BUSINESS PLAN

ON

STAR COFFEE SHOP

 COMPANY INFORMATION

COMPANY NAME: STAR COFFEE SHOP

BUSINESS NAME: STAR COFFEE SHOP

ADDRESS: 10-G, Kitchlu Nagar

Ludhiana

TELEPHONE: 9814116199

CONTACT PERSON: GAGANDEEP KATARIA

DATE OF ESTABLISHMENT: 1st June 2019

DAYS OPEN: 7 DAYS A WEEK

TIMINGS: 09:00 A.M. – 10:00 P.M.

 TABLE OF CONTENTS

Executive summary
 Type of Business
 Company summary
 Management
 Product/Service and Competition
 Exit
1 Background and Purpose
1.10 Current Situation
1.20 The resource based concept
2 Objectives
2.10 Short Term
2.20 Long Term
3 Market Analyses
3.10 Overall Market
3.20 Specific Market
3.30 Competitive Factors
3.40 Pricing
3.50 Advertising & promotion.
4 Development and production
4.10 Resource Requirement
4.20 Quality Assurance
4.30 Identify Locations
5 Marketing
5.10 Marketing strategies and resources
5.20 Sales Forecast
6 Financial Plans
6.10 Financial Statement
6.20 Break-Even Analysis
6.30 Sales Forecast
6.40 Cash Flow
7 Organizational Management
7.10 Key personnel resources
7.20 Human Resource Management

8 Summary and Conclusions

9 Scheduling and Milestone

 EXECUTIVE SUMMERY

COMPANY’S ADDRESS:
STAR COFFEE SHOP
10-G Kitchlu Nagar
Ludhiana

CONTACT: - GAGANDEEP KATARIA

TYPE OF BUSINESS: - The hard Star coffee shop is a specialty beverage
retailer. It uses a system that is new to the beverage and food service
industry to provide hot and cold beverages in a convenient and time-
efficient way. Star coffee shop provides its customers the ability to
drive up and order their choice of a custom-blended espresso drink,
freshly brewed coffee, or other beverage. TDP is offering a high-quality
option to the fast-food, gas station, or institutional coffee. The Star
Coffee Shop will target two markets:

The Daily Commuter: - Someone traveling to/from work, out shopping,

delivering goods or services, or just out for a drive.

The Captive Consumer: - Someone who is in a restricted environment

that does not allow convenient departure and return while searching
for refreshments, or where refreshments stands are an integral part of
the environment.

MANAGEMENT: - Coffee Shop located in heart of city of Ludhiana, Near

Dayanand Medical College will lead by Mr. Gagandeep Kataria who has 4
 years of experience in sales marketing in food products. He has done his
B.Sc.

PRODUCTS AND SERVICE: - Star coffee shop provides its patrons the finest
hot and cold beverages, specializing in specialty coffees and custom
blended teas. In addition, it will offer select domestic soft drinks,
Italian sodas, fresh-baked pastries, and other confections. Seasonally,
TDP will add beverages such as hot apple cider, hot chocolate, frozen
coffees, and more.
The Star Coffee Shop considers itself to be a player in the retail coffee house
industry. Primary competition will come from following sources: Café
Coffee Day, Barista, Traditional coffee shop, Fast Food outlets and
even from Convenience stores.

USE OF PROCEED: - We need at least 10 lakh for the starting of the

business.

EXIT PLAN: - Our projected value at the end of the third year is projected value
of the business is 15,00,000 this represent an IRR of 60%. Hard Star Cafe chooses
to become the Drive-thru version of Starbucks, obtaining thousands of rupees
through an initial public or private offering that would allow the company to open
twenty to thirty facilities per year in the region of the country between the
mountain ranges, in both major and small metropolitan communities. This is the
preferred Exit Strategy of the Management Team. The danger in this is that
competitors would rise up and establish a foothold on a community before--or in
the midst of--the arrival of The Hard Star, causing a potential for a drain on
revenues and a dramatic increase in advertising expenditures to maintain market
share. Knowing these risks--and planning for them--gives company the edge
needed to make this scenario work.
 BACK GROUND AND PURPOSE

CURRENT SITUATUION: - Star Coffee Shop would be operating at

different location in Kolkata. The main idea behind is to target the
daily commuters and captive consumers. It will also generate an
opportunity for creating the job. Differentiating ourselves from other
more traditional cafes has given us the ability to effectively compete on the
beverage and pastry side of the business with the already entrenched
competition. Sales are brisk and in-line with projections. Hard Star café
would provide one of the best coffee services with the state-of-art-
technology available in various Star coffee shops.

THE RESOURCE BASED CONCEPT: - Besides the financial and technical

support that is being provided we need to have fresh coffee beans which is
integral part of our business success. Apart from that the customized coffee
van, coffee machine are also be considered as an integral part for the
success of our business.
 OBJECTIVES

SHORT TERM: - The Star Coffee Shop has established three firm objectives it
wishes to achieve in the next three years:

1. Thirteen Drive-thru locations and four fully booked Star Coffee by the end
of the third year.

2. Gross Margin of 45% or more.

3. Net After-tax Profit above 15% of Sales.

LONG TERM: - The Coffee shop Objective is in three-fold, with each being as
integral to our success as the next.

1. Product Objective - Provide customers the finest quality beverage in the

most efficient time.
2. Community Objective - Provide community support through customer
involvement.
3. Economic Objective - Operate and grow at a profitable rate through sound
economic decisions.
 MARKETING ANALYSES

OVER ALL MARKET: - Indian Coffee Board puts country's coffee

production at 2.90 tones (Post monsoon estimation) and 3.06 tones (Post
Blossom Estimation) respectively. For the present crop year beginning
October, the board has estimated an output of Arabica at 101,525 tones and
Robusta 204,755 tones. Karnataka leads the country with 2.05 tones (Post
monsoon estimation) and 2.21 tones (Post Blossom Estimation) production
followed by Kerala and Tamil Nadu. According to ICO estimate, India
produced over 3.1 million bags of 60 kgs each in 2009 compared with 3.3
million bags in 2007.Country's coffee exports during fiscal 2008-09 stood at
1.96 lakh tones signifying marked decline from 2.18 lakh tones in 2007-08.

SPECIFIC MARKET: - The Coffee Shop will focus on two markets:

1. The Daily Commuter - someone traveling to or from work, out shopping,

delivering goods or services, or just out for a drive. Commuters are defined
as any one or more individuals in a motorized vehicle traveling from point
"A" to point "B." The Star Coffee shop’s greatest concentration will be on
commuters heading to or from work, or those out on their lunch break
 2. The Captive Consumer - Someone who is in a restricted environment that
does not allow convenient departure and return while searching for
refreshments, or where refreshments stands are an integral part of the
environment. Examples would include high school and college campuses,
where there is limited time between classes, and corporate campuses where
the same time constraints are involved, but regarding meetings and project
deadlines, and special events--such as carnivals, fairs or festivals-where
there is an admission price to enter the gate, but exiting would mean another
admission fee, or where refreshments are an integral part of the festivities.

COMPETITIVE FACTORS: - There are four general competitors in The Star

coffee shop drive-thru market. They are the national specialty beverage chains,
such as Starbucks and Barista, local coffee houses--or cafes--with an established
clientele and a quality product, fast food restaurants, and convenience stores.
There is a dramatic distinction among the patrons of each of these outlets.
Competitors to the Star Coffee on campuses would include fast food restaurants-
assuming they are close enough to the consumer that they can get there and back
in the minimal allotted time, vending machines, and company or school cafeterias.
The consumers in this environment are looking for quick, convenient, fairly
priced, quality refreshment that will allow them to purchase the product and return
to work, class, or other activity. Competitors to the Star Coffee at events such as
festivals and fairs would include all the other vendors who are licensed to sell
refreshments.

PRICING: - We will keep the price of instant coffee at Rs.20 which is quite
cheaper as compared to Café Coffee day or Barista
ADVERTISING AND PROMOTION: - We believe in quality of products so our
service products will self flurries on goodwill & words of mouth.

DEVELOPMENT AND PRODUCTION

RESOURCE EQUIPMENT: - We need at least 10 lakh for starting our business

which includes buying of Coffee Machines and Computers.

QUALITY ASSURANCE:-

1. We create a sense of quality assurance of green and roasted coffee products,

new coffee product development, and coffee specification programs.

2. Coffee products for quick-service restaurants, fine and casual dining and
convenient stores.
.

MARKETING

MARKETING STRATEGY AND RESOURCES:- Star Coffee Shop target

market is the Star individual who has more money than time, and excellent taste in
a choice of beverage, but no time to linger in a cafe. By locating the Drive-Thrus
in high traffic/high visibility areas, this unique--and abundant--consumer will seek.
The Star Coffee Shop out and become a regular guest.

To penetrate the target market for the Star Cafes, these units will do what they
were designed to do. The Hard Star will take the cafe to the customer. By using the
community support program Hard Star is instituting, arrangements will be made to
visit a high school, college campus, or a corporate campus once or twice a month
(Even visit these facilities for special games, tournaments, recruiting events, or
corporate open houses). And, for every cup or baked good sold, a portion is
returned to the high school or college. It becomes a tremendous, painless way for
the institution to gain a financial reward while providing a pleasant and fulfilling
benefit to their students or employees.

SALES FORECAST: - In the first year of its operation Hard Star will have ten
customized Star vans will be fully operated. The first five will be operated within
third month of this plan and the next five will be operated by end of this year. Hard
Star is building in a certain amount of ramp-up for each facility while commuters
become familiar with its presence. These fully operated Star will generate more
than 5 lacs in the first year of its operation.

In the second quarter of the second fiscal year, The Hard Star will deploy next 10
fully operated Star coffee shops. Hard Star Chain expects all ten Star units to
generate revenue 10, 00,000 in the second year. In the third fiscal year, with an
additional 10 more Star vans deployed, Hard Star expects to see amount of
revenue generated is something close to15 lacs.
ORGANIZATION CHART
 SWOT Analysis for a Coffee Shop

Opening a coffee shop is more than knowing the difference between a mocha latte
and a caramel macchiato. Before you pick out your theme and the catchy phrase
your staff will chant when greeting customers, you must strategize your
operational plan. Creating a SWOT analysis -- identifying the good, bad and
potential ugly -- for your business is essential before moving forward. No matter if
you create a formal plan or scratch some ideas on a napkin, know where you stand
within the industry and against your competition.

Strengths
Your coffee shop needs to stand out from the rest as you compete with several
neighborhood favorites and the giants like Starbucks and Dunkin Donuts.
Identifying your strengths is where you pinpoint your niche within the market such
as serving homemade desserts or having distinctive ambiance. Identify at least one
or two things that will drive customers to your café repeatedly. Consider that one
of your strengths may simply be on an impeccable location where you're the only
game in town. Use opportunities such as those to your benefit.
Weaknesses
Every business has a weakness. It could be that due to your budget, you'll have to
keep your location small or that you won't be able to order premium blends from
overseas. Your weaknesses are those areas that you either do not perform well in,
are missing the mark on or at an overall disadvantage. It's easy and enjoyable to
focus on the dynamic products and services you'll offer, however, it's just as
necessary to consider those that could pose a problem.
Opportunities
Creating new opportunities is where you can plan for growth in products such as
adding a "coffee of the month" and special discounts for frequent customers. List
both short-term and long-range goals so that you can anticipate logistical needs for
all aspects. Some physical growth, such as opening a larger or additional location,
may be in the works and therefore you should plan ahead for what is needed to
reach those goals.

Threats
Your competition is an obvious threat to your business, but there are other key
factors you should take into account. Ask yourself questions such as "Will
customers continue to frequent coffee shops or is this a fad?" and "How will
product costs affect my business?" Write down a list of your threats such as your
location flooding when it rains to how your limited menu causes customers to go
elsewhere. Mull over all of your potential threats to complete your plan.
 FINANCIAL PLANS

FINANCIAL STATEMENTS: - The Hard Star Café Company’s financial picture

is quite promising. Since it is operating a cash business, the initial cost is
significantly less than many start-ups these days. The process is labor intensive
and TDP recognizes that a higher level of talent is required. The financial
investment in its employees will be one of the greatest differentiators between
Hard Star and its competition. For the purpose of this pro-forma plan, the facilities
and equipment are financed. These items are capital expenditures and will be
available for financing. There will be a minimum of inventory on hand so as to
keep the product fresh and to take advantage of price drops, when and if they
should occur.

BREAK-EVEN ANALYSIS:-To arrive at the average monthly fixed costs, Hard

Star cafe calculated the fixed costs for the Drive-thru. Using the average
price per unit, less the average cost per unit, divided into the fixed costs of
operation, Company concludes that we will need to sell at least the number
of units shown in the following table and chart to reach break-even each
month.
Monthly Units Break-even Rs. 2986
Monthly Revenue Break-even Rs. 75,000

Assumptions
Average Per-Unit Revenue Rs.20
Average Per-Unit Variable Cost Rs.2
Estimated Monthly Fixed Cost Rs. 10,000

SALES FORECAST:-Revenues for the first year of operation are based on an

almost 10% growth rate from month to month. This is an aggressive
estimate, but we feel that our strong emphasis on marketing will have
positive results. Annually, beyond the first year of operations, we're
predicting a growth rate of roughly 10%. We'll have a better idea of
potential growth rate beyond year one as we make our way through our first
year. The plan will be updated as we receive more information.

CASH FLOW:-
Initial capital requirement (cash outflow) = 10, 00,000(-)
Investment recovery (cash inflow) = 75,000 p.m (+)
Operating expense = 25,000 p.m (-)
= 50,000 p.m

BALANCE SHEET
 ASSETS

Current Assets
Cash 1,00,000
Account receivable 45,000
Deposits Prepays 68,200
Inventory 20,000

Total Current Assets 4,43,200

Fixed Assets
Start up costs 10,00,000
Other equipments 60,000
Total Fixed Assets 2,50,000

ORGANIZATIONAL MANAGEMENT
KEY PERSONNEL RESOURCES: - The Star Coffee Shop is a relatively flat
organization. Overhead for management will be kept to a minimum and all senior
managers will be "hands-on" workers. There is no intention of having a top-heavy
organization that drains profits and complicates decisions.

At the zenith of this three-year plan, there will be four "Executive" positions: chief
operating officer, chief financial officer, chief information officer, and director of
marketing. There will be other mid-management positions, such as district
managers for every four Drive-thrus, and a facilities manager to oversee the
maintenance and stocking of the Star Cafes, as well as overseeing the maintenance
and replacement of equipment in the Drive-thru facilities.

HUMAN RESOURCE MANAGEMENT: - The management of hard Star cafe

realizes that motivated and committed human resources are the key to the success
of a coffee business. Therefore the company took great care in selecting the right
kind of people and made an effort to retain them. Consequently, the company's
human resource policies reflected its commitment to its employees.
The Company relied on its baristas and other frontline staff to a great extent in
creating a kind of experience which differentiated it from competitors. Therefore
the company paid considerable attention to the kind of people it recruited. The
Company’s recruitment motto is "To have the right people hiring the right people."
STP (Segmentation, Targeting and
Positioning)

Segmentation
 Coffee

Targeting
 Doctors
 Students
 Journalist
 Senior Officials

Positioning
 Traditional Ambience
 Affordable food
 Courteous Services
 Healthy food
 Meeting Place
 SUMMARY AND CONCLUSION

The Hard Star will penetrate the commuter and captive consumer markets by
deploying Drive-thru facilities and Star Cafes in the most logical and accessible
locations. The Drive-thrus are designed to handle two-sided traffic and dispense
customer-designed, specially ordered cups of specialty beverages in less time than
required for a visit to the locally owned cafe or one of the national chains. The
company has identified its market as busy, Star people whose time is already at a
premium, but desire a refreshing, high quality beverage or baked item while
commuting to or from work or school. In addition to providing a quality product
and an extensive menu of delicious items, to ensure customer awareness and
loyalty, as well as positive public and media support, Hard Star could be donating
up to 7.5% of revenue from each cup sold in individual Drive-thrus to the charities
of the customers' choice.