises to import specialty items at no extra cost will ensure our top quality ingredients

are obtained for our F&B Offerings.

Other: We anticipate moderate growth, positive cash balance, marketing concerns will remain at

or below 1.5% of sales, and all residual profits will be reinvested into the Cafe as stated until FY4.

Café di Nofà

Page 41

8.1 Startup Funding

Café di Nofà start-up costs are detailed below, in the Start-up Table. The following table shows how these start-up costs will be funded by owner and investor capital.

Table: Startup Funding

Startup Funding

Startup Expenses to Fund KWD 530,000 Startup Assets to Fund KWD 75,000 Total Funding Required KWD 605,000

Assets Non-cash Assets from Startup KWD 60,000 Cash Requirements from Startup KWD 15,000 Additional Cash Raised KWD 95,000 Cash Balance on Starting Date KWD 110,000 Total Assets KWD 170,000

Liabilities and Capital

Liabilities Current Borrowing KWD 0 Long-term Liabilities KWD 0 Accounts Payable (Outstanding Bills) KWD 0 Other Current Liabilities (interest-free) KWD 0 Total Liabilities KWD 0

Capital

Planned Investment General Jacob Hamadah KWD 200,000 Other Partner 1 KWD 250,000 Other Partner 2 KWD 250,000 Additional Investment Requirement KWD 0 Total Planned Investment KWD 700,000

Loss at Startup (Startup Expenses) (KWD 530,000) Total Capital KWD 170,000

Total Capital and Liabilities KWD 170,000

Total Funding KWD 700,000

8.2 Important Assumptions

There is no burden of taxes, social security, unemployment insurance, or other payables on Pay Roll.

8.3 Break-even Analysis

A break-even analysis table has been completed on the basis of average costs/prices. With fixed costs

of KWD 11,1717 ~KWD 2.43 in average per unit sales, and 0.55 in an average variable costs, we

need 15,155 per month in sales to break even.

Café di Nofà

Page 42

Table: Break-even Analysis

Break-even Analysis

Monthly Units Break-even 6,236 Monthly Revenue Break-even KWD 15,155

Assumptions: Average Per-Unit Revenue KWD 2.43 Average Per-Unit Variable Cost KWD 0.55 Estimated Monthly Fixed Cost KWD 11,717

Chart: Break-even Analysis

8.4 Projected Profit and Loss

Our Projected Profit and Loss covers three years and becomes somewhat less predictable over time.

However we anticipate a +/- 5% accuracy in Y1; approximately +/- 10% accuracy in Y2; and

approximately +/- 20% accuracy in Y3, respective to the total Net Profit figures (not percentages).

Our P&L shows our predictions for operations once startup costs have been covered.

We predict marketing & advertising costs to stay relatively consistent at about 1.4% of sales.

Normally, a start-up will operate with negative profits through the first two years, however we believe

with the proper capitalization, target market, working equity, and location and product offering we will be

able to profit in the second full year of operation.

Note that we predict we will exceed our objective of 65% gross margin in Y1-Y3.

Our sales projections are more than conservative and our expenses to include rent and key money are

based on a WORST CASE SCENARIO. Should sales increase as we anticipate, or the key money and rent

be less than listed, we would be looking at significantly better returns.

Café di Nofà

Page 43

Table: Profit and Loss

Pro Forma Profit and Loss

2013 2014 2015

Sales KWD 180,967 KWD 487,184 KWD 608,848 Direct Cost of Sales KWD 41,059 KWD 110,156 KWD 137,679 Other Costs of Sales KWD 6,000 KWD 7,000 KWD 8,000 Total Cost of Sales KWD 47,059 KWD 117,156 KWD 145,679

Gross Margin KWD 133,907 KWD 370,028 KWD 463,169 Gross Margin % 74.00% 75.95% 76.07%

Expenses Payroll KWD 48,799 KWD 125,500 KWD 131,500 Marketing/Promotion KWD 4,900 KWD 6,100 KWD 7,075 Depreciation KWD 0 KWD 0 KWD 0 Equipment & Tools KWD 2,500 KWD 2,500 KWD 2,500 Supplies & Materials KWD 6,000 KWD 6,000 KWD 6,000 Rent KWD 75,000 KWD 180,000 KWD 180,000 Insurance KWD 1,200 KWD 2,400 KWD 2,400 Legal Fees KWD 600 KWD 600 KWD 600 IT KWD 600 KWD 1,000 KWD 1,000 Spoilage, Loss, Breakage KWD 1,000 KWD 2,000 KWD 2,000

Total Operating Expenses KWD 140,599 KWD 326,100 KWD 333,075

Profit Before Interest and Taxes (KWD 6,692) KWD 43,928 KWD 130,094 EBITDA (KWD 6,692) KWD 43,928 KWD 130,094 Interest Expense KWD 0 KWD 0 KWD 0 Taxes Incurred KWD 0 KWD 0 KWD 0

Net Profit (KWD 6,692) KWD 43,928 KWD 130,094 Net Profit/Sales -3.70% 9.02% 21.37%

Café di Nofà

Page 44

Chart: Profit Monthly

Chart: Profit Yearly

Café di Nofà

Page 45

Chart: Gross Margin Monthly

Chart: Gross Margin Yearly

8.5 Projected Cash Flow

We are positioning ourselves in the market as a low risk concern with steady cash flows. While we

have not accounted for it in the projections, we anticipate receiving three or four months free base rent while the cafe is under construction and soft opening.

We have allowed for a more aggressive cash balance initially, to allow us to react quickly to unforeseen

F&B, supplies, and/or equipment needs, as well as missed classifications and forecasts, and hopefully most of all, higher than anticipated sales.

Café di Nofà

Page 46

Accounts payable is paid at the end of 60 days while sales are in cash or act-as-cash transactions

which gives our cafe the excellent cash flow structure needed to sustain from any emergency scenario

after 3 years of operations.

We will secure a strong cash balance by the end of year one and by the end of year two we we will

have drastically reduced the cash balance against any debts occurred during StartOps or SusOps.

In year three any amounts above KWD10,000 not dispersed for dividends will be invested into semi-

liquid stock portfolios to decrease the opportunity cost of cash held. The interest will show up as - Dividends in the Cash Flow table and will be updated quarterly.

Table: Cash Flow

Pro Forma Cash Flow

2013 2014 2015

Cash Received

Cash from Operations Cash Sales KWD 180,967 KWD 487,184 KWD 608,848 Subtotal Cash from Operations KWD 180,967 KWD 487,184 KWD 608,848

Additional Cash Received Sales Tax, VAT, HST/GST Received KWD 0 KWD 0 KWD 0 New Current Borrowing KWD 0 KWD 0 KWD 0 New Other Liabilities (interest-free) KWD 0 KWD 0 KWD 0 New Long-term Liabilities KWD 0 KWD 0 KWD 0 Sales of Other Current Assets KWD 0 KWD 0 KWD 0 Sales of Long-term Assets KWD 0 KWD 0 KWD 0 New Investment Received KWD 0 KWD 0 KWD 0 Subtotal Cash Received KWD 180,967 KWD 487,184 KWD 608,848

Expenditures 2013 2014 2015

Expenditures from Operations Cash Spending KWD 48,799 KWD 125,500 KWD 131,500 Bill Payments KWD 97,919 KWD 369,005 KWD 326,351 Subtotal Spent on Operations KWD 146,718 KWD 494,505 KWD 457,851

Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out KWD 0 KWD 0 KWD 0 Principal Repayment of Current Borrowing KWD 0 KWD 0 KWD 0 Other Liabilities Principal Repayment KWD 0 KWD 0 KWD 0 Long-term Liabilities Principal Repayment KWD 0 KWD 0 KWD 0 Purchase Other Current Assets KWD 0 KWD 0 KWD 0 Purchase Long-term Assets KWD 0 KWD 0 KWD 0 Dividends KWD 0 KWD 0 KWD 0 Subtotal Cash Spent KWD 146,718 KWD 494,505 KWD 457,851

Net Cash Flow KWD 34,249 (KWD 7,321) KWD 150,997 Cash Balance KWD 144,249 KWD 136,928 KWD 287,925

Café di Nofà

Page 47

Chart: Cash

Café di Nofà

Page 48

8.6 Projected Balance Sheet

All of our tables will be updated monthly to reflect past performance and future assumptions. Future

assumptions will not be based on past performance but rather economic cycle activity, regional F&B

industry strength, and future cash flow possibilities.

We expect solid growth in Net Worth beyond the year 2020.

Table: Balance Sheet

Pro Forma Balance Sheet

2013 2014 2015

Assets

Current Assets Cash KWD 144,249 KWD 136,928 KWD 287,925 Inventory KWD 8,786 KWD 66,614 KWD 38,787 Other Current Assets KWD 35,000 KWD 35,000 KWD 35,000 Total Current Assets KWD 188,035 KWD 238,542 KWD 361,712

Long-term Assets Long-term Assets KWD 15,000 KWD 15,000 KWD 15,000 Accumulated Depreciation KWD 0 KWD 0 KWD 0 Total Long-term Assets KWD 15,000 KWD 15,000 KWD 15,000 Total Assets KWD 203,035 KWD 253,542 KWD 376,712

Liabilities and Capital 2013 2014 2015

Current Liabilities Accounts Payable KWD 39,726 KWD 46,305 KWD 39,381 Current Borrowing KWD 0 KWD 0 KWD 0 Other Current Liabilities KWD 0 KWD 0 KWD 0 Subtotal Current Liabilities KWD 39,726 KWD 46,305 KWD 39,381

Long-term Liabilities KWD 0 KWD 0 KWD 0 Total Liabilities KWD 39,726 KWD 46,305 KWD 39,381

Paid-in Capital KWD 700,000 KWD 700,000 KWD 700,000 Retained Earnings (KWD 530,000) (KWD 536,692) (KWD 492,763) Earnings (KWD 6,692) KWD 43,928 KWD 130,094 Total Capital KWD 163,308 KWD 207,237 KWD 337,330 Total Liabilities and Capital KWD 203,035 KWD 253,542 KWD 376,712

Net Worth KWD 163,308 KWD 207,237 KWD 337,330

8.7 Business Ratios

Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 5812, Full Service Restaurant are shown below.

Café di Nofà

Page 49

Table: Ratios

Ratio Analysis

2013 2014 2015 Industry Profile

Sales Growth n.a. 169.21% 24.97% 1.65%

Percent of Total Assets Inventory 4.33% 26.27% 10.30% 6.34% Other Current Assets 17.24% 13.80% 9.29% 43.25% Total Current Assets 92.61% 94.08% 96.02% 53.12% Long-term Assets 7.39% 5.92% 3.98% 46.88% Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 19.57% 18.26% 10.45% 25.40% Long-term Liabilities 0.00% 0.00% 0.00% 73.91% Total Liabilities 19.57% 18.26% 10.45% 99.31% Net Worth 80.43% 81.74% 89.55% 0.69%

Percent of Sales Sales 100.00% 100.00% 100.00% 100.00% Gross Margin 74.00% 75.95% 76.07% 58.06% Selling, General & Administrative Expenses

77.69% 66.94% 54.71% 23.02%

Advertising Expenses 2.71% 1.25% 1.16% 1.74% Profit Before Interest and Taxes -3.70% 9.02% 21.37% 6.52%

Main Ratios Current 4.73 5.15 9.18 1.25 Quick 4.51 3.71 8.20 1.00 Total Debt to Total Assets 19.57% 18.26% 10.45% 99.31% Pre-tax Return on Net Worth -4.10% 21.20% 38.57% 4325.25% Pre-tax Return on Assets -3.30% 17.33% 34.53% 29.65%

Additional Ratios 2013 2014 2015 Net Profit Margin -3.70% 9.02% 21.37% n.a Return on Equity -4.10% 21.20% 38.57% n.a

Activity Ratios Inventory Turnover 4.44 2.92 2.61 n.a Accounts Payable Turnover 3.46 8.11 8.11 n.a Payment Days 39 42 49 n.a Total Asset Turnover 0.89 1.92 1.62 n.a

Debt Ratios Debt to Net Worth 0.24 0.22 0.12 n.a Current Liab. to Liab. 1.00 1.00 1.00 n.a

Liquidity Ratios Net Working Capital KWD 148,308 KWD 192,237 KWD 322,330 n.a Interest Coverage 0.00 0.00 0.00 n.a

Additional Ratios Assets to Sales 1.12 0.52 0.62 n.a Current Debt/Total Assets 20% 18% 10% n.a Acid Test 4.51 3.71 8.20 n.a Sales/Net Worth 1.11 2.35 1.80 n.a Dividend Payout 0.00 0.00 0.00 n.a

Appendix

Page 1

Sales Forecast

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Unit Sales Drinks (Coffee/Tea) (Min .500 Max 2.000)

0 0 0 0 0 0 0 4,221 4,432 4,654 4,887 5,131

Drinks (Other) (Min .500 Max 2.500)

0 0 0 0 0 0 0 2,144 2,165 2,187 2,209 2,231

Food (Panini) (Min 1.500 Max 2.750)

0 0 0 0 0 0 0 1,845 1,900 1,957 2,016 2,076

Food (Pastry) (Min 500 Max 1.000)

0 0 0 0 0 0 0 2,462 2,536 2,612 2,690 2,771

Food (Plate) (Min 2.250 Max 4.000)

0 0 0 0 0 0 0 1,286 1,299 1,312 1,325 1,338

Food (Specials) (3.500) 0 0 0 0 0 0 0 1,407 1,477 1,551 1,629 1,710

Food (VIP) (Min 4.750 Max 12.000)

0 -0 0 0 0 0 0 400 500 600 700 800

Total Unit Sales 0 0 0 0 0 0 0 13,765 14,309 14,873 15,456 16,057

Unit Prices Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Drinks (Coffee/Tea) (Min .500 Max 2.000)

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

KWD 1.25

Drinks (Other) (Min .500 Max 2.500)

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

KWD 2.25

Food (Panini) (Min 1.500 Max 2.750)

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

KWD 0.75

Food (Pastry) (Min 500 Max 1.000)

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

KWD 3.25

Food (Plate) (Min 2.250 Max 4.000)

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

KWD 3.50

Food (Specials) (3.500) KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

KWD 7.00

Food (VIP) (Min 4.750 Max 12.000)

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

Sales Drinks (Coffee/Tea) (Min .500 Max 2.000)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 5,276

KWD 5,540

KWD 5,818

KWD 6,109

KWD 6,414

Drinks (Other) (Min .500 Max 2.500)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 4,824

KWD 4,871

KWD 4,921

KWD 4,970

KWD 5,020

Food (Panini) (Min 1.500 Max 2.750)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 1,384

KWD 1,425

KWD 1,468

KWD 1,512

KWD 1,557

Food (Pastry) (Min 500 Max 1.000)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 8,002

KWD 8,242

KWD 8,489

KWD 8,743

KWD 9,006

Food (Plate) (Min 2.250 Max 4.000)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 4,501

KWD 4,547

KWD 4,592

KWD 4,638

KWD 4,683

Food (Specials) (3.500) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 9,849

KWD 10,339

KWD 10,857

KWD 11,403

KWD 11,970

Food (VIP) (Min 4.750 Max 12.000)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Total Sales KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD KWD KWD KWD KWD

Appendix

Page 2

33,836 34,964 36,144 37,374 38,649

Direct Unit Costs Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Drinks (Coffee/Tea) (Min .500 Max 2.000)

12.00% KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

KWD 0.15

Drinks (Other) (Min .500 Max 2.500)

20.00% KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

KWD 0.45

Food (Panini) (Min 1.500 Max 2.750)

15.00% KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

KWD 0.11

Food (Pastry) (Min 500 Max 1.000)

25.00% KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

KWD 0.81

Food (Plate) (Min 2.250 Max 4.000)

20.00% KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

KWD 0.70

Food (Specials) (3.500) 30.00% KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

KWD 2.10

Food (VIP) (Min 4.750 Max 12.000)

0.00% KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

KWD 0.00

Direct Cost of Sales Drinks (Coffee/Tea) (Min .500 Max 2.000)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 633 KWD 665 KWD 698 KWD 733 KWD 770

Drinks (Other) (Min .500 Max 2.500)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 965 KWD 974 KWD 984 KWD 994 KWD 1,004

Food (Panini) (Min 1.500 Max 2.750)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 208 KWD 214 KWD 220 KWD 227 KWD 234

Food (Pastry) (Min 500 Max 1.000)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 2,000

KWD 2,061

KWD 2,122

KWD 2,186

KWD 2,251

Food (Plate) (Min 2.250 Max 4.000)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 900 KWD 909 KWD 918 KWD 928 KWD 937

Food (Specials) (3.500) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 2,955

KWD 3,102

KWD 3,257

KWD 3,421

KWD 3,591

Food (VIP) (Min 4.750 Max 12.000)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Subtotal Direct Cost of Sales KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 7,661

KWD 7,924

KWD 8,200

KWD 8,488

KWD 8,786

Appendix

Page 3

Personnel Plan

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Chief Executive Officer (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 (KWD 0) KWD 0 KWD 0

General Manager (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Business & Team Development Manager (1)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 (KWD 0) KWD 0 KWD 0 KWD 0

Executive Chef (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Administrative & Accounts Manager (1)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Food & Beverage Manager (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Chef de Cuisine (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 300 KWD 600 KWD 600 KWD 600 KWD 600 KWD 600

Chef des Partie, Demi Chefs des Partie (Back of House) (10)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 1,350

KWD 2,700

KWD 2,700

KWD 2,700

KWD 2,700

KWD 2,700

Pastry & Panini Chef (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 175 KWD 350 KWD 350 KWD 350 KWD 350 KWD 350

Barrista Lead (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 175 KWD 350 KWD 350 KWD 350 KWD 350 KWD 350

Barrista Team (2) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 175 KWD 350 KWD 350 KWD 350 KWD 350 KWD 350

Service Manager (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 175 KWD 350 KWD 350 KWD 350 KWD 350 KWD 350

Service Team Leads (3) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 675 KWD 675 KWD 675

Service Team (Front of House) (9) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 900 KWD 1,800

KWD 1,800

KWD 1,800

KWD 1,800

KWD 1,800

Storekeeper (1) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 100 KWD 200 KWD 200 KWD 200 KWD 200 KWD 200

Busers, Dishwashers, & Helpers (9) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 675 KWD 1,350

KWD 1,350

KWD 1,350

KWD 1,350

KWD 1,350

Cleaning Crew (5) KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500

Total People 3 0 0 0 0 0 32 0 0 3 0 0

Total Payroll KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD

4,025 KWD

8,550 KWD

8,550 KWD

9,224 KWD

9,225 KWD

9,225

Appendix

Page 4

Pro Forma Profit and Loss

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Sales KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 33,836

KWD 34,964

KWD 36,144

KWD 37,374

KWD 38,649

Direct Cost of Sales KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 7,661

KWD 7,924

KWD 8,200

KWD 8,488

KWD 8,786

Other Costs of Sales KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500

Total Cost of Sales KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 KWD 8,161

KWD 8,424

KWD 8,700

KWD 8,988

KWD 9,286

Gross Margin (KWD

500) (KWD 500)

(KWD 500)

(KWD 500)

(KWD 500)

(KWD 500)

(KWD 500)

KWD 25,675

KWD 26,539

KWD 27,444

KWD 28,386

KWD 29,363

Gross Margin % 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 75.88% 75.91% 75.93% 75.95% 75.97%

Expenses Payroll KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD

4,025 KWD

8,550 KWD

8,550 KWD

9,224 KWD

9,225 KWD

9,225 Marketing/Promotion KWD 0 KWD 0 KWD 0 KWD 0 KWD 400 KWD

1,000 KWD

1,000 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500

Depreciation KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Equipment & Tools 15% KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 500 KWD 500 KWD 500 KWD 500 KWD 500 Supplies & Materials 0% KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD

1,000 KWD

1,000 KWD

1,000 KWD

1,000 KWD

1,000 KWD

1,000 Rent 0% KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 Insurance 0% KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 200 KWD 200 KWD 200 KWD 200 KWD 200 KWD 200 Legal Fees 0% KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 100 KWD 100 KWD 100 KWD 100 KWD 100 KWD 100 IT 0% KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 100 KWD 100 KWD 100 KWD 100 KWD 100 KWD 100 Spoilage, Loss, Breakage 0% KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 200 KWD 200 KWD 200 KWD 200 KWD 200

Total Operating Expenses KWD 0 KWD 0 KWD 0 KWD 0 KWD 400 KWD

1,000 KWD

6,425 KWD

26,150 KWD

26,150 KWD

26,824 KWD

26,825 KWD

26,825

Profit Before Interest and Taxes

(KWD 500)

(KWD 500)

(KWD 500)

(KWD 500)

(KWD 900)

(KWD 1,500)

(KWD 6,925)

(KWD 475)

KWD 390 KWD 620 KWD 1,561

KWD 2,538

EBITDA (KWD 500)

(KWD 500)

(KWD 500)

(KWD 500)

(KWD 900)

(KWD 1,500)

(KWD 6,925)

(KWD 475)

KWD 390 KWD 620 KWD 1,561

KWD 2,538

Interest Expense KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Taxes Incurred KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Net Profit (KWD

500) (KWD 500)

(KWD 500)

(KWD 500)

(KWD 900)

(KWD 1,500)

(KWD 6,925)

(KWD 475)

KWD 390 KWD 620 KWD 1,561

KWD 2,538

Net Profit/Sales 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% -1.40% 1.11% 1.71% 4.18% 6.57%

Appendix

Page 5

Pro Forma Cash Flow

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Cash Received

Cash from Operations Cash Sales KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD

33,836 KWD

34,964 KWD

36,144 KWD

37,374 KWD

38,649 Subtotal Cash from Operations KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD

33,836 KWD

34,964 KWD

36,144 KWD

37,374 KWD

38,649

Additional Cash Received Sales Tax, VAT, HST/GST Received

0.00% KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

New Current Borrowing KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

New Other Liabilities (interest-free)

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

New Long-term Liabilities KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Sales of Other Current Assets KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Sales of Long-term Assets KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

New Investment Received KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Subtotal Cash Received KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 33,836

KWD 34,964

KWD 36,144

KWD 37,374

KWD 38,649

Expenditures Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Expenditures from Operations Cash Spending KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD

4,025 KWD

8,550 KWD

8,550 KWD

9,224 KWD

9,225 KWD

9,225 Bill Payments KWD 0 KWD 267 KWD 500 KWD 500 KWD 500 KWD 713 KWD

1,220 KWD

2,247 KWD

13,845 KWD

24,950 KWD

26,442 KWD

26,736 Subtotal Spent on Operations KWD 0 KWD 267 KWD 500 KWD 500 KWD 500 KWD 713 KWD

5,245 KWD

10,797 KWD

22,395 KWD

34,174 KWD

35,666 KWD

35,961

Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Principal Repayment of Current Borrowing

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Other Liabilities Principal Repayment

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Long-term Liabilities Principal Repayment

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Purchase Other Current Assets KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Purchase Long-term Assets KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Dividends

KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Appendix

Page 6

Subtotal Cash Spent KWD 0 KWD 267 KWD 500 KWD 500 KWD 500 KWD 713 KWD 5,245

KWD 10,797

KWD 22,395

KWD 34,174

KWD 35,666

KWD 35,961

Net Cash Flow KWD 0 (KWD

267) (KWD 500)

(KWD 500)

(KWD 500)

(KWD 713)

(KWD 5,245)

KWD 23,039

KWD 12,569

KWD 1,970

KWD 1,708

KWD 2,689

Cash Balance KWD 110,000

KWD 109,733

KWD 109,233

KWD 108,733

KWD 108,233

KWD 107,520

KWD 102,275

KWD 125,314

KWD 137,883

KWD 139,852

KWD 141,560

KWD 144,249

Appendix

Page 7

Pro Forma Balance Sheet

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Assets Starting Balances

Current Assets Cash KWD 110,000 KWD

110,000 KWD 109,733

KWD 109,233

KWD 108,733

KWD 108,233

KWD 107,520

KWD 102,275

KWD 125,314

KWD 137,883

KWD 139,852

KWD 141,560

KWD 144,249

Inventory KWD 10,000 KWD 10,000

KWD 10,000

KWD 10,000

KWD 10,000

KWD 10,000

KWD 10,000

KWD 10,000

KWD 7,661

KWD 7,924

KWD 8,200

KWD 8,488

KWD 8,786

Other Current Assets KWD 35,000 KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

KWD 35,000

Total Current Assets KWD 155,000 KWD 155,000

KWD 154,733

KWD 154,233

KWD 153,733

KWD 153,233

KWD 152,520

KWD 147,275

KWD 167,975

KWD 180,807

KWD 183,053

KWD 185,048

KWD 188,035

Long-term Assets

Long-term Assets KWD 15,000 KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

KWD 15,000

Accumulated Depreciation KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 Total Long-term Assets KWD 15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 KWD

15,000 Total Assets KWD 170,000 KWD

170,000 KWD

169,733 KWD

169,233 KWD

168,733 KWD

168,233 KWD

167,520 KWD

162,275 KWD

182,975 KWD

195,807 KWD

198,053 KWD

200,048 KWD

203,035

Liabilities and Capital Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Current Liabilities

Accounts Payable KWD 0 KWD 500 KWD 733 KWD 733 KWD 733 KWD 1,133

KWD 1,920

KWD 3,600

KWD 24,775

KWD 37,218

KWD 38,844

KWD 39,278

KWD 39,726

Current Borrowing KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 Other Current Liabilities KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 Subtotal Current Liabilities KWD 0 KWD 500 KWD 733 KWD 733 KWD 733 KWD

1,133 KWD

1,920 KWD

3,600 KWD

24,775 KWD

37,218 KWD

38,844 KWD

39,278 KWD

39,726

Long-term Liabilities KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0 KWD 0

Total Liabilities KWD 0 KWD 500 KWD 733 KWD 733 KWD 733 KWD 1,133

KWD 1,920

KWD 3,600

KWD 24,775

KWD 37,218

KWD 38,844

KWD 39,278

KWD 39,726

Paid-in Capital KWD 700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 KWD

700,000 Retained Earnings (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) (KWD

530,000) Earnings KWD 0 (KWD

500) (KWD

1,000) (KWD

1,500) (KWD

2,000) (KWD

2,900) (KWD

4,400) (KWD

11,325) (KWD

11,800) (KWD

11,411) (KWD

10,791) (KWD

9,230) (KWD

6,692) Total Capital KWD 170,000 KWD

169,500 KWD

169,000 KWD

168,500 KWD

168,000 KWD

167,100 KWD

165,600 KWD

158,675 KWD

158,200 KWD

158,589 KWD

159,209 KWD

160,770 KWD

163,308 Total Liabilities and Capital KWD 170,000 KWD

170,000 KWD

169,733 KWD

169,233 KWD

168,733 KWD

168,233 KWD

167,520 KWD

162,275 KWD

182,975 KWD

195,807 KWD

198,053 KWD

200,048 KWD

203,035

Net Worth KWD 170,000 KWD

169,500 KWD

169,000 KWD

168,500 KWD

168,000 KWD

167,100 KWD

165,600 KWD

158,675 KWD

158,200 KWD

158,589 KWD

159,209 KWD

160,770 KWD

163,308

Appendix

Page 8

Endnotes

1. The possibility of a third party ownership interest may be the result in the possible scenario of under capitalization through conventional

means of financing. In this case the terms of third party ownership will be addressed on a per agendum basis.

2. Ownership is based upon investment amount, involvement, responsibility and accountability.

3. It is preferred to have only one third party owner who will bring all or three-quarters of the investment required for capitalization.

4. This financial account will be restricted in nature of its use as it will be designated the contingency reserve fund and emergency reserve

fund, of which 6,000kd and 8000 will be retained for the contingency and emergency reserve respectively.

5. Assuming no long-term liabilities or other outstanding debt obligations are created in order to capitalize this venture.

6. Additionally we will not actively target the married women because of our moral obligations. However we strongly feel that our targeting

the single females will undoubtedly bring in the females who are otherwise socially unavailable.

7. These are the most desirable resources in Kuwait for both single males and married males to engage in conversation, watch, and generally

desire regardless of intent. The men want to be where the pretty, available women are. Period.

8. So much so have they been studied that quite frequently I have been admonished for how un-enjoyable our meals were because I was

constantly analyzing every aspect of the meal in order to determine what the underlying problems were in Kuwait for eating out.

9. Now you may find questions with why Customer Service is a main theme here, while it is also calculated in the Value as well. There is one

reason for this. The Customer Service is SusOps BAD here in Kuwait it has to be addressed on its own. Simply put it is the worst customer

service ever experiences in any country I have been too.

10. Efficient (adj.) Performing or functioning in the best possible manner with the least waste of time and effort.

11. Effective (adj.): Adequate to accomplish a purpose; producing the intended or expected result.

Appendix

Page 9

Cheap Imported Labor Induced Customer Service Death

Customer Service must be at the heart of every restaurant operation or its survivability will be dramatically reduced. Whether most people

care to admit to it they have a favorite, or a few favorite places they like to go for certain occasions, experiences, or other reasons.

However they will discontinue their normal or standard choosing preferences if they feel these preferences are no longer providing them the

value they demand. In this process of giving up their favored F&B spots there is a scale of tolerance where most people will put up with a

certain degree of inconvenience in order to maintain their baseline (homeostasis).

Some people will accept many missed customer service opportunities in which they were not provided a beneficial customer service or as

well. they may also accept a good many bad experiences of customer service. But one thing is for sure, continue to give no customer service,

or bad service, and they will look for a new baseline.

This appendix is an analysis of the reason Cheap Imported Labor is the reason for the Death of Customer Service in Kuwait.

The Laborer

Assumption #1: Generally speaking the laborer in Kuwait is a recruit from a third world country where they and their families are poverty

stricken. They come to other countries to work because of the dire situation in their home country.

Analysis #1: This is strike one. They are forced to leave their family and country behind because they can not afford to provide decent

accommodations for them. This puts them almost immediately on a negative outlook on their situation.

Assumption #2: These workers, in order to get the privilege to feed their families by working overseas, have to first go heavily into debt to

people who provide them with the so called "opportunity" in their home country.

Analysis #2: This puts a heavy burden on the worker who know has to work at whatever job he gets, regardless if it is the job he was

selected for, in order to pay down this economic burden which often times takes years to pay off.

Assumption #3: They are often times not put in the job position for which they agreed, and were hired for in their home country. They

almost always are not provided the payment they agreed to with their recruiter.

Analysis #3: This is a very big problem into the satisfaction and efficiency of the laborer. Now they are hundreds or thousand of miles from

home, not being paid what they agreed on, not working in the position they were hired for, and we have not even addressed their living

situation.

Appendix

Page 10

Assumption #4: Local laborers now have to cut costs anyway they can in order to sustain even a poverty level of living in their new work

country in order to send money back home to their family which was the entire objective of their leaving their home land. Except now they

can not go back because they are locked in for three years working in Kuwait.

Analysis #4: Now the laborer is living away from home, has little more than what he was making in his home country, and is forced to live

in poverty level accommodations while working exceptionally long hours often times at two jobs in order to make enough money to send back

home. This results in their attitude which degrades understandably so over the course of their time in Kuwait.

The Job

Assumption #1: The laborer is now employed in a job he knows little if anything as it was more important to his lively hood and the

recruiters paycheck for him to lie on his experiences, or take whatever job he could with lower pay, just to be working.

Analysis#1: This laborer is essentially untrained and possible unskilled. If if he is skilled but untrained he will not be able to provide the

level of service required as he is too focused on trying to meet the baseline of training required for understanding and comprehension of his

tasks.

Assumption #2: The laborer is now employed in a job he is not trained for, and does not have the base skills to perform the job even if he

were trained.

Analysis #2: This employee will lack confidence which will result to poor performance. This poor performance will lead to management

disapproval, which will inevitably lead back to further lack of confidence spiralling down and down until eventually the employee no longer

cares about his confidence or performance and seeks job termination through firing or through self termination.

Assumption #3: The laborer is now fired, but because management has chosen to keep costs down, another cheap imported laborer is

hired.

Assumption #3: The process repeats over again.

The Customer

Assumption #1: The customer is the point of interaction between the laborer and the business and is given exceptionally poor customer

service because of the above outlined assumptions.

Analysis #1: The customer decides to either endure this poor service which leads to the current scenario in Kuwait where poor service is

everywhere, OR, the customer decides to move to another location to have his customer service needs met.

Either way this an excellent point to summarize this as our opportunity to fix this cycle. We will not adhere to the cycle of poor customer

service which will generate more customer for our restaurant. We will also provide an excellent choice for top notch customer service for

those who have left the other establishments looking for a better choice.

Appendix

Page 11

Quality vs. Cost = Value

The concept of Quality vs. Cost = Value has been around a long time in business concepts. However until recently many people viewed this only from a financial perspective.

It was not until recently when people, through systems like Lean Six Sigma, bodies of knowledge like project management, and concepts like earned value quality management, did it really become clear there are other perspectives from which to view Quality, Cost, and Value.

The one most important to us is from the perspective of the customer.

PERSPECTIVE: CUSTOMER

When we are dealing with Quality things we might consider from the perspective of the customer are not only to food, but also to the

customer service, the atmosphere, the additional offerings, etc.

When dealing with cost in regard to the customer we definitely should be looking at things such as monetary cost, but also time cost, or

opportunity cost, and etc.

DEFINITIONS:

Quality - The standard of something as measured against other things of a similar kind. In most cases this would refer to the level of

satisfaction brought about to the consumer. If it brings about a low level of satisfaction because of flaws in the make, or substandard parts or ingredients, it will usually been seen as low quality because it did not provide the level of satisfaction desired.

F&B Offerings - The food and beverage offerings absolutely have to be every bit as good or better than the customer is hoping for. This

is critical. If the food is excellent we can walk the line of higher prices. But we should attempt to provide them with quality food and

moderate prices. There are ways to drive down the cost of buying the food but substituting for cheaper products for cost sake should never be one of our options.

Customer Service - Likewise the quality of our customer service has to be above and beyond expectations. This is more than just

saying “yes sir” or “no sir”. It is about anticipating the needs before the customer walks in the door, and having those needs met

before they even ask. If we can offer small services, just little things, along with trained happy staff that are paid what your reputation

is worth, then it will drive revenues exponentially.

The Atmosphere - Every restaurant makes the same mistake…They pile in the tables, so people are sitting right on top of their

neighbor, with no chance for privacy or intimacy. This is a huge mistake. When the house fills then bring out more tables to

accommodate more people. If the house is not full stick with the intimacy of fewer settings, further apart. Give the customer an

experience…Not just a quick hot meal and a check.

Appendix

Page 12

Cost - An amount that has to be paid or spent to buy or obtain something. Also the expenditure of something for the attainment of a goal. In

these two definitions we see where the person must expend either their time or another opportunity as well as to pay money in order to

obtain something they want.

Monetary - Most everything on the mind of every customer is “How much is this going to cost?” Not because they are cheap by nature,

but they want to assess whether their investment is going to be worth the cost. Will the amount of money they pay return to them on their investment and excellent meal with great service? Or will it return to them sorrow and grief and a stomach ache?

Time - Another cost is time. How long does it take to be acknowledged? How long to be seated? How long to get your food, or to get the waiter’s attention? If these time costs exceed expectations of the customer then their value or satisfaction degrades.

Opportunity - Is a unique cost in that it acts as an exponential multiplier. If a person believes this opportunity to dine with Café di Nofà

is less costly than that of another opportunity they are glad to have visited. If the opportunity cost appears to high it shows they would

rather be anywhere else besides our café. Now the uniqueness about the opportunity cost is it can be influenced by a host of outside

factors both from our side and form the customer’s side. Factors such as friends that came with the customer, a phone call he received

during his meal with good or bad news, or any-thing in between. On our end we must do everything we can to ensure our factors

influence his opportunity cost. This will allow us a buffer on other issues or will multiply the already good time they are having.

In this diagram it is important to remember that we are referring to the Quality and the Cost pertaining to the customer or rather, from their

perspective. We are not concerned with what our perception of cost and quality are but rather how they perceive it to be. The effects in the table below are a mix of attributes significant to our cafe.

Things we addressed:

Satisfaction - Were the customers satisfied with the Value overall?

Distribution of Visits - Were they likely to have a heavy weekly, monthly, yearly distribution of visits to a given location based on value estimation.

Loyalty - Are they loyal to that establishment and continuing to patronize?

Reputation - Will they have good things to say, bad things, or nothing?

Scrutiny Level - Will they scrutinize everything with a white felt glove and magnifying glass when it comes to quality or will they relax and enjoy and let minor issues slide.

Level of Tolerance - If a small customer service opportunity is missed or some sort of mistake is made will they be ready to write of the

restaurant for good or will they bear it patiently.

Appendix

Page 13

Appendix

Page 14

As pictured in the tables we can see as the Quality (to the customer) increases, and the cost (to the customer) decreases, the value (to the

customer) increases. In almost all cases lowering cost does not necessarily drive our revenue down or our expenses up. If we understand the

Law of Diminishing Returns we are able to test out inputs measured against our outputs in order to determine where the best Return On Investment lay with respect to increasing all of these qualities and reducing all of these costs.

In short it is my observation most of (80% or more) the restaurants in Kuwait are on the downward curve on the line of marginal returns

whereupon the rate of return is decreasing at an increasing rate. We aim to be right near the plateau marginal return curve. As well we find

the same number of business on the wrong end of the marginal cost curve, cutting costs to such an extent they are also driving their prices

up through the many problems arising from cutting corners and taking shortcuts.

Appendix

Page 15

So Sorry Shake Shack

The Shake Shack opened up in the Avenues Phase II around the Summer of 2011. They were a huge hit because they had the only market

for hamburgers and milkshakes in the mall. (Not counting fast food like McDonald's or Burger King as they are really no comparison to Shake Shack). They had decently priced F&B offerings with fairly high quality food from their fresh quality ingredients.

Because of its first fiscal year of huge success Shake Shack thought it would open a second restaurant in the Avenues Phase III not more

than 500 meters away from its original location and it would succeed as well as it had in its current location. Two of the same restaurants in

the same mall? One could speculate that they did so well and saw that Starbucks was able to have 5+ locations in the same mall they should be able to repeat this strategy as well.

Perhaps the owners of the Shake Shack thought, because of their exceptional time vending to massive crowds, that another Shake Shack was warranted in the new expansion of Avenues in order to keep up with demand.

However what they did not account for are the following factors, they became overpriced, they were very small in size to begin with, they had

a very large target crowd to draw from, they were the only store offering their style of F&B, and they were new and trendy.

With the Shake Shack its customers began to slowly realize it was overpriced when a simple hamburger meal with a shake was costing them

6+kwd in a fast food type setting. As the Shake Shack approached the end of the first year it hit the point of no return unbeknownst to them most likely.

Around month 9 or 10 (after having first opened its doors) its food quality dropped as the owners decided to use lower cost food ingredients.

Customer began to realize this and started to lose interest which started driving business away. But it was still trendy at least so some people

were overlooking the cost of the food and the low quality.

However this all changed when the Avenues Expansion opened up for Phase III. It literally destroyed the customer base overnight. Since the

opening of the new expansion there is now a Million of Milkshakes store that had Kim Kardashian appear for its opening. This put the Millions of Milkshakes store on the map. Now Shake Shack lost its competitive edge for milkshakes to a specialized Milkshake operation.

Additionally other American F&B organization opened there doors with better hamburgers or lower priced hamburgers than the Shake Shack such as the Texas Roadhouse and Cheesecake Factory. Now they now lost their main sources of revenue, the hamburger meal.

To compound the matter they now have two locations instead of one, with less customer base, high prices, low quality of food, and will no

doubt be shutting their doors within a year to at least one location or perhaps both.

Trend is a fickle thing. If you rely on trend and not well grounded business principles you put your business at great risk. Once trend leaves

your side it never comes back in your lifetime. Had the owners conducted a sound assessment of their Strengths, Weaknesses, Opportunities, and Threats, they would have identified the very things identified here and would likely have been able to prevent them.

Appendix

Page 16

Memberships

Memberships will be an important part of bringing our customers into our "family" with deals and specials for them. In Kuwait

we see plenty of "Sale" signs and "Special Offers" but they are not at all on sale or on special. We will change this for our loyal

customers by providing them with rewards for being loyal.

Fine Diner' s Club

The concept for the Fine Diner' s Club is to entice diners to try the VIP section, and once they like the VIP section, to get them to continue

using it.

The Fine Diner' s Club is based on a three-tier system, per item, per person, per visit. This means in a circumstance where someone is

buying meals for their friends who do not have the FDC they will only be given the points for their purchase, per item, per visit.

Tier 1 - Panini, Pastries, & Desserts earn you 1 point per item, per person, per visit.

Tier 2 - Main Menu Meals (including specials) earn you 2 points per meal (does not include things like side orders, drinks, etc)

Tier 3 - VIP Meals earn you 4 points.

*50 points earns you a free VIP entree, or 2 Main Meals, or equivalent KWD 7.000 discount on bill.

Ex-presso Club Card

For every coffee drink you purchase you get on punch on the punch card. No limitations on this card. If you buy 1 espresso for yourself and 4

for your friends you get 5 punches. 20 punches equals 2 free coffee drinks.

Appendix

Page 17

Emerging Markets Opportunities

For those suppliers of technology, furniture, F&B offerings, and etc we will have established the following talking points for discussion on mutually beneficial arrangements.

1. We will provide the due-diligence to get all items inspected, tested, and approved through the appropriate ministries for import into Kuwait for which a one time fee will be assessed based on the future sales revenues potential.

2. We will provide the opportunities in a direct sale from our cafe at purchase from you with either, cost plus 10%, with no exclusive

representative agreement OR at wholesale price with exclusive resell/distributor agreement.

3. We will require all items/opportunities on account with payment net 60 on F&B items, and net 120 on all other items.

Appendix

Page 18

SOP's, PR&LL, TTPs

STANDARD OPERATING PROCEDURES (SOPs)

Generally Standard Operating Procedures will have an early on development which is to be considered a baseline for operations, managing everyday situations, as well as addressing mission critical functions to be performed with the steps in order to perform them.

Early Phase SOPs will consist of industry gathered procedures that have been developed across the F&B industry. The consultant will be responsible for planning the the GM and the CEO these procedures.

These procedures must developed with the make, model, type of assets we will be working with such as technology items, software, POS

systems, etc. This is to ensure employees will have the ability to know their job prior to starting their job. An easy to access, read, and understand SOP document is essential for each team member to learn without having to do so by trial and error.

Avoiding the Trial & Error method will drastically reduce our loss of margin from mistakes on billing and charges, to breaking of equipment through negligence, etc.

The early phase SOPs will be developed prior to the arrival of the team, and will also be updated by the team within the first month of train-up.

Operations Phase SOPs will be developed after the first month of operations. It will combine the Early Phase SOPs and the first month of

soft opening experience of TTPs evaluated under PR&LL to further modify the SOPs in order to move toward a more effective and efficient set of procedures.

Operations Phase SOP will be performed by the CEO, the GM, the Investment Partners if warranted, and the Cafe team members. After a

thorough PR&LL is conducted in a round table, face to face fashion, changes will be proposed to the SOPs in a one-on-interview setting, with a proposed rough draft being submitted to all members for rebuttal and further discussion.

Once the final comments and changes have been conducted, this SOP will continue until reaching the last phase.

Late Phase SOPs will be continuing in development as the cafe continues to offer more services such as on-line ordering and e-

commerce. The intention of the Late Phase SOPs is to keep the procedures from being set in stone and rather, as a living document that

continues to be modified in accordance with the appropriate procedures (round table discussion, changes, one-on-one interview, rebuttals, changes, finalized).

In this manner we expect to be able to continue to use the PR&LL to our advantage to build a better business model that will be able to be replicated in other areas.

Appendix

Page 19

PERFORMANCE REVIEWS & LESSONS LEARNED (PR&LL)

Performance Reviews are conducted after a set, specified, and understood interval in order to review the performance of the team

member, no matter what positions they are in, top to bottom. The value of the Performance Review can not be overstated. These reviews

will be responsible for developing the Lessons Learned from our past measurements of our performance which will further expand and

develop our Tactics, Techniques, and Procedures which will be used for updating the Standard Operating Procedures.

The Performance Reviews must encompass a thorough review which should entail a rating on critical areas such as knowledge, performance, appearance, etc. These areas will be determined later in the Project Plan for StartOps.

Lessons Learned are a critical output of Performance Reviews and a critical input to Tactics, Techniques, and Procedures. These

lessons will be obtained from the in-depth reviewing of employee, and team, and organizational performance. These Lessons Learned will be

critically analyzed to determine suitable courses of action to be taken in the future to best exploit or mitigate the circumstance whether it be

an opportunity or a threat, strength, or weakness.

TACTICS, TECHNIQUES, & PROCEDURES

Tactics are conceptual actions that are implemented through a series of tasks or sequences. This is best exemplified in the F&B industry with

"Dealing with Tough Customer" or "Turning Negative Attitudes into Positive Experiences". These conceptual actions can be carried out

through maneuvering and should be documented and trained upon in order to give the best chance to our employees for getting the actions

correct. Tactics will be set forth as training requirements in order to ensure the correct steps are followed in the real world setting of daily

operations.

Techniques are very important to this cafe, for the reason of its branding. In order to be authentic in style, taste, and experience we must

ensure our techniques are those used in Italy to deliver the very same elements. We must also adapt techniques to ensure the inefficient and

ineffective techniques are dropped for those which make more practical and applicable sense. Techniques will be taught through training

delivered by the right teachers for their given discipline. Our techniques also need to be quantifiable in order to ensure we can keep them in line with our quality demands.

Procedures will take the tactics and the techniques and wrap them all into an effective step by step so the user is able to recreate them

without fail. These will then be implemented into SOPs as necessary so that all those who come into a similar and likely to occur situation will have the ability to know ahead of time a good procedure to follow that is in line with the cafe's higher level objectives, mission, vision, etc.