Cherry Tree Cafe Ppt

8/3/2019 Cherry Tree Cafe Ppt

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CHERRY TREE Caf

2011-2012

Expansion Business

Project Plan

By:CherryWendy

ZoeSarah

Roy


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Introduction

CHERRY TREE is a contemporarycontemporary caf located adjacentto thethe largestlargest university campus, aiming to offer anaffordable high quality coffeecoffee & food& food

Our project is to expand the existing small caf,providing a new friendly, comfortable

ambience meeting point.

Strike to achieve both our mission

statement and expected profit


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To achieve our goal, we need to controlfollowing elements:

Product quality: The food, coffee beverageswould be of high value and quality

Service: Our staff will be well trained toprovide excellent services.

Marketing Campaign: Introducing CHERRY TREEloyalty club program as well as providing sponsorship to

major student events as a way of advertising.

Management team:Act in the best interest of the Cafto achieve target revenue meanwhile providing excellent

customer service.


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Project stakeholders and team

y The expanded Cherry Tree caf will be a registered coffeebusiness that runs as a partnership.

Internal

Investors Management Employees

External

Vendors andSuppliers

Banks Customers Government

Operating

Generalmanager

Accountants Full time

barista andpatisserie cook

Shop assistant Delivery


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What Makes Us Different

New modern look, classy and relaxingrelaxingenvironmentenvironment

A dining loungedining lounge with a small reading area

Free WiWi--FiFispotspot

The introduction of a set of popularbreakfast/lunch menubreakfast/lunch menu and new line of coffee beans

Regular maintenanceRegular maintenance service on our coffee machine andquality check on the coffee blend used

Targeting a net profitnet profit of at least 15%15% by the end of the 2ndyear


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Market Research

Industry analysis:

More than one billion cups of coffee are consumed in Australia each year, anincrease of 65% over the last 10 years. The total revenue of this industry is AUD5 billion with annual growth of 2.6% from 2007 to 2012.

This unique market sustained demand during the recent global economicdownturn. During this period, revenue for the industry grew compared to rivalhospitality industries like restaurants which experienced a decline in revenuefor 2008 and 2009.

Customer analysis:The local climate in Melbourne, with considerable rainy days, is very

conductive for the consumption of hot non-alcoholic beverages. At the sametime, hot dry summers drive people into cafes to order iced drinks.

This coffee shop can also provide a relaxing environment for touristcostumers who usually spend considerable time in Melbourne CBD.


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Competitor analysis:

This cafes direct competitors include Gloria Jean's, Starbucks and manysole local cafes.

The proposed coffee shop strongly emphasis not only offers one of the besttasting coffee and cakes, but also provides home-like and comfortableenvironment.

Environmental aspect of industry:

In Australia, Sustainable coffee has the largest growth with an annualgrowth rate between 10% and 20%.

Both Rain forest Alliance and Fair Trade coffees are now available inAustralia. We consider supporting these programs to more outstanding inthe market.


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S.W.O.TSTRENGTH

Location:Location: Thelocation factor is akey strength forsetting-up

Demand:Demand:Increasing numberof students wouldstream into the cafat lunchtime

Customer base:Customer base:The customer baseis not onlyuniversity studentsbut also visitorswho accompany the

students

WEAKNESSES:

VolatileVolatileCustomerCustomer

base:base: Eventhough the

potential customersin the university isvast, due to thenature of thebusiness in theuniversity makesthe customer

potential as acritical weakness asmuch as it isargued as astrength.

OPPORTUNITIES

Pricing:Pricing: Offercompetitive pricing,value-addedservices and quality

products atcompetitive prices.

Introducingvariousvariousproductsproducts to meet

the overall demandof the customers.

PromotionPromotionthrough embracingculture

THREATS

RenovationRenovationcosts:costs: Therenovation cost isas much as the

cost for newentrants into theindustry.

With the rapiddeployment in

Melbourne, thereis stiffstiffcompetitioncompetition inour target marketalong with theincrease in thedeveloping

opportunities.


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Strategies

High qualityHigh qualityusing Imported coffee beans :

Our buyers will spend approximately 8 weeks

per year travelling to countries of origin,

including Colombia, Brazil, and Yemen etc.

Most of the equipment can be purchased frommanufacturers in countries like China to

reduce cost achieving a 30% cost saving30% cost saving


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Estimated financial profit

The partners have provided the company with sufficient start-upcapital, and we are looking for more investmentsmore investments from both financecompany and banks as the business carries on.

CHERRY TREE Caf will maintain a healthy 62% gross margin62% gross margin,which will see its net worth doubling in two years. An annualprojected sale of $450,000projected sale of $450,000 in FY 2012 (in line with the industryaverages). We anticipate its net profitability to increasenet profitability to increase from16.86% in FY 2012 to 19.59% in 2014.

The companys net worthnet worth is expected to increase fromapproximately $80,000 by the end of FY 2012 to approximately$300,000 in 12 years time (FY 3014).


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Projected P&L

Projected

Profit and

Loss Year 2012 Year 2013 Year 2014

Sales

Sales Revenue $450,000 $550,000 $610,000

Cost of Sales $171,000 $209,000 $231,800

Other $0 $0 $0

Total Cost of

Sales $171,000 $209,000 $231,800

Gross Margin $279,000 $341,000 $378,200

Gross Margin

% 62.00% 62.00% 62.00%

Expenses

Payroll $90,000 $110,000 $122,000

Sales and

Marketing and

other

Expenses $2,000 $2,000 $2,000


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Year 2012 Year 2013 Year 2014

Depreciation $5,000 $5,000 $5,000

Rent $40,500 $40,500 $40,500

Maintenance $4,500 $4,500 $4,500

Utilities/Phone $6,000 $6,000 $6,000

Other $13,500 $16,500 $18,300

Total Operation

Expenses $161,500 $184,500 $198,300

Profit Before

Interest and

Taxes $117,500 $156,500 $179,900

Interest

Expense $6,390 $6,390 $6,450

Taxes Incurred

30% $35,250 $46,950 $53,970

Net ProfitNet Profit $75,860$75,860 $103,160$103,160 $119,480$119,480

Net

Profit/Sales 16.86% 18.76% 19.59%


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Projected Balance Sheet

Projected

Balance

Sheet Year 2012 Year 2013 Year 2014

Assets

Current Assets

Cash in Hand $170,000 $220,000 $350,000

Inventory $20,000 $25,000 $28,000

Other Current

Assets $0 $0 $0

Total Current

Assets $190,000 $245,000 $378,000

Accumulated

Depreciation $5,000 $10,000 $15,000

Others $0 $0 $0

Total Non-

current Assets $5,000 $10,000 $15,000

Total Assets $195,000 $255,000 $393,000


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Liabilities

Accounts

Payable $31,974 $31,947 $34,836

Others $0 $0 $0

Total Current

Liabilities $31,974 $31,947 $34,836

Long-term

Debt $80,000 $60,000 $40,000

Total Liabilities $111,974 $91,947 $74,836

Owner's

Equity

Capital $100,000 $100,000 $100,000Retained

Earnings -$16,974 $63,053 $218,164

Total Equity $83,026 $163,053 $318,164

Total Liabilities

and Equity $195,000 $255,000 $393,000


Liabilities

Accounts

Payable $31,974 $31,947 $34,836

Others $0 $0 $0

Total Current

Liabilities $31,974 $31,947 $34,836

Long-term

Debt $80,000 $60,000 $40,000

Total Liabilities $111,974 $91,947 $74,836

Owner's

Equity

Capital $100,000 $100,000 $100,000Retained

Earnings -$16,974 $63,053 $218,164

Total Equity $83,026 $163,053 $318,164

Total Liabilities

and Equity $195,000 $255,000 $393,000


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Conclusion

In conclusion, opening and running an

expanded size quality caf is not an easy job.

To make our business successful, we havedone a considerable amount of market research on cafeand local hospitality industry. Legal issues and policiesinvolved are consulted. Business risks are accessed byboth internal partners as well as external organization.

These have given us various innovative ideas to run ourbusiness with risks minimized. However, incidental costwill be taken into account by getting an business

insurance


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Reference

y http://www.acta.org.au/news.phpy http://www.ibisworld.com.au/industry/default.aspx?indid=2015y http://www.melbournecoffeereview.com/y http://www.ato.gov.au/content/downloads/BUS25193n19080711.pdfy http://www.worksafe.vic.gov.au/wps/wcm/connect/wsinternet/WorkS

afe/Home/Insurance+and+Premiums/WorkSafe+Injury+Insurance/y http://www.worksafe.vic.gov.au/wps/wcm/connect/wsinternet/WorkS

afe/Home/Laws+and+Regulations/Employer+Rights+and+Responsibilities/

y http://www.epa.vic.gov.au/noise/residential/prohibited-hours.aspy http://www.melbourne.vic.gov.au/enterprisemelbourne/Pages/Home.

aspx


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yQuestion?


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yThank you!:]

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