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This food restaurant business plan, is a candid disclosure of a business venture to be situated in Nsukka, Enugu State. Our intent is to set realistic business expectations, and eliminate any questions about the profitability of this business venture. Entrepreneurs have a tendency to paint the restaurant business plan with a very optimistic brush, highlighting strengths and camouflaging the risks. Our intent is to have a definitive business, financial, and marketing plan that not only serves our need for capital financing, but is utilized as our daily business roadmap. We have taken all precautions to validate our business and financial models, focusing on realistic projections. We have accomplished this as follows:
Our financial model is rooted in industry facts, not optimism. We have based costs on a vast
industry and practical research with similar ventures, validation against National Hospitality Industry cost averages, and analysis against local Nsukka market averages. We have taken a collective look at all figures to make solid business estimates.
Our business concept was derived from detailed Market Analyses. Instead of building a
business around a preconceived concept, we analyzed the market findings and built a concept around our consumers. In other words, our business is built to service an unmet consumer 'want'.
A buffered financial plan that ensures adequate capitalization. A contingency buffer is included
in the start-up cost to ensure the business in not under financed, as well as giving the business adequate funding to sustain it in the first six months of start-up. Industry experts confirm a longer ramp-up stage for restaurants over other retail/service businesses. A common mistake for new entrepreneurs, but fully addressed in this business plan.
A solid Risk Mitigation Plan. We have evaluated traditional and non-traditional risks associated
with Restaurant failure and accounted for them directly in the business plan. Instead of dismissing the risks, we have identified valid mitigation strategies for each.
Deep Management Experience. Our management team has 20 years combined experience, and
deep involvement with the Nsukka restaurant industry. The total capital requirement to launch Classic Restaurant & Lounge is N7, 400, 000.00 of which N6, 430, 000.00 is allocated to start-up capital, and N970, 000.00 as business operations cash reserve.
Mission • Classic will be an inspiring restaurant, combining an eclectic atmosphere with excellent and
interesting food. The mission is to have not only a great food selection, but also efficient and superior service - customer satisfaction is our paramount objective. Classic will be the restaurant of choice for a mature and adult crowd, couples and singles, young and old, male or female.
• Employee welfare, participation, and training are equally important to our success. Everyone is
treated fairly and with the utmost respect. Our employees will feel a part of the success of Classic Restaurant & Lounge.
• Our concept combines variety, ambiance, entertainment and a superior staff to create a sense of
'place' in order to reach our goal of overall value in the dining/entertainment experience. We offer fair profits for the owners and investors, and a rewarding place to work for the employees.
Keys to Success
Unique, Innovative & Contemporary: 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 design and decor. We will offer a fine dining experience in an electric atmosphere.
2. 3. 4.
Product quality: great food, great service and atmosphere. ‘Spice of Life' Menu: The menu will appeal to a wide and varied clientele. Our eclectic
menu features regional specialties around the country. Employee Retention Focus: Employee retention and development programs will be a primary
focus and success platform for this business. Through these programs, we will be able to draw seasoned and elite professionals and build a committed work force. We have budgeted for a stock option program for Chef and Management positions to subsidize a lower salary base. This lowers our immediate overhead and attracts quality staff.
Cost Control Focus: We will control costs at all times, without exception. Cost Control will be an
integrated function of the restaurant from the onset. Cost control is about managing the numbers - interpreting and comparing the numbers that impact the bottom line. 80 percent of the success of a restaurant is determined before it opens. Our focus is to reduce the cost of goods sold to meet our profit margin goals by managing the following crucial elements of cost: Purchasing, Receiving, Storage, Issuing Inventory, Rough Preparation, Service Preparation, Portioning, Order Taking, Cash Receipts, Bank Deposits and Accounts Payable. We will use of this restaurant food business plan to track actual costs against our forecasts in managing the business. Due to intense competition, restaurateurs must look for ways to differentiate their business to achieve and maintain a competitive advantage. Midtown/Downtown Nsukka’s redevelopment requires a place that will fit into the 'new look' of the community, one that is contemporary and entertaining. Classic will fill that niche.
Classic Restaurant & Lounge's objectives for the first three years of operation include:
• Keeping food costs at less than 35% of revenue. • Improving our Gross Margin from 65.41% in Year 1 to 67.10 in Year 2. These are attainable
targets; our ‘stretch' is to attain 70.73% by Year 3. • Keeping employee labor cost between 37-39% of total sales. • Remaining a small, unique restaurant with eclectic food and service.
000 per year. consideration will be given to incorporate a dining patio. rent. and Full Service Dining. Where possible. 200. and legal and consulting costs associated with opening our restaurant.311 worth of current assets during start-up: • • • • Fixtures and Lighting: $32. • Achieving a profitable investment return for investors for Years 2 . 500. and will open Classic in December of this year. Company Ownership The restaurant will start out as a private Limited Liability Company. Start-up Summary We are currently negotiating a restaurant space of 3. Fax. Our start-up costs are mostly expensed equipment.183 Sound and Televisions: $8.000 square feet. For lack of a better term we are launching a ‘multi-ethnic' cuisine restaurant . and marketing arenas.000 . start-up labor.500 . The Midtown demographics fit this concept perfectly. owned by its founders.• Averaging sales between N1. Safe): $6. finance. restaurant and hotel. since there is a large university community. Enugu State.000 sq. Parking and accessibility issues will be reviewed as key criteria. painting.250 Lounge and Dinning Equipment: $26. We will draw on our Advisory Board as part of the site selection and lease negotiation.000 will be allocated for business operations reserve. Company Summary The Design Classic Restaurant & Lounge is unique to Midtown Nsukka. In total. _________ and __________. Classic is a complimentary mingling of national cuisine on a single menu.6. • Expanding our marketing and advertising in Nsukka to increase our customer base. We will purchase the following $73. At the start of business. This is not a family dining establishment. Printer. The Menu Classic is focused on servicing Nsukka's growing demand for an electrifying eating experience. furniture. The restaurant features 2 venues in one (a concept called ‘Multi-Branding'): A Lounge. Total space requirements are 3. The Management Our management team has over 20 years combined experience in food.1. $97. business management.a restaurant concept that responds to Nsukka's need for selection and choice. in Midtown Nsukka.378 Office Equipment (2 Computers. This is a solid start-up forecast based on our market analysis. offering multiple dining and entertainment options within a single establishment. reconstruction. This concept offers customers variety. ft. • Promoting and expanding the Classic restaurant concept as a unique Midtown destination restaurant. The atmosphere caters to a young but mature adult crowd. the restaurant will provide seating for 110 patrons. The spatial and menu divisions will broaden our appeal and provide our customers with a different experience on each visit.
000 square feet. and participate on the Classic Advisory Board.m.911 . The restaurant will operate during peak service time to take advantage of street traffic. The central dining area will allocate 88 seats. Where possible. dinner.2:30 p.000 cars daily. – 8:00pm Sundays . Dinner: Monday to Saturday. Restaurant Design Single-Level Design Concept: The total space requirement is 3. and Retail development. Operating Criteria The restaurant will be located in Midtown Nsukka. In total. Parking and accessibility issues will be reviewed as part of this analysis. This is especially key during the site selection and start-up stage.000 include all kitchen equipment. The restaurant will feature a comfortable and open concept design. The outlook for the future of Nsukka's Midtown district is exceptionally positive and the most progressive development area in the city. We have budgeted for the services of a premier Restaurant Consultant familiar with the South-Eastern Market. Residential. This company will have an integral role in validating the final restaurant location and personnel selection.Market brunch takeout only. exotic drinks.Long-term Assets in the amount of $65. as well as non-alcoholic offerings. The market has been carefully selected and tested for the necessary demographics and retail traffic necessary to meet the goals laid down for profitability. and after-hour patronage from the entertainment facilities in the area. The patio setting will be a fun and casual atmosphere for the summer crowd. 9 a. Location & Operations Restaurant Location Midtown Nsukka is the location selected for the Classic concept. consideration will be given to incorporate a dining patio. Optional Patio: During the busy summer months customers can also sit outside on our patio and we will offer a special summer menu. 5:30 p. featuring lighter fare. Start-up Requirements Start-up Expenses PROJECT MANAGEMENT Restaurant Consultant (4 months) $0 $15. the restaurant will provide seating for 110 patrons. The busy Midtown commercial/residential location has been chosen based upon a successful demographic model and a traffic count of more than 33. Service will be available during the following hours: Lunch: Monday to Saturday. .m. The restaurant will service brunch.m. Developers are infusing over 500 million in Commercial. and the lounge 22 seats. and after-hours dining during the week and weekends.
195 $1.155 $1.) Flooring Fire Alarm System Security & Phone System EQUIPMENT Liquor Control System .250 $7.538 $14. Smallware & Supplies (FOH) Dishwasher.061 $8.115 $1.000 $3.615 . Uniforms POS (Point of Sale System) . Smallware (Bar & Lounge) Glassware.592 $9.080 $5.3000 sq.244 $14. Ice & Glasswasher . ft.092 $2.988 $0 $7.298 $8.244 $19.DESIGN Architectural Design Structural & Plumbing Design Mechanical & Electrical Design Graphic Design Electrical & Structural Engineering Fees Design Consultants (Kitchen.368 $2.040 $0 $33.185 $2. Flatware.122 $52. Interior & Dining) Engineer & Architect Fees CONSTRUCTION Plumbing HVAC (Air Return.Lease Kitchen Equipment Freight Fees FF&E Taxes (Taxes on Purchase) OPERATIONAL Capitalized Legal Fees (LLC.622 $3. Flatware.119 $7. Tap & Permit Fees Business License & Temp Certificate of Occ. Air Ducts.964 $4.025 $0 $3.389 $7.500 $6.615 $4. Investor Agreements) Software: Restaurant/Inventory Software: Cost Control Impact.Lease Stools. Liquor Licenses $0 $2.615 $0 $0 $38.) Electrical Disposal & Demolition Structural Construction (4 Months General Labour) Facade (Exterior Construction) Plaster (Dry Wall) Mill & Metal Work Interior Finishes (2500 . Chairs.099 $3.Lease Glassware.092 $4. etc.298 $0 $2. Tables.
811 $97.250 $6.550 $750 $1.791 Liabilities and Capital .250 $5.Utilities.881 $146.311 $65.119 Start-up Funding Start-up Expenses to Fund Start-up Assets to Fund Total Funding Required $427.000 $427.119 Assets Non-cash Assets from Start-up Cash Requirements from Start-up Additional Cash Raised Cash Balance on Starting Date Total Assets $165.275 $6.050 $14.550 $3.800 $19.050 $58. Training & PR Research & Development Start-Up Salary (Mngt & Chefs) Recruiting (Staff) Inspections Initial Cleaning Services Total Start-up Expenses $9.209 Start-up Assets Cash Required Start-up Inventory Other Current Assets Long-term Assets Total Assets $97.250 $6.910 $690. Tax & Insurance Security Deposits (Phone/Elec/Gas/Water) Initial Lease Deposits Bank & Loan Closing Costs Web Site Construction Initial Marketing.099 $27.910 Total Requirements $690.000 $262.209 $262.500 $73.099 $49. Disposal.980 $312.
791 Total Capital and Liabilities $312. and superior service. garnished with stunning presentation.000 $50.000 $0 $440.000 $40.000 $40.209) $12.791 Total Funding $740. We will review our menu every 4 months. Their creative . Customer satisfaction is the driving force behind our success. The kitchen staff will have the best in culinary education and work experience.Liabilities Current Borrowing Long-term Liabilities Accounts Payable (Outstanding Bills) Other Current Liabilities (interest-free) Total Liabilities $0 $300. Portugal. Our wine list will be modest and primarily focused on wines from California.000 $130. and the remaining labels will be available by the bottle. Our food will be of the finest quality and prepared with exotic flare.000 $0 $0 $300. Approximately 25% will be available exclusively by the glass. while maintaining the 'favorites' for loyal patrons. and Argentina.000 Services Classic Restaurant & Lounge will feature national dishes.000 Capital Planned Investment Zander Hunte Peter Smith Investor 1 Investor 2 Investor 3 Investor 4 Investor 5 Midtown Revitalization Grant Additional Investment Requirement Total Planned Investment $60.000 $40. Spain. Portions will be modestly sized.000 Loss at Start-up (Start-up Expenses) Total Capital ($427.000 $40. an eclectic ambiance.000 $40.
food magazines. eating places that identify themselves as ethnic establishments numbered nearly 78. Market Analysis Summary Instead of building a business around a preconceived concept. TV cooking shows and imported goods offers ample evidence that America. allowing budget dining in a fullservice restaurant. 3. as a whole.5 billion. Zara takes all these factors in consideration for the design of this cosmopolitan restaurant. Again. Zara's Tapas concept is built to offer different-sized portions.000 in 1999 and recorded sales of $30. This statistic is in line with findings reported by the Tableservice Operator Survey. Zara's menu is priced at a mid-tier level. customers are demanding value for their dining dollar. 2. Classic’s Menus Classic's varied national menu will feature basically regional flavors. We want everyone to feel welcome and entertained.talents will compliment one another. is currently on an international tasting spree. Although the restaurant industry as a whole has seen growth in 2002/2003.50 . we conducted market research and built a concept around our consumers. The proliferation of international cookbooks. lighting. Reasonable Prices: This was no surprise given the economic tide.$9. The lounge and restaurant staff will offer the finest service in an electric atmosphere and offer customers an extraordinary dining experience. bar. The menu flows together to create complementary elements. We have defined the following groups as targeted segments that contribute to our growth projections: • The Business Person • Downtown Nsukka Couples • The Destination Customer . and other options to improve the dining experience are also factors in customer decisions. but rather suggest that incorporating strong multi-ethnic influences in the menu selection will be popular. Menu Variety: Ethnic restaurants are increasing in Atlanta. with no entrée over $20. The list below offers a small selection of our opening menu offerings: • Include menu offering here. The Dining Experience: Customer satisfaction with food and service has been and continues to be of utmost importance. Portion Selection: Nearly 95% of our surveyed focus group endorsed having a choice of different size portions. Our customers want the option to choose what satisfies their appetite. In addition we have an extended Tapas and Appetizer selection priced between $3.50. Our market analysis identified the following key drivers as areas of opportunity to service Nsukka's restaurant customers: 1. variety is the underlying element for this concept. In fact. Market Segmentation Classic's Restaurant & Lounge intends to cater to a wide customer base. but our findings indicate that the décor. 4. Our research results do not identify any single ethnic style of restaurant as desired.
Market Analysis Year 1 Potential Customers Business Person Downtown Atlanta Couples Tourists The Destination Customer High-end Singles Total Growth 18% 32% 13% 8% 29% 5.• High-End Singles • Tourists • Unviversity Community These particular market segments are 22-45 years old.818 19. They have disposable income. They need a competent establishment that helps impress clients and prospects.140 10. national menu.645 7. romantic. have disposable income. Afterward.411 15.76% Target Market Segment Strategy The Business Person: They work hard all day and often stay overnight in a strange city. striking decor. and lounge.348 20.815 63.348 11. here to socialize and be entertained.914 21. and will embrace our national fusion cuisine. Downtown Nsukka Couples: The restaurant will have an intimate. Classic's will be a destination dining locale.141 68. Classic's cosmopolitan flair and comfortable atmosphere will be perfect for sophisticated business people.673 8.499 16.168 4.054 4.95% 6.223 18. Classic's will be especially appealing to married suburban couples indulging themselves with a "date night" downtown.74% 7. These young Midtown couples are generally very successful working professionals. away from the kids. entertainment and events. as they don't have the time to prepare food nightly. They spend the most on drinks. enticing adult atmosphere that suggests "date. food and tips. and are seeking upscale.510 11.47% 2. Service Business Analysis . using marketing to draw customers from outside the main city limits.688 21. In most cases they are budgeting to eat out on a regular basis. they want to relax and use the money they are making (or are expensed by their company). They are likely to spend more on experiences they perceive as unique.991 55. Tourists: Nsukka attracts many vacationers during the ember months of November through January.47% 3.23% 5. and comfortable restaurant options.982 Year 2 Year 3 Year 4 Year 5 CAGR 4.944 66.215 4.925 17.724 18. Many of these consumers are new to Nsukka from larger cities. and sophisticated. A large percentage of the tourist populations are vacationing families.896 4.76% 9.527 7. Classic will be a destination restaurant. Our national menu. accustomed to dining within the city and at non-franchised restaurants.097 12. They are also the most open to trying something new. excellent service and engaging clientele will confirm the feeling of being in "the in place" in Nsukka.565 7.The Image Seekers. cosmopolitan. trendy. Zara will break these habits. High-end Singles: We will attract them with our eclectic atmosphere and layout.311 4.593 8. These are the types of people who frequent other restaurants and bars in the area. The Destination Customer: Nsukka is a very 'sectioned' city. with its attractive atmosphere. This is especially true for the tourist populations that visit for cultural and social events.039 22." Classic's will be the best date location in town. and consumers often look only in their own neighborhoods for restaurant options. and will spend quite a bit on such outings. food wise. These are the individuals that pride themselves on socializing and dining at the premier locations . whether they live in and around Nsukka or are here for work. Our Destination Clients tend to be new suburbanites that miss the excitement of a city.950 57.
The restaurant industry is highly competitive and risky. and selling them at a much higher price. and the organizational skills to bring off what is essentially a giant catered party. those based on solid understandings of the market needs. and a unique atmosphere. Restaurants make money by taking inexpensive ingredients. we will be the talk of the town. And half of them were located in Midtown. regionally specialized menus. We will create an appealing and entertaining environment with unbeatable quality at an exceptional price. you need an understanding of the risks and financial conditions. but as one that offers consistently high quality food. Strategy and Implementation Summary Our strategy is simple. Therefore. We will keep our standards high and execute the concept flawlessly. so that word-of-mouth will be our main marketing force. and management of inventory and staff have a much higher chance of success. While we are not striving to be the lowest-priced restaurant. We intend to succeed by giving people a combination of excellent and interesting food in an environment that appeals to a wide and varied group of successful adults. two to three times a day. Any time wasted in seating customers. cooking them properly. However. While some entrepreneurs think that success is as simple as a good location and a trendy concept. Our marketing challenge is thus to stand out from our competitors. we are aiming to offer exceptional food at reasonable prices for the average restaurant diner. Any ingredients wasted in the kitchen are money thrown out. National menu with featured menu review every 4 months . All menu items are moderately priced for the area. but so is atmosphere and distinctiveness. hip interiors and reasonably priced. Location is clearly important. Our competitors are heading in the right direction. Three of them offered traditional cooking. Most new restaurants opened by inexperienced owners struggle or fail. not only as the "new" restaurant. the ability to handle enormous pressure. taking orders or preparing food is money walking away. Our main focus in marketing thereafter will be to increase customer awareness in the surrounding communities. The owners' thorough understandings of opening and running a restaurant 2. especially when combined with prior experience in the restaurant industry. we know the truth: To succeed in the restaurant industry. combining them in creative ways. We will direct all of our tactics and programs toward the goal of explaining who we are and what we do. Competitive Edge Classic competitive edges are: 1. Competition and Buying Patterns In 2003. Nsukka consumers are seeking variety and new experiences. An extraordinary contemporary restaurant design 3. As an exciting and eclectic restaurant. We will focus on establishing a strong identity in our community with a grand opening. the top ten Nigerian restaurants shared two things: cozy. but only Classic is based on sound market research in the local market. the execution of our concept is the most critical element of our plan. menu variety.
respectively. Media Objectives and Strategy: Establish our image as a unique Midtown restaurant with great service. "Come to Town" promotions) Employee Training. Incentive and Retention program Market Analysis Conclusion: At the end of the day. • Scheduling adequate frequency of ads to impact market with menu items and promotions. but price has become a factor as a result of the economic turns. 8. but the solution is to deliver the best food at the best price with the highest level of service in one establishment. So. . The full Marketing program is as follows:. Inner and Outer City Marketing campaign (i. couples. where is a customer more likely to go? There is no absolute answer to the question. and every 90 days they undergo a performance appraisal. Customer Service: In our years within the restaurant industry. 7. Management will demand the wait-staff provide the very best in quality services to the customer. This is part of our Employee Manual. We budgeted a great deal into the renovations and decor to generate the aesthetic appeal of Classic. and exciting concepts to draw in the local repeat customers. and Operations Manual guide. if the food and service is better at a fine dining restaurant than a casual restaurant. This must be done aggressively in order to accomplish our service goals. Marketing initiatives will concentrate on the following: Building and Signage: The most important Marketing tool that we have is the exterior of our building. making certain that they are content and satisfied with their dining experience. Wait-staff are thoroughly trained. Food and atmosphere is far out-shadowed by superior customer service that turns a new customer into a repeat customer. • Where possible. This is the very definition of value and the concept at the heart of Classic's business model. superior service. and great food served in an eclectic atmosphere. and our new sign. A primary part of the budget is allocated to create the media and customer buzz for the month prior to opening and the next three months after the grand opening.4.e. because we all compete for the same home meal replacement dollar. 2-Tiered spatial layout Chef Co-op program to allow new entrants. value. customer service has always been the major draw for the dining clientele. there are two segments of the restaurant industry that are our main competition: the casual dining restaurant and the fine dining value restaurant. 5. Management recognizes the key to success at this time of initial opening is extensive media promotion. positioning advertisements in or near entertainment/food related editorial. Advertising and Promotion: Our Advertising Plan and media schedule call for targeting customers directly through local publications aimed at . A healthy budget is allocated for the first year. Unique. We will maximize efficiency in the selection and scheduling of advertisements by: • Selecting primary business publications with high specific market penetration. singles. and destination customers. everyone that sells prepared meals in this district is a Classic competitor. 6. However. trainee and featured chef Chef/Management Stock Incentive Program. Marketing Strategy Classic Restaurant & Lounge's Marketing strategy will be to promote our electric food.
location. This will be by far the cheapest and most effective of our marketing programs. reservations. • Produce a complete Classic Restaurant history and menu offering piece to be used as the primary public relations tool for all target media editorial contact. Promotional Campaign: The best way to reach our potential customers is to develop an intense advertising campaign promoting our Classic concept of "Spice of Life.' who still appreciate in-town dining. Public Relations Marketing. Our periodic customer surveys and weekly menu item sales evaluations will help us to understand what advertising is working and what is not. keeping key editors abreast of all new promotions. past happenings. Publicity Strategy: Working with a media company. and menu introductions. We will support this plan with ads that reinforce the Classic dining concept. • Maximizing ad life with monthly and weekly publications. Our most important tactic will be word-of-mouth/in-restaurant marketing. Community: Classic will look for key opportunities to pair with local community development organizations and radio stations to interface with our customers. we will gain considerable recognition through newspapers. Press Release/Grand Opening: Classic Restaurant will release a series of press releases on the Grand opening. who we are reaching. This will also be effective for inclusion in press kits. and decor. menu offering. basically. and flash media promotions.• Redirecting customers to our website to register for upcoming functions. we will employ three different marketing tactics to increase customer awareness of Classic: In-Restaurant Marketing. A full media kit will be sent to all local publications. and give something back. Consumers will be encouraged to visit our website to be greeted with a flash media intro that highlights the restaurant. Working with a renowned media company (Classic Advisory Board). and releases on new menu items will be made monthly. in order to better our community. newsletters and public announcements. VIP lists. Publicity Revenues: We anticipate at least 10% of our annual sales will be generated directly from our publicity. with ongoing contact between key editors • Develop a regular and consistent package update program for the major target media. we will develop an advertising campaign built around our Classic Diner theme. upcoming attractions and our dynamic menu." In addition to standard advertising practices. and redirect advertising as effectively as possible. . measure the success of our direct marketing and media activities. Additionally. Our goal is to understand our customer. Classic will focus on the following publicity strategies: • Develop a sustained public relations effort. and new 'suburbanites. and Media Marketing. • Establish contact with editorial staff for the purpose of being included in entertainment "roundups"--product comparisons in dining publications and the local papers. Marketing Program In line with our Marketing strategy. We will continually look for local community programs in which we can participate. we will develop a consistent reach and frequency throughout the year. targeting each specific customer segment within a five-mile radius.
• Critics' Choice: Prior to the Grand Opening there will be two preliminary parties catering to the Media and Critics community. We will approach them to cater business luncheons and private functions. • Restaurant and Special Events Website: We have contracted with local design teams to deliver a high-quality. This will be a preliminary review. we will have a special evening for restaurant people. Notices of all live entertainment segments and special features will be posted to local newspapers' calendar announcements. • Media Relations: Several media relations teams will be utilized to market the Restaurant. the restaurant will offer a monthly dating night. and possible Co-op efforts to promote the Midtown district. containing interior pictures of our restaurant. menus and prices. This initial review and input will give critics and media commentators a stake in Classic's success. Media Marketing • Newspaper campaign: A much targeted media campaign to obtain featured articles about the restaurant in their Living. We will encourage the media and restaurant critics to meet at the restaurant and review the decor. service and food. constantly updated website. distinct billboard ads will advertise the launch of the Restaurant. navigable.P.' This will serve the dual purpose of training our staff and introducing ourselves to the community. • Brochures: Make a brochure for the in-town hotels and business establishments to provide to their guests and staff. through their contributions to the final design. and private functions. Dinner before the 'Grand Opening. Entertainment and Dining segments.P. This will offer us higher visibility for future functions and community events. • Government Relations: There are several Government offices in the Midtown/Downtown area.I.I. Party: We will host a V. • Wait Area Marketing: Wait staff will service appetizers to customers waiting to be seated or on the wait list. Word-of-mouth referral is very powerful and particularly amongst the business community. where we will consider constructive input to make minor revisions prior to the true Grand Opening. • • • • Live Entertainment parties Special Events Valentine's Day New Year's Eve party Public Relations Marketing • Georgia Hospitality & Tourism V. • Private Functions: Target marketing to businesses for regular business lunch and dinner entertaining. chefs and staff to get together to discuss the market and food trends. In addition to food and beverages. . A perfect night for the local area's restaurant owners.Word-of-mouth/In-Restaurant Marketing • Restaurant Night: Every first Monday of the quarter. customers can choose from an array of dating packages up for auction. • Monthly Dating Connection: With the increasing appeal of Internet and speed dating. • Billboard Advertisement: One month prior to the opening.
whether on their first visit or their hundredth. Our sales forecasts for years 3 through 5 are very conservative. and to tell all their friends and acquaintances about the great experiences they just had at Classic. we will insist on payment at delivery . Sales Strategy Our strategy is simple: we intend to succeed by giving our customers a combination of delicious and interesting food in an appealing environment. All factors governing our sales progress are outlined below in the Important Assumptions section.041 $0 $272.204 $0 $293.595 $220. so they know that their feedback goes directly to the owners • Evaluating food choices for popularity. and keeping favorites on the menu as we rotate seasonal foods and specials Sales Forecast The following sales graph is based on first year start-up estimates only. We can accomplish this by: • Hiring employees who genuinely enjoy their jobs and appreciate Classic's unique offerings • Continually assessing the quality of all aspects mentioned above. and atmosphere.• Inner & Outer City Marketing: We will budget to attract customers from the suburbs. and are unable to maintain the initial quality customers expect on return visits. speed.006. or they spend all of their efforts at opening. Although we hope to do catering for local businesses and government offices with time. with excellent customer service. and initial poor service. decreasing word of mouth advertising and leading to poor revenues.174 $0 $959. Our marketing strategies are designed to get critics and initial customers into our doors. Our sales strategies must take the next step and encourage customers to become repeat customers. or quality discourages customers from returning.047 $1.047. We anticipate that the business will not be at full operating capacity until the sixth month of operations. speed. Sales Forecast Year 1 Sales Total Sales Food Total Sales Bar/Beverages Other $853. This is due to the competitive nature of the market and existing customer loyalty.089. and immediately addressing any problems • Interacting with our customers personally.we will not sell on credit. Classic's sales strategy requires consistently high quality food. compared to industry standard growth rates.981 $0 $317.279 $1.499 $0 Year 2 Year 3 Year 4 Year 5 . service.170 $252.999 $1. New restaurants often make one of two mistakes: they are unprepared or under prepared for opening.
416 Year 2 $322. It will be the virtual business card and portfolio for the company.769 $1. The website will include email capabilities and online reservations and special events scheduling.204 $1. Personnel Plan . service employees should average at least twice the minimum wage in any given shift.260 $1.240 $76.835 $0 $423.073.687 $0 $406.308 for the first year in business. lounge tenders) do not include anticipated tips. Georgia area. Prep cooks/dishwasher (4).279.406. reviews and happenings at Classic.Total Sales $1. This is also a potential for customers needing catering. and our menu prices.167 $0 $398. People cleaning the restaurant (4).276 Year 5 $342. Our site will offer our menus.597 Web Plan Summary Classic Restaurant & Lounge will have a dedicated website.657 $0 $371. A customer will be able to order a selection for pickup using a debit card. simple.670 Direct Cost of Sales Total Cost of Sales: Food Total Cost of Sales: Bar/Beverages Other Subtotal Direct Cost of Sales Year 1 $298.341. Kitchen: The Executive Chef will be assisted by: • • • • An Assistant Chef from a national search (1).048 $79. Personnel Plan We believe the personnel plan is in good proportion to the size of the restaurant and projected revenues. busboys. Cooks that work directly with the chef (3). Our website will be used to try out new offers. The staff will include 13 full-time employees and 8 part-time employees.588 (including Partner Salaries) is 37% of total sales. starting with an on-line order feature for the Sunday Market Brunch.758 $72. Skilled waitresses and lounge tenders on weekends and evenings will make substantially more. The estimated gross annual payroll of $399.228 $0 $415.762 $80. Selections will be based on our pre-packaged meals available during the Sunday Market Brunch.088 $1.407 Year 3 $329.211. With average tipping rates for the Atlanta.976 Year 4 $336. and expanding if the concept gains favor with our customers. who will work a total of 754 man-hours per week and generate an average monthly gross payroll of $27.289 $77. prices. contemporary and well designed. We will also have a monthly Paparazzi Review about what did happen at Classic to get new customers interested in our restaurant. Wage salaries for service personnel (wait staff.
640 $5.800 $11.640 $5.960 $12.640 $5.120 $11.800 $8.640 $5.300 $5.640 $5.600 $9.500 $9.760 $11.640 $5.640 $5.640 $5.640 $5.400 $32.640 $5.760 $7.640 $5.400 $44.120 $7.760 $11.640 $5.200 $44.640 $5.640 $5.288 $12.000 $32.800 $11.640 $5.960 $12.640 $5.640 $5.000 $48.960 $8.200 $7.500 $9.120 $7.500 $13.000 $14.200 $44.400 $44.240 $18.640 $10.960 $12.160 $32.500 $14.500 $25.400 $7.288 $12.800 $11.760 $7.240 $24.640 $5.640 $5.120 $11.200 $9.640 $5.500 $9.160 $24.640 $5.640 $5.400 $14.640 $5.000 $28.640 $5.000 $48.640 $5.200 $7.760 $11.240 $18.640 $5.640 $5.000 $14.400 $14.440 $10.288 $12. Chef Hostess (Full Time) Hostess (Part Time) Waitperson 1 Waitperson 2 Waitperson 3 Waitperson 4 Waitperson 5 Waitperson 6 Waitperson 7 Waitperson 8 Waitperson 9 Wait/Barperson Bartender 1 Bartender 2 Busboy 1 Busboy 2 Busboy 3 Assistant Chef Sous Chef Cook 1 Cook 2 Prep Cook/Dishwasher Prep Cook/Dishwasher/Cleaning Dishwasher 1 Dishwasher 2 Cleaning/Dishwasher Open Total People $28000 Year 2 Year 3 Year 4 Year 5 $29.640 $5.800 $8.440 $10.640 $5.760 $11.640 $5.120 $7.640 $5.640 $5.640 $5.640 $5.440 $14.640 $5.800 $0 20 $0 24 $0 25 $0 25 .400 $7.800 $0 25 $28000 $28.160 $32.400 $24.288 $12.960 $18.440 $10.960 $12.640 $5.400 $24.640 $5.960 $18.240 $24.800 $5.240 $24.960 $18.400 $44.640 $5.288 $12.Year 1 General Manager (Year 2+) Partner/Manager Partner/Asst.160 $26.000 $32.640 $5.640 $5.200 $7.960 $12.760 $11.700 $8.500 $48.440 $14.200 $13.400 $32.640 $5.640 $5.160 $32.400 $32.640 $5.640 $5.640 $5.000 $48.400 $32.960 $8.000 $48.640 $10. Manager/Exec.400 $32.640 $5.640 $5.640 $5.000 $24.000 $25.400 $14.
The Financial Plan includes: • • • • • • • Important Assumptions Risk Analysis & Mitigation Plan Sales Forecast (5. also ensuring that we do not enter this venture undercapitalized.000 in investment for renovations. but Manage for the Best. The key underlying assumptions are: Economy Emerging Economy.Total Payroll $399. The financials account for the following growth projections: o Year 2: 6% Year 4: 4% o Year 3: 5% Year 5: 4% Weekly Sales Variance. liquor license. and above average food/beverage cost.000 of owner investment and $130. recovering from an economic slow down. and business success.588 $400. Saturday will typically be our best sales for the week. food & restaurant supplies." We have approached the financial plan as follows: The First Year projections anticipates a below average sales volume. below average seat turn. We have been cautious with our projections. kitchen equipment. This position will help us ensure sufficient financial planning to accommodate a reasonable ramp-up period. working capital.828 $431.000 in long-term loans and $200. Business Growth Annual Growth Rate Percentage. legal fees. furniture.3.788 $429.1. marketing and personnel. above) Break Even Analysis Profit and Loss Statement Cash Flow Statement Balance Sheet Important Assumptions The financial plan depends on important assumptions. Financial Pro Forma In addition to the $110.728 Financial Plan Classic Restaurant & Lounge financial model is based on a business concept to "Plan for the Worst. We anticipate a robust-growth economy. We anticipate modest growth over the coming years. most of which are reflected in the financial statements that follow. Classic is seeking $300.128 $432. The sales volume for all other days is represented as a percentage relative to Saturday. Therefore our weekly sales will vary as follows: Monday: 55% Tuesday: 60% Wednesday: 75% Thursday: 95% Friday: 90% Saturday: 100% .000 in grant monies. and incorporate mitigation for all manageable risks.
Revenue calculations are based upon competitive price comparisons and established menu values in the current marketplace. 750 per person for After-Hours dining. dinner at N2.33%. Cost of goods sold have been calculated as a percentage of sales and will be monitored on a daily basis in order to keep Cost of Food within the range of 31 . Dinner = 88% • Year 2: After-Hours = 70%. Brunch = 1. while the summer months tend to be the slowest restaurant period.Seasonal Sales Variance.0. and N1. and Average Seat Turns: Daily average for lunch spending is N1. Dinner = 100% (implied wait period) Six-Month Start-Up Stage.0. This is reflected in a higher than average monthly sales variance shown as follows (Worst-case / Expected-case): • Month 1: 32% / 51% Month 4: 64% / 75% • Month 2: 41% / 58% Month 5: 80% / 90% • Month 3: 52% / 66% Month 6: 90% / 92% Market Analysis findings are static.0. October through the late season is the most productive sales period. This trend is reflected in the financials though a seasonal variance as follows (where October is targeted to be our most successful sales month): June: 70% July: 75% August: 80% September: 85% October: 100% November: 95% December: 95% January: 85% February: 95% March: 85% April: 90% May: 90% Industry & Start-Up Fiscal Year-1 Ramp-up. . In Nsukka. Brunch = 70%.0 • Year 3: After-Hours = 1. 750 per person.25 Cost Control. As a new restaurant entry to the Midtown market. the ramp-up in customer draw is expected to extend over 6 months. Our Annual Sales Growth is based on attaining the following seating capacity percentage per dining period: • Year 1: After-Hours = 53%. and Cost of Beverages (Non Alcohol) below 9%. Our experience in the industry confirms a longer ramp-up stage for restaurants over other retail/service businesses.0.7. Brunch = 1. Dinner = 1. Brunch = 82%. Dinner = 1. With a focus on Cost Control. Seat Turn averages are modestly estimated at: • Year 1: After-Hours = 0. We assume that there are no unforeseen changes in findings outlined in the Market Analysis. Brunch = 87%. Dinner = 1. Pricing & Cost Control Competitive Pricing Model. we anticipate 6 months to fine tune the restaurant operations and manage our costs within the defined tolerance range. Brunch = 1.0 • Year 2: After-Hours = 0.7. Dinner = 100% (implied wait period) • Year 3: After-Hours = 80%. The following are baseline assumptions on Average Check Totals. 050 per person.
• We budgeted operational shortfall in an operational contingency budget that we will utilize if the need arises. 4.Inventory turnover and Accounts Payable. Accounts receivable turnover is calculated to be 0 days. 2. • We calculated worst-case monthly financial shortfall based on the ramp-up sales percentages outlined in our financial assumptions. Additionally. specializing in the Nigerian Market. and on retainer for 4 months of business operations. we have an extended Appetizer selection priced between N550 – N950. Inventory is turned on a 7 day cycle as inventory is used daily within all categories. Another mitigation has been our overall Restaurant concept. How do we know we have selected the right location for this concept? . We have worked with our Restaurant Consulting firm to validate our cost estimates to their industry knowledge. we have scaled back the size to reduce business overhead. How do we manage a successful restaurant in current market conditions? Our original effort was to open a restaurant twice the proposed size. and business operating capital. How do we confirm that our Funding Requirement is sufficient? We have leveraged our membership with the National Hospitality Industry Association to look at industry averages for this market segment for Restaurant startup and Operations. allowing budget dining in a distinguished restaurant. In addition. As we are in the midst of an economic recovery. We have the menu priced at a mid-tier level with no entrée over N2. How do we allow an adequate startup period and capital to launch the concept and grow our customer base in a competitive sector? Our financial plan is budgeted to support the Worst-Case business scenario. We will be recruiting a seasoned chef (national search) whose style is in accord with the Restaurant concept and our market segment. rollout. Operations and Business Management Experience. The selected firm has experience with over 72 Restaurant launches. 000. Risk Analysis/Mitigation 1. We addressed the financial risk as follows: • We looked at our monthly break-even. 5. startup requirements. The Financial Plan incorporates a budget for a Nigerian Restaurant Consulting group. and accounts payable are projected to be 30 days. Our Accounting service will be contracted to a firm specializing in Restaurant accounting. We will be offering an equity interest to our select Chef to maintain the industry knowledge. and have the right industry knowledge? Owners have a combined 20 years of Restaurant Management. Their services are budgeted for the business start-up analysis. as payment is rendered with service. 3. How do we ensure we have addressed all resource gaps. The current Economic slowdown and recovery state was a key consideration in our restaurant concept. we included a contingency buffer in the financial estimates to account for any potential cost variance.
This transition shows the restaurant managing through its start-up period. What if there is an additional need for Business Capital after the Restaurant has exhausted its 6month buffer? Our intent is to be a self-sufficient business far in advance of the 6-month probation period.976 $415.088 $1. We have accounted for an operational contingency budget that will be used to supplement any slow periods. Site selection was based on space. In summary. 6. and functionality.341.00% 30.211.073.406. Based on the results.00% 7.416 $398.00% 0 Year 5 5 6.769 $1. the Classic Restaurant concept was formed specific to Midtown Atlanta.276 $423.407 $406.416 $398.00% 7.00% 7.00% 0 Year 3 3 6. but we took a very objective approach with our concept.260 $1.204 $1. We would also look to the partners' capital reserves as another source of funds. the restaurant will develop its customer base and reputation and the growth will pick up more rapidly towards the second and third years of business Pro Forma Profit and Loss Year 1 Sales Direct Cost of Sales Other Total Cost of Sales Year 2 Year 3 Year 4 Year 5 $1.276 $423.597 $0 $0 $0 $0 $0 $371.00% 0 Year 4 4 6. We show an adjustment increase in Year 2 as we exit our start-up phase of the business and move into our expected annual sales forecast.00% 0 Year 2 2 6. we let the Market Analysis define the need.00% 30.976 $415.00% 0 Profit and Loss Statement The most important assumption in the Projected Profit and Loss statement is the gross margin.279.00% 30. Our next step would be to approach our private investors for capital by extending their return on investment.407 $406. General Assumptions Year 1 Plan Month Current Interest Rate Long-term Interest Rate Tax Rate Other 1 6.00% 7.Again we will draw on the Consulting group that has the expertise in site selection and lease negotiation.00% 7.597 . there are no guarantees with location.00% 30. In all. and gaining efficiency and customer loyalty.00% 30.670 $371. we have looked at this risk. But as we are considering all contingencies. Instead of going in with a predefined business concept. visibility.
124 $4.500 $12.250 $0 $4.000 $21.124 $4.Gross Margin Gross Margin % $702.600 $2.200 $3.089 $9.200 $15.200 $3.744 $6.744 $0 $9.200 $3.400 $6.413 $0 $4.681 $872.etc.400 $2.568 $0 $4.656 $6.400 $23.000 $18.124 $4.600 $2.500 $3.19% 69.000 $6.210 $1.125 $2.000 $6.496 $1.788 $429.000 $6.640 $2.558 $84.576 $1.) R&D Meals General Business Comps Owner Comps Other Expenses (ComAreaMaint.800 $13.000 $6.89% Expenses Payroll Marketing/Promotion Depreciation Leased Equipment Accounting/Payroll Processing Legal Retainer Fees Business Licenses & Permits Credit Card Expense Bank Fees Music & Entertainment Training / Employee Retention Programs Repairs & Maintenance Utility Services (Gas/Electric/Water/Sewer) Telephone/Communication Expense Insurance: Fire/Theft/Liability/Liquor/Product Restaurant Occupancy Cost (Lease) Payroll Taxes (FICA/FUTA/SUTA) & Employee Benefits Exterminator/Trash Removal Dishware/Uniforms/Cleaning Supplies/Decor Printing/Paper/Postage/Subscriptions Facility (Exterior Cleaning/Grease Trap/Hood/Windows.000 $24.000 $28.400 $6.400 $22.228 $925.000 $6.091 $1.000 $0 $4.800 $11.500 $12.828 $431.333 $2.744 $6. $399.200 $25.128 $432.996 $1.400 $23.10% 68.200 $12.705 $79.072 65.000 $23.200 $15.000 $27.131 $1.800 $24.466 $9.04% 69.800 $20.600 $2.500 $12.728 $18.624 $77.640 $2.400 $23.984 $983.157 $9.800 $13.800 $22.124 $4.000 $26.000 $22.744 $6.000 $6.000 $6.107 $1.500 $3.955 $0 $4.760 $9.000 $19.008 $9.500 $3.124 $4.588 $400.500 $12.800 $21.008 $9.800 $12.983 $1.156 $3.000 $6.000 $6.850 $2.400 $6.400 $6.200 .600 $2.744 $5.008 $9.500 $12.933 $1.500 $3.400 $6.612 $9.600 $2.41% 67.200 $3.200 $3.200 $22.353 $812.008 $9.125 $2.613 $81.400 $75.640 $2.800 $23.125 $2.800 $14.000 $30.640 $2.821 $1.
189 $8.546 7.628 6.etc.081.34% Break-even Analysis For our First Year Break-Even Analysis. our monthly break-even point is $92.952 $74.629 $9. With direct cost of goods (inventory.703 Cash Flow Statement The cash flow depends on assumptions for inventory turnover and payment days.630 Assumptions: Average Percent Variable Cost Estimated Monthly Fixed Cost 35% $54.) Total Operating Expenses $656. Our projected same-day collection is critical.640 $40. and .377 Net Profit Net Profit/Sales $18. Break-even Analysis Monthly Revenue Break-even $83.296 $58.41% 10.433 $684.692 $173. so our cash flow does not track accounts receivable.071 $260. in this plan) at 35% of sales.372 $724.712 1. we will drive the Cost of Goods Sold (COGS) down.198 Profit Before Interest and Taxes EBITDA Interest Expense Taxes Incurred $45. We will surpass our break-even point in October of our first year. rent.875 $52.571 $253.158 $721. and increasing our Gross Margin.420 $134.070 $204.49% $94.570 $211. We have no sales on credit.809 $154. and utilities.230 per month which includes our full payroll.020 $15. As we exit the start-up phase of the business and focus on cost control.984 $33.74% $78.309 $148.19% 12. we have an average running fixed costs of $60.920 $128.698 $12.582 $5.375 $19. and an estimation of other running costs.414 $729.801 $136. dropping our break-even value.
769 $1.406.670 Expenditures Year 1 Year 2 Year 3 Year 4 Year 5 Expenditures from Operations Cash Spending Bill Payments Subtotal Spent on Operations $399.114 $400.175.772 $0 $0 $0 $47.772 .772 $0 $0 $0 $47.197. HST/GST Received New Current Borrowing New Other Liabilities (interestfree) New Long-term Liabilities Sales of Other Current Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1.073. Pro Forma Cash Flow Year 1 Cash Received Year 2 Year 3 Year 4 Year 5 Cash from Operations Cash Sales Subtotal Cash from Operations $1.225.128 $765.260 $1.125. We do not expect to need any additional financial support.777 $1.976 $432.702 $1.is reasonable and customary in the restaurant industry.769 $1.728 $792.670 Additional Cash Received Sales Tax.204 $1.772 $0 $0 $0 $47. Month-by-month assumptions for projected cash flow are included in the appendices.279.073.260 $1.769 $1.000.588 $601.406.260 $1. VAT.341.279.211.442 $1.211. as the downturns are incorporated into the monthly revenue variance figures.341.341.204 $1.324 $431.406.211.989 $429.204 $1. HST/GST Paid Out Principal Repayment of Current Borrowing Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment $0 $0 $0 $47.088 $1.073.104 $1.088 $1.279.088 $1.670 $1. even when we reach the less profitable months.152 $1. VAT.170 Additional Cash Spent Sales Tax.772 $0 $0 $0 $47.828 $745.788 $724.
000 $473.500 $58.300 $65.000 $26.843 $73.000 $0 $0 $15.232.311 $302.384 $322.175 $73.000 $6.924 $1.097 $0 $0 $63. On a linear projection.426 $189.876 $1.000 $1.727 $441.193.549 $1.942 Net Cash Flow Cash Balance $25.633 $65.280 $236.295 $172.000 $19.315 $0 $0 $65.000 $13.300 $236.000 $354. We do not anticipate difficulty meeting our debt obligations based on achieving the specific goals outlined in this plan.815 $39.014 $65.514 $322.109 $73.713 $61. Zara Restaurant & Lounge has a positive Net Worth beginning in Year 3.398 $63.839 $73.000 $52.Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent $0 $0 $0 $0 $0 $20.500 $32.479 $118.815 $46.625 Liabilities and Capital Year 1 Year 2 Year 3 Year 4 Year 5 Current Liabilities Accounts Payable Current Borrowing Other Current Liabilities Subtotal Current Liabilities $58.311 $434.194 $59.713 $0 $0 $59.206 $39.276 $37.311 $554.926 $65.000 $39.287.254.095 $38.315 . Pro Forma Balance Sheet Year 1 Assets Year 2 Year 3 Year 4 Year 5 Current Assets Cash Inventory Other Current Assets Total Current Assets $172.608 $73.048.539 $189.500 $45.479 $38.474 $1.500 $393.000 $0 $0 $10.095 $86.194 $0 $0 $58.276 $17.500 $586.633 $441.206 Balance Sheet Statement The projected Balance Sheet is quite solid.311 $283.398 $0 $0 $61.125 Long-term Assets Long-term Assets Accumulated Depreciation Total Long-term Assets Total Assets $65.000 $0 $0 $10.500 $341.311 $347.000 $32.097 $65.
692 $301.209) ($428.000 $440. as well as a contingency in the event the business is unsuccessful. Financial Solvency: The financial projections indicate that exit will be achievable over 3 years for the operating capital line of credit. the owners will look to launch a second restaurant concept.546 $460. or B) A larger Restaurant consortium. The entire financial debt would be retired by Year 7. At this stage the business debt is reduced. 4. 2. and Classic has established market share. Expansion (Option 1): Our overall goal to maintain Classic as a unique and eclectic concept.000 $440. We have addressed this question at several levels: Expansion as a Business Goal We have set multiple financial goals to grow the success of the Classic concept.422 $204. By second quarter of Year 2. Our objective with the site selection and lease negotiation is to have the opportunity to expand the restaurant as a logical growth and profit plan.131 $174.009 $61. In addition Year 2 brings an increased sales and profit margin to sustain the addition of a full-time General Manager.912 $172. Payback & Exit Strategy In addressing this question we look at the Exit Strategy as a definition of our business vision and goals.504 $90. but another unique restaurant concept with strong growth potential. with greater sales capacity and revenue potential.628 $90. Under a realistic scenario the Company should have over $70. Based on projections.131 $354. 1. Private Sale: We are in the business of making money.869) ($275.082 $108. Expansion will be considered with our financial backers and Investor partners.496) ($359. We will look at the private sale of the majority interest via A) Leveraged Buyout.712 $31.926 $78.932 $301.455 Paid-in Capital Retained Earnings Earnings Total Capital Total Liabilities and Capital $440.932 $393.140 $126. At the close of Year 3.000 in cash in the bank after income taxes the second year.014 $136.300 $94.375) $18.625 $460. our interest is in delivering healthy profits to our Investors and Financial backers. In both cases.171 Expansion.625 $473. This is not a chain.456 $264.068) ($153.Long-term Liabilities Total Liabilities $252. Expansion (Option 2): Throughout our business plan we have stayed focus that Classic would be successful as a larger venue. Exit Strategy to Retire the Business . the business has captured market share by the end of the first year.000 $440. profit margins are increasing.4% of its optimum sales potential with the current seating and space allocation. we see Classic as meeting 80. and compound the profit return for Classic Investors.684 $218.801 $174. 3.633 $173. Sales and profit margins will be based on the restaurant valuation in Year 3.228 $310.169 $156.000 $440.625 Net Worth $31.504 $341.171 $586.000 ($427.
We step into this venture with confidence and the success of our respective prior business efforts. however sometimes ventures do not fulfill their promise. No one attempts a business anticipating failure. we will first attempt to sell the operation and use the proceeds to clear all outstanding balances. In the event that our venture cannot achieve profitability and retire the encumbrances. Any further outstanding balances will be borne by the investors on a weighted percentage basis of the total amounts due. .We at Classic are committed to our concept and its viability. If we are unable to sell the operation for sufficient proceeds we will be forced to default whereby the loan will be in senior standing.
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