FINAL PROJECT- BUSINESS DEVELOPMENT REPORT

Associated by National Vocational and Technical Training

Commission (NAVTTC)
Trade: Hospitality Management
 CENTRAL PERK CAFE

Prepared By:
Ayesha Sabir
Saba Sarfaraz
Syed Saad Ahmed
Tariq Bin Khalid
Skillston – Central Campus
Email: sabasarfaraz0001@gmail.com Page | 1
 TABLE OF CONTENTS
Executive Summary …………………………………………………………………………….4
Scope of Project …………………………………………………………………………………2
Product / Service Plan …………………………………………………………………………..6
Marketing Plan ………………………………………………………………………………….9
Strategy & Implementation.………………………………………………………………....….11
H.R.M Plan …………………………………………………………………………………….16
Financial Plan …………………………………………………………………………...……..
References ……………………………………………………………………………………..75

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ACKNOWLEDGEMENT

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 EXECUTIVE SUMMARY

Central Perk cafe is a friendly, comfortable atmosphere inspired by famous USA 90's TV show
F.R.I.E.N.D.S, where customer can receive quality food, service and entertainment with the old
school ambiance at a reasonable price. The coffee house will offer a variety of choices to the
customers. Coffee and tea of all sorts will be offered, moreover, there will be few refreshment
items.

The Central Perk coffee house was one of the principal settings of the series, has inspired various
imitations. In 2006, Iranian businessman Mojtaba Asadian started a Central Perk franchise,
registering the name in 32 countries. The decor of our coffee house will also be inspired by
CENTRAL PERK, featuring replica couches, counters, neon signage and bricks. The coffee
house will also contain paintings of the various characters from the series, and televisions
playing Friends episodes. Same will go on our coffee house as to attract the FRIENDS fans.

The key to fulfillment will be provided by the philosophy and principles of the business. The
core values are customer focus, quality treatment, and professional expertise, as is evidenced by
associates and staff performance, compassion, trust, and hard work. If the Cafe is to sustain its
growth and other capacities, it must continuously strengthen its customer relations and identify
their ongoing needs. We will watch closely for industry trends that may impact our service
system

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 SCOPE OF PROJECT

Millions of people stop every day for an espresso-based coffee drink. People who would not
have dreamed of spending more than 100 rupees for a cup of coffee a few years ago now will
gladly pay 400 to 800 rupees for their cappuccino, mocha latte or vanilla ice blended drink.
CENTRAL PERK CAFÉ is determined to become a daily necessity for local coffee lovers, a
place to dream of as you try to escape the daily stresses of life and just a comfortable place to
meet your friends or to read a book, all in one. With the growing demand for high-quality
gourmet coffee and great service, CENTRAL PERK CAFÉ will capitalize on its proximity to
build a core group of repeat customers. CENTRAL PERK CAFÉ will offer its customers the best
prepared coffee within few seconds in the area that will be complimented with pastries, as well
as free books that its patrons can read to enjoy their visit

The specialty-coffee business is growing at a healthy pace. During the past 5 years, there has not
been a single year, despite war and recession, in which specialty coffee sales have not grown. In
many years the increase has been in double digits. In addition, no coffeehouse chains have failed
during this time, although the list of casualties in other industries is quite long.

CENTRAL PERK CAFÉ meets this need and fills this niche. We offer high-quality products in
an upscale environment. Furthermore, our high-profile location in Liberty Lahore provides a
mixed customer base that will maintain high levels of business in every season, at all times of the
day, every day of the week.

A strength which this business will possess is the ability to change with the times. Rather than
limiting the future opportunities by having a small area, our coffee house will have 3,525 square
feet of space and a kitchen designed for flexibility. As the fad of coffee houses fades, Coffee
Circus will be able to change to a full course restaurant or whatever the situation calls for.

To reach our potential customers, a combination of marketing techniques will be utilized. Social
media is an effective way for marketing and advertising these days.

Overall management will be the responsibility of the owner. The owner brings to the business
over 20 years of business experience including over five years in restaurant management and five

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years in directing a multifaceted non-profit housing program. The general manager will have a
minimum of 5 years of related experience. A major emphasis of café will be to hire economically
disadvantaged or at-risk persons and provide them with job training.

MISSION

“Our mission is to offer residents of the Local area the best international European and
American style coffee products and services. We are committed to providing the quality of our
services and value our customer expectations.”

VISION

“Our vision is to become the first choice of cafe in Local area, and a respected company -- as
measured by our customers, our employees, our shareholders, and the community we live in.”

OBJECTIVES

 To attract a minimum of 100 regular customers per day for take-out and dine in, in the first
year of operations;

 To offer our customers quality and variety of coffees and tea and an old school 90's vibes
with relaxing ambiance at a reasonable price, and provide outstanding customer experience,
measured by minimum 10 percent yearly sales growth, and customer complaints less than 1
percent.

 To generate positive cash flow from operations, and at least overall 20 percent net profits to
sales.

 Become selected as the “Best New Coffeehouse in the area” by the local restaurant guide.

 Make CENTRAL PERK the number one destination for coffee in the city.

 Achieve a 15-20% net profit margin within the first year and 30% by FY3 and that will make
sure the ROI (Return on Investment in 3 years).

 Be an active and vocal member of the community, and provide continual re-investment
through participation in community activities such as the Chamber of Commerce and
financial contributions to local charities and youth organizations

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 Create a solid concept in the industry and track performance in order to begin expanding to
other markets within the first year of operation.

VALUE

Central perk cafe will use its strategy, staff, and quality systems to provide each customer with a
seamless three-part customer experience - service product (New York central perk styled cafe),
friendly environment, and quality service delivery -- each part of which will meet or exceed our
customers' expectations.

Our values are critical to our success and set us apart from our competitors. These values
include:

 Performance excellence. We act like responsible owners, always seeking to meet or exceed
expectations.
 Teamwork. We act as a team, committed to each other, and bound by trust and loyalty.
 Integrity. We treat one another, and all our stakeholders with dignity and respect. Honesty,
ethical behavior, and integrity are fundamental characteristics of our business conduct.

KEYS TO SUCCESS

Our keys to success are:

 Excellent product and service that will build and maintain customer loyalty.
 A business location that will assure high company visibility and a high flow of customers.
 Proven management ability to successfully run this business with unique concepts.
 Our commitment to continuous improvement and total quality services.
 Unique old school environment and ambiance to attract people of all ages.
 A superior-tasting product backed by a unique quality store.
 A relaxing, upscale interior design.
 Prime site selection with an upscale affluent population, year-round tourist activity, heavy
pedestrian traffic by the site, a dynamic student population and a concentration of local
businesses.
 A market that exposes Coffeehouse to high-profile “trend-setters” and “key influencers”.
 Highly trained and friendly staff using best Talent Management Techniques.

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 Multiple revenue streams including gift items, gift baskets and coffee gift/frequency cards in
addition to coffee, pastry, chocolates, tea and water
 Employee training to insure the best coffee preparation techniques.
 Marketing strategies aimed to build a solid base of loyal customers, as well as maximizing
the sales of high margin products, such as espresso drinks.

BUSINESS GOALS

Our goal is to be the coffeehouse of choice for every community with new innovation. We know
the world is moving so fast so everybody wants quickness in everywhere of their life so all that
things we know and bring innovation in our coffeehouse business that is Time, we know Time is
money we have introduced for the first time the coffee which will not take more time and just
within few minutes, coffee will be in customer’s hand. Business workers, tourists who visit the
city, and students, will enjoy quality experience that no other competitor had to offer.  As a
result, we intend to create coffeehouses that quickly achieve profitability and sustain an attractive
rate of return (20% or more annually) for our investors.

We also want to make our contribution to the welfare of the local community by supporting
charitable and civic activities. We will support the farmers who grow our coffee by using Fair
Trade, Sustainable Production and Organic products whenever possible.

Our coffee house also awards its business to as many local suppliers as possible, keeping the
business in the community or, at the least, in the state.

The goals of the business are to provide a substantial income and to create a business and
working environment where both the customer and employee are treated with dignity and
respect. The specific goals of the business are:

 Clientele - create a base clientele of persons who live and work in the area. These persons
will like a relaxed atmosphere where they can "hang out".
 Employees - Competent employees (at least 50% from low-income neighborhoods) who are
committed and loyal

COMPANY OWNERSHIP

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Central Perk Café is incorporated in Johar, Karachi is sole proprietor business. We will
approach the government programs designed to help small business setups for financial support.

 We will approach banks for a five years loan based on our business model and feasibility
study which will be very attractive for bank institutions to invest with us and support small
business setup.

 We might, as 3rd option, approach private investors for a five-year term loan and investment
which will meet the setup and cash flow requirements

The borrowed funds will be used exclusively to buy equipment, based on the list that will be
made available to the lending institution. The loan could be repaid in equal monthly installments
over a five-year period.

MANAGEMENT

 Goals

To have a competent and knowledgeable management staff which functions as a team.

 Objectives
1. Hire experienced, qualified persons

2. Conduct weekly management meetings

3. On-going training to include outside classes in food service, management, etc.

4. Reviews every six months

5. Performance incentives

6. Encourage creativity

PRODUCTS

Central Perk Cafe will sell high-quality specialty coffee, Espresso, tea, Kava, juices, Cigar and
other varieties. Despite being an upscale coffeehouse, our prices are in line with the leading
national chain

The Central Perk Cafe Menu

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The Central Perk Cafe menu sets us apart from other coffee and sheesha houses, giving us a
competitive edge.

Central Perk Cafe offer 4 four groups of drinks - coffee, tea, Expresso, juice - with several
choices within each group. This enables us to provide more variety than our competitors while
keeping the preparation of the drinks easy to execute. We are taking advantage of the immense
popularity of flavored drinks and Chai tea by offering a product mix that includes items the other
coffeehouses don't carry as well as more familiar drinks. Central Perk Cafe offers several
smoothie drinks. We carry the highest quality fresh juices.

MENU

Prices have been determined after a thorough analysis of all food costs for every item in each
drink. In some cases, an average price has been calculated and applied to all similar drinks and
varieties in order to keep the menu from confusing the customer.

MARKETING PLAN

Market Analysis

Central Perk Cafe will focus on meeting the demand of a regular local resident customer base, as
well as a significant level of students, travelers passing through and local business people.

Market Segmentation

Central Perk Cafe will focus on the middle- and upper-income markets. These market segments
consume the majority of coffee and other Varieties.

Central Perk Cafe customer base in Johar, Karachi is comprised of two target groups.

Affluent local residents

 Students

These groups are all potentially strong customer segments. The benefit of this mix of customers
is that it helps maintain consistent business throughout the year.

Karachi is home to a major branch of the State University as well as dozens of other schools,
including many prestigious private schools and academies. To reach students we offer special

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student discount cards, pass out free coffee coupons at student events and offer entertainment on
weekends.

Students represent an excellent customer segment for several reasons:

 Students bring an energy and youth to the coffeehouse.

 By attracting students we generate excellent word-of-mouth.
 Students represent a large base of potential part-time employees.
 Often under the drinking age, students need an affordable place to hang out with their
friends.

 Affluent locals

Within five miles of Central Perk Cafe are of the most affluent people in Karachi. Key
influencers, trendsetters, artists, writers and celebrities have homes in Defense Karachi.

 Other

The other customer segments (local residents, local business and pass-through traffic) provide a
consistent foundation all year long.

Also, by appealing to several market segments, Central Perk Cafe will not become overly
dependent on any single consumer group. For example, several local coffeehouses with primarily
student customers do poorly during the non-school months. They must also market themselves a
new each year to the incoming students. Central Perk Cafe will avoid these peaks and valleys in
business with a mix of customers.

Market Needs

Because Karachi has a cool climate for three to four months out of the year, hot coffee products
are very much in demand. During the remaining warmer seven to eight months of the year, iced
coffee products are in significantly high demand, along with a slower but consistent demand for
hot coffee products. Much of the day's activity occurs in the morning hours before ten a.m., with
a relatively steady flow for the remainder of the day.

SERVICE BUSINESS ANALYSIS

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The retail coffee industry in the Pakistan has recently experienced growth. The cool marine
climate in Karachi for four to five months stimulates consumption of hot beverages in these
months. During the remaining warmer seven to eight months of the year, iced coffee products are
in significantly high demand, along with a slower but consistent demand for hot coffee products.
Coffee drinkers in the Karachi are finicky about the quality of beverages offered at the numerous
coffee bars across the region. Despite of low competition in the immediate area, Café classic will
position itself as a place where customers can enjoy delicious coffee beverages with a fresh
pastry, tea, juice, soft drinks, chocolates in a relaxing environment.

COMPETITION AND BUYING PATTERNS

Competition in the local area is somewhat sparse and does not provide nearly the level of product
quality and customer service as Central Perk Café. Local customers are looking for a high quality
product in a relaxing atmosphere. They desire a unique, classy experience.

• Location: Central Perk Café will be located near University road, Karachi. This is the busiest
area in town with high student traffic. The closest coffee shop is a thirty minute drive.
• Reasonable prices and Quality: Since Central Perk Café purchases latest equipment and
technology, and will be operating with a team of multi-skilled employees, it will be able to
offer high quality coffee at reasonable prices.

Leading competitors purchase and roast high quality, whole-bean coffees and, along with Italian-
style espresso beverages, cold-blended beverages, a variety of pastries and confections, coffee-
related accessories and equipment, and a line of premium teas, sell these items primarily through
company-operated retail stores. In addition to sales through company-operated retail stores,
leading competitors sell coffee and tea products through other channels of distribution (specialty
operations).

Lifestyle factors converge to make the coffee industry strong at all times. The stimulant effect of
coffee is an important reason why many hard-working, fast-paced Pakistanis consider a stop at
their local coffeehouse a necessary part of their day. Conversely, coffeehouses provide a calm,
inviting environment for people to socialize, relax or catch up on work.

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Young people under the legal drinking age are one of the fastest-growing segments of the coffee
drinking market. Coffeehouses provide them with a much-needed place to meet with their
friends.

Entertainment on weekend nights draws a young group of enthusiastic customers. The surge in
interest in coffee drinking among young people assures a diverse, receptive, sophisticated
customer base now and in the future.

Older adults also enjoy the fact that for the relatively modest price of a cup of coffee and snack,
they can meet with their friends, relax or work. Instead of going to a bar and paying for an
alcoholic drink or a restaurant where a meal usually comes with a hefty price tag, the
coffeehouse is an intimate yet inexpensive venue.

• Coffee drinking is now an all-day activity.

Once concentrated in the early morning hours or mid-afternoon, in recent years coffee drinking
has become an all-day activity. Even late at night, many coffeehouses are packed with patrons.
It's not unusual for a well located coffeehouse to exceed a daily average of 900 customers

COMPETITIVE EDGE

Our competitive edge, compared to the other coffee plus Sheesha houses in the greater area
includes the following.

 A significantly higher quality better tasting coffee, Expresso, tea, Kava, juices, Cigar and
other food varieties.

 Our location can arguably be considered the best in the market.

 An ambiance superior to all other coffeehouses in the area with upscale "Friends inspires"
look.

 The only coffee plus house to provide regular weekend old school evening entertainment.

A wider variety of popular drinks than our competitors, including flavored coffee and Expresso
drink, tea, and juice. We have several drink options for people who don't drink coffee.

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STRATEGY AND IMPLEMENTATION

The Cafe classic will use a strategy of total quality - in product and service. Our promise is in our
Location, the products we sell, the people we attract and the atmosphere we create.

Strategic Assumptions

 People want better-tasting coffee Expresso, tea, juice, Snacks & pastries, and sheesha
varieties. Coffee drinkers and users want a more inviting coffeehouse environment.

 Coffee drinks users are considered an affordable luxury.

 The coffee house industry is largely unaffected by the economy and world events.

SWOT ANALYSIS

The SWOT analysis provides us with an excellent opportunity to examine and evaluate the
internal strengths and weaknesses of Central Perk Café. It also allows us to focus on the external
opportunities presented by the business environment as well as potential threats.

Strengths

Central Perk Café has a valuable inventory of strengths that would help it to be successful. These
strengths include:

a) Uniqueness: Themed café based on famous 90’s show F.R.I.E.N.D.S.

b) Location: Near university road. (Since students are a big portion of our expected customers,
High foot traffic to be expected from the vicinity)

c) Quality: High grade Arabica coffee beans.

d) Management: Experienced personnel in the upper management and trained staff working
under them.

e) Price: cheap alternative to most popular brands.

Weaknesses

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Strengths are valuable, but it is useful to realize the weaknesses. We have identified some of our
weaknesses:

a) Price: Cost factor associated with keeping state-of-the-art equipment and technology.

b) Competition: More popular and known coffee shops.

c) New Beginning: No customer base.

d) Short staff: Limited operating capacity during peak sales periods.

e) Lack of funds: Need to get funding via loans or investors.

Opportunities

Central Perk Café’s strengths and the awareness of its weaknesses will help it capitalize on
emerging opportunities. These opportunities include, but are not limited to:

a) Market: Growing niche of coffee drinkers and enthusiasts.

b) Uniqueness: The ability to appeal to a different target market than other cafés

c) Economic Conditions: Consumer behavior changes due to the economic downturn,

respectively an increased preference to buy affordable coffee instead of expensive ones.

d) Expansion: Opportunity to open franchising.

Threats

Threats the Central Perk Cafe should be aware of include:

Competition: Other popular brands that are more reputable.

b) Consumer Behavior: Change in market taste.

Tax: Higher taxes in the future

d) Price Fluctuations: Credit times, higher interest rate, and higher inflation rate than predicted.

MARKETING STRATEGY

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Other coffee rely almost entirely on word-of-mouth marketing to generate business. We will
engage in an ongoing aggressive marketing program that will help us establish profitability
quickly and set the stage for continual growth.

Our strategy will be to position Cafe classic as the "Lexus" of coffeehouses, offering a high
quality product and superb service in a superior environment.

LAUNCH MARKETING

Most coffeehouse chains do little or no marketing and advertising. For example, Starbucks'
philosophy is that their ubiquity in the marketplace is all they need to sustain and grow their
customer base. They spend less than 1% of gross revenues on advertising, and when they do
spend, it is usually to introduce a new product.

The retail coffee industry is a sales-oriented business with historically very little experience in
marketing and advertising. This is likely why little is done. As yet, the major players have not
been taken over by sophisticated companies, where marketing is viewed as essential to gaining
market share.

An element of our differentiation from other coffeehouse chains will be our use of advertising
and marketing to gain awareness, build customer traffic and establish a strong brand image. We
intend to create immediate customer awareness and not wait for word- of-mouth. We will also
building customer traffic immediately with an aggressive Launch Marketing Plan.

Launch marketing will promote awareness, build immediate traffic and establish our brand
image via several methods.

 Public relations/publicity

 Direct Mail

 Design & Packaging

 Community Involvement
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 Sampling

 Superior Location

Trendsetters

Johar is the home to thousands of individuals who can be important to the successful
positioning of Café classic. One mention on a TV talk program or in a 'lifestyle' magazine can
(and has) launched many successful careers and businesses.

With literally hundreds of celebrities and wealthy business people as local residents, the word-
of-mouth recommendations from these people can drive significant business to us as well as
generate favorable publicity.

Celebrities in Karachi are also actively involved in the community, many supporting several
local charities. Our involvement in the community will enable us to garner exposure for Cafe
classicamong an important group of local residents.

Key individuals will be targeted with gift baskets from Cafe classic containing samples of our
products to entice them to visit Cafe classic and talk about us with their friend.

SALES STRATEGY

Because Central Perk Café is a new entity, we recognize that we will need to prove our
company's worth to Karachi's customers, in order to earn respect and business.

Most important, we need to sell our company, not necessarily our products and services, and
create positive word-of-mouth. We will have to push our service capacities.

Our sales strategy is based on the belief that there will be a regular flow of first-time customers,
due to our convenient location. The real sales effort will be to focus on the conversion of each
first-time customer into a long-term customer relationship, where these customers come
regularly to our Café, and also bring or recommend new friends to share the experience of a great
coffee.
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This focus recognizes that it would cost our company less money to convert a new customer into
a long-term relationship, than it does to attract a new customer. With this in mind, our sales
activities will concentrate on keeping existing customers happy, and always meet or exceed their
expectations.

Consistent, customer-centric service is the absolute requirement in the hospitality industry, and
so it is for all our employees. Every member of our team will be empowered to deal with our
customer’s requests in such a way that no customer should leave dissatisfied. Problem solving
will be encouraged throughout the organization, and it would also be fair to say that each
employee is part of the sales staff, not only the first line servers.

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