Final Assignment Paper for Business Plan 27.09.2017.pdf

MASTERS OF MANAGEMENTENTREPRENEURSHIP IN ORGANISATION ASSIGNMENT: BUSINESS PLAN Cinnamon's FOR: MR. FRANKLIN STYNE IYADURAI MBA, BSc, (Ph.D. Candidate) BY: SHANTHI RAMAYAH ASIA e UNIVERSITY 2017 TABLE OF CONTENTS 1.0 Executive Summary ...................................................................................... 4 1.1 Business Objectives......................................................................................................... 4 1.2 Mission Statement ........................................................................................................... 4 1.3 Keys to Success ............................................................................................................... 4 2.0 Company Summary ...................................................................................... 5 2.1 Ownership ....................................................................................................................... 5 2.2 Start-Up Plan ................................................................................................................... 5 2.3 Location and Facilities .................................................................................................... 5 3.0 Product and Services .................................................................................... 6 3.1 Product and Service Description ..................................................................................... 6 3.2 Competitive Comparison................................................................................................. 6 3.3 Sales Literature ................................................................................................................ 7 3.4 Sourcing and Fulfillment ................................................................................................. 8 3.5 Technology ...................................................................................................................... 8 3.6 Future Services ................................................................................................................ 9 4.0 Market Analysis Summary .......................................................................... 9 4.1 Industry Analysis............................................................................................................. 9 4.2 Market Segments ........................................................................................................... 10 4.2.1 Market Needs ...................................................................................................................................... 10 4.2.2 Market Trends ..................................................................................................................................... 10 4.2.3 Market Growth .................................................................................................................................... 11 4.3 Target Market Segment Strategy................................................................................... 11 4.3.1 Main Competitors ................................................................................................................................ 12 4.4 Positioning..................................................................................................................... 12 5.0 Marketing Strategy and Implementation ................................................. 12 5.1 Strategy Pyramid ........................................................................................................... 12 5.2 Value Proposition .......................................................................................................... 13 5.3 Competitive Edge .......................................................................................................... 13 5.4 Marketing Strategy ........................................................................................................ 13 5.4.1 Positioning Statement .......................................................................................................................... 13 5.4.2 Pricing Strategy ................................................................................................................................... 13 5.4.3 Promotion Strategy .............................................................................................................................. 14 5.4.4 Distribution Pattern ............................................................................................................................. 14 5.4.5 Marketing Programs ............................................................................................................................ 14 5.5 Sales Strategy ................................................................................................................ 14 5.5.1 Sales Forecast ...................................................................................................................................... 14 5.5.2 Sales Programs .................................................................................................................................... 15 5.6 Milestones ..................................................................................................................... 15 6.0 Management Summary .............................................................................. 16 6.1 Organizational Structure ............................................................................................... 17 6.2 Management Team ........................................................................................................ 17 6.3 Management Team Gaps ............................................................................................... 17 6.4 Personnel Plan ............................................................................................................... 17 7.0 Financial Plan .............................................................................................. 18 7.1 Important Assumptions ................................................................................................. 18 7.2 Start-Up Costs ............................................................................................................... 18 7.3 Source and Use of Funds ............................................................................................... 19 2 ....8 Business Ratios .............................. 26 3 .............. 21 7.........................6 Projected Cash Flow.................................................................... 7................................................... 22 7........................................................................................................................................................ 23 7..4 Break-Even Analysis ...........5 Projected Profit and Loss ...................7 Projected Balance Sheet ......................................................................................... 25 8.................................................................................0 References ......................................... 24 7...................... 000 annually. 4 . we need to be close to our market because we are not trying to get people to travel to reach us. 777.Not only great food but great service.Convenience is essential to us. Together they have over 10 year’s collective years’ experience in the restaurant and catering industry.1 Business Objectives Main objectives of the business plan for Restaurant are below: ▪ To be the premier Indian grill restaurant in Butterworth. 028. This equates to around RM302 per square foot in sales annually which positions Cinnamon’s Grill as a highly desirable concept for ownership in a table service market where RM200 to RM325 per square foot is considered moderately profitable and therefore a good investment.0 Executive Summary Cinnamon’s Grill is a new eating establishment that will provide moderate entrees. Our menu perfectly combines the ancient traditions and authentic flavors of India and fuses it with a contemporary ethnic edge as well as our signature lamp chops. or RM1. ▪ Location. ▪ To provide quality meals at reasonable prices with exemplary service 1. 1. and ▪ We will be mindful of the well-being of our customers and staff– treating each and every one with dignity and respect – just like we would at our own home! 1. We will offer wide range of delicious authentic Indian grilled cuisine. Our mission is to strive to achieve this goal by: ▪ by providing menu items incorporating quality ingredients at reasonable prices. 000. ▪ Product quality .3 Keys to Success ▪ The restaurant’s unique theme and contemporary – there currently is not a competitor with a similar theme and the closest competitor with a similar target demographic is 20 km away.2 Mission Statement Provide with a unique combination of Indian tandoor/grilled food and relaxing dining experience accompanied by soft number of Indian instrument music – similar to dining at home. . RM174. 000 of which will be contributed by the owners and the remainder will be secured by a proposed bank loan. Sales projections assume 1700 customers per week resulting in weekly sales of just over RM19. Will be a moderately priced 60 seat restaurant offering family style varieties of food and service. The restaurant will be family owned and operated by brothers Kishore and Gaurav. Total startup costs will be RM363.1. Kishore began his restaurant career at the age of 15 working in a quick-service foodservice operation and earned his way at college as a server and bartender. After earning his degree. we will rely on family to fill in where required until we are off the ground and making a profit. With the high turnover of help for startup restaurants. The restaurant will serve a variety of delicious authentic Indian grilled cuisine and grilled meat includes a long list of all kinds of meat including chicken wings. at the intersection of Province Wellesley and Penang Bridge highway.2. The busy Midtown commercial/residential location has been chosen based upon a successful demographic model and a traffic count 5 .30 pm Tuesday 11:00 am – 11. 2. In these organizations he held the positions of F&B Assistant Manager and then Manager. 000 and will require approximately 30 days to complete. Prai. 000 of the start-up costs will be funded by the owners. The restaurant will be open 6 days a week with hours as follows: Monday 11:00 am – 11. The Dev brothers will sub-contract the work themselves. 000. The restaurant is located in a major traffic area. sausages. 000. The majority of the expenses are in furniture fixtures and equipment totally RM110.3 Location and Facilities The 2. and the restaurant will feature a comfortable and open concept design.30 pm Wednesday 11:00 am – 11. The owner’s source of funds is a combination of liquid assets and marketable securities.0 Company Summary Cinnamon’s Grill will be located at The Pacific Mall. lamb. 2. octopus.30 pm Friday Rest Day Saturday 11:00 am – Midnight Sunday 11:00 am – 11. chop. he worked for a regional Grill chain restaurant and an independent fine dining restaurant.2 Start-Up Plan The cost to open the restaurant is RM363. RM175.30 pm Thursday 11:00 am – 11. salmon.500 square foot restaurant will be located in a The Pacific Mall. Butterworth.1 Ownership Will be owned by Kishore Dev. The location requires some build- out and renovation totally RM50. primarily from their existing catering business. The restaurant will be wholly owned and operated by Kishore and Kumar. and many more. The market has been carefully selected and tested for the necessary demographics and retail traffic necessary to meet the goals laid down for profitability.30 pm 2. The medium household income is RM46.0 Product and Services Cinnamon’s Grill will feature authentic Indian dishes. Malaysia 3. Generally. 3. 3. The target demographic is both men and women between the ages of 25 to 65 years old. Province Wellesley has a population of over 99. We will change our menu every 4 months.2 Competitive Comparison The Malaysian food and beverage retail market are expected to grow by around 10 percent per annum. The schedules will be written in a manner that will allow the ability to increase or decrease hourly labor according to sales volume in order to maintain a consistent labor cost control. Penang (Mainland) Source: Department of Statistics.3 Demographic Chart of Province Wellesley. these individuals have more disposable income than younger individuals Figure 2. and superior service. The residential population in the immediate area is comprised of a mixture of single family and multi-family housing. including the dining room. The restaurant layout. an eclectic ambiance. Our ingredients and spices will be of the finest quality and prepared with exotic flare. 6 . but maintain the 'favorites' for loyal patrons.1 Product and Service Description Cinnamon’s Grill will be open 6 days a week for lunch and dinner requiring multiple shifts. As such each and very restaurant is competing to grab the market revenue Local competitors within a 5 miles radius are as follows. has been designed for efficiency and flexibility to accommodate the fluctuation in customer traffic and peak meal periods. 532.804 according to Department of Statistic of Malaysia projection census 2017. kitchen and serving line. RM20 ▪ Overall both competitors don’t have any signature grill menu nor a grill concept restaurant. Following are samples of flyers. ▪ 3.this is a chain restaurant offering standard fare. ▪ Ananda Bhavan . Figure 3. we will print flyers focusing on our menu. Prices seemed a little higher than Cinnamon’s Grill but the meal serving was excessive and equal to the price point and range from RM30.This is a full-service family restaurant established in 1997. This primarily will be an advertisement of the restaurant. The flyer will be distributed as per following.3 Sales Literature For an initial start. hand out at shopping malls ▪ Social media fan page and sharing as this medium plays a very prime role in promoting the restaurant.00-RM50 per entry. ▪ D’Tandoor . sales promotion.1 (i) front page 1 7 . Entrées range from RM6. The food quality is average.99 .3. ▪ Give a way in-restaurant ▪ Personally. Reservations programs maximize traffic flow and seating. These suppliers can provide reasonably priced products. Touch screen ordering programs ensure accurate communication of customer orders. Some handhelds can also print customer checks and process credit card payments.3. Inventory management systems track supply levels and can help reduce waste due to spoilage.4 Sourcing and Fulfillment From years of experience combined with their existing catering business. improving accuracy and reducing ordering time. computerized information systems can improve and link food preparation and serving operations. Kishore and Kumar have established relationships with qualified suppliers. 3. Cost accounting programs help companies determine the profitability of individual menu items.1 (ii) back page 2 3. Timing systems monitor meal progress and can alert staff if an order is running behind schedule. delivered according to the schedule.5 Technology With an ample of technology. Figure 3. Handheld point-of-sale (POS) devices allow servers to place orders and print checks tableside. 8 . This could potentially become a large portion of gross sales. companies may consider population density.3. ▪ An appetite for change ▪ Food away from home trend while outside eg. People who working around nearest Sunway Business Park. competition. authentic.m. college. Young adults have the potential of providing large volume sales to the company during the peak hours of 11 a.0 Market Analysis Summary The restaurant industry is a large and diverse business.1 Industry Analysis ▪ Reasonable Prices for concept restaurant ▪ The Dining Experience ▪ Quick. a sales agent would be hired to directly market the products for daily delivery or catered functions. healthy. family function The restaurant industry is highly competitive. Apart from working people. leisure. visibility. to 2 p. 4. accessibility. and traffic.6 Future Services Cinnamon’s Grill has future plans to provide catering services for family reunions. The Dev brothers are targeting Year 2 and at that point. weddings and other events desiring an authentic grill menu. Prai Industrial area will be looking for walk-in good food and convenience for lunch. 4.m. 9 . household income. Office. The lunch business is driven by individuals. heightened consumer expectations. authentic. healthy.2. quick. 10 .2 Market Trends ▪ Generation has changed and impacted the entire span of the whole consumer mind-set.804 according to the 2017 Census Report of Department of Statistic of Malaysia.2.1 Market Needs Growing preferences for healthier food options. and reviewed or suggested. convenience.4. The residential population in the immediate area is comprised of a mixture age group. sustainability. rapidly advancing technology are reinventing the traditional dining experience and forcing change on how the industry operates. The location selected for Cinnamon’s Grill was chosen primarily to appeal to the growing number of households in the area. Butterworth is located in mainland of Penang. Malaysia 4. increased competition from this industry.preferences for global/ethnic cuisines is prompting restaurants to diversify their businesses. regardless of demographic.2 Population Chart of Province Wellesley. Food away from home" trends Demographic trends 4. Penang (Mainland) as per age group Source: Department of Statistics.2 Market Segments Cinnamon’s Grill will appeal to a consumer in both the residential and business community. Figure 4. it has population of 99. They are constantly connected and have high expectations regarding quality. concerns over environmental sustainability. ▪ Inclination towards global cuisines . speed.7 percent. ▪ Increase in food service ▪ Sustainable seafood ▪ Technological advancements . Malaysia 4.3. and service.743 persons in 2010 with annual growth of 6.adopting new technologies for ordering. entrepreneur engaged in food and beverage services was 891. ▪ Generation Z –strategy to attract on high-tech service. According to Department of Statistic Malaysia in 2017. innovative product development.3 Target Market Segment Strategy Cinnamon’s Grill will provide locals a place to socialize and talk shop while enjoying grilled cuisine and hearty food. Figure 4. new markets.3 Economy Chart on Restaurant Market Growth (Census 2016) Source: Department of Statistics. This service recorded a total of 569.570 establishments in 2010 with annual growth rate of 5. and new business models. diversified businesses. ▪ Preferences for healthier food options . and loyalty programs to offer convenient.focusing on specialized menu to enhance quality standards. payment.632 persons as paid full-time employees with percentage share of 63. louder music.616 persons in 2015 compared to 645.3 Market Growth ▪ Restaurants industry are looking for growth through increased market penetration. ▪ Modification of menu .are inclined to consume healthier and less processed foods.490 establishments operated in food and beverage services compared to 130. The census results showed that there were 167.1 percent.9 per cent in 2010 with annual growth rate of 14.4 percent. 11 .2. high-speed 4. Kishore and Kumar will also provide home cooked fare that appeals to the current trends of healthier food and offer menu selections which will appeal to this group. 5.3. Programs: Provide employee training on customer service and retention. The food quality is average. Prices are higher than Cinnamon’s Grill and range from RM20. ▪ Kumara Bhavan . 5. We will focus on establishing a strong identity in our community with a grand opening by creating an appealing and entertaining environment with unbeatable quality at an exceptional price.RM20. 4. with local businesses.4 Positioning Consumers believe that meals at home are healthier and higher quality than eating at restaurants.1 Strategy Pyramid Strategy: Be Butterworth area’s premier Grill Restaurant in Customer Satisfaction.this is a chain restaurant offering standard fare. At Cinnamon’s Grill we will position ourselves as the premier home-style restaurant by preparing quality home cooked meals with simple wholesome ingredients. Tactics: First create awareness-. ▪ D’Tandoor . Entrées range from RM6.0 Marketing Strategy and Implementation Cinnamon’s Grill intend to succeed by giving people a combination of excellent and food in an environment. 12 . 4. Keep track of Cinnamon’s Grill reviews and offer employees incentives attracting and retailing customers.This is a full-service family restaurant established in 1977. offer ongoing training programs for employees keeping them current on industry trends and food safety. park events. we will immediately acknowledge the customer with and most sincere greeting and begin the service process anticipating repeat customers.00-RM500 per entry. We will place the catering and lunch service flyers strategically on and near the industrial are and university campus. Cinnamon’s grill will be positioned as the premier traditional home-style restaurant.99 . Employ the use of surveys both at the table and online.our signage on the front of restaurant will bring customers to us and once inside.1 Main Competitors The following restaurants are located within a 5 miles radius of Cinnamon’s Grill. Our food quality is a reflection of us. • Word of Mouth Marketing.1 Positioning Statement Cinnamon’s Grill is a finest place in town to enhance your dining experience wide range of delicious grill cuisine represents splendor.Creating events is a great way to drive sales. and elegance in every dish. Customers often need a reason to celebrate dining out and events can often offer the perfect reason e. Valentine’s Day. not the product. 5. The average check price is expected to be between RM8-RM15 which appears in line with industry standards below RM25. We will achieve these goals by using the following: • Social Media Marketing – Facebook. Deepavali. The only magic grill provides sumptuous feast menu that bursts with flavor.4.3 Competitive Edge Cinnamon’s Grill competitive edge is in its people.Word of Mouth is one of the ancient ways people learned about what to purchase • Event Marketing . We truly believe business is not only as good as your products (meals) but the quality of your staff as well. We will utilize a marketing plan to build customer traffic. ▪ Market the company. Mother’s Day. ▪ Ensure customer satisfaction. WhatsApp and Twitter offer a unique opportunity growing up quickly. 5. ▪ Develop long relationships.00 this to hit the customers.4.5. 13 . Xmas. The magic grill! 5.2 Pricing Strategy As a new start-up we can currently control employee cost by hiring family members who will work for low and reduced wages.4 Marketing Strategy We will create an "identity" oriented marketing strategy with executions particularly in social media. 5. ▪ Market the benefit. mouth to mouth and event marketing strategies.g. As this is a new concept restaurant.2 Value Proposition Cinnamon’s Grill will be able to offer signature grill menus for a reasonable price in a comfortable ‘home-like’ setting. beauty. to attract the customers we will. 14 . ▪ Loyalty and Birthday Club members will have notified of upcoming special menu items and to alert them of our catering service.The restaurant will be located in a strip center at the busy intersection of Wellesley. WhatsApp 5. Twitter. 5. offering coupons. We can accomplish this by hiring employees who genuinely enjoy their jobs. and upcoming specials. With the addition of catering revenues.1 Sales Forecast We are expecting a conservative 5% increase in sales revenues annually over the next 3 years. Continually assessing the quality of all aspects mentioned above. 5.93% in Year 2 and 6. ▪ Event Marketing -We plan on joining our local networking for our grand opening ▪ Social Media – We will share with as much as friends on Facebook. We will have Signage on The Pacific Mall as well as signage over our entrance. service. Customers will have ample parking at Lowe ground car park which per entry is RM1 only. speed and atmosphere. information.4. sales will increase by 12. The growth is adjusted for inflation.4 Distribution Pattern Varieties of grill and Indian cuisine menus will be available at Cinnamon’s Grille only location at LG 79. Interacting with our customers personally 5.5 Sales Strategy Our sales strategy requires consistently high-quality food. Cinnamon’s Grill will use their website as an advertising medium. ▪ Word of Mouth – We already have a database of existing catering customers and will rely heavily on this method to attract and grow new business.5 Marketing Programs ▪ Our initial marketing campaign will consist of contacting our databases clients and notifying them of our grand opening. The Pacific Mall.5.3 Promotion Strategy ▪ Location.4. Prai.02% in Year 3. With easy access from and to Penang Bridge and located on the “going home side” of the intersection. 5.4. 235.00 Sales Sales Forecast 1.422.057.6 Milestones Our initial milestones are as follows: 15 .133.00 1.00 Revenues Additional Revenues 0.322. These initiatives are still in the planning stages as we gear up to hire and staff.00 2017 2018 2019 5.209.600.00 323.079.628.00 Subtotal Direct Cost of 356.027.00 200.843.602.00 414.00 81.400.176.5. The following table shows expected Sales Forecast for the next 3 years: Table 5.000.00 Controllable Costs COGS 402.000.100. They will play an active role in our employee culture.000.987.161.00 766.00 426.00 800.207.00 1.234.00 1.000.835.5.00 Payroll 269.1 Annual Sales Forecast Annual Sales Forecast 2017 2018 2019 Sales RM RM RM Food and Beverage 1.028.00 600.113.5.443.1 Bar Chart Sales Forecast 5.000.422.00 1.00 424.000. 5.00 1.2 Sales Programs We will encourage our employees to grow our customer base and provide incentives and regular bonuses to employees for referrals and repeat customers.00 0.00 Total Prime Cost 672.00 102.000.028.00 469.835.00 1.00 737.00 340.000.00 400.000.00 Total Sales 1.200. Other key personnel are the management at each location. Prai 2/1/2017 Complete Interior Decor 3/1/2017 Complete Kitchen / Wait Station Needs 3/1/2017 Hire Back Staff 3/1/2017 Hire Front Staff 3/1/2017 Secure a Point of Sale System 4/1/2017 Secure Lending for Initial Start-Up. Table 5.6 Milestones Milestone Date Sign Lease with The Pacific Mall.6 Milestone Chart 6. Working Capital and Cash Flow 4/1/2017 Chart 5. Candidates have already been identified for the first additional 16 .0 Management Summary At the present time Kishore and Kumar runs all operations for Cinnamon’s Grill. Together. The Dev brothers will purchase have considered a POS (point of sale system) that it simplifies communications between the kitchen and the wait staff.872 26.725 260. Penang.6. Kishore and Kumar will personally select each candidate. it can also help prepare payroll – which will save some money in the bookkeeping department.731 Total 204.000 20.2 Management Team The restaurant will be owned by Kishore Dev.166 Sales Agent 0 20. Table 6.648 27. In these organizations he held the positions of F & B Assistant Manager and then Manager. 6. Because the POS system acts as a time clock.294 64. Orders go Cinnamon’s Grill the computer. 6. he worked for a regional restaurant and an independent fine dining restaurant.163 Servers / Cashiers 46. they have plans to hire a Manager and a Kitchen manager.168 248. Over time.4 Personnel Plan This operation is an independent full-service restaurant operating for both lunch and dinner.4 Personnel Plan Personal Plan 2017 2018 2019 Owner / General Manager 0 0 0 Asst.432 23.745 25. to the most popular menu items. They’ve adopted an effective interview process designed to staff the restaurant with highly qualified people for each position. directly to the kitchen printer.487 Accounts Executive 8.848 48.933 17 .640 8. Kumar Dev received his Culinary Degree from the KDU. Kumar will initially be employed as the Kitchen Manager. 6.453 40. Manager / Cashier 25. a POS system can organize profit and loss statement and sales tax. Kishore began his restaurant career at the age of 15 working in a quick-service foodservice operation.448 Line Cooks 38.899 9.1 Organizational Structure Cinnamon’s Grill expects to hire 19 employees.024 24.480 62. Along with the daily operations of running a restaurant.253 49.304 39. After earning his degree. After graduation she was employed by a local chain restaurant and then at a Five Star Hotel in Penang.3 Management Team Gaps Initially brothers will fill in many of the management gaps. Another benefit of a restaurant POS programs is that it can track everything from food usage.600 Catering Employees 0 18.637 Prep Cooks 60.701 Kitchen Helper 24. 500 square feet ▪ The restaurant will employ 19 employees ▪ RM860. 7. 18 . but manage for the Best. Industry average for casual restaurant average of RM860.7. RM174.1 Important Assumptions ▪ Meal Price range from RM8. Also assumes additional increase in staffing (4 persons to be hired at 6 hours @ RM8. Every opportunity will be seized to accelerate expansion past the critical dates in this plan if cash flow from new stores exceeds projections.00 – RM15. Assumes 4 parties monthly @ RM15 per plate and RM50 persons. Plan for the worst.200.000 revenue targets.74 ▪ The restaurant is located in The Pacific Mall. 000 of which will be contributed by the owners and the remainder will be secured Cinnamon’s Grill a proposed bank loan.00 ▪ Average lunch price: 8.00 per hour.0 Financial Plan The over-all financial plan for growth allows for use of the significant cash flow generated by operations.2 Start-Up Costs Total startup costs will be RM363. 000 -1.79 ▪ Average dinner price: 13. The following sections outline our financial plan: ▪ Cost of Start-Up ▪ Profit and Loss ▪ Cash Flow ▪ Balance Sheet ▪ Financial Ratios 7. Prai and is comprised of 2. 000. Catering will escalate to 8 parties monthly in month 20 and then 10 parties monthly thereafter. 000. ▪ Annual 3% increase for inflation and 5% annual increase in revenues ▪ Year 2 Assumes Catering Business in Place. Additional startup expenses are in the form of working capital and contingency RM182.00 SSM Registration + Lease Deposit 1. The majority of the costs are associated with the restaurant equipment.500. 000 in the of a bank loan. 000.00 Outdoor Sign 3.2 Start-Up Costs Start-Up Requirement Start-Up Expenses Graphic Logo and Name Creation 1. 000.00) Startup inventory 110.200.000.00 Total requirement 363.000.800.00 Other Current Asset - Long term Asset - Total Assets 110.500.00 7. 000 and are requesting an additional RM189. The costs are associated with build out and renovation of the restaurant to provide updated plumbing and creating additional space in the dining area by removing a non-supporting wall: RM50. 19 .000. inventory and furniture and furnishings for the dining room.00 Total Start-Up Expenses 252.000.00 Start-Up Assets Cash required (142.500. 500. 500. Total costs for these items are reported to be RM110.00 Building Improvements 50.500. Table 7.000.00 Pre-Opening Expenses 14.000.00 Contingency 10. Kishore and Kumar will contribute RM174.00 Working Capital 172.3 Source and Use of Funds Total start-up costs are estimated to be RM363. 00 Total Funding 363.000.500.Table 7.3 Source and Use of Funds Start-Up Funding Start-up Expenses to Fund 252.00) Total Assets (142.00 20 .00 Capital Planned Investment Kishore 87.00 Assets Non-cash Assets from Start-up - Cash Requirements from Start-up (142.000.00 Start-up Assets to Fund 110.000.00 Loss at Start-up (Start-up Expenses) (252.000.500.00 Other Additional Investment Requirement Total Planned Investment 174.00 Kumar 87.000.000.500.000.000.00) Liabilities and Capital Liabilities Current Borrowing 189.00) Total Capital (78.00 Long-term Liabilities Accounts Payable (Outstanding Bills) Other Current Liabilities (interest-free) Total Liabilities 189.000.000.00) Additional Cash Raised - Cash Balance on Starting Date (142.500.500.00 Total Funding Required 363.00) Total Capital and Liabilities 110. 196.00) 316.00 669.653.00 1.00 1. 108.598.00 1.970.003.00 1.186.901.202.395.00) 633.00 191.186.186.00 188.365.00 222.00 439.756.00 13.438.059.171.00) 158.00 1.391.00) 950.00 502.00 669.144.517.601.989.588.00 669.335.00 1.00 816.492.186.00 2. 186 and represent the annual expenses. Based on the assumption of RM11.00 1.00 764.00 83.548.00 111.00 (573.186. This is further depicted in the Table Below and the Graph that follow: Table 7.108.734.00 195.00 314.103.00 1.00 209.535.186.00 477.186.00) 792.971.00 1. (669.00 565.00 (477.00 983.00 95. Unit Price 11.425.392.186.00 669.00 97.00 55.697.783.00 794.297.423.122.424.012.318. .584.00 125.00 139.00 1.611.624.450.186. the breakeven revenue then is RM1.4 Break-Even Analysis Break-Even Analysis Fixed Cost 669.360.934.00 691.186.00 669.00 669.306.00 251.186.00 27.4 Break-Even Analysis Total fixed costs associated with the restaurant are RM669.546.929.00 857.00 669.582.790.00 669.00 669.00 920.00 669.819.00 153.797.00 - 1.00 (95.186.00 669.070. The variable cost (overhead) is estimated to be RM4.00 (382.264.090.958.186.00 2.485.37 as the average meal price.234.267.408.132.222.108.934 Avg.00 69.598.186.801.849.00 669.00) 475.381.186.867.668.668.00 1.00 753.00 1.826.570.01 Variable Cost 4.00 669.00 2.243.743.611.587.941.00 1.00 286.186.00 879.186.186.00 732.00) 669.00 669.046.7.00 181.742.51 Number of Units 13.00 167.00 573.794.468.273.479.00 (286.37 Net Units Sales Fixed Cost Variable Cost Total Cost Total Profit .665.937.00 1.793.376.276.00 669.402.00 (191.839.674.00 41.00 628.00 942.005.00 2.092.990.00 669.196.00 669.917.534.269.00 376.970 or 97.00 1.00 62.185.217.51 per meal.00 21 .136.186.186.00 382.535 meals (units).00 1.00 1. .396.785.00 669.00 860.00 125. 000.821 Insurance 75.000.577 7.000 92.5 Projected Profit and Loss The profit and loss demonstrate modest increases in revenues over Cinnamon’s Grill are expected years with adjustments for inflation.602 Gross Profit 626.00 1.000.000.000.309 747.835 Cost of Goods Sold -402.469 92.040 72.360 12.00 2.711 13. Pro Profit and Loss Pro Forma Profit and Loss Year 1 Year 2 Year 3 Income Sales 1.250 79.234 Expenses Accounting / Legal 12.000.027 Total Expenses 625.00 - 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Sales Fixed Cost TotalCost Chart 7.356 7.00 1.141 Salaries 12.798 716.112 45.185 21.711 26.987 323.176 -426. Table 7.235.700 95.798 Payroll Taxes 0 0 0 Registration SSM and Licenses 7.000.000 77.057 340.731 Bad Debts 25.00 500.482 27.804 Rent 68.568 Miscellaneous 44.4 Break-even Analysis 7.000 70.234 58.341 12.276 Shrinkage 90.494 22 .500.075 688.500. Break-even Analysis 3.000 12.093 Wages 269.443 1.5.028.113 -414.568 21.000.422 1.267 809.739 Net Profit 1.161.000.481 Credit Card Fees 20.00 2.435 46. 994 42.237 Additional Cash Received 189.176 731.654 Subtotal Expenditures 1.7.181.994 11.247.681 Net Cash Flow 30.602 Cash Spent 710.113 414.426 Bills Paid Subtotal Spent on Operations 1.000 Subtotal Cash Received 1.192.240 35.036 1.654 Subtotal Additional Cash Spent 33.402 Cash Sales 1.000 Sales Tax Owners Investment 174.475.397 71.508.438 1.237 Expenditures Expenditures from Operations 765.217.835 Cash from Receivables 0 0 Subtotal Cash from Operations 1.556 Cash Balance 30.176 426.192.539.523 1.247.6 Projected Cash Flow The statement of cash flow shows the incoming and outgoing cash of the business.028 Additional Cash Spent Sales Tax Loan Payment 33.2 Pro Cash Flow Pro Forma Cash Flow Year 1 Year 2 Year 3 Cash Received Cash from Operations 148.145.953 23 .176.422 1.180.529 1.443 1.481 753. Table 7.438 1.378 37.289 1.028.240 35.995 11.101 30.378 37.658 1.5.402 29.235.161.523 1. 500 29.664 Paid In / Invested Capital 223.169 Subtotal Current Liabilities 59.250 28.306 Long Term Assets Long Term Assets 144.000 14.7 Proforma Balance Sheet Pro Forma Balance Sheet 2017 2018 2019 Assets Current Assets Cash 63.069 Total Assets 500.000 61.500 135.000 564.711 Retained Earnings Earnings Total Capital 223.000 30.000 26.000 290.500 151.450 213.734 Current Borrowing 1.925 303.7 Projected Balance Sheet Table 7.950 66.000 234.334 Total Liabilities 277.150 251.7.075 261.000 198.850 312.700 15.450 32.219 Inventory 14.111 Accounts Receivable 25.000 564.711 24 .575 1.000 234.150 251.803 Other Current Assets 129.975 146.375 Net Worth 223.500 281.104 Accumulated Depreciation 0 0 0 Total Long Term Assets 268.000 66.000 525.725 163.375 Liabilities and Capital Current Liabilities Accounts Payable 29.693 Other Current Liabilities 28.150 251.500 1.000 234.150 71.711 Total Liabilities and Capital 500.173 Total Current Assets 231.925 32.500 243.000 525.596 Long Term Liabilities 189. 24 1.00% 5.90% 28.70% 49.80% 5.24 1.80% Total Assets 100.30% 46.8 Business Ratios These business ratios are future estimates based upon current assumptions.30% 46.66 Income Statement Gross Sales 100.60% 2.00% 100.5 1.00% Total Current Assets 46.6 15.49 1.90% 64.7.06 Current Ratio 3.60% 12.60% 2.10% Return on Equity 0.60% 25.7 28.80% 37.10% Net Profit After Tax Balance Sheet Cash 12.92 3.60% 44.90% 28.00% 7.80% 24.80% 5.10% 16.10% 5. Table 7.92 1.00% 100.60% 44.49 1.50% 2.10% 5.00% 100.60% 25 .00% 36.00% 100.80% 37.80% 2.00% 5.24 1.80% 24.20% 11.00% Operating Income 0.60% 12.11 Collection Period Inventory Turnover 28.21 4.2 27 29.44 Assets to Sales 48.00% 17.26 0.8 Ratio Analysis Ratio Analysis Industry Year 1 Year 2 Year 3 Profile Main Ratios Quick Ratio 1.49 1.8 7.80% 15.80% Net Worth 44.40% 2.26 0.50% Total Fixed Assets 28.00% Return on Assets 0.10% Working Capital to Sales 16.70% Other Non-Current Assets 24.60% 44.85 Total Liabilities to Net Worth 1.70% 4.2 1.00% 100.00% 0.2 1.80% 37.92 3.80% Return on Sales 0.50% 56.26 0.21 4.80% 3.80% Total Current Liabilities 0.60% 15.00% Gross Profit 60.00% 100.20% 45.60% Total Long Liabilities 37.2 1.00% 0.50% 1.46 Current Liabilities to Net 0.30% 65.70% Interest Coverage 0.00% Inventory 2.00% 7.00% Accounts Payable 5.80% 24.80% 5.21 5.00% Accounts Payable to Sales 2.4 Worth Current Liabilities to Inventory 4.30% 49.80% 2.80% 2.90% 25.80% 14.60% Accounts Receivable 5.00% 5.60% 12.24 Fixed Assets to Net Worth 1.60% 45. com/news/articles/2015-04-14/americans-spending-on-dining-out- just-overtook-grocery-sales-for-the-first-time-ever 5.Franklin Styne Iyadurai.8. 2015.wikipedia.pdf 1.unlv.org/Restaurant/media/Restaurant/SiteImages/News%20and%20Research/ Whats%20Hot/What-s_Hot_Concept_Trends_1. http://www.gov.bplans. 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