Small Business Plan
A Business Plan for the Reorganization of a Small Restaurant
Company Overview & Strategy
Revised Statement of Mission and Vision
Mission Statement
Vision Statement
Product and Service
Marketing
Macro Environment
Target Market & Customers
Facilities
Business Performance Analysis
Strengths
Weaknesses
Opportunities
Threats
PESTEL Analysis
Political
Economic
Social
Technological
Environmental Factors
Legal Factors
Financial Projections
Risk Analysis
Action Plan
The Hometown Grill is considering making changes to its menu to become both healthier and more sustainable. Several lines of investigations were conducted including an industry overview analysis, a PESTEL analysis, as well as a SWOT analysis. It is recommended that the Hometown Grill continue with its inquiry and begin integrating changes such as localizing its supply chain and redesigning its menu items.
Company Overview & Strategy
This business proposal has been prepared for a locally owned and family operated restaurant known as the Hometown Grill. The restaurant has been in business for over seventy years and little of the operating model has changed. The menu offered has also stayed roughly as well and consists of a variety of relatively unhealthy offerings by today's standards. There are a lot of fried foods and fatty foods with a limited offering for the health conscious. Although this menu has served the business well over the years, the management has identified that more and more customers are requesting healthier meals. Therefore the Hometown Grill is considering reworking its menu and positioning itself as a more health conscious establishment to appeal to a wider and younger demographic.
Revised Statement of Mission and Vision
The Hometown Grill has never instituted a formal mission and vision statement. However, after reviewing the history and the current objectives the following statements have been proposed for the company.
Mission Statement
The Hometown Grills mission is to offer high quality, locally produced, sustainable, and reasonably priced meals to the local community. The restaurant will continue to serve the local community by providing a menu that includes the freshest of all grilled foods available in a hometown atmosphere.
Vision Statement
Our vision is to be the local premier food service establishment that offers the freshest foods available that have been prepared as locally as possible. The restaurant wishes to continue to serve the community by offering meals that appeal to the customers' health requirements as well as their appetites.
Product and Service
The new service was chosen because the management has noticed a new dedication to health consciousness by many customers. This is also consistent with social trends that have been identified. Redesigning the menu will take careful planning. Furthermore, it will also require a redesigning of the supply chain. Localizing the supply chain has been identified as one opportunity available for food businesses to encourage consumers to eat healthier and more nutritious diets, to invest in more sustainable manufacturing and distribution systems and to develop procurement systems based on more sustainable forms of agriculture (Smith, 2008). Food that is mass produced and traded internationally has often been processed and standardized for reasons other than health and nutrition. Some foods are produced to ensure that they do not suffer from spoilage. Often foods are sold in bulk forms to provide for low shipping costs as well as ease of transport.
Marketing
Macro Environment
There are two primary social drivers that have inspired the management of Hometown Grill to redesign their menu. The first is that in general consumers are becoming more health conscious as well as becoming increasingly concerned about how there foods are being produced or manufactured in some cases (Malik, 2009). These consumer segments are generally also willing to pay a premium over lower cost alternatives and represent roughly ten percent of the total market and expanding quickly. Nutrition and bad dietary habits have been shown to have substantial influence on weight gain and obesity, which are serious public health problems because the increased risk of premature death and civilization diseases like heart diseases, high blood pressure and diabetes (Lorinczi, 2008).
Many of the political drivers that affect Hometown Market can be summarized by vast amounts of uncertainty that are driven by a highly polarized political environment. Hometown Market has yet to deal with regulations or consumer protection measures to stem off public health issues such as obesity. However, it is possible in the future that this could become subject of increasing regulations. Even though increased regulations would complicate the operating environment, if the Hometown Market acts appropriately to tackle it menu and supply chain on its own, then any future regulations could actually result in a competitive advantage for the restaurant.
The economic drivers that shape the competitive landscape and consumer base are also subject to large amounts of uncertainty...
The global recession has reduced the amount of disposable income that various consumer segments possess (Bawden, 2011). The Hometown Grill serves products that are relatively more expensive than foods consumers can produce themselves at home. Therefore lower disposable income levels can cause the demand for the Hometown Grill to diminish. However, it may also be the case that with less disposable income consumers chose Hometown Grill over more expensive substitutes which could actually work in the business's favor.
Target Market & Customers
The target market will consist of potential customers within a twenty mile radius. Proximity to the restaurant is a prohibitive factor because most consumers are not willing to travel great distances to eat. The demographics of the target market are somewhat mixed however the business generally caters to a family oriented crowd. By expanding the menu, the restaurant intends to bring in more middle income and younger portions of the local community.
Facilities
The facilities have been largely unchanged since the company began operations many years ago. However, despite the age of the facilities, there is a certain vintage charm to the restaurant and it is recommend that no major renovation be performed in order to preserve the current atmosphere. Yet there are many opportunities to improve upon operations certain aspects of operations such as information technology. It is recommended that the business integrate a new customer relationship management (CRM) software suite to provide better communication capabilities as well as metrics regarding their customer base. Furthermore it is recommended that the company keep the existing staff however begin providing training in regards to customer service and using the new CRM suite.
Business Performance Analysis
SWOT Analysis
Strengths
Convenience
Customer Service
Location
Pricing
Local History
Weaknesses
Outdated Menu
Employee training
Competition
Limited funds available.
International Franchises.
Opportunities
Evolve with life style trends.
Reestablish itself in the Local Community
Train employees to have higher levels of customer service
Positive environmental commitments.
Threats
Operating costs are set to increase soon.
Another restaurant has started offering similar products to your own, at a lower price and you are unable to match this.
PESTEL Analysis
Political
The UK has currently developed a highly polarized political system that offers some potential for instability. The UK may be more politically volatile than any time in recent history as the country faces many new challenges as well as potential economic woes.
Economic
Although the UK has experienced periods of recovery since the global recession of 2008, this recovery has yet to fully take hold. Furthermore, the country has not yet fully recovered and still is experiencing a high level of unemployment. There is also growing inequality in the country that needs to be addressed.
Social
In regard to the industry in general, there have been major efforts to promote healthier products and healthier lifestyles which have taken hold in many consumer segments. The UK has experienced high rates of obesity and related health issues. As a result of these and other issues, the social trend is emerging that consists of the society being more health conscious on the whole.
Technological
The UK is a modern economy with sophisticated technological systems spread throughout the country. Technology could be harness for the restaurant to communicate and collaborate with local suppliers.
Environmental Factors
The UK has been one of the frontrunners in Europe to research and move towards mitigating environmental issues such as climate change. However, it still has a lot of work to do to become more sustainable. Therefore it is reasonable to suspect that in the future more of the society's resources will be devoted to issues regarding sustainability.
Legal Factors
The UK is a fairly litigious society and the legal system serves as a major consideration in any business venture. There are many rules and regulations that govern how business operates and in many cases these regulations require professional consultation to successfully navigate.
Financial Projections
It is estimated that the new menu expansion project will cost around $15,000 dollars overall. This will include redesigning the supply chain, choosing new menu items, teaching staff members to prepare items on the new menu, and printing new menus. There should also be signs printed to promote the new menu on both the interior and exterior of the facility. However, it is recommended that given the business structure that no major investment be made in regards to promotion. The business is well-established within the local community and thus it can expect to receive a substantial amount of word of mouth promotion from its current consumer base. The net present value (NPV) of the project was calculated over a six-year period at a rate of 7%. The NPV is a little over nine thousand and the offers the business an internal rate of return (IRR) of about thirty-three…
