Overview on natur livet restaurant by Md Papon

Overview On Natur Livet Restaurant

Mission ‘Natur Livet’ will strive to be premier organic food restaurant in the city. We want our guests to have total experience while visiting our restaurant. Not only will our guests receive a great meal they will also be provided with a soothing atmosphere. That will set us apart from the competitor we will want the dining experience to be as pleasing to the senses as it is to the palate. Our main focus will be serving quality food with at a great value. The food items will be organic and freshly produced by our own firm. We will feature a large selection of freshly prepared food, most in full view of our guests. We will feature items from different cuisines and different price ranges. We will also provide set menu for guests who want to have a good appetite in a reasonable price. Customer satisfaction is paramount. When approached by a customer with a request our motto will be to provide with best quality service possible. We will strive for broad appeal. We want to be the restaurant of choice for everyone-families and singles, young and old, male and female. Employee welfare will be equally important to our success. All will be created fairly with the utmost respect. We want our employees to feel a part of the success of the restaurant. Happy employees make happy guests. We will combine menu variety, atmosphere, ambience and friendly staff to create a sense of “place” in order to reach our goal of overall value in the dining/entertainment experience.

Objectives ‘ Natur Livet’ is an organic restaurant situated in the upper-class area of Chittagong city. The main objectives of our business are: •

To provide quality organic food stuffs to the locality.

•

To modify the menu and other services with the change in consumer taste, market demand and competitors’ strategy.

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To render an enlightening environment to enjoy food items.

•

To extend the business in different locality if the acceptability of our cuisines meets our prior expectation.

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To maintain the costs and operation under tight managerial expertise so that the mission of our venture can be satisfied.

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To increase the average sales from year to year by materializing the above mentioned objectives.

Executive Summary ‘Natur Livet’ restaurant is a new medium-sized restaurant located in a busy locality of Agrabad in the neighborhood of some aristocratic areas like Banani. Our restaurant is supposed to provide organic food to the consumers in of the restaurant. An emphasis on organic ingredients is based on our dedication to sustainable development. Additionally, the restaurant procures local foods when possible, reducing the dependence on the foreign suppliers. Services: ‘Natur Livet’ restaurant offers a fashionable, fun place to have a great food in a social environment. Our chef has a vast repertoire of ethnic ingredients and recipes. Majority of our demand will be forecasted from the recommendations of the customers. Organic recipes will be used to provide customers with diverse and specialized menu. We would also offer some healthy dishes, recognizing the trend within the restaurant industry for the demand for healthy cuisine. Customers: ‘Natur Livet’ restaurant supposes that the market can be segmented into some distinct groups that it aims to target. At first, we want to attract the conscious persons who want to have an appetite at the same time can be ensured with hygiene. The second group is the families want to have organic elements in their food stuffs. The third group consists of the white-collar officials who wish to have their enthusiasm for having frequent facilities of cleanliness by enjoying the organic food items. The last group which is particularly conscious of the organic food is the foreigners. Most of the foreign women preferring diet want to have such organic food items. In our restaurant we hope to offer organic cuisines to 86000 to 120000 consumers annually. Our capacity at a time is 100 customers and we hope that our average customers will be 100 consumers. Management: ‘Natur Livet’ restaurant has assembled a strong management team. We have a very sagacious general manager who has enough perception and decision making ability in any line of business. Moreover, the capital budgeting techniques and structuring will also be performed under his strict supervision so that cost-effectiveness and appropriate leverage condition can be met. Again, we have engaged some other managing partners who have also some problem solving attributes and the operation of the restaurant business. Furthermore, our production and purchase manager has some prior experience in working in some other organizations. So, we also expect that he can manage this segment efficiently. Our chef has an experience of 5 years who can decorate the food items in a very organized way and can also prepare the cuisines in proper mixtures. Most important to ‘Natur Livet’ restaurant is the financial success which will be achieved through the strict financial control of the Manager in Accounts. Additionally success will be ensured by offering a high-quality service and extremely clean, non-greasy food with interesting twists. The market and financial analysis indicate that with a start-up expenditure of tk 16,930,604.00 which might generate sales of 13,832,800.00 by year two, 15,344,200.00 by year three, and 16,408,400.00

by year four. In the initial year of operation we might incur a loss of -3,239,004.00 tk in year one. Profitability will be achieved from the operation of year two. Taking over of competing firms, impressive relationship with suppliers and cutting costs are expected to be our main opportunities of the venture. We hope to maintain these by proper planning and rendering of services timely. The trends and potential growth of the restaurant is really a matter of sanguine. We have observed that the sales growth will be 20-25% more in the coming years and also some increase in the contribution of GDP from restaurant business which might facilitate the achievement of our objectives. The marketing strategy is quite simple. We have a huge advertising budget for the initial year which will be included in the start-up expenses of the venture. This will provide the funding for the billboard in the main circle of the city. Again, we would incur some other advertising expenses for banners and poly signs in every year. These activities might pace up our sales and other campaigns. Our production plan would be in two steps. The first will be the production of raw materials, and another will deal with the production of food-stuffs. Our production of raw materials will be in our own firms situated in Savar. This production plant will be strictly managed by our production personnel for the maintenance of organic nature of the restaurant.

Name of the Venture The restaurant is a partnership firm. As it will be established in an aristocratic area, the name should be worthy to attract the attention of the customers. So, the entrepreneurs decided to name it as ‘Natur Livet’.

Location and Facilities of the Venture ‘Natur Livet’ will range in size of 3000 square feet and will seat 100 guests at a time. In order to attract the target customers this restaurant will be located in Gulshan area of Dhaka city. The restaurant will be equipped with a state-of-the-art sound system where our customers will be able to select their favorite country and western songs for free. The restaurant will be built on some prototype specifications: clean lines, open, and pleasing to the customer. The site/building selection will be chosen based upon the following list of criteria: • • • • •

Community size minimum of 50000 people within one mile. High visibility. Easy access to parking lot with a minimum of 10 parking spaces. Access of high officials during the working days. No overabundance of competition in the trade area.

All of these qualities are consistent with the goal of providing a top quality, entertaining dining experience at a justified price. The consumers’ satisfaction on the organic menu and service would be the best form of marketing.

Nature of the Business Restaurant business is a service oriented business. The main objective is to provide the consumers an atmosphere of eating with pleasure, relaxation and satisfaction. So, the service rendering is the main nature of the business. Still there is a portion of manufacturing involved in this business which acts as a backward linkage for the supply of raw materials in order to prepare the organic food stuffs..

Business in Brief Enlightened Surroundings The surroundings of the restaurant will be very enlightened so that the consumers can feel that our organic food stuffs would also make them luminous. This has been intended to remove the belief that unhygienic restaurants are lightened dimly. Quality Food ‘Natur Livet’ restaurant will serve nothing but fresh meats, vegetables, crisp salads, delectable side dishes and scrumptious desserts, all served with fashioned, home-style care. Variety, Variety, Variety A different menu for every day of the week will feature to name a few of our special theme dinners. Moreover, the items will be changed with delectable varieties on the two weekend days. Opening and Closing Periods The restaurant will remain open from 11.00 a.m. to 10.00 p.m. on the five usual weekdays. With a view to tackle the rush in the weekend days it will remain open from 11.00 a.m. to 11.00 p.m. so that the visitors can enjoy their meal in a serene atmosphere. Dinner Buffet As in the weekend days there would be more hurry than that in other working days, a special dinner buffet would be offered in Saturday and Sunday to keep the consumers in touch with the restaurant more frequently. Affable Employees Workforce is vitally important for the success of any business. In ‘‘‘Natur Livet’ ’ ’ restaurant employees would be sufficiently trained before the inception of the operation of the restaurant. So, the front-desk personnel would amiably welcome the visitors and the waiters would serve the cuisine cordially upon their preferences.

Ownership structure With a view to minimize the risk and gather a handful amount of capital, this restaurant will be owned by five eligible partners. As a partnership firm there would have some specific agreements among the partners under which their functional horizon and other interests would be preserved. This is more gaudily described in the organizational plan of the business.

Start-up summary: Start-up summary deals with the initial expenses, assets and funding of the business elaborately. Start-up expenses: In ‘‘‘Natur Livet’ ’ ’ the following start-up expenses would be incurred: Kitchen Design – Includes the expenses incurred in setting up the architectural format of the kitchen. Architectural Plans – Includes the total expenses for the architectural plan of the restaurant like floor plan expense. Travel/Lodging -- Travel expenses will be incurred to monitor construction, hire, and train staff. Manuals/Recipes -- All are estimates for typing, printing of employee training information, laminating recipes for kitchen use, and binders for all manuals. Pre-opening Labor -- This will cover training of employees and management as well as cleaning and organizing the restaurant prior to opening. Start-up Assets: These assets would be some fixed or long term assets and some current assets: Current Assets: Some initial cash balance, raw materials inventory and other short-term assets would be the start-up current assets. Long-term Assets: Building, land, equipments, furniture are the main long term assets to be maintained as start-up longterm assets. Start-up finance: Capital of the partners and any other investors fund would be the initial financing sources for the business. Current liabilities and long-term liabilities would accrue with the gradual operation of the restaurant. Start up summary Requirements Start-up expenses Travel and lodging Pre opening labors Uniforms Legal expenses Advertising Utilities Miscellaneous Total start-up expenses Start-up assets Current assets Cash balance Inventory Raw materials

50,000.00 200,000.00 50,000.00 10,000.00 200,000.00 350,000.00 209,396.00 1,069,396.00

3,200,000.00 18,333.00

Feeding cost Total inventory Total current assets Long-term assets Production unit Land Land development Production building Tractor Truck Dairy assets Generator Pump Chicken shed Total long-term assets of production unit Restaurant unit Kitchen equipment Furniture Air-conditioner Building Interior development Crokeries Office equipment Total long-term assets of restaurant unit Total long-term assets

71,271.00 89,604.00 3,289,604.00

5,000,000.00 100,000.00 60,000.00 80,000.00 500,000.00 100,000.00 20,000.00 20,000.00 500,000.00 6,380,000.00 2,500,000.00 391,000.00 800,000.00 2,500,000.00 300,000.00 200,000.00 570,000.00 7,261,000.00 13,641,000.00

Total assets Total requirements (total assets + total expenses) Funding Investment Managing partners 4 partners One partner Investor partner Total investment Current liabilities Accounts payable Current borrowing Other current liabilities Long term liabilities Total liabilities Loss at start-up Total capital Total Capital and Liabilities

16,930,604.00 18,000,000.00

5,200,100.00 6,300,000.00 6,500,000.00 18,000,000.00 0.00 0.00 0.00 0.00 0.00 0.00 -1,069,396.00 16,930,604.00 16,930,604.00

Restaurant Industry Overview in Bangladesh In the midst of nine segments in the service sector of our country, hotel and restaurant is playing a predominant role. Bangladesh is a densely populated country. So the emergence of hotel and restaurant business knows no bounds. We will analyze the restaurant industry under the following domain. This is: Involvement in nominal GDP (in billion tk) In the following table the nominal GDP (in million tk) of Hotel and Restaurant industry is shown from FY01-FY04: Nominal GDP (in billion tk) Industry Hotel and Restaurant

FY01 15.9

FY02 17.4

FY03 19.4

FY04 22

This information also illustrates that the contribution of the restaurant industry is pacing up gradually in the Nominal GDP of Bangladesh. Even though the inflation slows down the contribution, still this sector is a matter of sanguine to the potential investors.

Industry demand At present there are more or less 5000 hotels and restaurants in our country from small to large scale. But very few of these maintain the expected level of hygiene and environmental climate for the holding customersâ&#x20AC;&#x2122; attraction. Now we estimate the demand of this industry from the viewpoint of our selected location. As the restaurant will be situated in an aristocratic area like Gulshan, we hope to capture the surrounding 40,000-50,000 customers. Moreover, demand for our restaurant will be affected by the present level and service of the restaurants in the locality. Nature of the Market Capture: The nature of the market capture would work as one of the key driver of demand for our restaurant. Here we will operate as market nicher. As the existing restaurants are providing Indian, Thai, Chinese cuisines, we expect to operate in a different arena. Our most impressive feature is organic food stuffs. Here organic denotes natural or devoid of any fertilizer, insecticides etc.

Market Survey A survey on 76 consumers in Gulshan area reveals that 70 of the consumers have given their favorable opinion in the establishment of organic food restaurant.

Future outlook and trends Due to the emerging nature of our economy, the restaurant industry would flourish in Bangladesh in long-term future. This will lead to more investment in this industry in the form of companies that will assist boosting up of our financial market. Another distinguished feature in the industry is the increase in education on Hotel management and Hospitality management. Many private universities and institutions are providing graduate and post-

graduate degrees on these braches of knowledge. So, there is a promising opportunity for the restaurant business in near future. At present some restaurants are offering some distinguished features to attract the attention of the potential customers. So still there remains chance to expand the business thoughts and ideas. These may be introducing segments for couples, for elderly people, health conscious persons to a great extent. According to the theory of Economics, people spending increase with the increase in income. As our target consumers are an upper-class urban citizens, their preference must be on luxury as well as in hygiene.

Analysis of competitors There are at least 20-30 restaurants in Gulshan area at present. Out of these Asparagus, Aristocrat, Topkupy would be our prime competitors even though none of them provide pure natural or organic food stuffs. The services provided by these restaurants are quite satisfactory. But still we have to compete for capturing the market with our organic feature of food items.

Market Segmentation Our market has been segmented according to our specialized services. Our menu will attract the conscious citizens at large. Below are our targeted market segments. •

Age: Seniors, young married couples with children, aged persons specially health conscious people.

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Gender: We will equally target both sexes with a slight skew for fatty females due to their heavy consumption of mixed vegetables.

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Income: We will appeal to the high side of high income individuals and to all in the middle income bracket.

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Occupation: We will target the white-collar worker, young professionals with a family.

Industry Forecast As our target customers will be offered with variety and health conscious services through our menu, we can expect that there will be growth in the demand for the cuisines. The following table shows the growth rate of customers in 2008 and 2009 respectively. Although we hope that the officials, couples and other visitors might not grow in 2009, families and foreigners will grow to a great extent. Growth rate 2007 Week day Families Foreigners officials Couples Other visitors

2008

2009

20.00% 20.00% 20.00% 0.00% -20.00%

16.67% 11.11% 0.00% 0.00% 0.00%

Weekend day Families Foreigners officials Couples Other visitors

11.11% 12.00% 33.33% 0.00% -10.71%

10.00% 7.14% 0.00% 0.00% 0.00%

Contribution to real GDP growth In the following table the real GDP growth of Hotel and Restaurant industry is shown from FY01FY04:

Industry Hotel and Restaurant

Real GDP Growth by Sectors (%) FY01 FY02 FY03

FY04

7.0

7.10

6.9

7.0

Here we see that the growth rate is always positive and showing and increasing trend in the recent year. So, we can say that this sector is optimistic for further investment and flourish.

Services The Menu The menu is going to be very simple yet exotic to attract our target customers. As we are opening an organic food restaurant the menu would be set keeping in mind that the guests will expect the food to be fresh and hygienic. The menu will include different cuisines from different cultures. It would include all the cuisines that are generally served in the main stream restaurants in Dhaka and also some other different kind of dishes. The dishes served would be for three persons and we will also have the option of set menu. The set menu can be served from different cuisines. The cuisines served would be Thai, Chinese, Indian, Continental and also some special dishes from some European cuisines as our target customers also include guests from foreign countries. Organic Ingredients Organic food is, in general, food produced without the use of artificial pesticides, herbicides, and Genetically Modified Organisms (GMOs). In common usage, the word organic can apply equally to store-bought food products, food from a home garden where no synthetic inputs are used, and even food gathered or hunted in the wild. The organic food served in our restautant will be produced in our firm (mostly) and the other ingredients will be collwcted from the local area market. We will produce all the vegetables that we will serve and also the meat and fish. All the sea foods, shrimps and the ingredients will be collected from the market.

Ethnic Ingredients

Our chef will have great latitude in designing and producing menu offerings from many different world cultures. We will endeavor to produce all the traditional, authentic ingredients necessary to hold true to these varied and interesting cultural recipes. Interior design People need to keep life interesting and our artwork will reflect the world influences that are core to the attitude of the chef of the restaurant. We will do the interior decoration keeping in mind that the overall view of the restaurant should reflect the objective of the restaurant that is fresh and hygienic. The entrance of the restaurant will be soothing yet attractive because the first sight matters a lot. The next emphasis will be on the usage of light in the total environment. Because we want to say that â&#x20AC;&#x153;everything is clean and clear as you seeâ&#x20AC;?. All the furniture used in the restaurant will be specially made for the comfort of the guests. The walls of the restaurant will be decorated with attractive paintings and there would use of green plants in decorative manner. The internal planning of the building that means the architectural design will be done by an Architect from a well known firm and also the interior decoration will be done by the architect and one of our managers. Sales literature Currently there is not any sales literature produced for our restaurant. However there are plans to produce three different pieces once we open. All should be relatively inexpensive to produce and most will be accomplished in-house by using desk-top publishing. Below are the pieces that we are planning to produce. 1. Table Toppers- will explain concept and differences between lunch/dinner, announcing job opportunities and other activities will be announced. 2. Brochure/Handouts- will explain that we can handle large parties; banquets etc. and another will list our daily featured entries. 3. Direct: Mail Piece- will explain our concept, list prices, and show inside photographs of our restaurant. We will produce and mail of our first quarter of operation. Technology We will invest in three high speed computers to provide a fast and efficient connection to the internet and also be a link to our cash register. We will then be able to daily digest key financial information. We will also order online, email and have webpage. The cash register will be used for all the day to day dealings of bills and the computers will be used for keeping the records and update all the data.

Infrastructure Description of the building We are going to rent a small independent house on a 5-katha land on the main road of Gulshan-2. We will renovate the house and turn it to a restaurant.

The building is a bungalow kind of house, single-storied and has a lawn in front of it. The dining area, the kitchen and the office of the restaurant will be within the building. The parking area will be done in the lawn and also over the street but with the prior permission of Dhaka City Corporation. The area of the building is of 3000 square feet. We are going to use 2500 sq. feet (approximately) as the dining and office area and 500 sq. feet area as kitchen. Ownership of the building The building is owned by a retired person who now needs some source of earning. So we are in a contract with the owner to give him monthly rent payment. The renovation of the house will be done by us and all the costs will be done by us and all the costs will be borne by us. The owner of the building does not have any obligation in the business. Capacity We are able to serve 100 people at a time. The dining will be comprised of table for 6, table for 4 and table for 2. The number of table is given bellow: Size of table Large (6) Medium (4) Small (2) Total

•

No. of tables 4 14 10 28

No. of guests 24 56 20 100

Market Survey

In case of frequency in the visit, 27 respondents visit weekly and 24 on special occasions. So we should offer some special dishes on the weekends and keep sufficient facility for the arrangement of parties. Except 9 of the respondents all the rests prefer going restaurant along with family, friends and colleagues. So, we should prepare sufficient sitting arrangement keeping this consideration in mind.

Parking facilities As we have mentioned earlier the parking area will be within the restaurant boundary and also outside it. We are able to give parking of 10 cars at a time within the boundary. The responsibility of the cars parked within the boundary will be the obligation of the restaurant but the cars parked on the streets will be the guests’ responsibility.

Equipments and Personnel Equipments Our equipments are divided in two major parts: • Equipments used in the firm • Equipments used in the restaurant.

Equipments used in the firm: The equipments used in the firm are stated below • Pump • Generator • Tractor • Other cultivation equipments Equipments used in the restaurant These can be divided in four parts1. Equipments used in kitchen 2. Equipments used in dining area 3. Equipments used in office area 4. Equipments used in front desk 1. Equipments used in kitchen: Gas burner Brick oven Chiller freezer Blender Chopper Spoons Dishwasher

Oven Micro wave oven Refrigerator Grinder Pans Bowls and baskets Exhauster

2. Equipments used in dining area: • • • •

Crockery used for serving Crockery used for taking food Tables and chairs Air conditioners

3. Equipments used in office: • • • •

Office desk Chair for managers Air conditioners Computers

4. Equipments used in front desk: • • • •

Front desk Chair Computer Sofa (for guests who will be waiting)

The production process of the venture is broadly divided into two categories:

Equipments and Personnel 1. Production of raw materials 2. Production of food-items

Production of raw materials For basic raw materials for restaurant we will, we will establish our own firm. Other raw materials, which are not able to produce by ourselves, will be collected from local shop or will be exported. Here is a list of raw materials necessary for production and purchase of food items in our restaurant: Items Vegetables Chicken Beef Mutton Fish Egg Rice

Items Spices Sauce Soya-bin oil Ghee Shrimp Sea-food Tea

Items Mushroom Dals Mustard Cheese Potato Coffee Wheat

Our production of raw material will be completed in two ways: Production by self: Most of the basic raw materials, which can be produced in Bangladesh, will be produced in our own firm situated in Savar. We depend on our own firm, because by establishing our firm, the organic element of raw materials can be ensured strictly. We can monitor each and every step of production process. Description of the production unit:       

Location: Savar Total land area: 1.5 acre ( 6070 square Meter) Ownership pattern of the land: Own. Total area used for horticulture: 4400 square meter. Total land used for pond: 1500 square meter. Total area of the kitchen shed: 1600 square feet. Total area of the production building: 200 square feet.

There are five divisions within the production unit: • • • •

Vegetable and crop division Poultry division Dairy and Meat division Fish division

Production process

The total land area of the firm will be divided into two part-fisheries and horticulture and dairy. The poultry firm will be situated on floating firm above the pond. Total land area for horticulture will be further being divided into four parts. Three of them will be use for horticulture while other one will be used for dairy. After every three month the portion for dairy firm will be used for horticulture and dairy will be shifted to a new portion. This process will continue thought the year. Vegetables and crops division: We will produce rice, wheat, dals, mustard, mushrooms and all types of vegetables under this division. Our own tractor is used for cultivating the land. At a time, 3300 square meter of the total land area of 4400 square meter will be used for cultivation while other 1100 square meter will be used for graving cows and goats. The wastage produced by cows and goats are only fertilizer used in our land. For irrigating our land, we use our own shallow tube-well. Poultry division: Poultry and eggs will be produced under this division. We predict that in a year we will need 11000 boiler chicken and 500 layer chicken. In every month we will need 900 chickens. It takes 1 month to grow a boiler chicken. At a time our poultry firm will contain 1000 boiler chicken and 500 layer chicken. The price per baby chicken is 6 tk and food cost per chicken in its life time will be 50 tk. Dairy and meat division: Dairy and meat division will supply us milk, butter, ghee, butter-oil and meat. Our firm will have 4 dairy cows for producing milk. We predict that in a year we will need meat of 20 cows. As these cows will solely be used for producing meat, we will need to purchase 20 cows at every year. Our firm also contains 20 goats for each year. Fisheries unit: We will have a pond of 1500 square meter for producing fish. All types of fresh-water fish will be produced in our firm. The wastage produced by the poultry unit is the main feed of the fish. If necessary, additional food will be given, but this food will be fully natural. No hormone tablet or any type of fertilizer will be given to the fishes.

Ensuring the Organic Elements For vegetable Unit: For producing vegetables, we use only compost. The cow dung of the dairy and meat firm is the only fertilizer we use for our vegetables. We used no chemical fertilizer or even insecticides. Thus, the vegetable we produce in our land is fully organic. Dairy and meat: For feeding the cows and goats, we only rely on grass and other natural food such as straw, chuff etc. For processing the milk, we use traditional method, the method of boiling the milk, rather than pasteurizing which is not organic. For processing the meat, we do not use any preservative; rather we just collect the meat and freeze it.

Poultry: The process of producing organic poultry is somewhat difficult. We have to give vaccine to the chickens and it is supported by the World Organic Food Society situated in Germany. For feeding the chicken, we use only natural food. Also for processing chicken we do not use any preservative. We also do not use any preservative or chemical for eggs. Thus, we can ensure that the chicken and eggs are fully organic. Fish: As the poultry is situated above the pond, so, we use the wastages of the poultry as the feed for fish. No other kinds of feed are used for fish. If necessary then only natural feed are used. We do not use any insecticides, vaccination (hormone capsule) or fertilizer.

Suppliers of Raw Materials As we wonâ&#x20AC;&#x2122;t produce all the raw materials for the production, we need to purchase some of these from suppliers. We would order these from local suppliers like the Organic in Mina Bazar from which we can purchase some spices, tea and some other raw materials. Being ensured by the organic nature of raw materials, we would also buy some from other suppliers.

Production of food-items The production of food items will be handled by an executive chef under the catering manager. Under the executive chef 3 assistant chefs would perform and they will be supported by other 12 kitchen stuffs in the preparation of food stuffs. We produce the food items by incorporating some processes which would involve the use of sophisticated kitchen equipments imported from different countries. Moreover, we are quite confident that the organic food production will be ensured in all the preparation process maintaining the guideline of our executive chef who is much expert in this respect. Moreover, some international standards will be maintained in this regard. Personnel Requirements: Personnel plan( for production unit) 2006 (July-Dec) Manager production and purchase 1 Production personnel: Supervisor 2 Labor 12 Helper 4 Driver 1 Driverâ&#x20AC;&#x2122;s helper 1 Purchase personnel 1 Accountants 1 Security guard 3 Total 26

2007

2008

2009

2 12 4 1 1 1 1 3 26

Our main focus in marketing will be to increase customer awareness in the target market. We will direct all of our tactics and programs toward the goal of our explaining of whom we are and what we are all about. We have no plan to join in the coupon/discounting wars that other have embarked. We will price our products fairly, keep our standards high, and execute the concept so that word of mouth will be our main marketing force.

Target Market The production of organic food is costlier than producing it in inorganic way. Thatâ&#x20AC;&#x2122;s why; the food served in our restaurant will be a little costlier than any other restaurant. Because of this reason our target customer will be persons willing to pay a little higher money for a good appetite which will also give them the feeling that their money is returning to them. Conscious person: Persons, who are conscious about their health and also what food they are taking, will be our target customers, because our restaurant will serve foods which will be mainly produced in our firm. Other food items and spices will be collected from such sources that the food served before the guests will be fully organic. Families: Now days in our country, the awareness for healthy food and healthy environment of restaurants have been increased. Thatâ&#x20AC;&#x2122;s why; the families want to go to restaurant where the food will be hygienic. So they will be our target customers we believe that our restaurant will be able to cater their needs properly. Officials: That is the last customer pool who in offices and they need to take their food outside. It is not that much healthy for them. So if we can serve food which can fulfill their needs and even match their price range and satisfaction level, then they will come to our restaurant. Foreign Visitors: A large portion of our target customer will be foreign visitors. The foreigners are generally more health conscious and they prefer taking organic food. But in our country they donâ&#x20AC;&#x2122;t get restaurants or even markets where they can get organic food or food items. So if they get restaurant in our country serving organic food they will definitely come as our guests.

Foreigners View point In the midst of 76 respondents, 14 were foreigners. Now we analyze their responses in the following ways: •

The most important observation among the foreigners is that 11 of their monthly income are over tk 25000 of which 6 persons earn over tk. 100,000 monthly. So, it s very important to develop our organizational strategy keeping this under consideration.

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Again we have found that 11 of the foreigners visit restaurants daily and weekly. This shows the high frequency of their visit for which we have to develop our menu accordingly.

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Another significant observation is that 7 of them spend more than tk 1000 and some other spends more than tk 1000 per person. This spending structure should also be dealt with proper care so that we can establish a long term relationship with them and increase our revenue as well.

•

As all of the foreigners visit restaurants from their previous experience and hearing from others , our advertising should attract the local people and our service should be provided with trained employees so that they can gather a pleasing experience.

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Furthermore, none of the foreigners consider any other preference in food items expect food quality. 10 of them give preference for quality control initiatives and 11 of them emphasize the production of raw materials for food items. So we should make sufficient arrangements for interior decoration and maintain hygiene in the production process.

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11 of the foreigners are in favor of organic food restauran t and they are also willing to pay higher for the quality cuisine. So, we have sufficient endeavor for the initialization of the business.

Pricing Strategy In pricing the products of our restaurant we are going to use Premium Pricing Strategy. This strategy is used to produce high quality product and charge the highest price. As the production procedure of organic food is costly, the higher price charged in the restaurant will be reasonable and the higher value paid by the consumers will get back to them as we are going to serve them with quality foods that are promised by us.

In our survey we have found that out of 76 respondents 70 of them are in favor of organic food restauran t and they are also willing to pay higher for Plan the quality Advertising and Promotional cuisine. So, we have sufficient endeavor for the initialization of the business.

The advertising procedure of the restaurant will be comprised of 1. Setting advertising objectives 2. Setting the advertising budget 3. Developing the advertising strategy 4. Evaluating the advertising campaigns Setting advertising objectives The first step is to set the advertising objective. An advertising objective is a specific communication task to be accomplished with a specific target audience during a specific period of time. Our advertising objective will be firstly to inform the consumers and after a certain period of time it will be reminding. Now the rationales behind the objectives are: •

As we are introducing a new line of food in the market, our advertising will be informative. The primary objective is to build public demand.

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We will also do persuasive advertising by saying that we are serving the best quality food.

•

Reminder advertising is important for mature products-it keeps consumers thinking about the product. As we are going to run a restaurant it will be very important for us to remind the consumers that we are there to serve them with quality food which will value their money.

Setting the advertising budget As we are starting a totally new venture, we have to set an advertising budget that is large in size. Because we have to build awareness and gain consumer trial, the market share also impacts the advertising budget as we have to build a market for our product and also take share from the competitors. Developing advertising strategy Advertising strategy consists of two major elements 

Creating advertising message and Selecting advertising media.

For the advertising of the restaurant we are going to use billboards, banners and poly sign as the media. We will hire a billboard at Gulshan-2 circle. This billboard will hold the main reason for opening the restaurant; that is the organic food will value the money of the guests as well as give them a good appetite. This is also the advertising message. The banners will be used in all the main roads of Gulshan-1, Gulshan-2 and Banani. We will use the banners specially in front of all the embassies, high commissions, multinational corporations, NGOs, and in other main office areas. The poly sign will be used in front of our restaurant.

Evaluating advertising campaign We have to evaluate both the communication effects and the sales effects of advertising regularly. Sales effects are also affected by many other factors like product features, price, satisfaction etc. But

the communication effects solely depend on the advertising. After opening the restaurant the number of guests coming each day and the frequency of the guests’ visit will give evidence of effective communication. The organizational plan of the restaurant deals with the form of ownership, lines of authority and responsibility of members for the well-functioning of the restaurant. Now we go into the detail of the organizational plan of our restaurant:

Form of ownership This restaurant is a partnership firm. As all the members are capable of providing some capital and management resources or expertise, this business has been a partnership firm to earn substantial profit acknowledging unlimited liability.

Identification of Partners Name of partners : Managing partners • Nazmul Ahsan • Afra Ilham • Afsana Rahman • Afsana Islam • Rayhan Mahmood Investor partner: • Gazi Zahidul Islam Terms of agreement of the partnership: •

Profit of the restaurant will be shared equally regardless of the discrepancies in the capital generation.

•

All the partners are liable for activities of any of the partners while representing in the business arena.

•

Partners providing loans would realize 14% interest per annum for the loan provided.

•

All the partners would accrue monthly salaries for their contribution in management.

•

Nazmul Ahsan would act as the agent on behalf of the firm who has check-signing authority approved by other partners.

Organizational Structure

At the initial stage, the restaurant would follow downward moving hierarchical structure. So, the instructions would accrue from the upper level to the lower level employees. Currently, the managing positions will be held under each of the partners but it will be extended in future. These possible positions might be marketing director, purchasing agent, controller, director of human resources, director of training, director of research and development and administrative assistants.

Management team In order to lessen the excessive overhead expenses and earn a higher return, the management team of the restaurant would be simply consisted of the founder partners. As it is small in nature, the organizational structure is also simple as described earlier. This management team is responsible for all major decisions in addition to monitoring all other business activities.

Responsibilities of the management team The general manager would be the most proficient among the partners who possess the overall knowledge on this industry and can adopt flexibility with a sudden change in consumer behavior, market condition or socio-economic condition of the country. The manager in purchase and production would perform all the purchasing functions for production of raw materials as well as food stuffs for the restaurant. Thus, he would manage the firms for vegetables, poultry and fisheries. In this case, his responsibility would be to choose the cost effective source for purchasing or manufacturing functions. Moreover, the purchasing agents and store staffs would work under his control in future emerging business environment. The manager in Accounts would compile all the sources of revenues and expenditures to bring out the profitability and sustainability of the restaurant. Although finance is done by this manager, we hope that in future Finance manager would also evolve as the business flourish. Under the Catering manager there would be an executive chef who would formulate the cooking mechanism of food stuffs. He would be assisted by some other assistant chefs and finally the waiters would serve the organic foods according to the order placed. Then, the manager maintenance would perform the supervision of the maintenance of the restaurant. Under him, there would be some cleaners, bill-collector and security guards. This manager is also responsible for dealing with any client regarding the arrangement of parties by the restaurant.

Personnel Plan: The table depicted below shows our initial management staffing estimates: Personnel plan(total)

General manager Manager production and purchase Production personnel:

2006 (July-Dec) 180,000.00 120,000.00

2007

2008

2009

360,000.00 240,000.00

Supervisor Labor Helper Driver Driverâ&#x20AC;&#x2122;s helper Purchase personnel: For production unit For restaurant unit

72,000.00 72,000.00 27,000.00 24,000.00 12,000.00

144,000.00 144,000.00 54,000.00 48,000.00 24,000.00

30,000.00 42,000.00

60,000.00 84,000.00

Manager accounts Accountants: For production unit For restaurant unit

60,000.00

120,000.00

30,000.00

60,000.00 120,000.00

Manager catering Chef Assistance chef Kitchen stuff Waiters

72,000.00

144,000.00 144,000.00 96,000.00 72,000.00 660,000.00

Manager maintenance Front desk Security guard For production unit For restaurant unit Clearers

90,000.00

180,000.00 48,000.00

45,000.00

90,000.00 180,000.00 43,200.00

Total

876,000.00

3,115,200.00

Strengths 1. Fresh market The market of organic food is fresh in our country. We launch our product in a market in which there is no direct competitor. People who prefer organic food will be a large portion of our potential customer. 2. Fully New idea The most important strength of our venture is- the concept of organic food restaurant is fresh and new for our country. There is no such restaurant is present in Bangladesh now. Thus our venture will get an extra attention to the customer. 3. No dependence on raw materials We do not depend on external sources for our basic raw materials (such as chicken, fish, egg, milk, meat, vegetables etc). Rather we produce these products in our own firm. This will ensure continuous supply of raw materials at a lower cost. 4. Organic elements are ensured If we purchase our basic raw materials from outside suppliers, we can not ensure our customer that the food stuffs we supply are fully organic. As we produce the raw materials in our own firm and we ourselves monitor each and every steps of the production process, we can ensure our customer that our products are fully organic.

5. Customer satisfaction As we can ensure the organic element in our food items, this will satisfy our customer to seek for organic food and helps us to retain old customers and create new customers. 6. Strong staff resources Our five entrepreneurs are directly engaged in the management of the business. This will ensure the proper monitoring of the business. Also at every stage of production and operation we employed sufficient staffs and workers. 7. Modification of menu Our menu is not fixed. We will change our menu and add new items in our menu to attract new customers and to give customers a good experience in dining. 8. Own transport We use our own 1.5 ton truck to carry raw materials from our firm to our restaurant. Thus we need not rely on outside transport and our transportation cost will be substantially low. 9. Advertising Not all restaurants in our country advertise. But we know the strength of advertisement and we go for it. Our billboard will definitely inform the potential customer that a new way of restaurant is being opened for their experience. Poly signs and banners are also helpful in promoting our advertising process. 10. Secured source of capital Our restaurant has raised its capital from internally generated funds mainly. Some portion would be provided by an investor in the venture. So, the sources of capital are quite secured. 11. Modern technology We have adopted some modern technologies keeping facilities online contracts with the customers. Moreover, we welcome the guests to use their credit cards or debit cards in the payment of the bill. 12. Attractive interior Our restaurant would provide some attractive interior arrangements with soothing environment which will be enlightened and dirt free enough to please our guests. Moreover, our rhythmic sound system would pace up the entertainment at a large scale. 13. Proper management Five of our entrepreneurs are directly engaged in management. They will work with their best effort and this will ensure a proper management system. 14. Proper planned organizational structure Our organizational structure is very simple. Senior management is under the supervision of the partners which would ensure the proper planning and implementation of the decisions.

Weaknesses: 1. Very unfamiliar concept

As the concept of organic food is not so familiar with our present customers, some customers may not be interested with the idea or they may not belief the credibility of the food items to be organic fully. 2. Cost-sensitive project Since the production of raw materials is somewhat costlier than producing other ingredients for this line of business, offering organic food is really a cost-sensitive project. 3. Small dimension of the restaurant The dimension of the restaurant is not too large to accommodate more than 100 visitors at a time. Moreover, some other restaurants are offering more spacious arrangement for serving the cuisines. 3. Amateur senior management The senior management of our restaurant is quite amateur because they donâ&#x20AC;&#x2122;t have any prior realistic experience of maintaining and controlling the operations of business. Thus, this may appear as a weakness for the well-functioning of the restaurant. 4. Absence of occasional discount Even though we are opening a new arena of restaurant business in Bangladesh, we wonâ&#x20AC;&#x2122;t provide any occasional discount system on food stuffs whereas other competitors would provide these opportunities to the potential customers. Our conception is that such discount might reflect a negative attitude on the customers regarding the quality of our cuisines.

Opportunities: Opportunities arise from the circumstances of external environment. As the entrepreneurs we expect the following opportunities that our venture can confront in future: 1. Taking over of competing firms Since our operation would attract the potential flavor of customers and the number of circumspect consumers might increase keeping the consideration of quality and hygiene of the food stuffs, we hope to take over other competing firms in future; which is an imperative opportunity of our restaurant business. 2. Impressive relationship with suppliers As some of our raw materials for the preparation of food items would be collected from the suppliers, we hope to maintain an effective relationship with them. This would ensure the quality materials. 3. Cutting costs In order to ensure organic nature of our food items, we wonâ&#x20AC;&#x2122;t use any insecticide or chemical fertilizer in our production unit lands. Our own generated manure from dairy and poultry would be used in those lands. So, this will cut our cost to some extent.

Threats

Sometimes the opportunities may not appear with regard to the expectation. So, some threats might affect the venture at large. Our restaurant business might face the following threats: 1. Competitors’ change in action: In quest of tackling our business strategy, the competitors might change their course of action. For example, they can also open this organic branch of operation that might lead our market capture. Again, they can also introduce new diversified mechanisms. 2. Change in consumer taste: Since the consumers always transform their taste or preference in any commodity, we might face a lower consumer demand under that situation. The rationale behind this is the over abundance of restaurants in the organic line of food ventures.

Important Assumptions Sales: ‘Natur Livet’ is going to launch production in January, 2007. Our sales are expected to grow at 10.92% and 6.93% in year 2008 and 2009 respectively. Cost of raw materials: Cost of raw materials is determined by taking the total cost of production unit and cost for suppliers. Cost of goods sold: Cost of goods sold is calculated by taking into account the ending and beginning raw materials. We will keep 20% of the total raw materials as inventory for a every year. Accounts payable: Of the total cost for suppliers, 20% is reported as accounts payable throughout the years. Cost Determination: Fixed cost includes salaries, depreciation, insurance cost, rent, utilities. Fixed costs are fixed in all the years. Variable cost includes all other cost except fixed cost. Variable cost will increase at a rate of 10% than the preceding year. Retained Earnings: In year 2007, we are retaining 60% of the net income while in year 2008 and 2009 we are retaining 40% of the net income respectively. Depreciation: Production unit Land development Production building Tractor Truck Cows(for milk) Generator Pump Chiken shed Restaurant Unit Kithchen equipment

Rate 20 years 5 years 5 years 10 years 5 years 5 years 5 years 5 years Rate 8 years

Furniture Air conditioner Buildings Interior development Crockeries Office equipments

10 years 10 years 20 years 3 years 3 years 5 years

Break-even Analysis Variable cost Cost elements Variable cost of goods sold Additional service cost Laundry Cleaning Packaging Menu and others Total variable cost per customer

Cost per customer 104.5707 7.442666 3.101111 0.865426 2.10587 0.34617 118.43

Fixed cost Cost elements Production payroll Depreciation Other Salaries Utilities Insurance Rent Transportation cost Depreciation Salaries for selling personnel Total fixed cost Average revenue per customer-395.18 Average variable cost per customer-118.43 CM per customer = 395.18-118.43 = 276.75 Break-even number of customers = =

Break-even Sales (in Taka):

Fixed Cost CM per Customer

6631200 276.75 = 23961 persons.

Fixed Cost

= CM Ratio

Cost per customer 864,000.00 211,000.00 320,000.00 1,051,200.00 642,000.00 220,000.00 1,440,000.00 198,000.00 881,000.00 804,000.00 6,631,200.00

6631200 = 276.75 395.18 =9,468,898.941 taka

Break-even Analysis 10000000 8000000 6000000

profit

2000000

20000000

18000000

16000000

14000000

12000000

10000000

8000000

6000000

-4000000

4000000

-2000000

2000000

0 0

profit

4000000

-6000000 -8000000

sales

Pro-forma Income Statement Income statement Sales Cost of goods sold Gross margin Operating expenses Administrative and maintenance expense Salaries Utilities Insurance Additional service cost Rent Transportation cost Laundry Cleaning Depreciation Kitchen equipment Furniture Air conditioner Buildings

2006 0.00 1,155,704.00 -1,155,704.00

2007 13,832,800.00 5,019,945.00 8,812,855.00

2008 15,344,200.00 6,181,092.00 9,163,108.00

2009 16,408,400.00 6,620,101.20 9,788,298.80

330,000.00 321,000.00 110,000.00

1,051,200.00 642,000.00 220,000.00 258,000.00 1,440,000.00 198,000.00 107,500.00 30,000.00

1,051,200.00 642,000.00 220,000.00 283,800.00 1,440,000.00 217,800.00 118,250.00 33,000.00

1,051,200.00 642,000.00 220,000.00 312,180.00 1,440,000.00 239,580.00 130,075.00 36,300.00

312,500.00 39,500.00 80,000.00 125,000.00

720,000.00 90,000.00

156,250.00 19,550.00 40,000.00 62,500.00

Interior development Crockery Office equipments Total administrative and maintenance expense Selling expenses Salaries for selling personnel Packaging Menu and others Total selling expenses Total operating expenses Net Income

50,000.00 50,000.00 62,000.00 2,011,300.00

100,000.00 100,000.00 124,000.00 4,827,700.00

100,000.00 50,000.00 124,000.00 4,837,050.00

50,000.00

72,000.00

804,000.00 73,000.00 12,000.00 889,000.00 5,716,700.00 3,096,155.00

804,000.00 80,300.00 13,200.00 897,500.00 5,734,550.00 3,428,558.00

804,000.00 88,330.00 14,520.00 906,850.00 5,709,185.00 4,079,113.80

72,000.00 2,083,300.00 -3,239,004.00

124,000.00 4,802,335.00

Sales Forecast 20,000,000.00 Sales

15,000,000.00 10,000,000.00

gross margin

5,000,000.00

Net Income

0.00

9 0 2

8 0 2

7 0 2

6 0 2

-5,000,000.00

Pro-forma Cash Flow Statement Cash flow Cash flow from operating activities Cash received from customers Cash payment To suppliers For production unit Operating expenses Net cash provided by operating activities Cash flow from investing activities Purchase of lands Cash flow from financing activities Withdrawal by owners Net increase in cash

2006

2007

2008

2009

0.00

13,832,800.00

15,344,200.00

16,408,400.00

(1216625) (1643000) -2,859,625.00

(2226500) (2861775) (4835700) 3,908,825.00

(3005775) (2989952.5) (4903550) 4,444,922.50

(3306352.5) (3130947.75) (4978185) 4,992,914.75

0.00

(2,500,000.00) 0.00

(3500000.00) 0.00

0.00 -2,859,625.00

1,238,462.00 2,670,363.00

2,057,134.80 -112,212.30

2447468.28 -954,553.53

cash at beginning period Cash at ending period

3,200,000.00 340,375.00

340,375.00 3,010,738.00

3,010,738.00 2,898,525.70

2,898,525.70 1,943,972.17

Cash Flow cash received from customers

20,000,000.00 15,000,000.00

net cash provided by operating activities

10,000,000.00

Net increase in cash

5,000,000.00 0.00

cash at ending peroid

9 0 2

8 0 2

7 0 2

6 0 2

-5,000,000.00

Pro-forma Balance Sheet Balance sheet Current assets Cash Inventory Long term assets Production unit Land Land development Production building Tractor Truck Dairy assets Generator Pump Chicken shed Restaurant unit Kitchen equipment Furniture Air-conditioner Building Interior development Crockery Office equipment Total long-term assets Total assets Liabilities and capital Current liabilities

2006

2007

2008

2009

340,375.00 256,025.00

3,010,738.00 1,091,980.00

2,898,525.70 1,173,278.00

1,943,972.17 1,262,705.80

5,000,000.00 100,000.00 60,000.00 80,000.00 500,000.00 100,000.00 20,000.00 20,000.00 500,000.00

7,500,000.00 100,000.00 60,000.00 80,000.00 500,000.00 100,000.00 20,000.00 20,000.00 500,000.00

11,000,000.00 100,000.00 60,000.00 80,000.00 500,000.00 100,000.00 20,000.00 20,000.00 500,000.00

2,500,000.00 391,000.00 800,000.00 2,500,000.00 300,000.00 200,000.00 570,000.00 13,641,000.00 14,237,400.00

2,500,000.00 391,000.00 800,000.00 2,500,000.00 300,000.00 200,000.00 570,000.00 13,641,000.00 17,743,718.00

2,500,000.00 391,000.00 800,000.00 2,500,000.00 300,000.00 200,000.00 570,000.00 16,141,000.00 20,212,803.70

2,500,000.00 391,000.00 800,000.00 2,500,000.00 300,000.00 200,000.00 570,000.00 19,641,000.00 22,847,677.97

0.00

Accounts payable Current borrowings Total current liabilities Long term liabilities Accumulated depreciation Retained earnings Capital Total Liabilities and Capital

0.00 0.00 0.00

556,625.00 0.00 556,625.00

612,287.50 0.00 612,287.50

673,516.25 0.00 673,516.25

545,800.00

1,637,800.00

2,679,800.00

3,621,800.00

-4,308,400.00 18,000,000.00 14,237,400.00

-2,450,707.00 18,000,000.00 17,743,718.00

-1,079,283.80 18,000,000.00 20,212,803.70

552,361.72 18,000,000.00 22,847,677.97

Some Important ratios 2006 Sales growth (%) Percentage of total assets Cash Inventory Total current assets Percent of sales Sales Gross margin Operating expenses Net profit before tax Additional ratios Return on equity Current ratio

2007

2008 10.92%

2009 6.93%

14.34005% 5.804628% 20.14468%

8.508401% 5.526626% 14.03503%

100% 63.70984% 41.33% 22.38270632%

100% 59.71708% 37.37% 22.34433%

100% 59.65419% 34.79% 24.85991%

17.20 7.37

19.05 6.65

22.66 4.76

2.39071% 16.96791% 1.798257% 6.154178% 4.188967% 23.12209%

-17.99

Social Cost-benefit Analysis is also called economic analysis of a project developed for evaluating investment projects from the point of view of the society. Most often it is done for public investments. But in the recent times this analysis is also encouraged for private investment so that the economic feasibility study of the project can be done. ‘‘Natur Livet’ ’ is a service oriented organization with some manufacturing process involved set up as an organic food restaurant. So, undoubtedly this will involve both inputs and outputs gained and lost by the society. Net benefit of the restaurant = Value of output in terms of shadow price- value of inputs in terms of shadow price = Social benefit – social cost

Concept of shadow pricing Shadow pricing represents the market prices of inputs and outputs only under conditions of perfect markets which are hardly fulfilled in developing countries. In case of food stuffs and raw materials the market demand price is the shadow price for these outputs because these are non-tradable and at the same time they increase the consumption of the outputs.

In case of inputs the shadow price is the cost of capital inputs. Some of these inputs are tradable and some other non-tradable. The cost of labor inputs, increased productivity of the employees and valued supply of cuisines is really tricky for the time being. So we are ignoring the shadow pricing effect in this segment.

Social benefit of ‘Natur Livet’: The social benefits can be categorized in the following segments: • Profit generation: This is a social benefit too as it increases the gross national income of the country by contributing to the service sector. As a result the economic growth of the nation is somewhat attributable to the contribution of our business venture. • Increased productivity of the employees: Our restaurant business would provide an opportunity to the employees to gain experience while operating in the venture. Moreover, we would provide some training to the employees. So, this will lead to increased efficiency of the employees; increase the productivity of the venture which will benefit both the individual employees and the society as well. • Food value and entertainment: As the main motto of our restaurant business is to provide quality foods that are organic in nature. So, this will facilitate the consumers’ food value maintaining the hygiene factors. Thus, our guests will be benefited by preserving sound health having a good palate. Our enlightened environment will also keep them mentally fresh and enthusiastic. As a result, they will have enough rationale to perform their services properly which will benefit the society to a great extent.

Social costs of ‘Natur Livet’ • Cost of capital inputs The cost of capital inputs represents the cost of physical assets and other long term assets of the restaurant. Some of these assets are acquired through import. So these are tradable but it is really difficult to trace the border price or CIF (cost, insurance & freight) price of these inputs as we have assumed the total amount of the capital inputs altogether. Again the opportunity cost of capital input is another huge cost to the society. The opportunity cost is the earnings that could have been generated from those investments. • Cost of labor input The cost of labor input is another social cost for our restaurant because these labors could have been used for other purposes. Thus, the marginal product of the labor is reduced and the society is deprived of those outputs. Projected No of customers per day 2006 2007 2008 2009 (July-Dec) Week day Families Foreigners Officials

20 15 25

24 18 30

28 20 30

Couples Other visitors Total

10 15 85

10 12 94

10 12 100

Weekend day Families Foreigners Officials Couples Other visitors Total

36 25 15 16 28 120

40 28 20 16 25 129

44 30 20 16 25 135

Average spending by customers (in Taka) 2006 (July-Dec) Week day Families Foreigners Officials Couples Other visitors Weekend day Families Foreigners Officials Couples Other visitors

2007

2008

2009

400 650 250 350 300

450 750 250 350 300

Sales Forecast 2006 (July-Dec)

2007

2008

2009

Week day Families Foreigners Officials Couples Other visitors

2,088,000.00 2,544,750.00 1,631,250.00 913,500.00 1,174,500.00

2,515,200.00 3,065,400.00 1,965,000.00 917,000.00 943,200.00

2,923,200.00 3,393,000.00 1,957,500.00 913,500.00 939,600.00

Weekend day Families Foreigners Officials Couples Other visitors Total sales

1,684,800.00 1,950,000.00 390,000.00 582,400.00 873,600.00 13,832,800.00

1,872,000.00 2,184,000.00 520,000.00 582,400.00 780,000.00 15,344,200.00

2,059,200.00 2,340,000.00 520,000.00 582,400.00 780,000.00 16,408,400.00

Cost of Production(production unit) 2006

2007

2008

2009

Cost of raw materials Seeds Chicken Duck Young fish Cows(for meat) Goats Feeding cost For fish For chicken For cow For goats Vaccines Production payroll Depreciation Land development Production building Tractor Truck Cows(for milk) Generator Pump Chiken shed Insurance cost Property tax Total Cost of Production (production unit)

5,000.00 34,500.00 500.00 10,000.00 50,000.00 10,000.00

11,000.00 75,900.00 1,100.00 22,000.00 110,000.00 22,000.00

12,100.00 83,490.00 1,210.00 24,200.00 121,000.00 24,200.00

13,310.00 91,839.00 1,331.00 26,620.00 133,100.00 26,620.00

45,625.00 287,500.00 109,500.00 5,000.00 25,000.00 432,000.00

100,375.00 632,500.00 240,900.00 11,000.00 55,000.00 864,000.00

110,412.50 695,750.00 264,990.00 12,100.00 60,500.00 864,000.00

121,453.75 765,325.00 291,489.00 13,310.00 66,550.00 864,000.00

2,500.00 6,000.00 8,000.00 25,000.00 10,000.00 2,000.00 2,000.00 50,000.00 10,000.00 150,000.00 1,280,125.00

5,000.00 12,000.00 16,000.00 50,000.00 20,000.00 4,000.00 4,000.00 100,000.00 20,000.00 300,000.00 2,676,775.00

5,000.00 12,000.00 16,000.00 50,000.00 20,000.00 4,000.00 4,000.00 100,000.00 20,000.00 300,000.00 2,804,952.50

5,000.00 12,000.00 16,000.00 50,000.00 20,000.00 4,000.00 4,000.00 100,000.00 20,000.00 300,000.00 2,945,947.75

Cost of suppliers 2006 Shrimp Sea food Spices Oil Tea Coffee Sugar Other ingredients Total Cost for Suppliers

2007 1,032,950.00 500,000.00 60,000.00 85,000.00 1,200.00 3,600.00 100,375.00 1,000,000.00 2,783,125.00

Cost of Goods Sold of The Restaurant 2006 Cost of raw materials Beginning inventory 89,604.00 Cost of production unit 1,280,125.00 Cost for purchase Less: Ending inventory (256025) Direct labor

2008 1,136,245.00 550,000.00 66,000.00 93,500.00 1,320.00 3,960.00 110,412.50 1,100,000.00 3,061,437.50

2009 1,249,869.50 605,000.00 72,600.00 102,850.00 1,452.00 4,356.00 121,453.75 1,210,000.00 3,367,581.25

2007

2008

2009

256,025.00 2,676,775.00 2,783,125.00 (1091980)

1,091,980.00 2,804,952.50 3,061,437.50 (1173278)

1,173,278.00 2,945,947.75 3,367,581.25 (1262705.8)

Purchase personnel Chef Assistance chef Kitchen staff Cost of good sold

42,000.00

1,155,704.00

84,000.00 144,000.00 96,000.00 72,000.00 5,019,945.00

84,000.00 144,000.00 96,000.00 72,000.00 6,181,092.00

Personnel plan Per person salary per month General manager Manager production and purchase Production personnel: Supervisor Labor Helper Driver Driverâ&#x20AC;&#x2122;s helper Purchase personnel: For production unit For restaurant unit

Salary per month 30,000.00 20,000.00 6,000.00 2,000.00 1,500.00 4,000.00 2,000.00 5,000.00 7,000.00

Manager accounts Accountants: For production unit For restaurant unit

10,000.00

Manager catering Chef Assistance chef Kitchen stuff Waiters

12,000.00 12,000.00 4,000.00 1,500.00 2,200.00

Manager maintenance Front desk Security guard For production unit For restaurant unit Clearers

15,000.00 4,000.00

5,000.00 5,000.00

2,500.00 2,500.00 1,200.00

84,000.00 144,000.00 96,000.00 72,000.00 6,620,101.20

Salaries for Administrative Personnel 2006 General manager 180000 Manager accounts 60000 Accountants: Manager maintenance 90000 Front desk Security guard Clearers Total 330000

Salaries for Selling Personnel 2006 Manager Catering 72000 Waiters Total 72000

2007 360000 120000 120000 180000 48000 180000 43200 1051200

2007 144000 660000 804000

2008 360000 120000 120000 180000 48000 180000 43200 1051200

2008 144000 660000 804000

2009 360000 120000 120000 180000 48000 180000 43200 1051200

2009 144000 660000 804000

Retained Earnings Previous balance Profit of the current year Paid out Total retained earnings

2006 -1069396 -3239004

2007 -4308400 3096155

2008 -2450707 3428558

2009 -1079284 4079114

0 -4308400

1238462 -2450707

2057135 -1079284

2447468 552361.7

Daily average Spending By Customers 2006 Week day

Families Foreigners Officials Couples Other visitors Total average customer per day Weekend day Families Foreigners Officials Couples Other visitors Average spending by customers

2006 (July-Dec)

2007

2008

2009

20 15 25 10 15

24 18 30 10 12

28 20 30 10 12

36 25 15 16 28

40 28 20 16 25

44 30 20 16 25

2007

2008

2009

Average of 2007 (weekdayĂ&#x2014;261 +weekend dayĂ&#x2014;104) /365 24.55890411 17.84931507 22.15068493 11.70958904 18.70410959 94.97260274

Week day

Families Foreigners Officials Couples Other visitors

400 650 250 350 300

Weekend day Families Foreigners Officials Couples Other visitors

450 750 250 350 300

Total Spending by Customer Subhead (Avg. Customer × Avg. Spending) Families Foreigners Officials Couples Other visitors Total Average spending by customer (37531.34/94.97)

10173.44 12110.64 5537.671 4098.356 5611.233 37531.34 395.1807

Survey Questionnaire Questionnaire on Consumer Behavior about Organic Food Items 1. Personal Information: Sex: • • Age: • • • • •

Male Female under 25 25-30 30-35 35-45 above 45

What is your monthly income? • 5000-10,000 • 10,000-15,000 • 15,000-25,000 • 25,000-50,000 • 50,000-1,00,000

Daily avg. Spending (weekday×261 +weekend day×104) /365 414.2465753 678.4931507 250 350 300

•

above 1,00,000

2. How often do you visit restaurants? • Daily • Weekly • Monthly • On special occasions • Never 3. Is it necessity or wish? • Necessity • Wish 4. With whom do you visit restaurants? • family • friends • colleagues • alone • others 5. How much money do you spend on restaurants? • below 500 • 500-1000 • 1000-2000 • above 2000. 6. How do you choose the restaurant? • own locality • previous experience • hearing from others • whatever you get • price range • preference for menu • others 7. Which one is important for you? • food quality • food quantity • price • different cuisines • others 8. Do you give extra preference for restaurants which have some quality control measurements? • yes • no 9. Does the production of the food materials matter your consumption of the food? • yes • no

10. Does the preparation procedure matter your consumption of food? • yes • no 11. What is your opinion about organic food? • Positive • Negative 12. Are you willing to pay higher money for organic food items? • yes • no 13. Does availability of Organic Foods change your food habit? • yes • no Answer of the Respondents (Total) Questionnaire on Consumer Behavior about Organic Food Items 2. Sex: • • Age: • • • • •

Personal Information: Male Female

56 20

under 25 25-30 30-35 35-45 above 45

8 21 16 15 16

What is your monthly income? • 5000-10,000 13 • 10,000-15,000 11 • 15,000-25,000 17 • 25,000-50,000 16 • 50,000-1,00,000 10 • above 1,00,000 10 2. How often do you visit restaurants (respondent includes multiple answers)? • Daily 13 • Weekly 27 • Monthly 17 • On special occasions 24 • Never 02 3. Is it necessity or wish? (Respondent includes multiple answers) • Necessity 24 • Wish 54 4. With whom do you visit restaurants? (Respondent includes multiple answers) • family 45 • friends 47 • colleagues 17 • alone 06

•

others

5. How much money do you spend on restaurants?(Respondent includes multiple • • • •

below 500 500-1000 1000-2000 Above 2000.

answers)

17 26 21 15

6. How do you choose the restaurant? (Respondent includes multiple answers) • own locality 09 • previous experience 48 • hearing from others 17 • whatever you get 04 • price range 04 • preference for menu 18 • others 03 7. Which one is important for you? (Respondent includes multiple answers) • food quality 64 • food quantity 09 • price 11 • different cuisines 05 • others 04 8. Do you give extra preference for restaurants which have some quality control measurements? • yes 66 • no 08 9. Does the production of the food materials matter your consumption of the food? • yes 61 • no 14 10. Does the preparation procedure matter your consumption of food? • yes 58 • no 16 11. What is your opinion about organic food? • Positive 70 • Negative 04 12. Are you willing to pay higher money for organic food items? • yes 68 • no 06 13. Does availability of Organic Foods change your food habit? • yes 62 • no 12

Answer of the Respondents (foreigners)

Questionnaire on Consumer Behavior about Organic Food Items 3. Sex: • • Age: • • • • •

Personal Information: Male Female

11 03

under 25 25-30 30-35 35-45 above 45

01 02 00 02 09

What is your monthly income? • 5000-10,000 0 • 10,000-15,000 1 • 15,000-25,000 0 • 25,000-50,000 2 • 50,000-1,00,000 3 • above 1,00,000 6 2. How often do you visit restaurants (respondent includes multiple answers)? • Daily 06 • Weekly 05 • Monthly 01 • On special occasions 00 • Never 02 3. Is it necessity or wish? (Respondent includes multiple answers) • Necessity 05 • Wish 08 4. With whom do you visit restaurants? (Respondent includes multiple answers) • family 05 • friends 09 • colleagues 04 • alone 01 • others 01 5. How much money do you spend on restaurants?(Respondent includes multiple • • • •

below 500 500-1000 1000-2000 Above 2000.

00 04 04 03

6. How do you choose the restaurant? (Respondent includes multiple answers) • own locality 01 • previous experience 07 • hearing from others 06 • whatever you get 00 • price range 00

answers)

• •

preference for menu 02 others 00

7. Which one is important for you? (Respondent includes multiple answers) • food quality 12 • food quantity 00 • price 00 • different cuisines 00 • others 00 8. Do you give extra preference for restaurants which have some quality control measurements? • yes 10 • no 02 9. Does the production of the food materials matter your consumption of the food? • yes 11 • no 01 10. Does the preparation procedure matter your consumption of food? • yes 09 • no 02 11. What is your opinion about organic food? • Positive 11 • Negative 01 12. Are you willing to pay higher money for organic food items? • yes 11 • no 01 13. Does availability of Organic Foods change your food habit? • yes 09 • no 03