Executive Summary: Figure 1. Project Growth of Sale and Profit of SC Shop

Executive Summary
Coffee shop is the flourishing business in Kerala. Coffee or Tea bar is a daily necessity
for local coffee addicts, a place to dream many things, a place 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 tea or coffee and great service, SC shop
will capitalize inside School of Management Studies (SMS), Cochin University campus to
build a core group of repeat customers. The culture will offer its customers the best
prepared coffee/tea in the area that will be complimented with pastries, as well as free
books that its patrons can read to enjoy their visit.
The shop will operate a 50 square foot coffee bar near to the entrance of SMS building.
The identified place can be obtained for lease for one year possible to get extension in
the upcoming years. The start-up funds available with owner is INR 50,000/-. It is
expected that the remaining capital of Rs.50,000/- will be obtained through commercial
loans from State bank of Travancore.
The business is expected to earn sales revenue of INR 175,000/- in the first year. SC
shop will strive to maintain a high gross profit margin and reasonable operating
expenses. The projected sale and the profit are indicated in Figure 1.
Figure 1. Project growth of sale and profit of SC shop
1.
Business Description
The coffee and tea consumption in the campus is very high. SC shop will serve students,
teachers, ministerial staffs, laboratory staff and visitors are the customers of the campus.
It is expected that the people from School of Management Studies and neighboring
departments will be the loyal customers of the shop. An opinion survey conducted in
SMS indicates that the proposed business plan is something people are waiting for. The
quality and cleanliness will be the distinctive feature of the venture. The product share is
indicated in Figure 2.
Figure 2. Product share of SC shop
2.
Marketing
The projection of daily sales of SC shop for the given in Table 1. The total expected sale
per day will be Rs. 15500/- . The expected daily profit is about 50 percent of the
operating expenses.
Table 1. Projected Daily sale

Items
Coffee
Tea
Snacks
Stationery
TOTAL
Day-time
INR 1,000
INR 1,500
INR 2,000
INR 1,000
INR 5,500
Evening
INR 250
INR 500
INR 750
INR 250
INR 1,750
Total
INR 1,250
INR 2,000
INR 2,750
INR 1,250
INR 7,250
SC shop will offer its customers the best tasting coffee or tea beverages in the area. This
will be achieved by using high-quality ingredients and strictly following preparation
guidelines. The store layout, menu listings and marketing activities will be focused on
maximizing the sales of higher margin espresso drinks. Along with the espresso drinks,
brewed coffee and teas, as well as some refreshment beverages, will be sold in the
coffee bar. SC shop will also offer its clients pastries, small salads and sandwiches. For
the gourmet clientele that prefers to prepare its coffee at home, SC shop will also be
selling coffee beans. The menu offerings will be supplemented by free books and
magazines that customers can read inside the coffee bar
Figure 2 Market analysis results of SC shop

SC shop will focus its marketing activities on reaching the University students and
faculty, people working in offices located close to the coffee bar and on sophisticated
teenagers. The details of market survey are shown in Figure 2. The market research
shows that these are the customer groups that are most likely to buy tea or coffee and
snacks. The quality and cleanliness are other important factors to be used for marketing
in well educated group of customers.
SC shop will cater to people who want to get their daily cup of great-tasting coffee in a
relaxing atmosphere. Such customers vary in age, although the location is inside
University campus, most of our clientele will be college students and faculty. Our market
research shows that these are discerning customers that gravitate towards better tasting
coffee or tea. Furthermore, a lot of college students consider coffee bars to be a
convenient studying or meeting location, where they can read or meet with peers without
the necessity to pay cover charges. For SC shop, this will provide a unique possibility for
building loyal client base.
3.
Operation
The SC shop will be open with one working staff and one cashier cum accountant. The
SC shop is planned to operate at 50 square feet space room available in the ground
floor of School of management studies, CUSAT. The women labors are available in the
locality to engage in the operation of the shop. The location of the shop is accessible to
suppliers delivery van and waste removal. The start-up fund requirement is given in
Figure 3.
Figure 3. Start-up fund plan of SC shop
4.
Management
SC shop is owned by Mr. JOB THOMAS, who holds a Masters Degree in Business
Administration from Cochin University. Mr. Thomas has good management experience in
owning similar shop near University campus. He had conducted a study in various coffee
shops, which is operating with significant margin. The customer feed back would be the
prime consideration in the development of the business. The person who is working as
cashier cum accountant will have to manage the labour, ordering inventory, dealing with
suppliers, developing a marketing strategy and perform other daily managerial duties. A
profit-sharing arrangement for accountant will be considered based on the first year
operational results. The personnel plan of SC shop is given in Table 2.
Table 2. Personnel Plan

Personnel
Cashier
Worker
Number of employees
TOTAL
5.
Year 1
INR 60,000
INR 48,000
2
108000
Year 2
INR 66,000
INR 52,800
2
118800
Year 3
INR 72,600
INR 58,080
2
130680
Finance
SC shop will capitalize on the strong demand for high-quality coffee. The owners have
provided the shop with sufficient start-up capital. With successful management aimed at
establishing and growing a loyal customer base, the business will see its net worth
doubling in two years. SC shop will maintain a healthy 50% gross margin, which
combined with reasonable operating expenses, will provide enough cash to finance
further growth.
The profit and loss account is projected for upcoming three years. The sales, margin,
expenses and profit are given in Figure 4. It is expected that the proposed product is
profitable in the first year. The profit is increasing in the upcoming years.
Figure 4. Projected sale, margin, expenses and profit of SC shop

The balance sheet is projected for the upcoming three years. The projected asset,
liabilities and capital are given in Figure 5. The growth of asset and capital is increasing
significantly. The net worth of the business is increasing, which is the positive sign of
growth of the business
Figure 5. Projected assets, liabilities and capital of SC shop
6.
Critical-Risks
The neatness and the custom made coffee or tea would be core attraction of SC shop.
Milma booth stall will definitely be one of the major competitors because of its
established marketing and operational practices. However, despite of Milma booth stall
entrenched market position, many customers favor smaller, independent establishments
that offer cozy atmosphere and good coffee at affordable prices.
7.
Harvest strategy
Strategy will be focused at getting new customers, retaining the existing customers,
getting customers to spend more and come back more often. Establishing a loyal
customer base is of a paramount importance since such customer core will not only
generate most of the sales but also will provide favorable referrals. SC shop will position
itself as unique coffee bar where its patrons can not only enjoy a cup of perfectly brewed
coffee but also spend their time in an ambient environment. Comfortable sofas and
chairs, dimmed light and quiet relaxing music will help the customers to relax from the
daily stresses and will differentiate SC shop from incumbent competitors. To speed up
the customer service, at least two employees will be servicing clients--while one
employee will be preparing the customer's order, the other one will be taking care of the
sales transaction. All sales data logged on the computerized point-of-sale terminal will be
later analyzed for marketing purposes.
8.
Milestone schedule
The milestones are guidelines for each of the members should strive to achieve. The
milestones of SC shop is given below.

Executive Summary: Figure 1. Project Growth of Sale and Profit of SC Shop

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Executive Summary: Figure 1. Project Growth of Sale and Profit of SC Shop

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Executive Summary

Figure 1. Project growth of sale and profit of SC shop

Figure 2. Product share of SC shop

Table 1. Projected Daily sale

Figure 2 Market analysis results of SC shop

Figure 3. Start-up fund plan of SC shop

Table 2. Personnel Plan

Figure 4. Projected sale, margin, expenses and profit of SC shop

Figure 5. Projected assets, liabilities and capital of SC shop

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