Professional Documents
Culture Documents
INTRODUCTION
burgers that were available in Kathmandu. With the help of that survey, I found that
people like to have quality burger as one option for their lunch, but as per them the
burgers that are available in the streets are unhygienic as well as the taste is not up to
the par. So, with this gap in mind I seek to incept a low cost business model to serve
burgers through a specialized kiosk, which basically are small shutter or shops that
specialize in burgers. The business model is based on takeaway dining, i.e. customer
buys the products and eats it in his own place of choice; but having this said the
kiosks will be strategically placed in the location where there is ample public space
for consumption.
1.3 Mission, vision and objectives
Every
organization
has
its
own
Vision,
Mission
and
Goal
that
guide
the
organization
to
sustain
for
very
long
period
of
time.
Similarly
the
Fitness
First
also
has
its
Vision,
Mission
and
Objectives.
Below
explains
vision
mission
and
goal
of
the
organization.
1.3.1 Vision
To become one of the best Burger Koisk of the Kathmandu valley by creating unique
position in the minds of customer with our quality and professional service.
1.3.2 Mission
We are committed to Quality, Service, cleanliness and value for each and
every customer, each and every time.
Customers are the most important visitor on our premises and they are not
dependent on us, we are dependent on them. We are not doing them a favour
by serving them they are doing us a favour by giving us the opportunity to
do so.
1.3.3 Objectives
Objectives
To provide high level of customer satisfaction with qualitative burger with
affordable price.
To gain market share and earn profit more than the competitors.
KEY PARTNERS
KEY ACTIVITIES
Suppliers
Share holders
Customers
Employees
Preparation of
Burger
KEY RESOURCES
VALUE
PROPOSITION
CUSTOMER
RELATIONSHIP
Quality
Hygienic
Affordable price
Customer
Satisfaction
Raw Material
Machinery
Equipment
Operation Cost
Other Direct & Indirect Cost
Salary & Rents
Start up Capital
Urban youths
Adults
Quick and tasty
hygienic lunch
without hassle
CHANNELS
COST STRUCTURE
Affordable and
accessible
Quality
products
CUSTOMER
SEGMENTS
Suppliers
Share Holders
Members
Customers
REVENUE STREAM
Sales of Products
The key activity of our organization is to make or prepare the burger ordered by the
customer with distinct taste and hygienic manner.
Key resources
To make our organization run we need different resources like meat patty, veg patty,
bread roll, lettuce, tomato, onion, mayonnaise, ketchup, and relish.
Customer Segment
Our organization has targeted many customers mainly urban youths, adults who wants
quick and tasty hygienic lunch without hassle.
Channel
We will totally encourage all type of participants who are urban youths and adults
who want quick and tasty lunch without hassle. Whereas different suppliers of
equipment and raw material play an important role to deliver the value preposition we
promise to our customer. All employees play an important role in the service deliver.
Customer Relationship
We totally focus on providing our customers affordable and accessibility of quality
products.
Key Partner
We are associated with different partners without whom the organization is to be run.
The key partners are suppliers, shareholders, member/customers and employees.
Cost Structure
During the start up of business different start up capital is to be invested and further
equipments are to be purchased and operation cost are to be met up with different
direct and indirect cost. Salaries are to be provided to the staff working in the
organization and rents are to be paid for the premises.
Revenue structure
The revenue is generated with sales of different variant of burgers.
CHAPTER II
PRODUCT AND SERVICES
2.1 Product
Your Burger Point provides the product burger that the customers want to consume.
Your Burger Point is the brand that everyone will trust for its taste and hygiene as
well as its quality. Our goal is to be a destination for mostly youths and adults who
want quick tasty, healthy and hygienic burger without hassle.
There will be three types of burger in Your Burger Point:
Hamburger Burger
Chicken Burger
Veg Burger
Daily Demand
Monthly
Yearly
1500
45625
547500
The other data related to operational and organizational management was obtained
through market study. In this, various people from the restaurants business who have
years of experience were asked about the true nature of business and its prerequisites.
Similarly, various machineries and raw material suppliers were also consulted so that
the business plan would be accurate in terms of its fixed and variable costing.
CHAPTER III
INDUSTRY ANALYSIS
3.1 The competition
The industry is not a big one. The competition is increasing day by day. If you
maintain the quality of your service in terms of consistency and price, it is not
difficult to keep your loyal consumers. As per the market demand there are so many
Burger Kiosk established in the market to serve the consumer in the fast time and in
best way. There are many Burger house or kiosk in busy places like Newroad,
Thamel, New Baneshwor, Nepaltar, etc.
3.2 Competitors Analysis:
Some of the famous burger houses in our location i.e. Newroad are:
1. RDs Caf
2. Big Bite
The following are the competitive analysis of the RDs caf and Your Burger Point:
Table 2: Competitors Analysis
Competitors
RD Cafe
Strength
1. Have lots of customers
1. High price
1.Highly experienced
professionals
2. Competitive price
field
3. Convenience location
4. Quality Products
Weakness
Intensity of Rivalry: Intensity of rivalry is very high to attract and retain every
potential customers in market either providing quality services or in low cost.
Threats of Substitutes: There are many Burger shops in Kathmandu valley that
provides similar services to its clients. There are so many shops that provide
the good services with different substitute products. Thus there is a threat of
substitute in the market in terms of services provided. But in Your Burger
Point, though the services are similar but the prices and hygienic burger do
vary.
CHAPTER IV
MARKETING STRATEGIES
4.1 Customer Analysis:
4.1.1 Segmentation
There are so many customers in Nepal and we have segmented the customers
according to the demographic area like urban area, income level: middle class and
others.
4.1.2 Target
Though there are so many customers we can target on but due to limited resources
and time constraints we are only targeting the Newroad area that is the most busiest to
target urban youths and adults who want quick and tasty lunch without hassle so there
will be opportunities of selling more of our products and take competitive advantages.
4.2 Marketing Plan
4.2.1 Business objective
Burgers are general products that are readily available everywhere. In spite of its
general tendency there are certain elements in the product as well as service that
differentiate one burger from another.
As YOUR BURGER POINT is new entrants in the takeaway burger segment, our
initial strategy is to maximize sales in order to create a loyal customer base so as to
build a strong brand that will differentiate it from the competitors and also create
barriers for new comers. This strategy will be perused for next 3 to 5 years so as to
stabilize our market in order to fulfill our long-term objective of building a brand that
will be synonymous to tasty and quality burgers.
4.2.2 Target segment
We will be basically targeting three segments of the burgers based on burger variant
as we need to provide variety of products to the market. The three segments will be
hamburger, chicken burgers and veggie burgers.
10
Market Segments
Ham
Chicken
Veggie
Total
36956
22174
9855
68985
2956500
1884769
739125
5580394
Through this survey, the total per year demand of burgers was found out to be about
547,500. Similarly, within burgers, demand for Hamburger was found out to be
273,750; Chicken-burger was found out to be 164,250 and Veggie-burger was found
out to be 109,500. With this demand on mind, I planned to serve only 15% of total
market and with 90% capacity utilization for the initial year. The total sales target for
the first year is about 68,985 burgers.
4.3 Marketing strategies
The demand sensitivity for all variants of burgers is assumed to be same considering
the little difference among the products. It is fairly assumed that Rs 1 increase in price
will decrease in demand of burger by 1000 units. Similarly, Rs 50,000 spent on
promotion per year will lead to increase in demand by about 11,000 units.
Likewise, a new addition of the store requires about Rs 500,000 of additional
investment that will increase the demand by about 90,000 burgers per year.
Appropriate mix of place, promotion and price is chosen for each burger variants so
as to maximize sales.
For hamburgers, the price will be decreased to Rs. 80 that is Rs. 5 will be reduced to
the market price. There wont be any place strategy, as it will involve extra
investment in fixed assets, as we will need to open up an exact same store in another
location. Similarly, 3.3 units of promotion will be done amounting to Rs 165,000. It is
logical to decrease the price by Rs. 5 as it will help to attract new customers. We will
be doing much promotion in newspapers and magazines as well as using social media
for creating buzz in the market.
For chicken burgers, the price will be decreased by Rs. 5 to make it Rs. 85. No
distribution channel will be added and 1.8 units of promotion will be done amounting
11
to Rs 90,000. Similarly, for veggie burgers, the price will be decreased by Rs. 5 to
make it Rs. 75. In this segment too we will not be adding any distribution channel and
using 0.5 units of promotion amounting to Rs 25,000.
Even though the promotional expenses for each of the products variants are estimated
separately. The advertisements and promotions of one-product variants will provide
synergistic effects to other product variants.
4.4 Positioning
Products may be positioned in many different ways. Generally, the way they are
differentiated and the benefits they offer.
4.5 Product Attributes
The basic goal of positioning strategy is to own a word that ranks the product in
prospects mind as a Hygienic. We would equip our workers with disposable gloves
preparing raw materials such as cooked patty of ground meat, bread roll, lettuce,
tomato, onion, mayonnaise, ketchup, and relish.
4.6 Benefits
Burger would be the tastiest and healthiest food that would reach the customers.
4.7 Marketing Mix
The marketing mix of Your Burge Point consists of the various elements in the
marketing mix that forms the core of a companys marketing system and hence helps
to achieve marketing objectives.
Product
We are providing hamburgers, chicken burgers and veg burgers to the customers with
very hygienic and great teaste. However, customers requirements change over time.
In order to meet these changes, Your Burger Point will introduce new products and
will continue to do so. Care is taken not to adversely affect the sales of one choice by
introducing a new choice, which will cannibalize sales from the existing one.
Price
The customers perception of value is an important determinant of the price charged.
Customers draw their own mental picture of what a product is worth. A product is
more than a physical item, it also has psychological connotations for the customer.
12
The danger of using low price as a marketing tool is that the customer may feel that
quality is being compromised. It is important when deciding on price to be fully
aware of the brand and its integrity.
Promotion
The promotions aspect of the marketing mix covers all types of marketing
communications One of the methods employed is advertising, Advertising is
conducted on in the press for example in newspapers and magazines.
Place
Place, as an element of the marketing mix, is not just about the physical location or
distribution points for products. It encompasses the management of a range of
processes involved in bringing products to the end consumer. The shop is located in
the busiest place of the Kathmadu i.e. Newroad.
People
The employees in Your Burger Point have a standard uniform and it specially focuses
on friendly and prompt service to its customers from their employees.
Process
The production process consists of converting various raw materials into burgers. The
basic process includes preparing raw materials such as cooked patty of ground meat,
bread roll, lettuce, tomato, onion, mayonnaise, ketchup, and relish. Then as the
customer's orders, the store manager will inform the cook and the helper. The cook
will then put the patty into the grill and bread roll into the oven. In the mean time, the
skilled staff will source all the necessary ingredients and both of them in coordination
will prepare burgers according to orders. The store manager will then prepare receipt
and hand over the burger and receipt to the customer and collect the payment.
Physical evidence
Your Burger Point focuses on clean and hygienic interiors of of the shop.
13
CHAPTER V
OPERATION PLAN
5.1 Production (operation) process
The production process consists of converting various raw materials into burgers. The
basic process includes preparing raw materials such as cooked patty of ground meat,
bread roll, lettuce, tomato, onion, mayonnaise, ketchup, and relish. Then as the
customer's orders, the store manager will inform the cook and the helper. The cook
will then put the patty into the grill and bread roll into the oven. In the mean time, the
skilled staff will source all the necessary ingredients and both of them in coordination
will prepare burgers according to orders. The store manager will then prepare receipt
and hand over the burger and receipt to the customer and collect the payment.
Figure 1: Operation Process of Your Burger Point
Order
of
customer
Inform
Cook
and
Helper
Burger is prepared
Receipt is made
Suppliers decisions
In order to gain competitive advantage selecting key supplier is a must. Where and
what we buy or need to buy in the future should be thus properly analyzed. After
having done the market survey, we have decided to custom make the necessary
furniture from the Wood craft, a local furniture maker. They have ensured us effective
delivery of qualitative goods and serviced with custom made designs with certain
discounts.
14
Capacity
Utilization (%)
Year 1
90
Year 2
Sales Target
Monthly
Daily
68985
5749
189
100
76650
6388
210
Year 3
110
84315
7026
231
Year 4
120
91980
7665
252
Year 5
130
99645
8304
273
15
per the brief market survey where suppliers of equipments and owners of burger
vendors were consulted for the pricing of the assets required for setting up this
establishment.
The followings are the fixed assets.
Table 5: Fixed Assets
Particulars
Amount
400000
Furniture
100000
500000
Machinery and equipment is depreciated at the rate of 10% whereas furniture and
fixtures at the rate of 20%, total amounting to Rs 60000 per annum.
5.5 Raw materials
The total raw material cost for three product lines were calculated based on
percentage of selling prices. 55% of the selling price consists of actual cost of raw
materials which amounts to about Rs 255,768.05
Table 6: Raw material Cost
Raw material per month
Raw materials in prop to
sales
Proportion
55%
44.49
255768.05
5.6 Labor
One cook and a support staff will be used interchangeably for operating the store
whose salary will be 12,000 each with total amounting to 24,000. The total cost for
labor is summarized below:
16
Number of labor
Rate/month
Amount
Skilled
12000
24000
Semiskilled
Unskilled
Total
24000
Per Month
Rent Expenses
600000
Electricity
2000
Utilities
5000
2000
Amount
255768.05
Labor cost
24000
67000
5749
60.32
17
CHAPTER VI
ORGANIZATIONAL AND MANAGEMENT PLAN
6.1 Form of organization:
The organization will be registered as a partnership firm under Partnership Act, 2020
(1964) of Nepal with two partners.
6.2 Organization structure of management team and their profiles
Since the organization set up will be relatively very small, the structure will be flat
and have very informal but professional culture. YOUR BURGER POINT will have a
simple organisational structure with two partners handling the general management
functions and decision-making. Likewise, one store manager will handle the day-today operation of the stores and two other skilled support staff will be employed in
order to prepare and serve burgers. (Refer Annex 2 for organisational chart). The
profile of partners is as follows.
Sunil Shrestha: Sunil is currently pursuing his masters degree in business
administration from D.A.V. Business School with major in Marketing.
Sushma Maharjan: Sushma is currently pursuing his masters degree in business
administration from D.A.V. Business School with major in Finance.
Figure 2: Organizational Structure
Managers/
Partners
Store
Manager
Store
Support
Staff
Store
Support
Staff
18
55000
Overhead:
Electricity
Stationary
Others
2000
Total
57000
19
Pre-operating expenses
Amount
Registration
10000
10000
Total
20000
20
CHAPTER VII
FINANCIAL PLAN
500000
Pre-Operating Expenses
200000
Working Capital
188384.54
Total Capital
708384.54
The total working capital is calculated for different days of inventory of materials and
credit sales:
Table 13: Working Capital
Days
PUC
Amount
17051.20
Account Receivables
171333.33
188384.54
The total cash is equivalent to all monthly expenses for labor, factory expenses,
administrative expenses and marketing expenses. Majority of raw material is highly
perishable in nature. So, raw material are only stored for 2 days considering its easy
availability, transportation ease and lead-time. There is no work in progress inventory
in production process as inventory is sourced as needed. Similarly, there is no finished
products inventory as burgers are prepared as the customers' orders. Likewise, the
there is no account receivable as all the sales will be in cash.
21
Equity
Loan
Total
Interest
Land
Building
100000
300000
400000
100000
100000
200000
300000
500000
40%
60%
100%
20000
20000
Working capital
188384.54
188384.54
Total
408384.54
300000
708384.54
58%
42%
100%
Vehicles
Office equipment
Total
Percentage
Pre-operating expenses
Percentage
12%
10%
22
Outstanding loan
Interest
Principal
Total Installment
300000
36000
47222.92
83222.92
252777.08
30333.25
52889.67
83222.92
199887.41
23986.49
59236.43
83222.92
140650.98
16878.12
66344.80
83222.92
74306.18
8916.74
74306.18
83222.92
Pricing
PUC
Marketing Expenses
Admin cost
Interest expenses
Total market, admin &
interest
Production unit
Cost plus
Comparative
Market skimming
60.32
23333.33
57000
3000
83333.33
5748.75
14.50
74.82
74.82
74.82
Add % mark up
14.96
6.08
25.18
Price
89.78
80.89
100
23
CHAPTER 8
FINANCIAL ANALYSIS
8.1 Projected financial statements
8.1.1 Projected Profit and Loss
As the profit and loss table shows, YOUR BURGER POINT expects to continue its
steady growth in profitability over the next five years of operations. The profit for the
first year will be Rs. 359,177.19 and will increase throughout the years to be Rs
1,374,339.20 at the end of fifth year. The complete projected profit and loss statement
of YOUR BURGER POINT is as follows.
Table 17: Projected Profit And Loss Statement
Particular
Capacity
Year 1
Year 3
Year 3
Year 4
Year 5
90%
100%
110%
120%
130%
68985.00
76650.00
84315.00
91980.00
99645.00
Sales revenue
5580393.75 6200437.50
6820481.25
7440525
8060568.75
Raw material
3069216.56 3069217.56
3069218.56
3069219.56
3069220.56
Labor
288,000.00
320,000.00
352,000.00
384,000.00
416,000.00
60,000.00
60,000.00
60,000.00
60,000.00
60,000.00
804,000.00
804,000.00
804,000.00
804,000.00
804,000.00
4221216.56 4594240.63
4967264.69
5340288.75
5713312.81
1359177.19 1606196.88
1853216.56
2100236.25
2347255.94
Sales unit
Depreciation
Factory
overhead
Total
factory
cost
Gross profit
Administration
684,000
684,000
684,000
684,000
684,000
Marketing
280,000
280,000
280,000
280,000
280,000
964,000
964,000
964,000
964,000
964,000
395,177.19
642,196.88
36,000
30,333.25
359,177.19
611,863.63
expenses
Total admin &
marketing
EBIT
Interest
EBT
24
16,,878.12
8,916.74
Accumulated
359,177.19
Profit
CFAT (Net
Cum CFAT
PV
PV
Income)
factor@10%
708,384.54
-708,384.54
1
-708,384.54
359,177.19
-349,207.35
0.909
-317,429.48
611,863.63
262,656.28
0.826
216,954.08
865,230.07
1,127,886.35
0.751
847,042.64
1,119,358.13
2,247,244.48
0.683
1,534,867.98
1,374,339.20
3,621,583.68
0.621
2,249,003.46
3,822,054.16
25
Total Cash
Year 0
Year 1
Year 2
Year 3
Year 4
708384.54
5580393.7
6200437.50
6820481.25
7440525.00
8060568.75
5581463.54
5954487.61
6327511.67
6700535.73
Inflows
Total Cash
5
520000
Outflows
Net Cash
Year 5
5225490.6
9
188384.54
354,903.06
618,973.96
865,993.64
1,113,013.33
1,360,033.02
188,384.54
543,287.60
1,162,261.56
2,028,255.20
3,141,268.53
188,384.54
543,287.60
1,162,261.56
2,028,255.20
3,141,268.53
4,501,301.55
Flow
Opening
Balance
Closing
Balance
The cash flow statement illustrates that Your Burger Point expects to maintain a
steady rate of cash flow over the next five years of operations. Please refer to Annex 3
for the complete projected cash flow statement.
8.1.5 Projected Balance Sheet
YOUR BURGER POINT is to maintain a healthy balance sheet. Please Refer Annex
2 for complete projected balance sheet.
8.1.6 Breakeven analysis
Analysis shows that YOUR BURGER POINT will break-even at 83.84% of total
sales in the 1st year. It is also because the capacity utilization is 90% in initial period.
It can also be attributed to gestation period. BEP would continuously decrease in the
upcoming years with higher utilization of capacity and improvement in sales and
costs. This break-even decreases to 57.20% by the end of 5th year
26
We can see that the BEP will been declining gradually till the 5th year, which
is a very good sign for the business.
The expected future cash flows of the project are greater and increasing.
27
APPENDICES
Annex 1
Projected Cash flow Statement
Particulars
Cash Receipts
Equity
Debt
Cash sales
Year 0
Year 1
408,384.54
300000 .00
Year 3
Year 4
-
Year 5
-
8,060,568.75
8,060,568.75
Total Receipt
Disbursement
Fixed Asset
Pre-operating
Expenses
Increase in
Inventory
Factory
Expenses
Year 2
500,000.00
20,000.00
17,051.20
5,653,312.81
Administration
684,000.00
684,000.00
684,000.00
684,000.00
684,000.00
Marketing
Interest
Principal
Total
Disbursement
Surplus or loss
(A-B)
Opening
balance
280,000.00
36000.00
47,222.92
280,000.00
30,333.25
52,889.67
280,000.00
23,986.49
59,236.43
280,000.00
16878.12
66,344.80
280,000.00
8,916.74
74,306.18
6,700,535.73
188,384.54
354,903.06
618,973.96
865,993.64 1,113,013.33
1,360,033.02
188,384.54
3,141,268.53
Ending Balance
188,384.54
4,501,301.55
28
Annex 2
Projected Balance Sheet
PROJECTED BALANCE SHEET
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
500,000.00
500,000.00
500,000.00
500,000.00
500,000.00
60,000.00
120,000.00
180,000.00
240,000.00
300,000.00
500,000.00
440,000.00
380,000.00
320,000.00
260,000.00
200,000.00
20,000.00
20,000.00
20,000.00
20,000.00
20,000.00
20,000.00
17,051.20
-
17,051.20
-
17,051.20
-
17,051.20
-
17,051.20
-
YEAR 0
ASSETS
Fixed Assets
Gross
Accumulated
Depreciation
Net
Fixed
Assets
Pre-operating
Expenses
Current
Assets
Inventory
Account
Receivable
Cash
Total Assets
LIABILITIES
Term loan
Short term
loan
Initial Equity
Profit
Retained
Total Equity
Total Capital
& Liabilities
500,000.00
188,384.54
543,287.60 1,162,261.56 2,028,255.20 3,141,268.53 4,501,301.55
708,384.54 1,020,388.80 1,579,312.76 2,028,255.20 3,438,319.73 4,738,352.75
300,000.00
-
252,777.08
-
199,887.41
-
140,650.98
-
74,306.18
-
408,384.54
-
408,384.54
359,177.19
408,384.54
408,384.54
408,384.54
408,384.54
971,040.81 1,836,270.89 2,955,629.02 4,329,968.21
408,384.54
767,561.72 1,379,425.35 2,244,655.42 3,364,013.55 4,738,352.75
708,384.54 1,020,338.80 1,579,312.76 2,385,306.40 3,438,319.73 4,738,352.75
29
30