Fast food

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prepared and served quickly growing rapidly in many Countries

Fast-food Restaurant
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food which is supplied quickly after ordering by minimal service cooked in bulk in advance and kept warm, or reheated to order Often are part of restaurant chains or franchise operations Standardized, foodstuffs are shipped to each restaurant from central locations

Also simpler fast-food outlets, such as Stands kiosks

NOTE:Because the capital requirements to start a fast-food restaurant are relatively small, particularly in areas with non-existent or medium income population, small individually-owned fast-food restaurants have become common throughout Pakistan.Generally restaurants, where the customers sit down and have their food orders brought to them, are also considered fast food.

Growing industry in pakistan relying heavily on the changing
o Lifestyle patterns o Population growth of the target age group and o Related increase in employment of women

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People want quick and convenient meals Consumers want to combine meal-time with time engaged in other activities, such as
o

shopping, work, or travel, therefore allocating less time for food, hence the growing need for fast food.

The presence of multinational fast food chains like o McDonalds o KFC o Pizza Express o Pizza Hut o Subway etc Have somewhat catered to the high income segment therefore developing a niche as upscale fastfood restaurants. Then they modify their menus to cater to local Pakistan tastes and most overseas outlets are owned by native franchisees.

Many regional and local chains have developed around the main cities of Pakistan (for example Khan Broast in Karachi) to compete with international chains and provide menu items that appeal to the unique regional tastes and habits at comparatively low costs. In Pakistan, multinational chains are considerably more expensive; they usually are frequented because they are considered chic and somewhat glamorous and because they usually are much cleaner than local eateries. However much of the middle-income segment (which forms a major chunk of fastfood goers) prefers visiting local outlets that offer low cost fast food, hence more frequent visits.

Visit fast food outlets, franchises and other chains to see how our ‘concept’ would fit into the neighborhood we are planning to target. Talk to customers to know their preferences, some detailed meetings with restaurant managers / owners over dinner would do the trick in obtaining best practices and critical information that otherwise could have been overlooked.

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Keep in mind that because a concept works in one area does not mean it will be well-received by customers in your location. Tastes are subject to location preference and more often target market. In high scale urban areas (like PECHS, KDA etc.) we are more likely to be successful with a niche concept than in a dense middle income areas (like Gulistan e Jauhar).

Our purpose We focused on the quality and price of our product to get the competitive advantage in the market. Our core competencies are quality of our product. We provide the better taste according to the customer demand. Consumer appeal Fast-food outlets have become popular with consumers for several reasons. One is that through economies of scale in purchasing and producing food, these companies can deliver food to consumers at a very low cost. we provide the facility of cleanliness, fast service and a childfriendly atmosphere where families on the road could grab a quick meal, or seek a break from the routine of home cooking.

LOCATION We open the restaurant in the main bazaar of moon market. OUR COMETITORS ARE

REASONS FOR THE PLACE SELECTION  frequently travel area  number of complimentary business that increase our earning potential convenient parking  proximity to other businesses (especially if you're catering to the lunch crowd).  It is necessary to revisit the business plan to make sure you are close to your target market. We get the building on rent R.S 10, 0000 per month and land around the around 2,000 sq.ft.

Layout and design are major factors in every restaurant's success. We allot the 40 to 60 percent of their space to the dining area, approximately 30 percent to the kitchen and prep area, and the remainder to storage and office space. our dining area consist on 40 to 50 percent of all sit-down customers arrive in pairs; 30 percent come alone or in parties of three; and 20 percent come in groups of four or more. To accommodate the different groups of customers, use tables for four that can be pushed together in areas where there is ample floor space.

We include the space for receiving; storage, food preparation, cooking, baking, dishwashing, production aisles, trash storage, employee facilities and an area for a small office where we can perform daily management duties. We arrange food production area so that everything is just a few steps away from the cook. Our design should also allow for two or more cooks to be able to work side by side during our busiest hours.

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Busy consumers don't want to read a lengthy menu before dinner We Keep the number of items in check and menu descriptions simple and straightforward, providing customers with a variety of choices in a concise format. Our menu has also indicate what dishes can be prepared to meet special dietary requirements. Items low in fat, sodium and cholesterol should also be marked as such.

UNPAID IMPERSONAL COMMUNICATION PAID IMPERSONAL COMMUNICATION

PAID PERSONAL COMMUNICATION

Advertising, sales promotion, contests and coupons. Advertising R.S 50,000 In advertising we used the billboard advertising, flyers in newspapers, and local cable TV advertising. Ask our customers how they found out about us, so that we can record where our advertising and marketing money are best spent. Sales promotion 50,000 Rs. Contests 20,000 Rs. Coupons 10,000 Rs.

UNPAID PERSONAL COMMUNICATION

We provide the following customer services  Acceptance of credit card  Check cashing  Credit  Delivery to home or work  Extended store hours  Parking  Play areas for children  Rest rooms  Special orders

Refers to the design of an environment through visual communication. We used the following technique. Lighting Color Music Scent

HIRING THE RIGHT EMPLOYEES

Manager

Chefs and Cooks.

Servers and Receptionists

Revenue & Cost Projections

– The Sales are expected to increase by 15% every year while the cost

Revenue Stream % of Total Sales
– Dine In – Take Away – Home Delivery

of raw materials is assumed to increase by 10%. The 15% annual increase in revenue is expected to result from a part increase in population increase and part increase in product price. 60% 20% 20%

Total Revenue 100%

– The minimum delivery order size is assumed to be Rs. 250/- per order

with 3 delivery riders being employed at the charge out rate of Rs. 25 per delivery order wherein no transportation fuel is provided by the fast food outlet. For Take Away and Home Delivery another 1% of sales added cost due to packing is assumed.

Rent Cost The rent for the assumed premises will be Rs. 100,000/- per month. It is assumed that Rs. – 1,200,000 will be given in advance before possession of premises. This will include 6 months deposit and 6 month advance rent. The rent would be payable on a monthly basis and is expected to increase at the rate of 10% per annum for the projected period. Utilities Requirement  The following table presents the assumed breakup of utilities on a monthly basis: – Utility Monthly Charges (Rs.)  Electricity 25,000 – Water 2,000 – Gas 15,000 – Telephone 10,000 – Total 52,000 –  As depicted above the most of the fast food machines require considerable gas during the preparation process. The preheating procedure of the equipment before commencement of preparation also consumes considerable gas. It is assumed that utilities expenses will be increased by 10% every year.

Depreciation on Building & Equipment

– Depreciation on Shop, Equipment, Machinery and

Working Capital & Pre Operating Costs
– It

Fixtures is assumed to be at the rate of 10% per annum based on the diminishing balance method for the projected period. is estimated that an additional amount of approximately Rs. 1,50,000 will be required as cash in hand to meet the working capital requirements / contingency cash for the initial stages. The requirement is based on the rent, utilities and salaries expenses for at least four months and 3 days raw material inventory. The following table gives the break up.

Item 4 Months Cost (Rs.)
– – – – –

Utilities 208,000 Salaries 358,000 Raw Material Inventory 70,000 Rent 400,000 Total 1,036,000 The provision for pre operating costs is assumed to be Rs. 50,000 which will be amortized equally over a 5 year period.

Account Receivables

– All sales will be made strictly on cash basis. It is not

advisable to operate a fast food restaurant on credit basis.

Miscellaneous Outlet Expenses – A monthly figure of Rs. 6,000 (200 per day) is assumed to be incurred for miscellaneous expenses which are expected to increase at the rate of 10% per annum for the projected period. Financial Charges – It is assumed that long-term financing for 5 years will be obtained in order to finance the fast food setup which would mainly include construction & décor of Building, Purchase of machinery & equipment, purchase of inventory etc. This facility would be required at a rate of 15% (including 1% insurance premium) per annum with 60 monthly installments over a period of five years. The installments are assumed to be paid at the end of every month.

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Taxation – The tax rate applicable to sole proprietorship is the same as that of the salaried individual. Therefore, we are assuming that the tax rate would be the same for the proposed fast food setup. Cost of Capital – The cost of capital is explained in the following table: Particulars Rate – Required return on equity 20.0 % – Cost of finance 15.0 % – Weighted average cost of capital 17.5 % The weighted average cost of capital is based on the debt / equity ratio of 50:50.

It is assumed that the owner with withdraw from the business once the desired profitability is reached from the start of operations. The amount would depend on business sustainability and availability of funds for future growth.

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