Liberty Restaurant Group Pty Ltd

Extracts from the Business Plan (Current Year)

Business Background

The company

Liberty Restaurant Group (LRG) is a dynamic hospitality corporation poised to capture

substantial market share in the hospitality industry. LRG was incorporated in 2010 and wholly
owned by Tom Fisher, who is also the CEO. It has two restaurants, one in Cairns and one in
Melbourne. A corporate office is located in Melbourne, and is not a profit centre.

The structure of the organisation is as follows:

Board of
CEO
Directors

Human
Finance Marketing Restaurant
Resources Chefs
Manager Manager Managers
Manager

Accounts officer Wait Staff Cooks

Kitchen hands

The two restaurants each have a Restaurant Manager, Chef and teams of various sizes
composed of cooks, kitchen hands, bar and wait staff, depending on the size of the
establishment.

The owner and Chief Executive Officer, Tom Fisher, has extensive experience as an executive
chef, in leading hotel and restaurant chains around the world.

Tom wants to launch a marketing strategy to build a larger market share. He is also
considering investing in a restaurant management software, which can integrate their POS,
inventory, and marketing operations, as well as be used for customer marked based on
purchase history or demographics- perfect for restaurant promotions.

LRG now has the potential to gain a reputation for offering high quality and innovative
cuisines.

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SWOT Analysis extract
• Strength - The owner and Chief Executive Officer, Tom Fisher, has extensive
experience as an executive chef, in leading hotel and restaurant chains around the
world. So his reputation is a key strength for the restaurant.

• Weakness – the location of the Melbourne restaurant in the Docklands area means
the restaurant loses out on the main peak season for the hospitality industry.
Customers dining in will drop by 25% from December to January, as the restaurant is
located in the business district where businesses have a low trading period.

Expenses
Rent, salaries and the cost of equipment leases are the largest expenses that Liberty
Restaurant faces.

Locations
LRG has negotiated favourable leases on all properties. LRG has three-year leases, with
three-year renewal options, on both restaurant locations. The monthly rent for each
restaurant is budgeted at $1,500 for the first year, $1,700 the second year and $1,900 for the
third year. During the three-year renewal period, rent will increase by 5% per year. This rental
amount includes water, gas, waste removal, and all maintenance costs.

Sales forecast
Based on market research, it is estimated that:
• In Melbourne, the number of customers dining will:
o decrease by 10% in Quarter 1
o increase by 5% in Quarter 2
o increase by 30% in Quarter 3
o decrease by 10% in Quarter 4
• In Cairns, the number of customers dining will:
o increase by 10% in Quarter 1
o increase by 5% in Quarter 2
o increase by 15% in Quarter 3
o increase by 20% in Quarter 4

Business Objectives and Key Performance Indicators for Current

Year
Based on a survey of similar businesses across Australia, it was determined that an LRG
restaurant with five full-time staff members could be expected to have the financial goals for
each restaurant for the coming year:
• Increase net earnings from food sales by at least 10% in all restaurants
• Increase net earnings from beverage sales by at least 15% in all restaurants
• Achieve 10% of sales through catering at all restaurants
• Holding spending, as a percentage of sales, at a steady rate, at all restaurants

Knowledge Management
LRG Information and Knowledge Management System is called Liberty IT. It is a secure
custom designed holistic information system developed just for Liberty Restaurant. The system
is used for managing bookings, billing customers, recording customer orders, POS services,
customer database, inventory management, accessing purchase and sales files, and
creating new food/beverage menu items.

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All employees must make themselves familiar with the Liberty Restaurant Information
Management System Policy and Procedure document. All employees will receive training on
how to use the system when commencing employment at Liberty Restaurant.

Credit Policy Extract

Only clients approved by the CEO shall be allowed credit terms of 30 days from date of
invoice.

To remain compliant with this policy, no amounts should be 31+days past due.

The following recovery actions shall be undertaken for overdue invoices:

1. 31-60 Days Past Due: An email/letter from the accounts manager, reminding the
client to pay.
2. 61-90 Days Past Due: A letter of demand from the accounts manager, cautioning the
client that recovery action will be initiated if outstanding invoices are not paid
forthwith.
3. 91+ Days Past Due: Hand over client details to external debt recovery agency.
4. 180+ days: Write-off amounts owing.

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 Financial Management Policy Extract

Position Delegations/ Reporting Responsibilities

Board of Directors • Develop and endorse the Financial Management Policy.
• Comply with Financial Management Policy.
• Endorse monthly financial reports, annual budgets and forecasting.
• Endorse annual audited financial accounts.
• Authorise Board reimbursement for expenses.
• Resolution of escalated financial disputes.
• Co-authorise cheques on behalf of the organisation (1 cheque signatory
+ CEO)
• Delegation authority: unlimited
CEO • Comply with Financial Management Policy.
• Contribute to development of Financial Management Policy.
• Oversee financial management of the organisation.
• Co-authorise funding agreements (as required).
• Approval to incur expenditure on behalf of the organisation.
• Authority to hold business credit card for organisation related
expenditure.
• Delegation authority - $100,000
Finance Manager • Comply with Financial Management Policy.
• Oversee monthly financial reporting for CEO, including:
o Cash flow reports
o Ageing summary
• Develop quarterly financial reports for CEO and Board, including:
o Profit and Loss statement
o Balance sheet
• Develop annual financial reports for CEO and Board, including:
o Profit and Loss statement
o Balance sheet
• Review budgets, forecasts and annual audited financial accounts and
provide recommendation to Board.
• Authorise Supplier Claim Forms.
• Co-authorise cheques on behalf of the organisation
• Approval in principle to incur expenditure in CEO/Managers absence.
• Delegation authority - $20,000
Accounts officer • Comply with Financial Management Policy.
• Develop daily sales and expenses reports for Finance Manager, in

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 conjuction with Restaurant Managers
• Develop monthly finance reports for Finance Manager and CEO,
including:
o Cash flow reports
o Ageing summary
• Process petty cash expenditure at Corporate Office.
• Delegation authority - $1,000
Restaurant • Comply with Financial Management Policy.
Managers • Develop daily sales and expenses reports for Finance Manager, in
conjuction with Accounts Officer
• Oversee monthly financial reporting for CEO, including:
o Cash flow reports
o Ageing summary
• Authorise Supplier Claim Forms.
• Process petty cash expenditure at restaurants.
• Delegation authority - $20,000

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