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Adding Alcoholic Beverages To Our Menu

Big Belly Burger

Eli Solomon
Elias Linares
Jeenous Makhani
Michael Gazda
Scott Chandler
Contents

Project Summary - Jeen------------------------------------------------------------------------------------------------------ 3


Introduction - Elias Linares ------------------------------------------------------------------------------------------------- 3
Rationale & Significance - Scott ------------------------------------------------------------------------------------------- 4
Plan of Work - Scott ---------------------------------------------------------------------------------------------------------- 5
Task Breakdown - Jeen ------------------------------------------------------------------------------------------------------ 6
Problem Analysis - Michael ------------------------------------------------------------------------------------------------ 6
Request for Qualifications (RFQ) or Bio Sketch - Michael ---------------------------------------------------------- 7
Cost Proposal: Budget For One Fiscal Cycle - Eli --------------------------------------------------------------------- 7
Net Gain in Recurring Expenses (for one fiscal cycle) ------------------------------------------------------------- 8
Net Gain In Sales Revenue $ 1,860,000 ------------------------------------------------------------------- 8
Net Profit $ 737,000---------------------------------------------------------------------------------------- 8
Net Gains Per Fiscal Cycle after Initial Investment $ 1,264,000 -------------------------------------- 8
Conclusion - Eli --------------------------------------------------------------------------------------------------------------- 8
References ---------------------------------------------------------------------------------------------------------------------- 9
Project Summary - Jeen

In this report we will be presenting the final layout of our project toward being allowed to serve
alcoholic beverages in restaurants as part of our menu.
We have put together a number of logistical, financial and strategic procedures that will indeed
help us in achieve this goal, reaching out to a completely new population, when it comes to our
in retail and food services.

Introduction - Elias Linares

Big Belly Burger® has always been leader of the fast food industry and its reputation goes
beyond the standards of quality and integrity. Our many years of service exceeding Customer’s
expectations make us the number One in this industry. As pioneers in this fast food business we
have the responsibility to innovate and be the major trendsetter. After a deep research and study
of our market, a team of economists specialized in the fast food industries Including myself,
found extremely convenient for our company to implement alcoholic beverage in our menus. In
this proposal we will include graphics and numbers that will show the economic benefits from
selling alcoholic drinks. We also predict an increase of 25% of our profits by the end of present
year.
Rationale & Significance - Scott

As a leader in the fast food industry, Big Belly Burger is committed to our customers. We want
our company to continue to grow and lead the market. In so, we feel it is necessary to implement
the sale of alcoholic beverages. Research shows that this addition in our restaurants will not only
increase sales and revenue, but also solidify our place as a market leader. The fast food industry,
as we all know, is a competitive one, and one that requires constant adaptability and innovation.
The market is a large and ever changing one and Big Belly Burger intends on continuing our
history of excellence. This proposed implementation is one that is incredibly feasible and well
worth the investment. Our research shows immediate positive results. As shown in figures one
below, approximately seventy-eight percent of Americans drink alcohol at least occasionally,
while forty-nine percent drink alcohol at least once per month. Figure two shows that beer and
wine are the beverages of choice for American drinkers. Based on this data, we can capitalize
greatly by adding alcohol to our restaurants. As for financial expenses, we have determined that
the liquor license application and filing will be approximately two hundred fifty thousand dollars
for all locations. Additional costs are detailed below. Our estimated total cost for this project is
five hundred twenty-seven thousand dollars for all locations. Our estimated profit for the first
year is seven hundred thirty-seven thousand dollars. As you can see, this addition to our
restaurants is a beneficial one.

Figure 1
Figure 2

Plan of Work – Scott


In order to implement the addition of alcohol to our restaurants, we developed this plan of work.
Initially we will need to apply for a liquor license. We have already begun the process of
notifying the local community board, in order to keep the neighborhood informed. After the
community board meets, they will make a recommendation in favor or in opposition of our
proposal. We will then file the liquor license with the state. Our legal team will handle the
logistics and the direct communication with the community board and state. From there we
would begin training our staff on the new beverages. Also, required equipment would be added
to the restaurant to implement the sale of alcohol. This includes a bar area, expanded
refrigeration as well as storage areas. Additional expenses are detailed below and include initial
stock of spirits and promotional advertising materials. At this point we would begin selling the
new beverages.
Task Breakdown - Jeen

1. Make a specific plan detailing what type of beverages will be sold


2. Study how much money we will be willing to invest per store supply
3. Make a clear outline of where the beverages will be served
4. Schedule the days and times where the beverages will be available to the public
5. Contact different possible manufacturers to supply our stores
6. Contact an experienced attorney that could advise and assist with the necessary liquor
permits
7. Submit liquor license applications
8. Follow additional forms
9. Provide specific stores with necessary appliances or structural changes to accommodate
new sales
10. Learn and apply requirements in order to maintain liquor licence on a yearly basis
11. Study market to provide accurate weekly supplies to stores

Problem Analysis - Michael


We must be wary of potential problems that could come from making this proposal a reality.
These could contain simple problems such as the logistics of obtaining several liquor licenses for
several different locations to more practical problems such as how we can make profit off the
situation. While a fresh idea in theory will create some buzz around our stores how long will it
last and will it be worth it to invest into something that may be short lived.

We must look into:


● How profitable would this actually be and for how long

● How possible will it be to obtain liquor licenses for every single one of our stores
Request for Qualifications (RFQ) or Bio Sketch - Michael
Each member of Big Belly Burger who have had an input on creating this proposal have a wide
variety of different qualifications that prove them to be qualified on the topic. This includes but
is not limited to the following:
● Degrees are numerous trade and business schools. - We have got the best forward
thinking minds on our team that have been studying these kinds of figures for years.

● Experience owning and operating popular bars. - With this experience it will make it
easier to transition over to a similar format.

● First hand experience on managing Big Belly Burger stores. - Our managers know how
our stores work and we have sure that they can make the transition into a different format
smooth and easy.

Cost Proposal: Budget For One Fiscal Cycle - Eli

Initial Expenses
● Liquor Licensing Fee (for all locations) $ 250,000
● Legal Fees $ 20,000
● Training/Retraining
○ Bartenders $ 15,000
○ Security $ 27,000
● Bar Equipment
○ Kegs $ 12,000
○ Expanded Refrigeration $ 31,000
● Initial Inventory
○ Beer $ 64,000
○ Wine Coolers $ 36,000
● Initial Advertising
○ Social Media Presence $ 12,000
○ Cross Promotions $ 23,000
○ Billboards $ 19,000
○ Opening Marketing Costs $ 18,000
Initial Expenses Subtotal $ 527,000
Net Gain in Recurring Expenses (for one fiscal cycle)
● Salary and Wages Expense $ 456,000
● Recurring Legal Fees $ 13,000
● Cost of Goods Sold $ 56,000
● Insurance $ 14,000
● Sales Tax $ 57,000
Net Gain in Recurring Expenses $ 596,000

Net Gain In Sales Revenue $ 1,860,000


(less total change in expenses) $ 1,123,000

Net Profit $ 737,000

Net Gains Per Fiscal Cycle after Initial Investment $ 1,264,000

Conclusion - Eli
Our findings suggest that, conservatively, we here at Big Belly Burger can boost our
revenue stream by $737,000 in the first fiscal cycle alone. Our overall revenue would increase by
$1,264,000 per fiscal cycle after our initial investment is repaid. As many members of the board
are aware, projects or investments rarely begin to yield a net profit until the fifth year of
operation. As our evidence suggests, this proposal easily has the potential to drastically increase
our revenue at Big Belly Burger, while mitigating our overall expenses. We have a duty to our
customers and shareholders to maintain the most competitive edge in the fast food industry. This
project would yield enough capital to open a new location every year and provide the upper hand
over our competition.
References

1. “Does Alcohol Belong in Family Entertainment Centers?” White Hutchinson - Leisure &
Learning Group, www.whitehutchinson.com/leisure/articles/AlcoholFEC.shtml.

2. McCarthy, Niall, and Felix Richter. “Infographic: Beer Still The No.1 Alcoholic
Beverage For Americans.” Statista Infographics, 8 Sept. 2016,
www.statista.com/chart/5758/beer-still-the-no1-alcoholic-beverage-for-americans/.