Low-Carb Dietary Restaurant - Research Paper Example

? Low-Carb Dietary Restaurant Business Plan Assignment] Table of Contents S.no. Title Page 1. Table of Contents 2 2. Executive Summary 3 3. Business Description and Vision 4 4. Market Defined 6 5. Products and Services 8 6. Organization and Management 10 7. Marketing and Sales Strategy 11 8. Projected Statement of Cash Flows 13 9 References 14 Executive Summary Low-Carb Dietary Restaurant wants to begin its operation in the Columbus city, Ohio from 1st January, 2012. It purpose of the business is to provide delicious, healthy recipes that are low in carbohydrates to those people who have tried all other dieting programs that didn’t work for them. Low-carb food is scientifically demonstrated to be very healthy and good for fitness for everyone, but especially for overweight people. Our diet program can help the obese people trying to lose weight to lose up to 15 pounds in just 2 weeks with guaranteed results. Our recipes are the combined effort of our very skilled chefs and expert nutritionists. At present we offer 100 low-carb foods at our restaurant and in pre-packaged food at the stores. Our aim is to remove the misconceptions regarding low-carb diet and bring it forward as the mainstream dieting program for the majority to allow them to lose weight in the most efficient and effective way possible. The aim of our president and the owner of Low-Carb Dietary Restaurant, Mr. XYZ, is to provide the best quality and taste food to please our customers and at the same time help them with their diet program. If blessed with success in the first few months, we look forward to expand our operations to other cities and states as well. Business Description and Vision Mission Statement The purpose of Low-Carb Dietary Restaurant is to help people who are on a diet plan switch to the most effective low carbohydrate diet which is scientifically proven to help lose weight very fast. We look forward to help the ambitious people, whose dieting plan has shown minimal or no effects for them, by offering them a very efficient low-carb diet program at our restaurant. Our overall objective is to satisfy our valuable customers by providing them healthy and most effective dieting plan based on delicious, scrummy and wholesome low-carb recipes. Company Vision Starting with just one branch in the largest city of Ohio State, we look forward to expand our business through a chain of similar restaurants within the country in the next 3 years. For this expansion and growth we aim to work with full dedication and devotion with no compromise on the quality of food we make. Business Goals & Objectives Benefits of low carbohydrate diet have been thoroughly studied in the past years; and our goal is to help our customers live a healthy life by taking advantage of these potential benefits. Goals and Objectives of Low-Carb Dietary Restaurant broadly encompass the following: Produce food products that fall in the category of low-carb diet that restrict carbohydrates to less than 20% of caloric intake. To offer dieting programs with quick weight loss results through low-carb products. Customer should lose up to 10 pounds weight within just two weeks. To offer a variety of recipes and diets to the customers to choose from. Healthy cooking and kitchen environment with compliance to all food regulations. To expand growth and profits by at least 20% in the first 3 years of operations. To enlighten the Columbus citizens and prospective customer about the advantages of low-carb diet. Brief History of the Business Low carbohydrate food restaurants have never been a center of attention for the Columbus city residents. Only a few people are aware of the potential benefits of low-carb diet and how helpful it can be in losing weight and staying healthy forever. People in other states have recently started noticing these advantages and that is why low-carb restaurants are expected to be in fashion very soon including Ohio. Key Company Principles Low-Carb Dietary Restaurant intends to carry its business activities complying with all ethical principles applicable to the industry including, integrity and the duty to remain faithful to our customers; Professional behavior is expected to be enforced throughout the organization including staff members, chefs and managers; the use of only fresh ingredients to be allowed in the kitchen; full and plain disclosure of all material facts to our customers with no hidden policies; and compliance with all the legal and regulatory requirements on similar industry restaurants. Market Defined Recently a lot of people have been attracted towards the low-card diet. This is because of the recent many studies and researches that demonstrate numerous benefits of taking low carbohydrate food. This has provided the opportunity to the prospective suppliers to increase their production and a sharp increase in demand is expected. We have thoroughly studied the required of several people in various cities of different states through surveys and geographical data and Columbus, Ohio seems to be the best place for starting a low-carb fast food restaurant. There is an increasing interest among the citizens of Columbus about having good health and losing excess weight through various dieting plans. So we feel we need to fulfill our duty and make them aware of the most efficient dieting plan there is. Therefore, a good low-carb food restaurant for catering the needs of large demand of low-carb food in this city, will prove to be a highly profitable concern. We expect to take advantage of this market by providing the customers exactly what they are looking for. The demand for low-carb food is expected to grow throughout all the states, but as stated above Ohio has one of the largest shares of this demand and Columbus, being the largest city of the state, is the best place to start with. The following graph depicts the increasing demand of low carbohydrate foods throughout the country. As seen in the chart the demand has risen steeply in the past two years. This is a result of increase in obesity. With our current production capacity we can cater the needs of providing low carb diet to a city having population of over 1 million. According to Men’s Fitness Magazine Columbus is 16th fattest city in America (Men’s Fitness). Also, according to a survey that asked people their height and weight, in Ohio state about 29.6% of adults and 30% of kids are obese (The Columbus Dispatch, 2012). Market composition and segmentation The market for low-carb foods may be further divided into two sub-categories. This includes those prospective consumers who have traditionally been subject to different diet plan that hasn’t worked for them (Category A); and those who are new to dieting plans and low-carb foods (Category B). As shown in the pie chart to the right, more about three-fourth of the market comprises of those who have already tried other diets and possibly are unsatisfied with it. Therefore, the main concentration will be given to those 73% consumers who are looking out for a new alternative dieting plan that can provide them quick and efficient results. Consumers belonging to Category A generally have quite a lot of misconceptions about low-carb diet. We will target these consumers through a marketing strategy that aims to remove these myths and misconceptions in a promising and encouraging way, as explained in the Marketing section of the plan. As for Category B, we propose to target these customers by introducing them to the low-carb diet in an exciting way. There are several scientifically demonstrated advantages of low-carb diet that we will introduce them to. The restaurant will also make packaged food to cater the needs of category B consumers and distribute those products to the stores and markets all around the city. If the packaged food is successful we will introduce it in other cities as well after the first 7 months. The location for the restaurant is strategically selected in the heart of the city center for easy conveyance. If we’re successful in fulfilling the needs of consumers in the first six months, we’ll have a total market share of around 10% by the end of first year in the country, and more than 50% market share in Columbus and Ohio State. Products and Services Many people think that to lose weight and be in shape they’ll have to sacrifice eating all the delicious foods. But this is not true. The secret in losing weight lie not in “not eating” but “eating wisely”. That’s why we aim to help our customers maintain good health while also enjoying the tastes of delicious food and snacks at the same time. Our menu aims to restrict the daily carbohydrate consumption of our customers, especially of those looking for weight control and treatment of obesity, by supplementing the foods high in carbohydrates (such as baked potatoes, whole wheat bread, waffles, spaghetti and raisins) with foods having high percentages of proteins and fats and very low in carbs (such as vegetables, salads, meat, eggs, poultry fish and fruits). Our extremely competent and expert shefs have designed a menu of around 100 dishes and combo meals that are very low on carbohydrates, with all dishes having less than 8gm of carbs. Other low-carb diet manufacturers produce food items like ice creams, candies, meal replacement bars and other treats that have ingredients like Maltitol. Despite being sugar-free products these are as bad as sugar for most obese people. Our products are competitive and of very high quality because we have taken special care of such ingredients and closely scrutinized all the food constituents with deliberate understanding and experimentation. We offer a one month weight control program to all those looking to lose weight and treat obesity. It contains all those delicious, rich and satisfying recipes that taste amazing and at the same time are low on carbohydrates. The combos meals differ from person to person and what their weight control targets are. Therefore, the superior quality and taste coupled with the added benefits of fitness programs make our products very competitive in the market. Some of the products are listed below: A variety of non-starchy vegetables, such as dark green leafy salad vegetables like cabbages, lettuce and spinach; herbs like basil and cilantro; other salad and green vegetables like cucumber, tomatoes, green beans, avocado and cauliflower etc. A variety of low-sugar fruits such as servings of berries, melon, fresh figs, dried mangoes, grapes, peaches and fresh plums. Dairy recipes consisting of skimmed milk, cream, full-fat cottage cheese and butter. Meat, poultry fish, seafood and eggs. Sweetened honey and low-carb chocolate dishes. Milk shakes and flavored milk drinks. Organization and Management Low-Carb Dietary Restaurant is owned by Mr. XYZ under the sole proprietor ownership. Mr. XYZ has plans on expanding the business and converting the business into a private company once the business affairs are settled. The owner works are the president of the organization and he has five managers working under him under the positions of: 1. Head of the Chefs (with two other junior chefs working under him) 2. Distribution Manager (with one agent working under him) 3. Finance Manager (with one junior accountant under him) 4. Staff Supervisor (with 5 staff members working under him) 5. Nutrition Advisor and Kitchen Specialist Although all managers work under the instructions of the President, they are allowed to set the goals and targets of their department and advice the President about the business matters. The Presidents retains the sole power to enforce the decisions made by the managers. President and all Managers comply with the restaurant’s code of conduct and possess the required expertise and experience required to perform the roles and tasks in their job. The restaurant will comply with all the regulatory requirements and possess the required licenses for operation in the Columbus, Ohio. Marketing and Sales Strategy Marketing Strategy The target market is the about 1 million population of the Columbus city. Out of the total population about 50% people are overweight. This 50% is the main target population and sub divided into Category A and Category B as explained in the “Market Defined” section. The aim of our restaurant is to reach and cater the needs of these people. Among the 500,000 overweight people are those who have several myths and misconceptions about the weight losing programs. We intend to remove these misconceptions by drawing attention to our website through brochures and newspapers. Some of these myths are listed below: Low carb means no carb food. Low carb diet discourage eating vegetables and fruits Low carb diet is unhealthy Low carb diet is boring and doesn’t taste good and delicious. Besides removing the myth we intend to draw attention towards the many scientifically demonstrated advantages of the low carbohydrate diet. Some of these include: Low carb diets reduce the risk of heart diseases such as high blood pressure, cholesterol, triglycerides. Even the diet with high proteins and fats but low in carbs doesn’t increase the risk of heart diseases. Low carb diet actually allows us to eat fewer calories without feeling hungry. Weight loss even without restricting the daily calories. Reduced blood glucose for diabetes. Decreases blood pressure Lowers blood insulin level, hence helps in losing weight Low-carb diet results in less muscle mass lost as compared to dieting consisting of high carbohydrate amounts. Sales Strategy Our main sales strategy is to invite the people looking for weight control programs to our restaurant and advising them, according to their individual needs, to select one of the dieting programs and combos as per their advantage. Our expert nutritionist will help these individual select what is best for them. We will advertise our quality products, stating their advantages and superiority over other competitive product, in the local newspaper, social media and sign sources. Advertising for diet program will be temporarily stopped once we have sufficient customers to attend to them properly. On the other hand marketing for our products will continue in the newspapers as we will be supplying our products to all local supermarkets and stores. This will encourage the general public to buy healthy products instead of the generic items. At the same time we will make sure we have sufficient production capacity to cater the market needs. Expansion plans will be withheld until next 6 months. Financial Management Estimates of Start-up Costs (Pre-commencement Expenditures) Expense Type Estimated Cost ($) Advance Rent of the Restaurant Property (Note 1) 1000 Furniture and Fittings (Note 2) 7500 Tableware and Crockery 5000 Legal and Professional Costs (Note 3) 2000 Newspaper Advertisement (Note 4) 1000 Stationery 100 Staff Commission 500 Lease of Vehicles (Note 5) 3000 Miscellaneous Startup Expenses 750 TOTAL 20850 Details of above-mentioned expenses Note1: The restaurant property has been arranged on rent agreement and the landowner has agreed with the advance rent of $1000. This is security deposit and refundable at the end of agreement. The current agreement is for 2 years and renewable at the end of the same. Note 2: Furniture and Fittings have been arranged to be purchased from Elegant Furniture Limited. This includes restaurant sofa sets, dining tables, chairs and other required articles and fittings. Note 3: These costs include the lawyer’s fee for registering the business with income tax authorities and other professional charges. Note 4: This expense covers the initial advertisement expenditure as explained in the Marketing & Sales section of the business plan. Note 5: Two delivery vans and 3 cars have been leased with PQR Lease Company Limited. The term of lease agreement is 10 years on equal semi-annual installments of $1,000. Low-Carb Dietary Restaurants Projected Balance Sheet 31st December 2012           Assets        $    $    $ Current Assets:             Cash         35750     Accounts Receivable   20000       Less: Reserve for Bad Debts   (2000)   18000     Merchandise Inventory     25000   Prepaid Expenses     12000     Total Current Assets         90750               Fixed Assets:           Vehicles   40000       Less: Accumulated Depreciation (1000)   39000     Furniture and Fixtures   17500         Less: Accumulated Depreciation   (1000)   16500     Equipment 10000       Less: Accumulated Depreciation (500)   9500     Total Fixed Assets           65000             Total Assets       155750                 Liabilities and Capital Current Liabilities:        $    $ Accounts Payable       0     Sales Taxes Payable       1000     Accrued Wages Payable       2500   Unearned Revenues       10000     Short-Term Bank Loan Payable     5000     Total Current Liabilities         18500 Long-Term Liabilities:           Finance Lease Payable       20000       Total Long-Term Liabilities           20000 Total Liabilities           38500               Capital:           Owner's Equity       50000   Net Profit       67250     Total Capital           117250               Total Liabilities and Capital         155750               Low-Carb Dietary Restaurants Projected Income Statement 31st December 2012       $    $ Revenue:           Gross Sales   250000   Less: Sales Returns and Allowances   (5000)   Net Sales   245000       Cost of Goods Sold:     Beginning Inventory   0   Add: Purchases   75000   Freight-in   10000     Direct Labor   30000     Indirect Expenses   10000           Less: Ending Inventory   (25000)   Cost of Goods Sold   (100000)         Gross Profit (Loss)   145000       Expenses:     Advertising   4000   Bad Debts   2000   Bank Charges   1000   Commissions   500   Distribution & Delivery Expenses   4500   Depreciation   2500   Insurance   500   Interest   250   Admin & Maintenance   6000   Miscellaneous   1500   Permits and Licenses   2500   Legal & Professional Fees   2000   Rent     10000   Repairs   250   Telephone   750   Utilities   9500   Wages   30000   Total Expenses   (77750)         Net Income (Loss)   67250         Low-Carb Dietary Restaurants Projected Statement of Cash Flows 31st December 2012 31st Dec 2012 $ Cash brought in hand at start of business 20000   CASH RECEIPTS Cash sales 150000 Collections on accounts receivable 80000 Loan proceeds 5000 Owner contributions 10000 TOTAL CASH RECEIPTS 245000 Total cash available 265000   CASH PAID OUT/DISBURSEMENTS Advertising 4000 Commissions and fees 500 Insurance 500 Interest expense 250 Materials and supplies 75000 Meals and entertainment 5000 Restaurant Administrative expense 6000 Lease of distribution vehicles 2000 Repairs and maintenance 250 Taxes and licenses 500 Distribution expenses 4500 Wages 30000 Other expenses 5000 SUBTOTAL 133500 Loan principal payment 1000 Capital purchases 39750 To reserve and/or escrow 20000 Owners' withdrawal 35000 TOTAL CASH PAID OUT 229250 Cash on hand (end of quarter) 35750 References Dolson, L. (2007, June 14). 20 benefits of low carb diets. Retrieved from http://lowcarbdiets.about.com/od/lowcarb101/a/lcbenefits.htm Dolson, L. (2008, January 26). Seven myths about low carb diets. Retrieved from http://lowcarbdiets.about.com/od/lowcarb101/a/lowcarbmyths.htm Vigneri, S. (n.d.). The fittest and fattest cities in america. Retrieved from http://www.mensfitness.com/training/lose-weight/the-fittest-and-fattest-cities-in-america The Columbus Dispatch. (2012, Aug 14). Ohio 13th-worst in obesity, but all is not lost. Retrieved from http://www.dispatch.com/content/stories/local/2012/08/14/ohio-13th-worst-in-obesity-but-all-is-not-lost.html Read More