Food & Beverages Business Plan for Startup Company in India


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1 | P a g e 1.0 EXECUTIVE SUMMARY 1.1 INTRODUCTION Dining out these days is more casual than the earlier times where it was treated as a luxury or as a habit of the rich people. It’s very casual to eat outside more than once a month or most probably more than once a week. Another reason why people are dining out more often is that the growing and competing economy has compelled people to move away from their native place to create their destinies in turn moving them far away from their beloved home cooked meals. The increase in dining out culture has affected the pockets of the diners in a huge way. It has led them to a situation where they have to continuously search for any offers or discounts on the food before making any outing plan. The increasing cost not only affects the diners but it has hit the food joint merchants as well. There are numerous options for the customer to choose from which affects the restaurant and the likes business on a significant level. A major proportion of the business is on the weekends which leaves the weekdays idle and typical for the food joint owner to meet his overall costs. Increasing digitalization in India has brought various new concepts of coupons and offers. It’s a huge hassle involving a lot of searching which is too time-consuming and by the time an appropriate offer is found the appetite is lost. To overcome the dual problem of the diners as well as the food merchants the founders have come up with the --- INC. card. The --- INC. card is not only helpful to its members by making the dining out more comfortable and affordable but is also a massive supporting shoulder for the food joint merchants. The double role of --- INC. card allows its members to avail a flat discount on the restaurant of their choice along with providing the consistent and regular business to its associated restaurants.

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2 | P a g e 1.2 KEY FEATURES The listed below are some key features of the --- INC. card: Plastic as well as digital card Beneficial for both single and group dining Affordable pricing Applicable on a-la-carte dining Straightforward flow of the monetary cycle between customer and restaurant as there is no brokerage or commission Trouble-free access via one click technology for the booking purposes Simple and constant offers throughout the year Easy payment and renewal options In-built marketing of the partner restaurants 1.3 MARKET OPPORTUNITIES The market to be focused upon by --- INC. is the Indian Market with prime target cities as follows: Delhi-Noida- Gurgaon Hyderabad Chennai Kolkata Bangalore Mumbai Pune Dining out has become much more popular these days. The 2013 survey on the dining out culture in India revealed that 34 of the people eat out two to three times a week while 27 eat once a week. About 11 eat three or more times a week 12 eat once a month 3 eat on special occasions while 12 love to eat daily at a restaurant. No doubt that in the preceding three years these figures have moved up which is not at all lamentable. It’s just a proof that Indian eating out culture has transmuted quite marginally.

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3 | P a g e Indians are not only enjoying lunch and dinner outside but they are also going out for tea coffee or even a light snack. Indians spend about half of their total consumption expenditure on food which seems to be rising among people between 20 and 25 years of age. Further Indian consumers are increasingly dining out particularly in urban areas. Urbanization changing lifestyle and food preferences are spurring the organized market but about 70 of the young consumers in India are price-sensitive. The other key driver for the growth in the FB sector is the rising number of working women and eating-out options. 1 Furthermore as estimated India’s food and beverages FB industry will expand at an average annual pace of 24 to reach Rs.3.8 trillion in sales by the year ending 31 March 2017. Fast-food joints which have the largest market share at 45 will grow by 16.6 a year followed by casual dining whose share is 32 will be expanding 10.1 annually. Standalone restaurants which comprise 22 of the market is the fastest-growing while the cafe segment with 12 market share is growing at 10.7 a year. Although the fine dining constitutes only 3 of the market the sector is seeing a renewed interest particularly from multinational chains. Fast-food chains such as McDonald’s Domino’s Pizza KFC Subway Haldiram’s and Bikanervala are estimated to have combined sales of Rs.92000 crore by 2016-17 as they expand into smaller cities. Local fast-food firms are expanding faster at about 37 in terms of number of stores compared with foreign firms growing at 28 a year. Although nearly 70 of the sector is still unorganized it is changing fast. In the next 4-5 years the unorganized share is expected to fall to 60.

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4 | P a g e As is common with everything in life eating out also comes with its pros and cons. The biggest con faced with eating out happens to be the cost of such indulgence. Although eating out is comfortable and easy but it’s also expensive and the individuals bank balance may not allow him to dine out as often as he would have liked. Since the Indian consumer is price sensitive the need of discounts and offers in the industry is much needed. In a major way it is being handled by various online coupons and offer aggregators as the customer is always looking out for some discount or offer available while eating out to keep a check on his increasing expenses. The fast paced life of the consumer also gives him the limited spare time and this time also is lost in searching for the relevant offers. Thus most of the times the discount card seems to be the best option as the diner does not have to go through numerous offers and coupons before dining out and he can enjoy a comfortable and affordable meal. 1.4 MARKETING STRATEGIES To compete with the existing market players and to win the significant market share we will be adopting the following marketing strategies:-

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5 | P a g e 1.5 MARKET PLAYERS The players in the market prove as a motivation for better performance. Thus some of the direct and indirect players are:

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6 | P a g e 1.6 FUND REQUEST AND ITS UTILISATION The founders of the business are investing Rs. 12.5 Lacs each. The outside investment sought from the investors is Rs. 50 Lacs. Thus the business will be starting with the funding of Rs. 75 lacs. The funds will be utilized as under: Launching of website and mobile application Ongoing research and expansion Working capital and staff recruitment Organizational and marketing expenses 1.7 SALES GROWTH AND REVENUE PROJECTION Our pragmatic approach in financial projections will be based on the membership cards in the 1 st year and add supplementary membership cards from 2 nd year onwards as well as merchant registration fees from 2 nd year. The projected revenue and profits are as under:

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7 | P a g e Sales and profit growth is as follows: Amount in INR Particulars Year 1 Year 2 Year 3 Year 4 Year 5 Total Revenue 617500000 3794148115 5832802393 8154908503 11766198546 Net Profit 352757400 2313139438 3549348454 4964612978 7152653502 Year 1 Year 2 Year 3 Year 4 Year 5 Total Revenue Rs 617500000 Rs 3794148115 Rs 5832802393 Rs 8154908503 Rs 11766198546 NPAT Rs 352757400 Rs 2313139438 Rs 3549348454 Rs 4964612978 Rs 7152653502 Rs 0 Rs 2000000000 Rs 4000000000 Rs 6000000000 Rs 8000000000 Rs 10000000000 Rs 12000000000 Rs 14000000000 Amount Sales and Revenue Projection

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8 | P a g e 1.8 THE MANAGEMENT TEAM Mr. ABC Mr. ABc 1.9 EXIT STRATEGY It’s not enough to build a business worth fortune we have to make sure we have an exit strategy to get money back out. The company may reach to a position where it might implement either forced or preferred Exit. The most likely exit for the company will come from an acquisition by a major player if the company wants to maximize the firm’s value and scope or by bringing an IPO that is the Initial Public Offer. Although the company may opt either of the following exit strategies: Transfer of the business Selling of the business Merging of the business