Coffee Planet (Sam's Business)

8/8/2019 Coffee Planet (Sam's Business)

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COFFEE PLANET (SAM)

Analyse the potential and viability of the success of newly opened store Coffee

Planet (Sam) Mumbai

Analysis of Coffee Planet

Target Market

Primary Target Market: The Primary target market for Coffee Planet in Mumbai is

the young generation both female and male students from the ages of 18-34. This

market is well educated and comes from middle class to upper middle class

population. Since the location is close to the Mumbai University customers can have

easy access to stores

Secondary Target Market: The secondary target markets are the, multinational

offices; local people where highly paid consumers work therefore special marketing

strategies will be used to gain their brand loyalty to Coffee Planet.

3. Analysis of the potential location

The coffee shop is located in a highly sophisticated place whereby Mumbai

University, multinational companies and small scale industries are based. The Coffee

Planet will be located in Mumbai Santa Cruz (east). The buildings around the area are

very contemporary and developed. The roads are in good condition to maintain easy

access to our location. (A map of the location can be seen in Appendix.)

IV. Planned Operation of the Proposed Business

A. Proposed Organization

Coffee Planet will be a privately owned business with horizontal organization.

The store will have a manager and three employees that will rotate shifts depending

how busy the store is during the day. Coffee Planet believes in an open and friendly

work environment and all employees of Coffee Planet refer to each other as Baristas

The store will open on 1st

November with the legal paper work, licensing, andgovernment approval should be completed in May of this current year

B. Proposed Product/service

1. The Product

Coffee Planet will sell a variety of coffee and tea beverages along with different

types of pastries, confections, and baked goods, coffee-related accessories and

equipment. The coffee shops provide customers with a pleasant place to come and

relax, study, work, or have business meetings. Both locations will provided wireless

Internet access in the stores so that customers can bring their laptop and continue theirwork if they wish.


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Coffee Planet will customize the menu to fit the tastes of the local people. A new

menu will be originated after several months of research and development. There are

some common tastes preferences of the Indians known already. For example, Indians

tend to take more cream in their coffee. Also, the skim milk option will not be offered

in India because dieting is not a commonly accepted practice in the country. Indians

will feel that they are being cheated out of their money if skim milk is put in their

beverages. Indians also like spices in their tea and coffee, especially ginger and black

clove. One of Indias favourite fruit flavours in mango, and in fact the mango is

Indias national fruit. The coffee beans and tea will be bought from local Indian

farmers in order to support the local agricultural economy, save money in

transportation and tariffs, and gain tax benefits. Inspections of the crops will be taken

into consideration to ensure the high quality and in maintaining standards. The

inventory policy will be put into practise to keep the stores stocked but not over

stocked to ensure freshness of products.

2. Transportation of goods

The raw materials (coffee beans and tea) will be transported to Mumbai making use of

Indias vast and efficient railway system, and supply trucks.

C. Proposed Strategies

1. Pricing

Competitive pricing is vital for the business to grow and succeed but definitely costs

need to be taken into consideration. Because of the costs involved in start up,

transportation and imported goods, the price will be set to make the coffee affordable

to the target audience. The payment will be done in rupees so the price of coffee

would be about 10 to 15 rupees. The prices for all good will vary from each and every

product with the use of pricing policy, Coffee Planet prices will be 20% lower than

those of the other Barista Company. This use of penetration pricing will ease the

business to slide into the market place. Though it is possible to get a cup of coffee for

15 merely 5 rupees at small stalls on the street, the success of the Barista Coffee

company in India show that the customers are willing to pay for better quality,

service, and environment

2. Promotion

Types of available media for marketing purposes which include everything from

newspaper advertising to television ads. Since this is a test venture and there is only

one location of store being opened, the promotion for the store has to be focused on

our target markets. Billboard advertising on the roads leading to the store locations is

a good way to increase awareness of the locations. Direct mail advertising with

promotional coupons will be used to reach the homes of the target market. Sales

brochures offering delivery services will be sent to the local call centres and big

companies. A large number of people have access to internet therefore a proper

website will be developed to communicate the products and other social networking


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sites Face book and Orkut will also be used to keep the customer updated with the

latest product and services

STAKEHOLDERS

As I am the proprietor of my own business by nature a sole trader Generally, mystakeholders includes

Customers

Suppliers

Community

Employees

Bank and Brokers

Suppliers:

The key stakeholders especially the suppliers are crucial for my business asoperation depends on their supply of products.

These are many suppliers in the market available. However, my potential suppliers

are Kings Food for food such as muffins, cakes, Paninis, sandwiches and for coffee

beans directly from the local suppliers such as farmers. The suppliers which I have

mentioned have agreed to my proposal

FINANCIAL FORECASTING AND BUDGETING:

Profit and loss A/c for the year ending March2010Particulars Amt in

INR

Average Percentage of

Sales

Net Sales 15,00,000 100%

Cost of Goods Sold 12,00,000 69.00%

Gross Profit 6,00,000 34.00%

Selling Expenses 35,000 4%

General Administration Expenses 80,000 5%

Depreciation ( Premises ) 8% SLM 1,30,000 8.00%

Operating Profit 3,20,000 21%

Interest @ 11.25 on loan 1,22,800 9%

Earnings before Tax 2,12,000 14%

Tax (10% + 1 surcharge+ 2 cess on tax )% as to IT Act

of India, First Slab)

19,000 1.65%

Profit After Tax ( Forecasted) 2,01,000 11.25%


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Budget For Year Ending March 2010

Operations Rs 6,00,000

Promotions and Marketing Rs 7,00,000

Finance Rs 4,00,000

Human resources Rs 3,00,000

Reserves and contingency Rs 4,00,000

Selling and Distribution Rs 2,00,000

Costs:

Billboards: 1500 rupees per 10ft by 15 ft billboard ad.

Direct Mail: 3000 rupees per 2500 prints plus stamps costs to mail directly to the

homes.

Sales Brochures: 3500 rupees per 2500 prints.

Coffee Planet (Mumbai) will sponsor scholarship contests and cricket tournaments for

the local students and make an annual large donation of Rs75, 000 to the local public

school systems to enhance brand loyalty. This environmental campaigning will give

Coffee Planet positive publicity.

SWOT ANAYLSIS:

SWOT analysis is an important tool which will help business to analyse the

environment of any business. It also helps to originate the strategy of our products to

generate sales.

STRENGTH HIGH LOW MEDIUM

Skilled Man Power

Own Premises

Transport

New Products in the city

WEAKNESS HIGH LOW MEDIUM

To established market share for products

Sponsors

Lack of Finance

To Gain business status

OPPORTUNITY HIGH LOW MEDIUM


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Government laws

To win customers with new products

THREATS HIGH LOW MEDIUM

Substitutes Available for the products

7) RISK ASSESMENT:

Risk assessment is examination of what factors are going to harm your project inpresent and future and by identifying those factors what precaution or steps are taken

to minimize or avoid those risk factors.

FACTORS TYPE RISK

1. Supply Chain

Management

Medium If there are problems with deliveries there are chances of

loosing customers

2. Financial Support

of Management

High As the business is owned by a sole trader financial support

from the management may lack

3. Pricing Low It is vital to conduct a competitor analysis before prices are

structured because it has to meet the market requirementsfailing to do so will have an impact on project and sales

4. Resources High Resources should be properly allocated and all the tasks

should be completed on time otherwise costs will go up

5. Budgets High Budgets should be identified at the start of the project

otherwise have to depend on other sources for availability of

finance

6. Objectives of the

project

High If the objectives are not met the outcome of the project may

not be achieved

COMPETITION

The products of Coffee Planet faces competition with its local competitors such as

Barista coffee company and Coffee caf day. The competitive advantage is that there

are no local competitors within the desired location

KEY TO SUCCESS


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Innovation of a coffee culture in the desired location and its products, services will

differentiate Coffee Planet from its local competitors.

The establishment of Coffee Planet as a community hub for socialization and

entertainment

Coffee Planet will position itself as an educational resource for individuals wishing to

learn about the benefits of the internet has to offer great Coffee and bakery products

CRITICAL ISSUES

The dual product/service of Coffee Planet business faces competition on two levels.

Coffee Planet competes not only with coffee retailers, but also with Internet service

providers. The good news is that it does not currently face any direct competitionfrom other cyber cafes in the local market. There are a total of three cyber cafes

within the desired area one located two in Kalina and nearby the Mumbai University

MACRO ENVIRONMENT

Many factors contribute to the large demand for good coffee. The student population

at the University is a main source of demand for coffee retailers. The popularity of the

internet is growing increasingly those who are familiar with the information

technology are well aware of how fun and addicting surfing the internet can be. Those

who have not yet experienced the COFFEE need a convenient relaxed atmosphere

where they can feel comfortable learning about and utilizing the current technologies.

Coffee Planet seeks to provide its customers with affordable internet access in an

innovative and supportive environment

POSITIONING

Coffee Planet will position itself as an upscale coffee house and internet service

provider. Students from downtown housing centres will use Coffee Planet as a place

to socialize and discuss the internet sites

Target Marketing:

Target marketing means we are targeting particular audience group in form of small

groups, individuals depending upon their level of interest, desires because they are our

potential customers. However the 6W will help us to decide who is our target market.

Who?

Generally students, young generation, contractors, local authority are my potential

customers because the coffee store would be located near the Mumbai University

What?


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At the closing stages of the project a project closure report will be handled to the

board because it states the execution, objectives, and review of the project. In view of

that the owner of the project will go through the report and ensure whether the

objectives are carried out and met the requirements. The project report should include

A final project report should include original business plan consistingof tasks, schedules etc.

A report of final deliverables of the project

An analysis of the internal and external environment of the project to

know the strengths and weakness of the project

THE SUCCESS OF PROJECT

The overall strategy for the project has been discussed earlier in this case. Thus the

ultimate objective would be to provide good quality products by taking qualitystandards into consideration. As we provide the technical guidance and support.

Moreover, we aim to provide first three services free of cost to the customer within

the six months from the purchase date of the product which will add value to my

project and overall business. We have described earlier, to follow the low-cost high

turnover approach to attract the potential customer. If they are getting best quality

with the low prices, will help to gain the market share and sales.

Bibliography:

1. Bates, W. (1998), ` Improving project management'', IIE Solutions, Vol. 30

No. 10, pp. 51-55

2. Buttrick, R. (1997) The Project Workout, London: Pitman Publishing3. Boella, M. and Goss Turner, S. (2007)Human Resource Management in the

Hospitality Industry, Burlington: Elsvier4. Cleland, D. (1995),Project Management: Strategic Design and

Implementation, International edit., McGraw- Hill, Singapore

5. Field, M. and Keller, L. (1998)Project management, Hampshire: Cengage

Learning EMEA


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References:

1. http://projectsteps.blogspot.com/2005/02/project-management-websites.html

2. http://www.pmi.org/Pages/default.aspx

3. http://www.businessballs.com/

4. http://www.startwright.com/project.htm5. http://www.mindtools.com/pages/main/newMN_HTE.htm
http://projectsteps.blogspot.com/2005/02/project-management-websites.htmlhttp://www.pmi.org/Pages/default.aspxhttp://www.businessballs.com/http://www.startwright.com/project.htmhttp://www.mindtools.com/pages/main/newMN_HTE.htmhttp://projectsteps.blogspot.com/2005/02/project-management-websites.htmlhttp://www.pmi.org/Pages/default.aspxhttp://www.businessballs.com/http://www.startwright.com/project.htmhttp://www.mindtools.com/pages/main/newMN_HTE.htm

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Coffee Planet (Sam's Business)