fianl project bh05501678

8/7/2019 Fianl Project BH05501678

1/54

Business Planning for a coffee shop

Done By: Noof Mohammed Al-SadaBH05501678Section: FA

Subject: SBI301 Seminar in Business Planning & AnalysisApproved By:Mrs. Ilene Valian

1


2/54

The Content

Cover pageThe ContentChapter 1- Executive SummaryChapter 2- Terms of DefinitionsChapter 3- introduction

Description of the product & services

Chapter 4- Market AnalysisMarket TargetMission Statements Business Environment

Chapter 5- Marketing PlanPricing the products for the profitWhats AdvertisingStart-up AdvertisingOn-going AdvertisingAppearance AdvertisingExpansion plans

Chapter 6- Competitive AnalysisBahrain Coffee shop marketRelated StudySWOT Analysis

Chapter 7- Management plan Management StructureHiring EmployeesWho should plan the menuJob DescriptionSuccess TipsLabor Cost

Chapter 8- Operating PlanThe project location & premisesEnvironment & Dcor Facilities and equipmentSpecial things to sellCountries ordered from

Chapter 9- Financial plan

Object & Financial ExpectationSales Goals

2

12-34

5-789

10

111111

12-1313

13-141414

14-15

1616-17

18-19

2020-21

2121-22

2223

24-2525

25-282829

3030


3/54

Break-even analysisIncome statements

Balance sheetFinancing proposal

Chapter 10- Summary and recommendation

Chapter 11- Appendices and ExhibitsAppendix1 (Sales Projection)Appendix2 (Direct Male)Appendix3 (Pictures)Appendix4 (Sample of card)Appendix5 ( Flow chart)Appendix6 (Gantt Chart)Appendix7 (The menu)Appendix8 (Project Financial statement)Appendix9 (Balance sheet)Appendix10 (Cash Flow)Appendix11 (Monthly Profit and Loss Statement)Appendix12 (Personnel and staff cost)Appendix13 (Survey)Appendix14 (References)

3

30-3131

3132

33

3435

36-3737

3839-4041-42

4344-45

4647

48-4950-64

65


4/54

Chapter 1Executive Summary

Starting a business is one thing, making it work is another. The

success of the business depends on many factors.

We know that the success in self-employment is largely the result of careful

planning and understanding of basic business techniques and formulas.

Based on that the researcher decided to make its own business planning

which is about making a study for establishing a coffee shop called Nofiatto in

the new extension in Seef mall. The plan is a frame to issues related to thebusiness that may effect its operations.

The researcher made the research and the study to acquire relevant ideas to

be implemented in the coffee shop, in addition to provide more products and

services.

This feasibility study covers the financial aspect and other implications of

introducing the afore-mentioned coffee shop in Seef Mall. The market

information has been supplemented by the owner Ms.Noof MohammedAlsada. The study is highly reliant on the pertinent data and information

provided by her. We have depended as well on information available from

other independent sources such as the ministry of informations Tourism

Directorate, In addition to some statistics of other coffee shops and similar

projects operating in Bahrain .

(See Appendix5 PAGE 38 )

4


5/54

Chapter 2

Term of Definitions

Annum

Mega-annum,is a unit of time equal to one million years. It commonly used

in geology and paleontology to signify time in the past. For example, 65 Ma

indicates 65 million years ago.

Appraisals

An official document usually provided by an appraiser or jeweler specifyingthe quality and replacement value of an item. This document is generally

needed by an insurance firm to assess the value of an item for insurance

purposes.

Archipelago

A sea, such as the Aegean, containing a large number of scattered islands.

Attractions

General all-0inclusive term travel industry marketers use to refer to products

that have visitor appeal, like museums, historic sites, performing arts

institutions, preservation districts, theme parks, entertainment and national

sites.

Avail

To be of use or advantage to; help.

Ceaseless

Without stop or pause; constant.

Collectible

That can be collected.

Conductive

The word "conductive" has a range of meanings within the context of

different standards and should be treated with care.

Courage

Quality of spirit that enables you to face danger or pain without showing

fear.

5


6/54

Dabble

To splash or spatter with or as if with a liquid.

Decisiveness

The trait of resoluteness as evidenced by firmness of character or purpose;

"a man of unusual decisiveness.

Dedication

Properly the setting apart of anything by solemn proclamation. It is thus in

Latin the term particularly applied to the consecration of altars , temples and

other sacred buildings, and also to the inscription prefixed to a book, etc., and

addressed to some particular person.

Demitasse

A small cup of strong black coffee or espresso

Diligence

The legal process by which a debtors lands, personal or moveable property

are attached for the recovery of the debt.

Enthusiastic

Having or demonstrating enthusiasm.Entrepreneurial

Creating new business.

Glance

To move rapidly from one thing to another. Used of the eyes.

Heritage

Something that is passed down from preceding generations; a tradition.

ImpatientlyUnable to endure irritation or opposition; intolerant.

Paradigm

One that serves as a pattern or model.

Patience

Patience is the ability and willingness to wait a long time or to carry out a

task that takes a long time, especially one that is by itself not heavy, but

boring. It also means not easily getting angry or not showing anger insituations of human communication where the other is unreasonable. It is

6
http://en.wikipedia.org/wiki/Altarhttp://en.wikipedia.org/wiki/Templehttp://en.wikipedia.org/wiki/Altarhttp://en.wikipedia.org/wiki/Temple


7/54

commonly referred to as a virtue, though it is not one of the traditional

theological or cardinal virtues.

Perseverance

The act of persisting or persevering; continuing or repeating behavior; "his

perseveration continued to the point where it was no longer appropriate.

Pertinent

Having precise or logical relevance to the matter at hand; "a list of articles

pertinent to the discussion"; "remarks that were to the point" .

Phenomenon

An occurrence, circumstance, or fact that is perceptible by the senses.

Plethora

A superabundance; an excess.

Proliferation

The continuous development of cells in tissue formation; cell formation.

Residual

Remaining as a residue

UnprecedentedHaving no previous example

Tolerance

The capacity for or the practice of recognizing and respecting the beliefs or

practices of others.

Vital

A critical element of the plan.

7


8/54

Chapter 3

Introduction

Bahrain coffee shop market draws on the high tourist tide the countryis witnessing. Markets at large are booming with an average of BD 16 million

(USD 42 million) changing hands every single month.

Based on information that I got from KPMG the Legal Assistant Advisory on

2006

Investor confidence is as high as never before and the price level is almost atstability. Tourist movement into the country is showing a healthy growth and

the catering sector is opening up and taking appropriate steps to

accommodate for the boom in tourism. During the last two year more than 10

million people visited the island, making the visitors- to citizens ratio hit 100%

per annum. The increasingly growing traffic creates a huge potential of caf-

goers base. World class events hosted by Bahrain, On the other hand, add to

the visitor creation process and offer such facilities positioned at vital

commercial spots more seasonal opportunities.

The researcher set and established business goals which is be to achieve

through the coffee shop, such as independence , financial security for

retirement national recognition , making profit and to be successful so as to

expand later on and franchising all over the world.

Likewise, the researchers goal is to raise the interest to work with people and

prepare to work of its own and to motivate the stuff to work for long term.

The proposed project is planned to derive its revenue from providing a variety

of offering types : light ready snacks, coffee, tea, espresso, soda drinks(), etc.

Every business starts with an idea. No matter what that idea is ,a well

thought out business plan is what helps turn that idea into reality

8


9/54

Description of the product & services

Why should customer pay to buy from Nofiatto Coffee shop when they

can buy ready made ground coffee from the supermarket, so the key question

is why will they pay to buy from Nofiatto Coffee shop? The answer should be

because the shop serves many kind of coffee and tea beside the other

products that will be explain it in details.

(See Appendix6 PAGE 39-40 )

9


10/54

Chapter 4

Market Analysis

Market demand for caf atmosphere and services is dictated mainly bythe number of Bahrain visitors from GCC countries and the rest of the world.

Local demand is as well a big source of potential customers. Worth noting

here is that building customer base can be easily done with help boost caf-

goers numbers and procure ceaseless turnover for the project.

Average demand is a function to several factors , at top pf which comes:convenience or the place utility. This factor gives each such project a special

advantages or disadvantages it depends. More specifically, traffic density

depends on the Place , rendering generalization impractical , though the

use of which as a benchmark can prove of avail.

Following is a table presenting the probable causation for caf-going along

with frequency and type of trip for average people:

Cause of trip Frequently Spending Remarks

On-Shopping Once/W BD 15 With family

Customary Twice/W BD 10 With Family

Accidental Once/W BD 5 Alone

The source of the table from a questionnaire applied to a sample of different

people .

(See Appendix 13 PAGE 50 )

Caf- going is one of life necessities for all adult age classes in such a limited

area country like Bahrain. This phenomenon accompanied with economic

activities such as shopping and buying has created new arenas of life style.In

short, indoor cafes (such as those in commercial complexes) can take a full

10


11/54

advantages of high traffic location they operate in , regardless of competition

from stand-alone and in-hotel projects.

Mission Statement

Nofaitto Coffee shop seeks to serve high quality food and beverages in

an upscale western atmosphere, conductive to family dining, while observing

the highest standards of services. This is the mission statement of the coffee

shop.

Business environment

Bahrain at a glance, The kingdom of Bahrain is an archipelago with a total

area of 712 sq.k.m. it is situated in the Arabian Gulf off the eastern cost of

Saudi Arabia with which it is connected by a causeway some 25 k.m long.

Bahrain is a member of the Gulf Cooperation Council an economic

aggregate of more than 32 million people, and is featured by stability and

religious and ethnic tolerance and mutual living. Great deal of capital for

investment is available in no-direct-taxation environment.

Bahrain is passing in a turning point in its development history. The last

few years forged great challenges on the country as a plethora of newdevelopments and projects has unraveled at unprecedented pace in the

country, leveraging it to an enviable position in the region. New catering

facilities are a logic response, inter alia, to the huge possibilities opened up

before the tourism sector of Bahrain.For the time being, number of

considerable coffee shops throughout the country doesnt exceed fifty,

scattered along major heavily inhabited and haunted areas. Some of them are

independent. While the others are centered at supermarkets and hotels. Hotelcafes put aside, number of r esidual establishments will be a little bit more than

thirty.


11


12/54


13/54

Market strategy.

Should Nofiatto go for large volume at low prices or low volume at high

prices? That is the bottom line in considering market strategy. As a small

business owner will likely opt for low volume and higher prices , since the

alternative involves having the resources, including labor ,display room,

distribution channels, etc. to move or serve large volumes of product or

perform major service tasks.

Customers.

What will the market bear? In other words, what are customers willing to pay for the

products or services? The basic formula for price setting is

Labor + Material + Overhead + Profit Margin = PriceAdvertising

More than 150 years ago, Thomas Macaulay, a British historian and

statesman , said : Advertising is to business what steam is to industry.

The same propelling power.

What is Advertising in Business?

Advertising informs the public and the customers about who they are, what

kind of business they operate, How they can buy the products and services

and why they should come to the coffee shop.


Start-up Advertising

In Nofiatto starting up advertising it includes many steps and process ,it takes

around 2/3 of the capital .In the first year, interested more in business cards and stationary,

announcement flyers and brochures, and the initial ads in newspapers or

other publications. So at the beginning the main focus was in telling people

where the coffee shop is located and what does it offer? So it includes:

Television.Its quite expensive for small business, when it can be afford not on

TVs only also in cinemas screens.

13


14/54


15/54

Product branching. In addition to specialty coffees, teas and associated

products, most coffee houses carry a variety of desserts and pastries. To

even out sales throughout the day and to account for seasonal variations.

Nofiattos followed this strategy.

15


16/54


17/54

Costa Coffee Casual, Snacks

Dar Albareh Caf & Galery Casual, BLD

Delifrance Casual, Snacks Casual, Snacks

Elios Casual, Snacks

French Corner Caf Casual, Snacks

Gallery, Movenpick Smart Casual, Snacks, Licensed

Grand Caf, Ramee Casual, Snacks, Licensed

Idea Gallery Casual, LD

Isabella Casual, Snacks

Le Bellevu Casual, Snacks, Licensed

Les Palmes Casual, Snacks, Licensed

Lobby Lounge Casual, BLD

Maison du Caf Casual, Snacks

Mrs.Fields Cookies Casual, Snacks

New York Coffee Casual, Snacks

Overlook Caf Casual, Snacks, Licensed

Paint in Space Caf Casual, SnacksPalms Caf Casual, Snacks, Licensed

Shades Cafe Casual, Snacks

Siraj Snack Bar Casual, Snacks

Starbucks Casual, BLD

Subway Casual, Snacks

Sultana Caf Casual, BLD,Licensed

Ventana Casual, SnacksVeranda Casual, Snacks

17


18/54

SWOT Analysis

Strengths

Past experience in such line of business.

The project operator was in charge of two similar projects in a few tears

ago , but shortage of full time dedication took her away from the business .

Anyway her past experience can be built on for a new, successful launch.

Place Utility

We touched previously on this subject .once again, the convenience provided

by vicinity to highly-haunted shops in Seef mall will assure the businessceaseless flow of frequenters.

New demand created by more degree of Bahrain openness and

favorable business atmosphere. The countrys increasing openness and

positive business conditions is bringing about more numbers of tourists and

visitors. Those numbers can be an important component of coffee shop

clients.

Opportunities Expected increase in demand.

Demand on catering services are on high in the country, more traffic for tourism and

shopping is expected every single quarter.

Bridging the need for more outlets in the location.

Insufficient existing coverage can give the project a new idea in the location.

Weaknesses

High financial leverage.

This weakness is related to majority of start-ups, with a difference in the

extent. The project will better its financial position through cash inflows

expected to cover loan repayment in due course.

Threats

Competition at the same site.

18


19/54

The proliferation of similar business at the site is the main potential threat the

business may face. Existing projects already in operation can be a source of

stiff competition taking into consideration their brand name and image held on

customers minds.

19


20/54


21/54

Review performance periodically, finally Nofiattos offered them support by

letting the employee train others when ready.

If the training done properly in time it will reduce the turnover and accidents,

improve the quality of work performed, lowers the cost of labor, and increase

productivity.

Who should plan the Menu?

The planning of menu should be a cooperative effort between the chef and

the manger or the owner. The chef knows the capabilities of the kitchen staff

and the equipment, as well as the availability of food products and their cost.

The manger, on the other hand , is largely concerned with sales objectives,

profitability and image of the coffee shop, so the researcher tried to cover all

of the main concern of the coffee shop.


Job Descriptions

The coffee shop will be managed and own by Ms. Noof Mohammed

Al-Sada.

The Head chef is responsible to the owner, overseas the day to dayoperations of the back of the coffee shop. Responsible for carrying out

company policies and performing the menu planning, purchasing, supervising

and motivate staff, filling in as needed for cooks, performing cost control

functions and maintaining a high level of quality and service in all aspects of

the operation.

The Hostess should has two years of hostess at least, and responsible that

greets guests as they arrive, takes their name, calls them when their table isready, escorts them to table and thanks them on their way out.

The waiters, there are two waiters who have experience for two years, they

are responsible to Check with customers to ensure that they are enjoying their

meals and take action to correct any problems, Escort customers to their

tables, Explain how various menu items are prepared, describing ingredients

and cooking methods, Inform customers of daily specials, Prepare checks that

itemize and total meal costs and sales taxes, Present menus to patrons andanswer questions about menu items, making recommendations upon request.

21


22/54

Remove dishes and glasses from tables or counters, and take them to kitchen

for cleaning, Serve food and/or beverages to patrons; prepare and serve

specialty dishes at tables as required, Stock service areas with supplies such

as coffee, food, tableware, and linens.

The cooker Assistant. Read work orders, recipes , or formulas in order to

determine cooking times and temperatures, and ingredient specifications.,

Tend or operate and control equipment such as kettles, cookers, vats and

tanks, and boilers, in order to cook ingredients or prepare products for further

processing, Measure or weigh ingredients, using scales or measuring

containers .

The cleaner will helps everyone there. Clean, wash, and sterilize equipment

and cooking area, using water hoses, cleaning or sterilizing solutions, or

rinses, Remove cooked material or products from equipment.

The Cooker , has 3 years of experience. His duties to Prepare orders

according to the customer's preference using established recipes, portions,

and methods established by the coffee shop, Regularly check all food items to

ensure adequacy and quality at all times, Maintain a clean and safe workenvironment, Keep all work stations and equipment as clean as possible at

all times. Follow a cleaning schedule for designated equipment and storage

areas, Work together in a team oriented environment to produce foods in a

timely and orderly fashion, Ensure that all orders are presented in a neat and

appetizing manner.

(See Appendix12 PAGE 48-49)

Some Success Tips in managing coffee shops

Take the time to develop new and unique products to offer customer,

Maintain the highest standards in everything they do; it will ensure a solid

reputation, Never sacrifice quality as a means of saving money or time., Plan

ahead, allow yourself time to work efficiently. The bonus is that will enjoy it a

lot more, Be creative., Make customer service the byword, Keep Customer

Coming Back: The true cost of a lost customer is often minimized bystatements, but al lost customer does in fact represent a potential loss a

22
http://www.careerplanner.com/Job-Descriptions/Food-Cooking-Machine-Operators-and-Tenders.cfmhttp://www.careerplanner.com/Job-Descriptions/Food-Cooking-Machine-Operators-and-Tenders.cfm


23/54


24/54

Chapter 8

Operating Plan

The project location and premises

One of the most important requirements is Location requirement, A good

location is critical to the success of the coffee shop extreme care must

be taken when selecting a site. Looking for the commercial location the

foremost considerations are:

Type of business which is planning to operate, Retail, wholesale and service

businesses have slightly different requirements as determined by the type of

product or service being offered and the market potential in a specific area.

The demographic of the area. it should find out the number of consumers who

want or need the product or service and & willing to pay the price, the median

income and employment opportunities , the age ranges of the major

population group, and the volume of retail trade and projected expansion

data, which is available from census reports and chamber of commerce

business reports accumulated during the market research project.

Competition. Must determine how many other similar establishments are

serving the market and how the business is going to decide if there is room for

the new venture. the best way by making a list of business near by.

Traffic patterns. Is the proposed location close to freeways, major

intersections, and/or a central business district? Is there sufficient parking?

The ease with which customers can get to the location is a major

consideration in terms of success.

The image. Before go scouting for locations, decide on the image of the

project such as quality products at good prices, superior service, and

convenience.

The product & service. Generally, there are specific areas within a

marketplace that cater to consumers in specific income brackets and/or

occupational groups. i.e. executives, blue-collar workers, students ,etc.

24


25/54

Consider the product/service and the projected number of potential buyers

within the community.

The amount of rent required. Locations having the highest potential of profit

through consumer traffic such as shopping mall, a corner shop, or a store with

good frontage are more expensive because competition keeps rents up to the

maximum. The trade-off is an increase in sales and lower advertising budget

because of visibility factor.

So the Accessibility to the target market is important. If customers will be

arriving by car, the location must provide adequate space for convenient and

safe parking. The coffee shop should be located near tourist attractions if they

wish to attract tourists. If they intend to cater to business people, it should be

within a few minutes of their workplace or their home .

Based on that The proposed project will be run in the Al-Seef area- a highly

trafficked location- where Seef Mall is at a stones throw from the center of

Manama. This location is one of the attractive of Bahrain ensuring continuous

demand from shoppers and passers-by. At Seef Mall the proposed caf is

among the first comers.

Environment and dcor

Everything a customer sees, feels, smells or hears in the establishment is

a part of its dcor .Colors , sizes, shapes, weights, and texture are all part of

the dcor .

Nofiatto dcor simple and at the same time awesome and focusing in many

things such as Building design, style of tables and chairs, tablecloths andnapkins, carpeting and flooring, wall hangings , pictures and drapes , light

fixtures , menus, Floor plan (the space between tables), uniforms for the

employees and plants and other decorator objectives.


Facilities and Equipments

Basic Necessities for the coffee shop includes Beverage stirrers,

Coffee, assorted whole beans, Coffee bags , Coffee pots, Condiments, if foodis served, Cream, Filters, Freezer bags, Honey

25


26/54

Milk, Mugs and cups, Napkins, Plates, if food is served, Salt and pepper, if

appropriate, Sugar , Sugar substitute, Tea , assorted loose-leaf, Teapots

Utensils.

Optional supplies

Books and magazines on coffee and tea, Candies, Cappuccino

makers, Coffee grinders, Coffee makers, Coffee scoops, Espresso makers,

Filters, paper and permanent, Gift baskets, Greeting cards, Herbal teas, Jars,

Mugs and cups, Spices, Tea cozies / strainers, Teapots, Tea towels, Whistling

tea kettles.

General Office Equipment:

There is no reason to pay high prices for office equipment and

supplies, Nofiatto purchased every thing need it for at least 50 percent below

standard retail prices either on sale through the discount period.

The basic equipments

Adding machine.

Many computers include a built in calculator and keypad. The advantage of anadding machine is that it provides a paper record of all figures, while the

calculator provides only a temporary display. This will be especially important

when its doing the daily cash totals.

Bookcase and inventory shelving system.

The printed matter (brochures, takeout bags and boxes, business card, etc)

will take up quite a bit of space , especially since I want to order enough to

last a while. There will be also sales receipts pads and tapes, purchaseorders, company stationary, promotional material ,etc. A bookcase and

shelving system will accommodate the items and keep them organized.

Computer considerations.

Initially a computer is certainly not necessity , but it makes inventory control

10 times more efficient. In future as my business grows, the administrative

duties will increase and require the preparation of inventory charts, customer

and employee database, and other information.

26


27/54

Desk and chair.

Spending a significant amount of time either sitting in front of the computer or

sitting at a desk doing paper works and making some telephone calls.

Therefore its extremely important that Nofiatto invested in the right desk and

chair Depending on height Nofiattos owner need computer keyboard desktop

to be about 26 inches from the ground, even more important the chair should

provide support for the base of spine, a backrest no higher than shoulder

blades.

Filling cabinet.

An absolutely essential item is a filling cabinet to keep all papers in order, it is

not enough to keep a ledger of income and expenses. Also save all invoices,

receipts, canceled checks, purchase orders, equipment warranties, copies of

delivery slips, coffee blends receipts,etc

Telephones.

In a commercial location, getting a business telephone will be one of the firststeps in setting up business. Nofiatto have two lines one as a hotline and the

other for the normal activities.

Special Equipment

Display equipment. Whether choosing display products on high-tech

shelving or in antique armoires, the decorating scheme of the shop is going to

serve an important promotional device, as well as inviting customers tobrowse and buy.

Enhanced packaging equipment.

Lighting.

This is the most overlooked any yet most important equipment in retail stores.

Refrigerator.

Perishable products such as milk and cream will need to be kept under

refrigeration. The size of the unit will depend upon what foodstuffs that plan tooffer.

27


28/54

Scale.

Nofiatto will be selling coffee and tea by grams, so it will need an accurate

scale for weighing out customer purchases.

Signs.

The type and the size of sign they put outside the coffee shop may be dictated

by the lease.

Special things to sell

For companys profit and to satisfy the customers taste the coffee shop sell

in some special things to make the shop special too, which includes :Baked

goods and desserts, Books on the history of tea and coffee , Coffee grinders ,

Coffee makers , Collectible china tea cups , Cookies , Demitasse cups

Espresso brewers , Flavored syrups , Loose-leaf tea , Mugs, unusual and

decorative , Prepacked gift assortments of various blends , Sandwiches ,

Spices and flavored sugar , Spoons (demitasse , iced tea, etc) ,Teapots

Tea cozies, strainers.

The coffee shop should be unique & special by some inventors in order tocompete with other coffee shops and keep position for the business

successful. One of the ideas that may see it common but its not, which is

customer services by putting phone number for the customer services so

therere direct relation with the customer for negative or positive issues.

The main common situations that disturb customers and to avoid it are:

When the coffee shop opens late or closes early , When a guest is greeted

impatiently, rather than with a smile , When empty tables, in view of waitingguests are not bused quickly , When flatware are spotted or coffee cups are

stained , When guests have to wait to place their drink or food order , When

the customer didnt satisfied with the coffee or food taste.

The mail order business and home delivery One of the other new ideas

Nofaitto established a hotline for the customer to order what ever they want

from the coffee shop. There is special web site to order from.

Website: www.nofiatoo.orgHotline: +973-176161666

28
http://www.nofiatoo.org/http://www.nofiatoo.org/


29/54

(See Appendix3 PAGE36-37 )

Countries Suggested to Order From

Flavors and aroma are the most important difference between

commercial and specialty coffees. Specially coffees are fragrant and come in

a wide variety of flavors. The orders of Nofiattos beans usually from many

countries such as Colombia and Brazil beside other Europeans countries.

Coffee should be black as hell, strong as death, and sweet as love. Turkish

proverb said.

From time to time the owner try another countries to ordered the coffee beans

from such: Arabian and African Family:Ethiopian Harrar , Kenya, Tanzania ,

Yemen Mocha , Hawaiian Kona , Indian Mysore , Celebes or Sulawesi Kalossi

, China Yunnan , Java Arabica , New Guinea , Sumatran Mandheling or

Ankola , Brazilian Bourbon Santos , Colombian , Costa Rican , Dominican

Republic or Santo Domingo , Ecuador , El Salvador , Guatemalan Antigua ,

Haitian , Jamaican Blue Mountain , Mexican Coatepec , Nicaraguan , OaxacaPulma , Peruvian Chanchamayo , Venezuelan Maracaibo..

29


30/54

Chapter 9

Financial Plan

Objectives and Expectations

The immediate goal of the management is to generate a cash flow

sufficient to meet all obligations of the business and generate a net profit.

It is expected this will accomplished through creative merchandising, intensive

advertising and the utilization of cost controls.

The Long-term goal of the management is to become one of the most famous

coffee shop not only in Bahrain also in the GCC countries and Globally too.

Sales Goals

Its easy for enthusiastic entrepreneurs to overestimate sales. But it is very

risky in the coffee shop budgets and its cost and expenses through sales

projections, Nofiatto chose the best approach that use a combination of

several methods. As follows:

Annual sales based on the best method investment.


Break-even Analysis

The breakeven point is the minimum amount Must charge in order to cover

all expenses incurred for the production and promotion of goods and services

without losing or making money. In other words, any income that is above the

break-even point is considered to be profit and anything below it is a Loss.

To find my break-even point, must first total all of operating costs, including

materials and labor, equipment lease or purchase payments, advertising,

utilities, office supplies, and any incidentals.

This is computed for a particular period of time, such as six months or a year.

However, if the business is still in the early stages of operation, It can use the

estimated figures on the projected expenses statement and guesstimate costs

for material and labor.

Stay informed, knowing the break-even point tells how much must be charged

for products and services and is invaluable in setting prices to realize a profit.

30


31/54

Keep in mind, however that the break-even point is a variable figure. Since it

depends on production and overhead costs, plan to reevaluate periodically to

make sure that the prices reflect any changes.

How to calculate the breakeven point for entertainment

Step 1

Determine the total cost of the entertainment

Cost of CD player BD 50

Cost of advertisement 3,000

Total Cost Related to the Entertainment BD3,050

Step 2

Establish your Contribution Margin

100% - pouring Cost Percentage= Contribution Margin

100% - 23% = 77%

Step 3Calculate the breakeven point

Total Cost Contribution Margin = Breakeven Point

3,050 .77 = BD 3,961

Income Statement

An income statement contains four types of information. In essence it tells me

how much money came in and from what sources, the cost of the rawmaterials that went into products that were sold, the expenses that were

incurred in the course of operating the business and whether a profit or loss

resulted

(See Appendix 8/11 PAGE 43/47 )

Balance Sheet

The basic purpose is to inform me as to what the business owns, what it owes

others, and what its worth is. The statement called balance sheet becausetotal assets must always equal total liabilities plus the Equity.

31


32/54


Financing proposal

One of the easiest ways to keep control of the paper dragon is set up a 9*12

inch manila envelope or a file folder for each of the following categories:

Paid bills: both personal and business.

Sales Receipts: of very product I have sold or service job I have performed.

Inventory records based on ongoing inventory control and quarterly audits.

Copies of inventory or billing statements that are paid, with a separate file for

those still due .Receipts for miscellaneous cash purchases.

Auto/Entertainment receipts from travel and promotional activities.


The cash cost of the project

Actual funds paid by the present project at the start-up-stage

Project revenues

Based upon the results of the breakeven analysis set out , the tables presentsprojected revenues over the course of the three coming years:

32


33/54

Chapter 10

Summary and recommendation

Everyone can make a business but not all of business makers can be

successful in their businesses, so owners put this point in their mind and in

their study which concerned and focused on how business can be successful

and famous, at the same time run for very long time.

Based on that the owners found that she is interested in the Coffee shops

and decided to enter this field with proper management decisions and futureviews.

Depends on immediate goal which was to generate a cash flow sufficient to

meet all obligations of the business and generate a net profit with the most

important objective which was the customer satisfaction, Likewise setting the

mission and vision with some special criteria.

At the end of the study that discussed and gathered the important information

that owners need to start up the business from many independent resources

to observe the highest standards of services.

33


34/54

Chapter 11

Appendices and Exhibits

Appendix1

Sales Projection

Number Of Customers Expected Each Day of the Week

SUN MON TUE WED THU FRI SAT TOLTAL

Breakfast 3 5 6 10 10 11 12 57Lunch 5 6 12 20 19 14 23 99Dinner 5 8 10 20 30 14 13 100

Total Customer per Week 256Average Menu PriceSandwiches BD 2.000Desserts 2.500Drinks 1.800

Estimated Average Guest Check Per PersonBreakfast Sandwich plus Drinks BD 3.800

Lunch Sandwich plus 2 Drinks and Desserts 8.100Dinner Sandwich plus 2 Drinks and Desserts 8.100

Estimated Weekly Sales57 Breakfast Customers BD 3.800 = BD 216.60099 Lunch Customers BD 8.100 = BD 801.900100 Dinner Customers BD 8.100 = BD 810

Total Weekly Sales BD 1,828.500

Estimated Annual Sales4 weeks BD 1,828.500 = BD 7,314

34


35/54

Appendix2

35

Nofiatto CafSeef Mall II, first floor

Dear Friend:I cant function in the morning until Ive had a cup of steaming hot, custom-blendedHawaiian Kona coffee with fresh cream. Thats why I dont open the Coffee shop until7:30 A.M.

You may be like me- looking forward to that rich flavor of freshly brewed cup of Java in the morning. If so, Id like to invite you to become a member of the CoffeeClub. Membership entitles you to incredible benefits that any coffee lover wouldappreciate, including 20 percent discount on each gram of whole bean coffee; a 15percent discount on each gram of ground coffee; a 30 percent discount on grinders,brewers, and coffee pots; our quarterly newsletter; and an open invitation to join meand fellow club members every morning between 7 and 7:30 A.M. for special cup tostart the day off right, even if you cant come by your self just phone us and we will

bring your delivery to your place even your job.Membership in the clubs is only to have a card and to stamp this card at least 10times in a month, every time you buy a cup of any kind of coffee they will stamp it for you, this can save your money on your personal and gift gourmet coffee purchase!Call me today for further information or to sign up as a charter Coffee club member. Ilook forward to adding the pleasure of truly fine coffees and tea from around the worldinto your day!

Sincerely,Noof Al-sada, Owner


36/54

Appendix3

36


37/54

Appendix4

This is a sample of the Card

37


38/54

IdeaChooseDesiredApproach( #1 or #2)

(Approach # 2)

(Approach # 1)ChooseEquipment

Develop Service

System

EstimateCost of

project and potential

Return

Lay OutPreliminaryfloor plan

Submit toArchitectContractor

ConstructionPhase

Hire and trainStuff

Pre-opening promotionalActivities

Final Cleanupand checkout

Dry-RunParty andGrand

opening

SelectLocation

Select typeof Business

DevelopMenus

SelectDecor

Decidetype of legalorgan-ization Select

LocationSelect typeof Business

A p p e n

d i x 5


39/54

Appendix 6


40/54


41/54


42/54


43/54


44/54

Main menu Nofiatto cafThe Sandwiches

Chicken Mayo Sandwich BD 1.800

( Chicken and Mayonnaise in Chabatta Bread, with mushroom and fresh lettuce)Egg Mayo Sandwich BD 1.700

( Egg and Mayonnaise in Chabatta Bread, with mushroom, cucumber and fresh lettuce)Tuna Mayo Sandwich BD 1.700

( Tuna and Mayonnaise in Chabatta Bread, with fresh lettuce and cucumber)Smoked Salmon Sandwich BD 2.000

(Slices of Smoked Salmon in Paniani Bread, with cheese, Mushroom and fresh lettuce)Roast Beef Sandwich BD 1.800

(Slices of Roast Beef in Paniani Bread, with cheese, dried Tomato, Mushroom and fresh lettuce)Triple Cheese sandwich BD 1.800

(Three Layers of melted Cheese in Paniani Bread, with mushroom, Cucumber and fresh Lettuce)Mozzarella Cheese Sandwich BD 1.700

(slices of melted Mozzarella cheese in Paniani Bread, Cucumber , Tomato , Mushroom and fresh lettuce)Nachos N Dip BD 1.000

(With Your choice of the Dip ask about it)

Diversities

Fresh cakes / Bottled Juices/Muffins/ Water/Chocolate Bars/ Biscuits/ Cookies, Etc..( Ask for the Price)

A p p e n

d i x 6


45/54

Appendix 8Projected Financial Statements

Projected Loss and profit Statement

Y1 % Y2 % Y3 %

Sales 87,768 100.0% 107,120 100.0% 136,327 100.0%

Cost of Sales 30,718.800 35.0% 37,492 35.0% 47,714.450 35.0%

Gross Profit 57,049.200 65.0% 69,628 65.0% 88,612.550 65.0%

Less: Operating ExpensesAdvertising and Promotion 900 976 1030Salaries and Wages 12,600 13,440 13,890GOSI and Other Staff Cost 1,189.200 1201 1325Telephone and Fax 840 869 898Electricity and Water 2,400 2,565 2,742Property Insurance 300 387 400Rental Expense 12,000 12,460 13,200Repairs and Maintenance 360 375 397Supplies 600 625 678Petrol Expense 240 255 300Depreciation Expense 3,504 4,504 5,504

Amortization Expense - Pre Operating 1,764 1,764 1,764Amortization Expense - Leasehold Improvements 1,000 1,000 1,000Total Operating Expense 37,697.200 42.9% 40,421 37.7% 43,128 31.6%

Net Profit 19,352 22.05% 29,207 27.3% 45,484.550 33.4%


46/54

Appendix 9

Projected Balance Sheet

Y1 % Y2 % Y3 %ASSETS

Current AssetsCash & Cash In Bank 9,756 38,184 67,353Supplies 9,899 10,789 11,679Food Inventory 12,000 12,000 12,000Total Current Assets 31,655 30.8% 60,973 62.6% 91,032 73.9%

Other AssetsRefundable Deposits 850 850 850Pre-Operating Expense 5,300 5,300 5,300Accumulated Amortization (1,764) (3,528) (5,292)Total Other Assets 4,386 39.5% 2622 15.3% 858 8.3%

Fixed AssetsEquipments & Furnitures 16,715 25,072 33,429Accumulated Depreciation (3,504) (8,008) (13,512)Leasehold Improvements 3,000 3,000 3,000Accumulated Amortization (1,000) (2,000) (3,000)Total Fixed Assets 15,211 29.7% 18,064 22.1% 19,917 17.8%

TOTAL ASSETS 51,252 100.0% 81,659 100.0% 111,807 100.0%


47/54

LIABILITIES AND OWNER'S EQUITY

Current LiabilitesAccounts Payables 1,900 3,100 4,300Total Current Liabilities 1,900 3,100 4,300Total Liabilities 1,900 3,100 4,300

OWNER'S EQUITYOwner's Investment 30,000 30,000 30,000Retained Earnings, Beg 0 19,352 40,291Net Profit for the Period 19,352 29,207 37,216Retained Earnings, End 19,352 48,559 77,507Total Owner's Equity 49,352 38,293 107,507

TOTAL LIABILITIES AND OWNER'S EQUITY 51,252 100.0% 81,659 100.0% 111,807 100.0%


48/54

Appendix 10

Projected Cash Flow Statement

Y1 Y2 Y3Operating Activities

Net Profit for the period 19,352 29,207 45,484Adjustments for:Depreciation & Amortization 6,268 7,268 8,268Operating income before working capital changes 25,620 36,475 37,216

Changes in operating assets and liabilities:Refundable Deposits (850) 0 0Supplies (9,899) (890) (890)Food Inventory (12,000) 0 0Pre-operating Expense (5,300) 0 0Accounts payable and accruals 1,900 1,200 1,200Net cash from operating activities (529) 36,785 37,526

Investing ActivitiesPurchase equipments (16,715) (8,357) (8,357)Leasehold Improvements (3,000) 0 0Net cash used in investing activities (19,715) (8,357) (8,357)

Financing ActivitiesShare in Capital 30,000 0 0Net cash (used in) from financing activities 30,000 0 0

INCREASE IN BANK BALANCES AND CASH 9,756 28,428 29,169Bank balances and cash at the beginning of the year 0 9,756 38,184BANK BALANCES AND CASH AT THE END OF THE YEAR 9,756 38,184 67,353


49/54

TOTAL CASH AS PER BALANCE SHEETAppendix 11

Monthly Profit and Loss Statement 9,756 38,184 67,353Jan08 Feb08 Mar08 Apr08 May08 Jun08 Jul08 Aug08 Sep08 Oct08 Nov08 Dec08 TOTAL

Sales 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 87,768

Cost of Sales 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 30718.8

Gross Profit 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 57049.2

LessOperatingExpensesAdvertising andPromotion 0 0 0 300 0 0 0 300 0 0 0 300 900Salaries and Wages 1050 1050 1050 1050 1050 1050 1050 1050 1050 1050 1050 1050 12600GOSI and Other Staff cost 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 1189.2Telephone and Fax 70 70 70 70 70 70 70 70 70 70 70 70 840Electricity andWater 200 200 200 200 200 200 200 200 200 200 200 200 2400Property Insurance 25 25 25 25 25 25 25 25 25 25 25 25 300Rental Expense 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000Repairs andMaintenance 30 30 30 30 30 30 30 30 30 30 30 30 360Supplies 50 50 50 50 50 50 50 50 50 50 50 50 600

Petrol Expense 20 20 20 20 20 20 20 20 20 20 20 20 240DepreciationExpense 292 292 292 292 292 292 292 292 292 292 292 292 3504Amortization Exp -Pre Operating 147 147 147 147 147 147 147 147 147 147 147 147 1764Amortization Exp 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 1,000


50/54

Lease improvementTotal Operate Exp. 3066.4 3066.4 3066.4 3366.4 3066.4 3066.4 3066.4 3366.4 3066.4 3066.4 3066.4 3366.4 37,697.2

Net Profit 3066.4 3066.4 3066.4 3366.4 3066.4 3066.4 3066.4 3366.4 3066.4 3066.4 3066.4 3366.4 37,697.2

Appendix 12

Personnel And Staff Cost

Personnel Cost1,670 GOSI 99.100

Position Nationality No Salary TOTAL 7% 3% TOTAL1 Manager & owner Bahraini 1 700 700 49 21 702 Head chef Expat 1 170 170 0 5.1 5.1003 Cook assistant Expat 1 150 150 0 4.5 4.5004 Cooker Expat 1 160 160 0 4.8 4.8005 Waiter Expat 2 130 260 0 7.8 7.8006 Cleaner Expat 1 110 110 0 3.3 3.300

Capital Expenditure

Equipment

Acquisition Y1 Y2 Y3

Date Item Description Qty Unit CostTotalCost

01-Jan-07 Espresso machine 1 2,000 2,00001-Jan-07 Coffee grinder 1 750 75001-Jan-07 Sink 1 150 150


51/54

01-Jan-07 Cheese Melter (Salamander) 1 500 50001-Jan-07 Drainage system 1 200 20001-Jan-07 Hood-Type Dishwasher 1 1,200 1,20001-Jan-07 Chopping Block 2 15 3001-Jan-07 Covered flooring/installation - 2,500 2,50001-Jan-07 Refrigerator 2 300 60001-Jan-07 Coffee, coffee makers, teas, teapots

& other stock plus serving supplies- 2,500 2,500

01-Jan-07 Scale 1 150 150

01-Jan-07 Glassware (Storage and display) 1 1,500 1,50001-Jan-07 Track l ight ing 1 560 56001-Jan-07 Desk, Filling cabinet , calculator - 1,500 1,50001-Jan-07 Disposer 1 300 30001-Jan-07 Deep fryer 2 100 20001-Jan-07 Broiler 2 75 15001-Jan-07 Waste Bin 2 12.5 2501-Jan-0701-Jan-07

Griddle 2 125 250Convection Oven 1 500 500

TOTALS 16,715 8357.5 8357.5


52/54

Appendix 13Please find 5 minutes to answer the following survey regarding your

experience in [Coffee shops]. The results will help us serve you better inthe future.

What is your gender?

Male

FemaleWhat age group are you in?

20 and younger

21-25

26-35

36-45

46-55

56-65

66 and older

What is your annual spending on the coffee shops?

Under BD 5

From BD 5 to BD 1

From BD 5 to BD 10

BD 15 and Above What is your overall satisfaction with [Coffee shop]?

Very satisfied

Satisfied

Neutral

Dissatisfied

Very dissatisfied

If you are dissatisfied, why?How often do you visit [Coffee shops]?

Daily

Several times a week

Once a week

Several times a month


53/54

Once a month

Several times a year Once a year or less often

Visited only once

Do not visit

Based on your experience, will you visit [Coffee shops] more or lessoften?

Would you recommend [Coffee shops] to your friend or affiliate?

Definitely

Probably

Probably not

Definitely not

Not sure

What are the Causes of trip?

On-Shopping

You are a Customer

Accidental


54/54

Appendix 14

ReferencesWeb Sites

http://www.zippys.com

http://www.imagechef.com

http://www.google.com.bh/search?hl=ar&q=cooker+Assistant+job+description

http://www.careerdepot.org

http://mahmood.tv/2007/08/24/the-bahraini-economy-excels/

http://www.answers.com/waitressing

www.google.com

www.giraux.com/buyers_guide/glossary.php

www.scotland.gov.uk/cru/documents/eval-debt-13.htm

http:// wordnet.princeton.edu/perl/webwn

http://www.royalbank.com/sme/bigidea/index.html

http://www.ehow.com/

Books & Magazines

- The Upstart Guide To Owning & Managing a Restaurant , ROY S. ALONZO

Published By Upstart Publishing Company, Inc.

-Business Marketing ,Crain Communications, Inc.

740 N.Rush Street

Chicago. IL60611 , Published Monthly

- The KPMGs Company

Mariam Abdulla ( Legal Assistant Advisory)

Chamber of Commerce
http://www.zippys.com/http://www.imagechef.com/http://mahmood.tv/2007/08/24/the-bahraini-economy-excels/http://www.answers.com/waitressinghttp://www.google.com.bh/url?sa=X&start=0&oi=define&q=http://www.giraux.com/buyers_guide/glossary.php&usg=AFQjCNHcwC2XjC0FYvA84uX_19fZZn9SUwhttp://www.google.com.bh/url?sa=X&start=5&oi=define&q=http://www.scotland.gov.uk/cru/documents/eval-debt-13.htm&usg=AFQjCNF77ZQUudr-lzktqe-vkEmxCMRlLAhttp://www.google.com.bh/url?sa=X&start=0&oi=define&q=http://wordnet.princeton.edu/perl/webwn%3Fs%3Dperseverance&usg=AFQjCNGSTHSbmtigY2QTOzAa3ce-Xgyx_ghttp://www.royalbank.com/sme/bigidea/index.htmlhttp://www.zippys.com/http://www.imagechef.com/http://mahmood.tv/2007/08/24/the-bahraini-economy-excels/http://www.answers.com/waitressinghttp://www.google.com.bh/url?sa=X&start=0&oi=define&q=http://www.giraux.com/buyers_guide/glossary.php&usg=AFQjCNHcwC2XjC0FYvA84uX_19fZZn9SUwhttp://www.google.com.bh/url?sa=X&start=5&oi=define&q=http://www.scotland.gov.uk/cru/documents/eval-debt-13.htm&usg=AFQjCNF77ZQUudr-lzktqe-vkEmxCMRlLAhttp://www.google.com.bh/url?sa=X&start=0&oi=define&q=http://wordnet.princeton.edu/perl/webwn%3Fs%3Dperseverance&usg=AFQjCNGSTHSbmtigY2QTOzAa3ce-Xgyx_ghttp://www.royalbank.com/sme/bigidea/index.html

fianl project bh05501678

Documents