Discuss About The Reimagining The Extracurricular Business.
“Coffee Sop” is the name of the business. The coffee shop is situated in the Sydney, Australia. The coffee shop offers the different varieties of coffee in the market. The main customers of the cafe are office workers. The cafe would also offer the sitting area to its customers.
The firm is only offering the beverage s to the customers. The main products of the firm are Latte, cappuccino, macchiato, Espresso, Americano etc. Firm is offering the coffees into 3 packs which are small, medium and large. In terms of services, firm is only offering the sitting area to the customers to manage the performance of the firm.
The business is a partnership business. It has been started with 3 people. They register the firm as a partnership firm and have made a contract of partnership. The liability of the shop is not limited. The partnership agreement explains that the same profit and loss would be shared by the partners from the business. According to the agreement, they could independently work outside as well.
The business has planned different strategy for the different activities ad operations of the business. The main strategy has been prepared for the marketing of the cafe shop. The firm has planned and invented various new policies to manage the performance of the business.
Three people have come together and start a new business. All these partners have different skills which is useful to manage the performance of the company. The Oliver has expertise in managing the activities of the company, Amelia is good in cooking and the marketing and other activities of the business are handled by Jack.
Coffee shop has been situated nearby the offices to manage and attract the office people towards the cafe. As discussed above, the main products of the firm are Latte, cappuccino, macchiato, Espresso, Americano etc. Firm is offering the coffees into 3 packs which are small, medium and large (McKeever, 2016). In terms of services, firm is only offering the sitting area to the customers to manage the performance of the firm.
The target market of the “Coffee shop” is office workers and the people who are indulge in work from home. The Coffee shop has been situated nearby the offices to manage and attract the office people towards the cafe. The target market of the firm is limited right now (Bokio, 2016).
The Australian industry of hospitality and restaurant has been studied and it has been identified that the growth rate of the industry is 2.5%. The industry is rapidly increasing and thus the Coffee shop would also enjoy a great market position (Brinckmann and Kim, 2015).
Promotion and advertising is done by the Coffee shop through using the social media and the local newspapers. The firm has given advertisement in the local newspaper to promote the product. Firm is also handling an official account of the cafe to promote the products and the cafe.
Organizational structure of the café has been evaluated and it has been found that the company has managed the organizational structure in such a way that all the workers of the firm could directly contact to the managers and the owners of the company to manage the performance of the company (Finch, 2016). The company has opted hybrid organizational structure in which the flow of information could directly reach to the labour class to managers of the company. The organizational structure of the company is as follows:
It is required for a food firm to acquire some license and register itself for the food safety and the quality of the food to the food institution. The cafe has acquired few licenses to manage the performance of the company. The company has also qualified the quality regulations as well (Hopp and Greene, 2018).
The professional advises are required by the company to regulate and evaluate the industry’s performance and the position of the company. The business has taken advises from the lawyer about the firm and the planner help has also been taken to identify the performance of the company (Wynne, 2016).
The coffee shop is situated in the Sydney, Australia. The business has been set up at the industrial place where various companies are operating their business is that the target people of the company could be captured easily. The main competition of the firm is from other coffee stalls nearby.
It is required for each business to buy some equipment for the business. In case of coffee shop, the following equipment has been purchased:
|
Equipment |
Purchase date |
Purchase price |
|
Espresso Machine |
$ 3,460 |
15-July |
|
Espresso Grinder |
$ 666 |
15-July |
|
Rental |
$ 1,08,000 |
15-July |
|
Refrigeration system |
$ 15,000 |
15-July |
(Schaper et al, 2014)
The service and retailing process of ten coffee shops has been evaluated further and it has been recognized that the trading hours of the company is 12 hours (morning 8 to evening 8). The company has trained the employees to deliver the best services and the product to the employee. The payment could be done to the firm through cash or digital payment (Watson, McGowan and Cooper, 2016).
The key sustainability of the company is to manage the performance and the activities in such a way that the market position and share of the company could be enhanced. In current scenario, company is focusing on enhancing the level of the sales of the company. The operating process of the business also explains about the better position of the company.
Funding is the crucial part of each business without funding, it is not easy for a company to run and manage the activities of the business. In case of coffee shop, it has been found that the capital would be raised by the partners through their contribution and the excess amount would be taken as loan from the bank. The funding is required to be collect by the end of May to manage the activities of the business (Brown, 2012). It has been found that each partner would contribute the same amount in the firm to run the business. The below table defines that the Oliver, Amelia and Jack would contribute $ 50,000 for the firm.
|
Partner |
Contribution |
|
Oliver |
$ 50000.00 |
|
Amelia |
$ 50000.00 |
|
Jack |
$ 50000.00 |
Though, the requirement of the business is quite higher and thus $ 1,50,000 should be sanctioned as loan amount from the bank. It has been found that the bank would charge 5% per annum on the bank loan and the amount has been sanctioned to the firm for 3 years. It is required for the company to pay the amount after 3 month to the bank through EMIs (Brooks, 2015).
In partnership business, firm could not generate the funds from the market through its securities. The funds could be generated by the company through the partners, bank and the family. In case of coffee shop, huge capital is not required and thus the amount has been managed by the firm through partner’s contribution and the bank loan.
Further, the forecasting study has been done on the business of next 12 months. The study has been performed after evaluating all the related factors of the industry and the location of the company. Firstly, the start up cost of the business has been evaluated and it has been found that the business would have to spend $ 2,50,000 as start up cost of the company. Though, the total capital of the company is $ 3,00,000 and thus the company left with $ 50,000 for the daily operations and the activities of the business (Brigham and Houston, 2012).
After evaluating the start up capital of the company, it has been found that the forecasted sales of the company are $ 22,090 in each month for next 12 months. It explains that from first day, a good strategy would be maintained by the company and the level of the firm would also be strong. The sales forecasting explains about the better level and the position of the company. Further, it has been found that current sales unit of the business is 4900 units which should be 5000 units t reach over the breakeven point where the cost and the profit of the company would be similar (Higgins, 2012).
Further, the other budgets and the case of the company have been evaluated and it has been found that the total purchase price of the company is $ 14,000. Purchase forecasting explains about the better level and the position of the company (Madhura, 2011). Further, it has been found that current purchase unit of the business is 4900 units which should be maintained and the purchase price should also be maintained by the business to manage the performance of the company.
The cost of sales of the company is 4 14000 which explains that no extra expenses are associated with the production of the coffee. The other expense of the company has also been discussed and it has been found that the performance of the company would be same for the next 12 months and after that, few changes would be occurred into the financial position of the company to evaluate the performance of the company.
The cash budget of the company and the income statement has also been evaluated to analyze the cash level and the profitability level of the company and it has been generated that the cash level should be maintained by the company through making few changes into its credit policy. All the calculations have been given in the appendix to understand the financial forecasting of the business in better way.
On the basis of the plan, it has been found that a better plan has been prepared. Though, it is required to impalement the plan in a better way. The firm is required to make an activity list and ensure that al the activities and operations of the business have been done on time so that the better result could be got from the business. The firm is required to look over the business plan and must implement all the process as described in the plan. A better implementation of any plan is the key to success. The business plan expresses that the performance and the position of the company should be completed before starting the business.
Conclusion:
To conclude, this business process would offer huge return to the company. It is mandatory for the business to evaluate and manage all the operations in perfect manner to achieve the budgeted goals and the profits. The business plan and the implementation process of the business plan express that the business would achieve the breakeven level in next year and from that time, huge profits would be earned by the company.
References:
Boiko, V.I., 2016. METHODS OF DESIGNING AND IMPLEMENTING A BUSINESS PLAN IN THE CULTURAL SECTOR OF THE REGIONS OF THE COUNTRY. In PERSPECTIVE DIRECTIONS OF SCIENTIFIC RESEARCHES (pp. 169-172).
Brigham, E. and Daves, P., 2012. Intermediate financial management. Nelson Education.
Brinckmann, J. and Kim, S.M., 2015. Why we plan: the impact of nascent entrepreneurs’ cognitive characteristics and human capital on business planning. Strategic entrepreneurship journal, 9(2), pp.153-166.
Brooks, R., 2015. Financial management: core concepts. Pearson.
Brown, R., 2012. Analysis of investments & management of portfolios. Pearson Higher Ed.
Finch, B., 2016. How to write a business plan. Kogan Page Publishers.
Gibson, C.H., 2011. Financial reporting and analysis. South-Western Cengage Learning.
Higgins, R.C., 2012. Analysis for financial management. McGraw-Hill/Irwin.
Hopp, C. and Greene, F.J., 2018. In Pursuit of Time: Business Plan Sequencing, Duration and Intraentrainment Effects on New Venture Viability. Journal of Management Studies, 55(2), pp.320-351.
Madura, J., 2011. International financial management. Cengage Learning.
McKeever, M., 2016. How to write a business plan. Nolo.
Schaper, M.T., Volery, T., Weber, P.C. and Gibson, B., 2014. Entrepreneurship and small business.
Watson, K., McGowan, P. and Cooper, S., 2016. Reimagining the extracurricular business plan competition through the incorporation of effectuation.
Wynne, H.S., 2016. 4 Wynnes Boating Manufacturing Company: A Market Analysis and Business Plan for Northwest Arkansas.
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