SAKAFAT RESTURANT : SAKAFAT RESTURANT (MBA-III) “Sakafat” means culture. Our restaurant is representing the mix of Pakistani culture. You will find the delicious and mouth watering food of every province of Pakistan as well as wide variety of fast food. It will cater to the burgeoning upper middle class. This is an unexplored market since the majority of the cafes in Pakistan are either unaffordable or they do not provide an adequate facility where friends can hang out and families can enjoy at low cost. The idea of a theme restaurant was proposed by one of the students of the class and later all the other 25 students agreed to work on it as their business venture, in teams of eight, focusing on specific segments of the business. The restaurant is slated to start up its operations in the 2nd half of coming year. : “Sakafat” means culture. Our restaurant is representing the mix of Pakistani culture. You will find the delicious and mouth watering food of every province of Pakistan as well as wide variety of fast food. It will cater to the burgeoning upper middle class. This is an unexplored market since the majority of the cafes in Pakistan are either unaffordable or they do not provide an adequate facility where friends can hang out and families can enjoy at low cost. The idea of a theme restaurant was proposed by one of the students of the class and later all the other 25 students agreed to work on it as their business venture, in teams of eight, focusing on specific segments of the business. The restaurant is slated to start up its operations in the 2nd half of coming year. Slide 3: The restaurant will start out as a LLC corporation, owned by its founders which are the 25 students of the class, and we are looking for a restaurant space of approximately 2,000 sq. ft. at Minara road, Sukkur. Startup Summary : Startup Summary The management is seeking around Rs.4,802,700 from SME Bank @ a markup of KIBOR + 4% and Rs.2058300 from investors to provide seed capital for the company.
The start-up costs come to Rs.6,861,000 which is mostly expensed equipment, furniture, reconstruction, rent, start-up labor, licenses, operating cash, and legal and consulting costs associated with opening the restaurant.
The tax calculations are done at the corporate tax rate of 35%. Slide 5: Meal Periods
Lunch: 12:00 p.m. – 4p.m
Dinner: 6p.m. – 12a.m Slide 6: Mission of the Venture
Be recognized for our service par excellence, our exceptional food and amazing drinks.
Conduct all our relationships with an emphasis on long term mutual success.
To be a place of choice for dining for every Pakistani.
To be instrumental in spreading the love for our culture in our community and to encourage an active and healthy lifestyle.
To a place where people can come and enjoy cultural food and environment. Slide 7: Critical Success Factors
The creation of a unique and innovative fine dining atmosphere will differentiate us from the competition. The restaurant will stand out from the other restaurants in the area because of the unique theme, design and decor. It will offer a fine dining experience in a cozy atmosphere.
Product quality. Not only great food but great service and atmosphere.
The menu will appeal to a wide and varied audience.
Controlling costs at all times without exception. Slide 8: Products/Services
The business will focus on establishing a cultural theme restaurant where people can enjoy their favorite dishes and cultural music and shows on the large screen TV, or just talk about it with friends while enjoying our tasty food and drinks.
To accommodate the different groups of customers, we will use tables for four that can be pushed together in areas where there is ample floor space. This gives us flexibility in accommodating both small and large parties. Booths for four to six people will be placed along the walls, and ample space would be reserved for receiving, storage, food preparation, cooking, baking, dishwashing, production aisles, trash storage purposes, as well as designated areas for employee facilities and an area for a small office where the staff can perform daily management duties Slide 9: Employees
The labor component of the project will be handled through advertising in a nationwide newspaper of good standard tentatively which is expected to be Jang and Dawn. The management will be looking for a combination of individuals with past experience, excellent manners, a satisfactory level of language capability and enthusiasm. Since the management will be offering above average wages we expect to attract the crème of the workforce and hope for low employee turnover. Appendix can be referred to for salary structure and expenses. Marketing & Sales : Marketing & Sales The Market
The target market for Sakafat is all culture loving people, belonging to the upper middle and higher income classes. The target age group is between 17 and 35 years. It is located in an area that attracts most of their evenings out.
Our customer base will come from the following segments:
People belonging to higher income groups from all over the city
Students (16 to 24 years)
Offices in the vicinity
The concept and product image of Sakafat will attract 3 different customer profiles:
Those who love local food.
Those who want to do more than just eat out.
The curious and the young at heart. ( because we are also offering fast food for young group) Slide 11: Marketing Objectives and Goals:
Our marketing strategy, based upon our analysis of the strengths, weaknesses, opportunities and threats for Sakafat! Is designed to meet the following objectives:
Offer an innovative product in a familiar style at a competitive price.
To be the most exciting hangout for culture loving people.
Focus on operational excellence.
To be the customers’ first choice when it comes to spending an evening out. Competition & Competitive Strategy : Competition & Competitive Strategy These and other themed restaurants are the ones we will view as our competitors e.g. Janbaz Bar B Que, Naz By Pass Motel, Day N Nite Bar B Que etc.
There are over 10 restaurants in Sukkur city. Although this presents an obvious challenge in terms of market share, it also indicates the presence of a large, strong potential. The newest competitors have made their successful entry based on an innovative concept or novelty. Capitalizing on an increasingly popular global trend of theme restaurants, Sakafat! will offer an innovative product in a familiar style at a competitive price.
There are three major ways in which we create a competitive advantage:
Innovative concept making us the only one of its kind restaurant in Sukkur.
Quality product at lower prices.
Other activities to engage the customer by allowing customers an experience that entails much more than food. Slide 13: Pricing
The pricing strategy was prepared keeping in mind the high initial investment, competition and the target market. A number of restaurants that cater to similar target markets were visited in order to establish comparable prices. Also, prices had to be competitive, yet not so low as to put off the elite crowd Sakafat! Plans to attract which tends to feel that very low prices imply lower quality food. Moreover, the plan is to have a minimal cover charge as well, say Rs. 100. This is the amount charged in order to enter the restaurant, and may be redeemed for food items. 15% GST is included in these prices, so there are no "hidden charges". Menu : Menu The menu for Sakafat! has been designed to cater for people of all ages at all hours of the day. Menu is divided into two main groups:
1) Pakistani cultural food which is again sub divided into four groups representing cultural food of four provinces of Pakistan.
2) fast food items. Promotion : Promotion There are thousands of possible tactics that can be applied to drive revenues without any reliance on mass media advertising due to our budget restraints initially. Below are some of the proposed strategies for pre launch and later for the day to day promotion of our restaurant, summing up to an amount of Rs. 860,000 approximately. (This figure is only for the first year of launch).
Pre-Launch Promotional Activities include “Teaser Advertisements” (Estimated amount allotted: Rs.260,000), a Grand Opening (Estimated amount allotted: Rs. 50,000) and Customer Relations (Estimated amount: Rs.156,400)
After-Launch Promotional Activities include launching a Website (Estimated amount allotted: Nil), doing a Radio Review (Estimated amount allotted: 76,800), having Contests (Estimated amount allotted: Rs.60000), doing Sampling (Estimated amount allotted for transportation and meal preparation: Rs. 120,000), starting Menu Bingo (Estimated amount allotted for printing Bingo cards and free merchandise: Rs. 36,000), and a Birthday Program (Estimated amount allotted: Nil). Operational Plan : Operational Plan Restaurant Equipment
The restaurant equipment includes:
Interior decor and multimedia
Other equipments like generators, WIFI terminals, Pocket PCs for waiters etc.
Hours of Operations
The restaurant would be open 7 days a week from 12pm to 3pm and 6pm to12 midnight. Slide 17: Layout
Sakafat is divided into three main sections:
Basement- Play land for children aging from 3 to 12 and computerized games section for children aging from 5 to 15.
Dining Floor- It would house the dining hall where meals would be served during lunch and dinner time. A kitchen would be located adjacent to the dining hall on the ground floor to prevent any hassle and shorten the service time. The dining area which is the ground floor of the restaurant however is specifically reserved for most of the dishes in the main course while snacks could be had at other places.
Television Room- This is the floor where screening of cultural shows would take place. During the weekends this floor is expected to witness a lot of visitors because fast food will be served at this floor so, the students and office workers are likely to visit this floor on weekends as they are free on weekends. Students are more fast food loving customers. Evaluation of management team: The management team is the most important part of any new venture and hence represents a major risk factor. Below we analyze the weaknesses and strengths of our management team and how we can overcome these weaknesses. : Evaluation of management team: The management team is the most important part of any new venture and hence represents a major risk factor. Below we analyze the weaknesses and strengths of our management team and how we can overcome these weaknesses. Slide 19: Marketing
Product: Taste and serving size of food may not appeal to people manual orders taken by waiters in a noisy surrounding may lead to confusion and inefficiency.
Price: Is high considering locality and service.
Promotion: A great deal of planning required. High budget of certain advertising plans. Anything going wrong in the promotional activities may reflect negatively on the image of the restaurant. Sampling may backfire if customers do not find food up to the mark.
Placement: If décor is not trendy and differentiating, it will fail to leave an impact. The seating order and ambience may be uncomfortable and noisy because of loud volume of television. Slide 20: Financial Risk:
The business will find it difficult to attract investors to a new venture because the amount of investment we need is huge i.e. Rs.4,802,700.1. In analyzing costs, we find that our cost of goods sold account for 73% of our revenue. Any high rise in inflation will result in deteriorating gross profit, hence active management of supplies needs to be carried out. High amount of current assets indicate excess liquidity hence better cash management is required. The return on assets and equity are negative in the first year of operations.
Production & Operations:
Unreliability of suppliers is a major risk. Research on suppliers of only two hotels has been conducted, which is not a comprehensive assessment. Poorly trained workforce is another big risk. We will need to plan a strategy based on operational innovation in order to avoid operational risk. Exit Strategy The most simple exit strategy would be to convert our theme restaurant into a boutique of traditional dresses. Harvesting is another option that is, selling the business to an employee or an outsider. One of the methods of harvesting is Direct Sale. This is especially common as small businesses are in demand by larger companies, who wish to grow by acquisition. We can also merge with another restaurant to gain synergistic benefits. Financial Plan : Exit Strategy The most simple exit strategy would be to convert our theme restaurant into a boutique of traditional dresses. Harvesting is another option that is, selling the business to an employee or an outsider. One of the methods of harvesting is Direct Sale. This is especially common as small businesses are in demand by larger companies, who wish to grow by acquisition. We can also merge with another restaurant to gain synergistic benefits. Financial Plan