Planning is essential in whichever task you want to involve yourself in. For business success, one needs to plan effectively and efficiently. Planning is essential when a person wants to start a business, know how to run it or as well in expanding of already existing business. Business plan helps an entrepreneur to put the business idea into action while giving him a chance and an opportunity to differentiate between realistic and achievable goals from the unrealistic and unrealistic (Chen et al., p. 210). It also enables one to put the required budget into consideration and be able to project profits or losses that can occur.
It is crucial to review and update the business plan for already existing business so as to control the future direction of the business. An efficient business plan will ensure you identify potential risks and new opportunities and thereby act accordingly (Ivanisevic et al., p. 173). This paper therefore, discusses the business plan preparation for a fast food company in Oman, breakeven calculation, profit projection, balance sheet and monthly cash flow forecast for the first year.
A dynamic entrepreneur should be able to generate a viable business idea that can bring forth worth while benefits. Business idea generation involves identification of a gap and an opportunity that exist in the market. This calls for creativity and innovation on the part of the entrepreneur. When there is a great demand for a certain product or a service in the market and the supply does not meet the growing demand, then this creates a gap that requires to be filled (John and Kundisch, p. 4). The idea should be aimed at solving a current or existing problem in the market.
Fast food industry is an area that is ever growing. Food is a commodity that is used daily, by every individual in the planet earth. Oman for instance, has high population and there is a steady increase in demand for food commodities as well as the purchasing power (Al-Busaidi and Jukes, p. 62). This therefore, creates a gap in the fast food industry in Oman. People’s taste and preference varies significantly when it comes to matters of food. Therefore, preparation of high quality meals with a wider range of variety is essential for business success in food industry. Advancement of technology as well as its use in food operations management in various organizations has revolutionized the face food industries. Some fast food industries have not fully invested in the use of technology in their operations. These are some of the gaps that a diligent entrepreneur needs to identify and take hold of. If a company fails to incorporate the use of technology in its operations, the chances of becoming out done by its competitors is very high (Vivaldini and Pires, p. 559). Strategically business planning is also crucial for a business to survive in this competitive world.
A business plan is usually a written document describing the future business operations, explaining the manner in which you will be able to achieve the goals and objectives of the business as well as means of achieving it. Business plans should be strategic. A business plan can give you a synopsis of the future expectations and what the benefits one can reap from the outcome of the business (Garonne and Davidsson, p. 225). At the start of a new business venture, usually there is limited resources and abilities. However, as the years’ progresses, there will be unlimited resources as well as greater abilities that will lead to increased profits and assets. However, to be able to transit and make the business grow, a proper and strategic plan should be in play (Delmar and Shane, p. 1176). The plan indicates how to move from one step to another in a progressive manner.
For a new venture to be successful, a strategic business plan should be prepared. Despite the time and resources consumed while preparing a business plan, it serves as framework and a benchmark through which you can be able to see yourself in years to come and if it will be possible to achieve your target goals (Brinckmann et al., p. 32). It is crucial to outline the business plan of your organization carefully and consider all variables that may be involved. While making a business plan, it is important to consult with the business partners, mentors and the colleagues. Business plan gives the entrepreneur a chance to explain his business idea concept to the investors and the public (Navarro, p. 141). The main essential features are;
Executive summary- This gives the general overview of the business venture. It is a short, concise and well written summary. The main goal of writing the summary is to capture the attention of your target customers so that they can have the urge to read more (Bewayo, p. 4). Although the executive summary appears first in the business plan flow, a prudent entrepreneur should consider writing it last. This is after working out the logistics of the plan and therefore, you can be able to summarize everything accurately and succinctly (Barry et al., p. 4). The executive summary includes; name and location of your business, products and/ or services to be offered, company’s mission statement and the purpose of the plan. It can also include the Ask section, where you indicate the amount of money you will possibly need to carry out the business operations.
Company description- In this section the entrepreneur describes his company in the manner in which the clients will have a high-level view about the organization. It gives the goals and objectives of the company and also describes how the company will carry out its operations. It includes; the legal form of the company, the nature of the organization, needs you will satisfy in the market, a brief history of the business, overview of the products and services to be provided and the target customers and suppliers (Ikemefuna and Enoch, p. 19), short-term and long-term organization goals and financial and market highlights summary.
Products and services- In this section, one should describe vividly the type of the products they will be dealing with. One should put into consideration the benefits the product will have to the customers. By describing vividly, the benefits of the product, it will increase on sales and maximize the profits (Zeithaml, p. 77). Customers will go for the products that will have unique benefits on them as well as those that will add value to their life. Using visual diagrams and pictures that are captivating would capture customer’s attention. This session includes; in-depth description of the products with their specific benefits, market role played by the introduction of the product, life cycle information about the products (Barton, p. 4), relevant copyright, trade and patent rights, research and development activities.
Market analysis- Market analysis shows the broad knowledge of the market as swell as the market research. It includes; target customer sketch such as demographics and size, statistical industry description, projected marketing data as well as the current and historical and detailed evaluation of the competitors with their strengths and weaknesses (Ruggieri et al., p. 228).
Strategy and implementation- This includes the summary of the sales and marketing strategies. It is crucial to have proper strategies in place so as to increase on sales. This can include the pricing, distribution and promotion strategies. Means in which you will be able to reach the target customers and thereby penetrate the market (Klettner et al., p. 158). Data on facilities and the operating hours, number of employees and sources of labor.
Organization and management team- The company’s organization structure, board of directors and the management team are important to be considered. The management team of the company can make the company fail or succeed. How the organization is structured from the bottom to the top is also crucial (Bunderson and Sutcliffe, p. 552). This session therefore includes; organization charts describing key employees and the departments, owner’s information with their skills, management team profiles and the list of advisors.
Financial plan and projections- This section involves inclusion of cash flow statements, balance sheets, income statements and capital expenditure budgets (Sahlman, p. 105).
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1.0 Executive summary Fast Food and Juice Centre is a fast food outlet that will be located in Muscat, Oman. Fast Food and Juice Centre will provide a variety of high quality meals with excellent packaging and at an affordable price. Kebabs, falafel, done, hummous, baba ganouj, meat shishas, lemon mint and other meals and drinks will be available for an amazing treat. Our priority will to offer the ever increasing population in Oman with excellent meals while offering free delivery services. Later, our idea is to go global and be able to open numerous outlets in various parts of Oman and in other countries. 1.1 Business objectives · To be a premier home-style fast food restaurant in Oman and in the whole world. · To offer great quality of various meals at an affordable price. · Free delivery services. · To reap maximum profits from the sales. 1.2 Mission statement Our goal is to provide excellent meals while giving our customers an amazing dining experience. Serving all our customers with a smile, dignity and respect, is our ultimate drive. 1.3 keys to success · Variety of meals on the menu to accommodate every one. · Convenience in our location while being able to deliver to those far away. · High qualified chefs, managers and human resource. · Creation of amazing brands and positive image. · 100% customer satisfaction and repeat business. |
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2.0 Company Description The typical home-style restaurant will be located on the East of Mutrah Souq, Muscat, Oman. The restaurant will be operating for 24 hours on weekdays while on Saturday, Sunday and public holidays, it will be open starting from 6.00 AM to 8.00 P.M in the evening. 2.1 Legal Form The restaurant will be operated as a family company and therefore, it will be under sole proprietorship. It will be legally registered under the Oman property state laws (Al-Shammari, Brown and Tarca, p. 436). 2.2 Start-up summary The cost of opening the restaurant is estimated to be around 250, 000 OMR. Most of the expenses will be in furniture, technology implementation and other equipment. This would take about 80, 000 OMR. The remaining will go in renovation process, infrastructure and employee’s salaries. Source of funds will be from family savings, loans and funding from investors and other stakeholders. 2.3 Location and facilities The restaurant will be located strategically at the entrance of Souq opposite the Mattrah Corniche. The customers will be able enjoy the meals outside at the amazing payments while enjoying the amazing view of local and international tourists at the sea and passing cars by at the port. The décor will be wood accented chairs and tables with a combination of red and white table cloths. |
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3.0 Products and services 3.1 Daily operations The restaurant will be offering breakfast, lunch, dinner and supper. It will be operating 24 hours during weekdays. On the weekends, we shall be offering special meals and will be operating from 6.00 am to 8.00 in the evening. In between there are various snacks and fruit juice to be enjoyed. We shall also be delivering to our esteemed customers who will be ordering via our website and other social media platforms. The layout of the restaurant is huge enough to accommodate many customers and allow smooth operations of the company. 3.2 Competitive comparison There are over 400 fast food companies in Oman. Around Muscat, the major competitors will be Mutrah Hotel, Riyam and Marina. They also offer fast food services but due to the increasing population around Oman, the demand for fast food is ever increasing (Al-Busaidi & Jukes, p. 61). Our aim is to offer meals of high quality and of great taste, texture and consistency. With such qualities and use of advanced technology in our operations we will have a competitive edge over our competitors and hence have a breakthrough. The fact that we shall be offering free delivery services to our customers, it will give us an upper hand. 3.3 Suppliers We shall depend on local farmers and local companies for the supply of raw materials. We shall be buying from the original source such as vegetables and fruits so as to obtain goods of high quality. 3.4 Management controls We shall implement strict management control strategies that will guard our operations. We shall conduct daily, weekly, monthly and annual inventory tracking. This will ensure we evaluate the profits and losses occurring and improve where necessary. |
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4.0 Marketing analysis The hotel and restaurant industry is the fastest growing sectors in Oman. With the increasing number of tourists and population, the food industry will remain to grow. 4.1 Industry analysis In the year 2014, the food consumption in Oman was 2.7% which is expected to rise to 3.2% in 2019. Most of the Oman’s food whoever is imported (about 80%) and the restaurant industry is reliant on suppliers from outside (Woertz et al., p.5). Many restaurants in Oman also, are not well equipped and their standards are low. This therefore, gives us an opportunity to provide high quality meals to the growing population. Due to the different consumer taste and preference, demographics of Oman and personal income, this differences creates grounds for various restaurants, both small and large organizations. The hospitality industry which is rapidly growing also is a major contributor to the food industry. Many hotels, cafes and restaurant are emerging in Salalah and Muscat areas (Market, 8). 4. 2 Market size Food retail sales in Oman has been increasing, from 2.8 million OMR to 5.4 billion in 2014. This is attributed by the tourists and expatriates’ growth, awareness, rising disposable income levels and political stability. Vegetables and fruits are the highest consumed. The demand will keep on growing at a rate of 4.5% tons. 4.3 Industry participants and main competitors Fast food industry is an open market in Oman. The Pizza Hut and American franchises such as Tea Leaf and Coffee Bean are thriving so well. Other chains like Dubai’s Jumeirah and Thailand’s The pizza restaurants are opening in Oman (Azri & Ibrahim, p. 4). Muscat Grand Mall and McDonald’s Salalah will be the major threats. 4.4 Target market segment The location of the restaurant is very ideal since it is strategic and many people converges in Muscat. Being the attraction site for tourists, we will be able to capture large market. Given that our target customers are the tourists, youths, working class and nuclear families, we will be able to deliver to all our customers given we shall be offering delivery services. 5.0 Marketing strategy and implementation Strategic positioning of our company and providence of quality meal will be enough to attract a huge market. Great atmosphere both inside and outside the restaurant with our qualified ever smiling attendants will give our customers a conducive atmosphere to enjoy their meals and drinks. 5.1 Competitive edge · Amazing variety of meals with great taste and flavor · Qualified and ever smiling staff · Embracement of technology · Free delivery services 5.2 Marketing Strategy We wish to capture and enlarge our market territory by serving our customers perfectly well with meals of the highest quality. We shall use social media through our websites and Facebook to communicate our brands and for our clients to make their orders. 5.2.1 Marketing programs We shall depend most on social media for our advertising and brand promotion (Mangold and Faulds, p. 362). This will include the website, magazines, newspapers, Facebook, YouTube and emails. Word-of-mouth and wall posters are also crucial in marketing. 5.2.2 Pricing strategy The prices of our meals and drinks are at a subsidized level that every person can be able to afford. 5.2.3 Branding Since branding is essential for increased sales, we will invest much in producing products of greatest brand (Mudambi, p. 529). Our brand logo is a full plate filled with fresh and tasty meal that is eye catching. 5.2.4 Positioning statement Fast Food and Juice Centre will be an excellent joint since there is a wide variety of meals to select from. With the great meals of reasonable prices and the amazing atmosphere, the restaurant will be the best site in Muscat. 5.3 Sales Strategy The sales strategy is aimed at increasing the revenue of the company and therefore, service to our esteemed customers is one of the utmost importance (Leigh and Marshall, p. 88). Training will be offered to our attendants so as to serve our clients to their best of their knowledge. Customer satisfaction and proper handling of any complaints will be our mission. 5.3.1 Sales Forecast We are anticipating a drastic increase in sales during the months of December as well as November due to holiday periods. We still believe as the months go by, the sales will increase tremendously. NB: All prices are in Oman Rial (OMR) ( ?.?) Annual sales forecast for the first year
Milestones
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6.0 Organization management Organization Structure We are expecting to start with 30 employees, who will be scrutinized and chosen for their explicit skills. This will include the manager and his assistant, cooks, dishwashers, servers, cashiers, bookkeeper, sales agent and catering employees. Management Team Our management will be a group of highly qualified managers and human resource management team. There may aim will to ensure the operations of the company runs smoothly. |
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7.0 Financial plan Our financial plan for the first year will include; required cost of start-up, profit and loss, cash flow, balance sheet and monthly sales projection. 7.1 Important assumptions · Meal price will range from 5 OMR to 12 OMR · Average breakfast price; 5 OMR · Average lunch price; 9 OMR · Average dinner price; 12 OMR · 30 employees to start with · 850,000 OMR- 1, 250,000 OMR revenue target · Sitting capacity of 200 seats 7.2 Start-up costs The estimated start-up costs will be about 250,000 OMR. Most of the capital will from personal savings and the rest will come from bank loans and investor funding. This will include costs for assets such as artwork, machinery and other equipment’s, furnishing and interior décor, pre-opening expenses, permits, working capital and graphic logo as well as name creation. 7.3 Break-even calculation Total annual sales will be about 150, 000 OMR. The variable costs are estimated to be 60,000 OMR and the fixed costs 660,000 OMR. Breakeven point= Total Fixed Costs÷ [(Total Sales-Total Variable Costs)/ Total Sales] (Palia, p. 35) Substitution of the figures in the formula we shall get 1,100,000 OMR. 7.4 Projection 7.4.1 Projected profit and loss for the first year
7.4.2 Projected cash flow
Sales tax is deducted after the final cash flow balance. 7.4.3 Projected balance sheet
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Business plan is essential for new and established businesses. It is a tool that each and every organization should have. Businesses plan enables the entrepreneur to set specific goals and objectives for the business (Alstete, p. 88). A plan allows one to communicate the business priorities better and be able to decide on the necessary assets, equipment, machinery and human resources. Investors and lenders depend on business plan before they can decide to invest on a certain company and before they could lend money respectively. A business plan gives entrepreneurs an opportunity to test new ideas (Becker et al., p. 61). Without a business plan a company goes to the risks of running out of cash since they didn’t anticipate the start-up costs and sales projections.
Conclusion
Business plan features vary from one company to another. The way one company may have organized their business plan will be different from another one. The complexity and simplicity of the plan also differ depending on the nature of the company. Strategic business plan is however, essential for success of an organization.
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