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Selling tactics The yearly cash flow estimates have been included in Table 7 below (Riebesell, 2001):
Contending against both "informal-dining-steakhouses" and "family-steak-restaurants," we will be offering these benefits: (1) Low pricing for complete buffets, (2) customers will not be giving tips since the restaurant will be self-service, (3) giving speedy service to all customers at all times, (4) offering variety in meals all the way through the week and (5) diners can watch their favorite sports during their meals.
The sales annual projections for the next 3 years are summed up below in table 3 below.
Table 3: Sales Forecast
Unit Sales
2010
2011
2012
Meals
22,822
35,000
45,000
Drinks
11,415
17,500
22,500
Other
1,000
Total Unit Sales
34,477
53,000
68,500
Unit Prices
2010
2011
2012
Meals
$15.00
$15.00
$15.00
Drinks
$2.00
$2.00
$2.00
Other
$10.00
$10.00
$10.00
Sales
Meals
$342,330
$525,000
$675,000
Drinks
$22,830
$35,000
$45,000
Other
$2,400
$5,000
$10,000
Total Sales
$367,560
$565,000
$730,000
Direct Unit Costs
2010
2011
2012
Meals
$2.00
$2.00
$2.00
Drinks
$0.50
$0.50
$0.50
Other
$1.00
$1.00
$1.00
Direct Cost of Sales
2010
2011
2012
Meals
$45,644
$70,000
$90,000
Drinks
$5,708
$8,750
$11,250
Other
$240
$500
$1,000
Subtotal Direct Cost of Sales
$51,592
$79,250
$102,250
Management and Operations plan
The entire initial-management will be dependent on the originator of the restaurant. He, however, will acquire a little back-up from others. Additional assistance will be taken as the business grows and flourishes. Additional workforce will only be taken into consideration when the time is right. This will increase responsibility of the initial workforce as they will have to perform many tasks, which in turn will give higher returns to investors in a short span of time (Davis, 1984).
Personnel Plan
The comprehensive yearly personnel estimates for the first 3 years are given in table 4 below (Davis, 1984):
Table 4: Personnel Plan
2010
2011
2012
Manager
$60,000
$65,000
$70,000
Hostess
$42,000
$45,000
$50,000
Chef
$54,000
$60,000
$65,000
Cleaning
$30,000
$35,000
$40,000
Waiters
$72,000
$100,000
$130,000
Other
$24,000
$52,000
$55,000
Total People
8
10
12
Total Payroll
$282,000
$357,000
$410,000
Human resources plan
At present, accounting along with payroll operations will be carried out by a bookkeeper, whose service will be hired through a contract. Later on, after such an expense can be managed internally, we will stop outsourcing both accounting along with payroll operations. We also plan to hire marketing director, procurement director, regulator, human resource manager along with an administrative assistant (Davis, 1984).
Financial data
Our financial plan is founded on cautious approximations and suppositions (Riebesell, 2001).
Important Assumptions
Table 5 outlines our "break-even analysis," Our break-even analysis is presented as "per-unit revenue," "per-unit cost," along with "fixed costs (Riebesell, 2001)."
Table 5: Break-even Analysis:
Monthly Units Break-even
14,028
Monthly Revenue Break-even
$146,453
Assumptions:
Average Per-Unit Revenue
$10.44
Average Per-Unit Variable Cost
$8.34
Estimated Monthly Fixed Cost
$29,459
Projected Profit and Loss:
The annual approximations of profit and loss for the next 3 years are given in table 6 below (Riebesell, 2001):
Table 6 Pro Forma Profit and Loss
2010
2011
2012
Sales
$367,560
$565,000
$730,000
Direct Cost of Sales
$51,592
$79,250
$102,250
Other
$0
$0
$0
Total Cost of Sales
$51,592
$79,250
$102,250
Gross Margin
$315,969
$485,750
$627,750
Gross Margin %
85.96%
85.97%
85.99%
Expenses:
Payroll
$282,000
$357,000
$410,000
Sales and Marketing and Other Expenses
Table 7: Pro Forma Cash Flow
2010
2011
2012
Cash Received
Cash from Operations:
Cash Sales
$367,560
$565,000
$730,000
Cash from Receivables
$0
$0
$0
Subtotal Cash from Operations
$367,560
$565,000
$730,000
Subtotal Cash Received
$367,560
$565,000
$730,000
Expenditures
2010
2011
2012
Expenditures from Operations:
Cash Spending
$8,979
$13,273
$20,231
Payment of Accounts Payable
$395,818
$525,084
$645,906
Subtotal Spent on Operations
$404,797
$538,357
$666,137
Additional Cash Spent
Long-term Liabilities Principal Repayment
$0
$10,000
$15,000
Subtotal Cash Spent
$404,797
$548,357
$681,137
Net Cash Flow
($37,237)
$16,643
$48,863
Cash Balance
$50,763
$67,405
$116,268
Projected Balance Sheet
The balance-sheet displays wholesome growth of net-value along with a powerful financial standing. The yearly estimates have been included in table 8 below (Riebesell, 2001).
Table 8: Pro Forma Balance Sheet
Assets
Current Assets
2010
2011
2012
Cash
$50,763
$67,405
$116,268
Other Current Assets
$50,000
$50,000
$50,000
Total Current Assets
$100,763
$117,405
$166,268
Long-term Assets
Long-term Assets
$0
$0
$0
Accumulated Depreciation
$1,000
$2,050
$3,153
Total Long-term Assets
($1,000)
($2,050)
($3,153)
Total Assets
$99,763
$115,355
$163,116
Liabilities and Capital
Current Liabilities
2010
2011
2012
Accounts Payable
$10,294
$15,217
$23,194
Current Borrowing
$0
$0
$0
Other Current Liabilities
$0
$0
$0
Subtotal Current Liabilities
$10,294
$15,217
$23,194
Long-term Liabilities
$100,000
$90,000
$75,000
Total Liabilities
$110,294
$105,217
$98,194
Paid-in Capital
$40,000
$40,000
$40,000
Retained Earnings
($3,000)
($50,532)
($29,862)
Earnings
($47,532)
$20,670
$54,784
Total Capital
($10,532)
$10,139
$64,922
Total Liabilities and Capital
$99,763
$115,355
$163,116
Net Worth
($10,532)
$10,139
$64,922
Conclusion
Since "The Assemblage" is completely different from other restaurants in the neighborhood, it will be able to attract a lot of clients. It is the solution of consumers' desire for a quality eating experience together with quality leisure and entertainment. Therefore, it is hoped that investment in this high-quality project is taken into due consideration.
References
Hensley, S. And Donohue, M. (2009). Restaurant Industry Expected to Post Modest Sales Growth in 2009 as it copes with the Weakest Economy in Decades. National Restaurant Association. Accessed from: http://www.restaurant.org/pressroom/print/index.cfm?ID=1725
Bryson, J. (1995). Strategic Planning for Public and Non-Profit Organizations; Jossey-Bass: San Francisco,; 137.
Daniels, J. And Radebaugh, L. (1998) International Business: Environments and Operations, 8th edn. Addison-Wesley: Reading, MA.
Davis, S. (1984). Managing Corporate Culture. Cambridge MA: Ballinger.
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