Business planning
Business planningTABLE OF CONTENTS PAGE
OVERVIEW........................1
ORGANIZATION OBJECTIVES...............2-3
INDUSTRY ANALYSIS....................3-4
BRAND NAME......................4
SITUATION ANALYSIS..................4-7
UNIQUE SELLING POINT.................7
ADVERTISING PLAN...................7
PERSONAL SELLING MESSAGE..............8-9
SUPPLIERS........................9-10
ACCEPTANCE OF GOODS..................10
BALANCE SHEET ANALYSIS...............10-12
ANALYSIS OF PROFIT AND LOSS A/C............12-14
PROJECTED CASHFLOW ANALYSIS............16
ESTIMATED LABOUR COST.................16-20
FUNDS FROM OTHER SOURCES..............20-22
CONCLUSION.......................20-23
PARTNERSHIP AGREEMENT...............at the end
OVERVIEW (executive summary)
The International Friendship Club is a variety entertainment and dining establishment located in Nicosia/ Cyprus. Our mission is to provide our patrons with a unique blend of entertainment while delivering a top quality launch and dining experience. We will do this by emphasising service excellence and the highest level of performance in all aspects of our operations and services. Our prominent services include entertainment, (trivia games, Playstation, cards, billiard and movies on projector). We also offer lunch, dinner, drinks and dancing to our customers.
Its two partners who have an equal share in ownership will operate the club. The partners are Vrahimis Boulos and Bilal Mustafa. The restaurant is ideally located in Makariou Ave. close to the Hilton Hotel in Nicosia. There it will be easily accessible to a large cross-section of consumers (students) and make it possible to provide people with a safe and controlled environment.
Our establishment brings a relatively new concept to the Districts hospitality industry. What we will provide is an ever-changing mix of entertainment to customers while serving all of their drinking and dining needs as well. We are somewhat of a way out club, in that we provide not only the drinking and dining needs of person going out but we also provide, in the same location and depending on the night, everything from dancing to competition games and also to a well movie experience. Because of its uniqueness to the marketplace in Nicosia, The International Students Club has an excellent opportunity to establish itself and become a force in the hospitality community in the District. This is partly because of the limited direct competition the company has to face. Although direct competition is limited, there are several establishments, which we feel, will pose competition to us in the market. They include The Syrian Club and the City Cafe
Despite the threats that the competition poses to the restaurant, we are still very confident in the ability of this concept and restaurant to thrive and succeed in the District.
ORGANIZATION OBJECTIVES
Since we are a new organisation, there are many marketing objectives that we have yet to achieve and which we will strive to accomplish within the next year of business. Three of the more prominent objectives we have include first, establishing and maintaining a high level of customer loyalty and a large loyal market base in the Nicosia area. Secondly, we seek to eliminate all of our internal weaknesses. Third and most importantly, we want to provide our customers with the most outstanding and superior quality of service found anywhere.
As a new business, we are faced with the task of having to find a place for ourselves in the market among consumers. We can best make a place for ourselves by establishing a large, loyal base of consumers. We plan to achieve this objective by providing patrons with an experience like no other and by delivering top quality entertainment. We will be able to determine if the objective has been achieved by monitoring the increase or decrease in the level of regular repeats customers over the next year.
Our second objective is one in which we have a great deal of concern. It is to eliminate our internal weaknesses. While we are concerned, we feel most confidants about getting it achieved. This is because internal weaknesses are those that we have the most ability to influence and change. Currently our internal weaknesses include inexperience in management and a lack of a loyal customer base, to name a few. We will determine if the objective has been reached by performing a second situation analysis at the end of the year and comparing it with our current analysis.
The third objective we have is probably the one most essential to determining our future in the marketplace. It is to provide our customers with the most outstanding quality of service found anywhere. By achieving this objective we will have little problem with achieving our first objective of developing a loyal customer base. This is because if we deliver a high quality of service excellence to our patrons, they will only naturally think highly of us and want return to our establishment. Also, by delivering outstanding quality in all aspects of the company, it will help to develop a positive reputation in the eyes of the consumers which will lead to more business for the restaurant and the club which will in turn lead to more profits for the business. We will determine if the objective has been accomplished by getting feedback from customers after they've had the club's experience. Surveys will be taken randomly throughout the year to determine if service and overall quality is being maintained, improving, or getting worse.
In any event we feel the achievement of these goals are essential to our remaining a viable venture in the marketplace and we plan to do everything within our powers to make certain that they are achieved.
Industry analysis
The Hospitality industry in Cyprus is, we can say, well developed compared to the population and size of the island. This is due to the reason that Cyprus is a tourist destination as well as an island with outgoing people. In 1999, the arrivals in Cyprus were estimated to be 2,434,285, which are approximately 4 times the population of Cyprus that is 754,064 (est.1999). Cypriots too, tend to love going out especially in restaurants and clubs. This is one fact that many food and beverages establishments have succeeded in making profit. Off course many other establishments have failed, in majority micro-establishments, due to lack of planning, experience and management.
Nicosia is the least attractive place for tourists but is the number one place in Cyprus for foreign and local students. Nicosia has over 20 colleges and 1 university. The foreign students are mostly from Arab countries, such as Jordan; Lebanon, Syria as well as Pakistan, Bangladesh, China and a big proportion are coming from Russia. Most of the F&B operations and clubs are working mostly with the local market. In discussions we had with managers of the certain industry, the main reason they do not combine foreign markets with the local is that Cypriots feel more secure to go where others Cypriots are, so managers, as they said, "they want to keep an image of their establishment". This discriminative act from most of the F&B establishments in Nicosia will be our main power as we are going to target mainly to the foreign market as well as the local market. Many of the foreign students and Cypriots from other districts we discussed together about this were disappointed for the reason that their social life in Nicosia is limited. Other students told us that they have been discriminated, mainly in clubs, due to their colour and that in 3-4 years staying in Nicosia they have never been to a local club. Their only way out is the college's parties and get-togetherness.
Our idea in making an International Friendship Club in Nicosia is what foreign students need at this time. A club, a restaurant, a bar, a leisure place for playing trivia games and Playstation, card etc. and a place that people can watch main events from the TV as well as the latest movies from the cinemas, showed by a huge projector, all in one location, is what the market in Nicosia misses. What makes our idea different from the others is that our place will welcome all type of people.
BRAND NAME DISCUSSION
International Students Friendship Club was chosen as the name of our establishment because the words friendship students club is what is missing actually from Nicosia. This is, we feel the most appropriate name to describe what it is that we have to offer our consumers in terms of goods and services, a wide variety. In the entertainment, as well as in the dining options and the overall concept of our business, the International Students Friendship Club's restaurant much like any other restaurant will provide a variety and flavours to its customers.
Situation-analysis
We, the owners of the International Friendship Club, are very enthusiastic about our chances of success with this new and exciting concept. Our enthusiasm was bolstered even more by what was revealed to us after performing a situation analysis for the company. The analysis showed that as a company, our strengths and the opportunities that exist far outweigh our weaknesses and the threats we perceive ourselves having to face. This indicates to us that with hard work and a total team commitment, the International Friendship Club will be a definite success. As for the particulars that were revealed through the analysis they are as follows.
First, the businesses internal strengths include the location of the club because of its convenient access to many students in the area. Students from the University of Cyprus, the College of tourism, the Philips college, the Hotel Institute, and the Higher Technical Institute who live close to their colleges can even have access to the International Friendship Club by foot. Vehicle transportation is not needed if they do not have their own vehicle due to the fact that our location is less than a kilometre away from their colleges. Second, we have strength in our prices that, for the services and the variety of entertainment we provide, are better when compared with the competition prices. Finally, our internal strengths include the variety that we provide for our customers, the services and in the entertainment that we deliver and also
the uniqueness we provide to our customers to have a mix of places in one (including: restaurant, bar, club, trivia games and cards, Playstation video games, TV projector etc).
Next, there are the internal weaknesses that we have as a business and they include, first our inexperience with being managers and operators of a business as well as the inexperience in dealing with the real world, unforeseen problems that are bound to arise with a new business. Secondly, there is the fact that as of yet we don't have an established customer base to rely on. Also, we also don't have a loyal market of consumers whom we can depend on even during the most difficult economic periods. Finally, there is the fact that we don't have yet the established reputation for service and excellence that some of our competitors may have with the consumers in the area.
Next, the situation analysis turned to the external factors that would be affecting our establishment. These factors include both our opportunities and the threats that we will have to face. First, there were the opportunities which include, the economic situation in the district which has the mayor and other prominent officials encouraging and supporting the formation of new businesses in the District in hopes of creating more revenue for the city. This is an opportunity because with the co-operation from the city and the powers that be, it will be less difficult to deal with all of the red tape and bureaucracy one has to go through when starting a business. Secondly, there the opportunity to become a student's attraction, because we are located in the island capitol which receives thousands of students on a yearly basis. By becoming a city hot spot, it would enhance our reputation not only with the local residents but nation wide as well. It would increase our business revenue drastically if we could become one of the "must visit" places for the students of the capital. The second opportunity has a direct relationship with the third and final opportunity that is to franchise and branch out. If we are successful in becoming a city hot spot, that would open up markets for us all over the world in places where people don't have but want the services and entertainment concept that we provide to our customers.
The final segment covered in our analysis was the threats we perceived ourselves having to deal with. They include first the many hassles and the bureaucracy we would have to deal with, such as obtaining the proper licenses, meeting the required health, building and safety codes and regulations. Secondly, there is the threat posed by the slow economy we are currently faced with. It is causing more students to opt to stay at home rather than going out. Finally there is the threat posed by the competition in the District for disposable income. Because Nicosia is the capitol, there are many establishments which provide a variety of things to do for the consumer which will make attracting those disposable dollars all the more difficult for a new business.
Over the coming year, it will be our goal to build on the strengths that we posses and to take full and complete advantage of the opportunities that exist for The International Friendship Club market. We also plan, to the best of our ability, to overcome the threats that await us and to eliminate as many, if not all, of our internal weaknesses. This will be achieved through strong management leadership, dedication to the company and careful decision making and planning on the part of The International Friendship Club owners and all of our employees.
HOW IS USP MANIFESTED?
The unique selling position of the International Students Friendship Club will be manifested by our ability to provide a variety of entertainment forms. It will further be manifested in our ability to provide for our customers, dining excellence as well as fun, excitement, and game competition, movies, all in the same location. In addition, our ability to cater not only to those looking for entertainment fun but also those who wish to use our establishment for business purposes as well as other private functions will add to creating a distinct U.S.P. for the International Students Friendship Club.
ADVERTISING OVERALL PLAN
The International Students Friendship Club overall campaign will utilise several mediums and techniques in order to get the students and generally the public awareness of our existence up. The mediums we plan to utilise include flyers and posters in the colleges and in the student's halls and buildings, billboards, newspapers and bus stop displays. The advertising campaign will be somewhat aggressive in its approach because we are a new entity trying to create a niche for ourselves in a very competitive environment. The advertisements will be targeted to appeal to the wants and sensibilities of our specific target market. We will accomplish this by focusing the ads on the entertainment and the variety aspects of our students club. Likewise, we will convey through our ads a sense of the atmosphere and ambience that will exist at the International Students Club. We will make use of free drinks and meal discount coupons as well. As with any product, we are hoping that word of mouth will also help in establishing the reputation of the International Students Club as a great place for entertainment and dining.
PERSONAL SELLING MESSAGE
The International Students Club's servers will be trained to provide customers with both quality service and congeniality. To ensure that our employees are both courteous and respectful when dealing with customers, we will establish an incentive program for our employees that will be based on customer responses toward the service they receive. Ideally, the interaction of an International Students Club server and a customer should be similar to the following dialogue:
Server: Good evening, my name is George and I'll be your waiter for this evening. Would you care for any appetisers or Drinks at this time?
Guest. No thank you, we are not quite ready to order yet so could you give us a few minutes please.
Server: Certainly. (Returns shortly) Are you ready to order now?
Guest. Yes, we are ready to order.
Server: May I recommend our specials.
Guest. Thank you, but we would like to order ...
Server: Would you like anything to drink?
Guest: We'll have ...
Server: OK I'll be right back with your drinks. (Returns) Here are your drinks and your dinner will be ready shortly. (Leaves and returns with food) Here is your dinner, I hope you enjoy it. If there is anything that I can get you please let me know.
Guest. Thank You.
The server will then check regularly to see if everything is fine with the customers and after they are finished with their meals, he will again check with them.
Server: Would you like any desert or is there anything else that I can do for you?
Guest: No thank you, we are ready for the bill please.
Server: Of course.
The server then will deliver through our computerised billing process, the bill to the customer.
DISCUSSION OF SUPPLY TO RESTAURANT , THE BAR AND THE CAFETERIA.
The supply of The International Friendship Students Club's food and beverages will be handled through a combination of several wholesale and retail suppliers. For our beef, pork, lamb and veal supply we will utilise the Fotiades Co. The Paulou Poultry and Egg Company will provide our needs in those areas. Our seafood will be acquired fresh from the Aqua seafood Company. Finally, three suppliers will provide our liquor and alcoholic beverages. The Hadjipaulou Co. Wine will supply our wine while the GALANOS Co. will supply all of our other alcoholic beverages and the Lanitis Co. will supply our Fountain Sodas/beverages.
To insure for our customers, the freshest food possible, our meats, seafood, poultry and vegetables will be ordered weekly. To add, because all of our suppliers are in the Nicosia area and in such close proximity, we will receive our supplies by way of refrigerated trucks. Again with the furthest supplier being outside Nicosia, the Aqua seafood Co which is in Liopetri, we will assure that the suppliers will deliver their product within 24 hours of ordering time.
ACCEPTANCE OF GOODS
The International Students Friendship Club's target market will find the club as a whole to be ideal for their dining and entertainment pleasure. This is because our services as well as our marketing will be geared towards attracting and satisfying the wants and needs of our target market. Through our research and personal experience, we have found that our target demographics dancing, playing Video-games Playstation type, cards and trivia games, watching new movies, as well as full course dining and alcoholic drinks when going out. By inquiring of the specific target market demographics, we have determined exactly what they want in terms of entertainment and dining. As a result, we have focused our endeavours to meet those needs.
Analysis of the Balance sheet and the purposes of the money used.
FIXED ASSETS.
Beginning with the fixed assets and specifically from the furniture and fittings we estimated a total amount of �23,000. In these furniture and fittings category that concerns the new tables and seats we bought for our restaurant, bar and club and our coffee shop. It includes one bar that will be additionally built as we took over an existing business. It includes one electrical oven that it was in the existing business and other kitchen stuff.
The lucky machines include 10 PLAYSTATION machine accompanied by a screen and their accessories such as joystick and games. We will be the first to have the original PLAYSTATION and its screen in Cyprus and more specifically we will be the first club to provide PLAYSTATION games and competition in Cyprus. Its cost is �3,000.
The electrical equipment was estimated to cost around �11,200. They include 1 TV projector that will be used in the coffee shop for special events on TV such as live football games or beauty competitions and it costs �1,500. One 29" TV'S will be used in the restaurant and one of the same size will be used in the bar. Both of them come at a cost of �1,000. We also need two professional CD players, one console with speakers, and a collection of new CD's all for the clubs use coming at a cost of �3,000. Two coffee machines that will produce a variety of coffees will be needed one for the restaurant and one for the coffee shop costing approximately �1,000. Air conditioning for the whole building will cost around �3,000 and lighting, mainly for the club, will cost �1,300. One central stereo must be bought for the need of the restaurant and the coffee shop that cost �400.
The electrical installation includes additional installation we need to make for our clubs purposes and we estimate the amount of �1,800.
The company's vehicle (car), which will be needed for the company just in case of an accident or in case the establishment will need something, especially in the night. Its cost is �8,200.
Intangible assets
Intangible assets include only the goodwill that is a high amount of money the owner of the previous business asks for the take-over. This amount is �53,000 and this shows that the coffee shop that we took over it had a good reputation at least. The goodwill also includes the location that our building is located in, Makariou Avenue, one of the best places in Nicosia close to the Hilton Hotel.
CURRENT ASSETS
Our current assets, is the stock that will be left in the building after we take it over. These includes chairs and tables, 3 computerised cash dispensers, 3 air-conditions, kitchen equipment, glassware and china, wooden blinds, alcoholic beverages and other decorative equipment all coming to the cost of �15,600.
TOTAL
The total of our company's assets is estimated to be �115,800.
At the end of the first year we estimated on our P&L account to come even to a profit of �12,840 and to pay a share capital of �2,000. (�115,800+12,840-2000)= �126
THE ANALYSIS OF THE PROFIT AND LOSS ACOUNT
PROJECTED INCOME
The total projected income for the year 2001 is estimated to come to a total of �240, 410. This income concerns the restaurant, the cafe and lucky machines, the bar and the income we will get from advertising other companies for the 20% of our other fund sources. In the profit and loss a/c following, the results are analysed monthly. We projected that our first month of operation will be our lower month of the year due to the reason that we are a new name in the market. We believe that January's income will reach 5.3% of the total income, which is �12,862 out of �240,410. On February our sales are expected to rise at least 0.9% from January coming to 6.2%. This difference increases the total income for the month February to �15,013 out of �240,410. March and April will be also increased to 7.1%. The income is expected to reach �17,165 each month. In the fifth month-May- we believe that there will be an increase of 3.6% due to the reason that many of the students will finish their final exams or at least their projects. In Nicosia, most of the colleges close at the end of April and beginning of May. We are expecting our income to be �25,772 of the total. June is expected to show a decrease of 0.9% in the total income. This is because most of the students, especially foreigners, travel back home. The decrease at that time is expected to be just 0.9% because it will balance from the local students that are staying in Nicosia at that time for their summer holiday. At that time our income is expected to decrease, from 10.7% of the previous month, to 9.8% of the total income (�23,620). July is also expected to decrease by 1.7% from the previous month because many students, especially from the colleges, are employed in Tourist areas such as Ay. Napa, Limassol and Pafos. The decrease will drop our income from �23,620(June) to �19,317. August is expected to be one of our lows in income month. At that time everybody in Cyprus takes holiday and move to tourist areas for their leisure. The main reason is that Nicosia does not have a beach and at that time the temperature reaches its maximum. The 6.2% of our income, �15,013, is expected to come mainly in between the beginning of august, 1st-7th, and by the end 24th-31st. September and October will show some stability by increasing from 6.2% (August), to 8.1%. The increased in income is mainly taking place because of the arrivals of the students for the new college season. This increase will lead our sales from �15,013(August), to �19,218. A small increase is also expected to take place in November. This difference of 0.7% is expected to increase our income by �2151 from previous month resulting in total income for November to �21,469.
The major increase though, is expected to be in December. Christmas time, especially in Nicosia, is the most profitable month for many food and beverage establishments. A 5.4% increase from November is expected to take place in December. That will increase our income from �21,469(November) to �34,380. In percentage this is 14.3% of the year's projected income.
Obviously, most of the income is expected to be received from our restaurant. The total projected amount of the restaurant for the year ended 31-12-2001 is �87,470; a 36% from the total income. The cafe and lucky machines are estimated to receive income of �71,300 or 29.7% of the total.
The club and the bar will bring an income of �56,400 or 23,4% and this is because it will be the only department of the establishment working on average 5.4 hours per day, which is the lowest compare to the cafe and the restaurant. The income from advertising is expected to be around �25,240(10.5%). Even though, the money for advertising other companies though ours is paid within the first year, (�2,103/month), we will have the responsibility to advertise them for three years.
COST OF SALES AND LABOUR COST
The major cost of our establishment through the whole year of operation will be the cost of Food and Beverages, obviously, and the labour. A total cost of �64,530 is expected for the whole establishment to operate.
Figures are analysed monthly in the P&L a/c based on the same percentage of income the operation estimates monthly.
Labour cost is estimated for the cafe to reach �30,358 for the current year. The restaurant's labour is estimated around �51,433 and the bar's and club's labour approximately �10,920. (More detailed estimations explained and showed in the following pages). The labour was estimated to be the same on each month and this, in case is needed, will be adjusted depending on the year period.
Other minor costs are the electricity, (�9,600), the repairs and maintenance (�1,500) and the depreciation (�9,400) which is based on 20% depreciating yearly from the fixed cost. (�47200 x 20 /100).
The total cost of sales and labour cost is �177,781 resulting in gross profit of �62,629. (�240,410 less177,781).
EXPENSES
These expenses include: directors' salaries, advertising, telephone and telex, printing & stationery, motor & transportation expenses, insurance, municipal taxes, cleaning expenses, rent payable, legal fees, audit and accountancy, subscriptions and donations, general expenses and secretarial expenses. The sources we got these amounts are from the municipal office of Nicosia (municipal taxes/legal fees), the owner of the coffee shop we are taking over (rent) and an accounting office (audit and accountancy). The rest of the expenses such as directors' salaries/advertising/donation etc were estimated from us.
The total expenses of the year 2001 are expected to reach �45,750. (Minor increase or decrease might be showed during the year due to the reason that we have been misinformed for some expenses). This result of �45,750 is expected to lead us to the amount of $16,879, which is the profit projected before financing expenses. (�62,629-�45,750)
PROJECTED PROFIT BEFORE TAXATION
Our profit before taxation is expected to be �12,840 after deducting an approximate amount of �4,039 for financing expenses. In some values on the line of profit before taxation the amount is negative even if the income for that period might be the highest (December's income). This is because some expenses are not paid equally per month. On December for example, which has the highest projected income and a negative profit before taxation, depreciation must be deducted, audit and accountancy is paid and cost of sales is higher obviously, so, that's why the profit amount is negative.
PROJECTED CASHFLOW ANALYSIS
The CASHFLOW statement generally compares the results of the cash inflows to the cash out flows in a business. In our case our inflows are �290,890 (income + loan from directors). Our outflows are interest tax, direct cost - depreciation, the total of management expenses and the purchasing of fixed assets. The result of the outflows is �163,019. The total net cash inflow is �127,871 (�290,890 less �163,019)
More detailed results are shown in the projected CASHFLOW statement in the following pages.
ESTIMATIONS OF EMPLOYEES NEEDED AND THE LABOUR COST
RESTAURANT
Our restaurant capacity will be for 100 persons seated on 25 tables. It will be operated on a daily basis and from 11am-3pm for lunch and 6pm-midnight for dinner. This schedule will be only for Monday until Friday. From Friday until Sunday the restaurant will be operated from 11am-4pm for the lunch and from 6pm-1am for dinner.
For Monday to Thursday in the morning the employees needed for the restaurant are: 1 cook, 1 barman that will also help in watering and 1 waiter that will also do the dishwashing due to the lower occupancy rate we expect. The following figures show the hours and labour it is needed for the mornings of Monday to Thursday.
1 cook 6hx4days= 24h x �2.5= �60 for Monday until Thursday
1 barman 5hx4days= 20h x �2 = �40
1 waiter 5hx4days= 20h x �1.8= �36
64h =�136
For Monday - Thursday in the Night
1 chef 8hx4days= 32h x �3.5= �112 for Monday until Thursday
1 dishwasher 8hx4days= 32hx �1.8= �57.6
(for 7 nights)
1 barman 7hx4days= 28hx � 2 = �56
2 waiters 2x(7hx4days)= 56hx �1.8=�101
148h = � 326.7
For Friday - Sunday in the morning
1 cook 6hx3days=18hx �2.5= �45 for Friday until Sunday
1 barman 6hx3days=18hx �2 = �36
2 waiters 2x(6hx3days)=36hx �1.8= � 64.8
72h = �145.8
For Friday - Sunday in the night
1 chef 9hx3days= 27hx �3.5= �94.5 for Friday until Sunday
1 cook 8hx3days= 24hx �2.5= �60
3 waiters 3x(8hx3days)= 72hx �1.8= �129.6
1 dishwasher 9hx3days= 27hx�1.8= �48.6
1 barman 8hx3days= 24hx � 2 = �48
174h = �380,97
BAR AND CLUB
Bar will be operating on daily bases and the club only from Friday until Sunday. As they are joined together the days that the club will not be working the lighting of the place will be like a pub format. It will be operating from Monday to Thursday from 9pm-2am and on Friday to Sunday from 10pm-4am as the club will be operating at the same time. The capacity of the club and bar is for 100 persons as it is consisted of 30 tables with 3 stools on each table and 10 stool extra on the bar. The time schedules are as follows:
(The salaries of the employees working after midnight are raised by average of 15%)
Monday-Thursday
1 barman 6hx4days= 24hx �2.5= �60
1 waiter 5hx4days= 20hx �2 = �40
44h = �100
Friday-Sunday
1 barman 7hx3days=21hx �2.5= �52.5
1 waiters (7hx3days)=42hx �2 = �84
1 Disk Jockey 7hx3days=21hx3.5 = �73.5
84h = �110
THE COFFEE SHOP AND THE LUCKY MACHINES
This department will be operating on a daily basis from 12-o clock midday until 12o-clock midnight in a total of 12 hors a day. The capacity of this department is for 120 person. 25 tables, four seats on each table and 10 PLAYSTATION machines, with two fixed seats on each machine. (The schedule of the working hours will be splinted in two from 12-6pm and from 6pm-12o-clock midnight with an approximate average of 12% increase on the salaries on the second shift.
Monday - Sunday 1st shift 12o-clock - 6pm.
1 barman 6hx7days=42hx �2 = � 84
1 waiter 6hx7days=42hx �1.8=� 75.6
1 dish/er 6hx7days=42hx �1.8=� 75.6
126h � 235.2
Monday- Sunday 2nd shift 6pm- 12o-clock midnight
1 barman 6hx7days=42hx �2.5= � 105
2 waiter 2x (6hx7days)=84h x � 2= � 168
1 dish/er 6hx7days=42hx �1.8= � 75,6
168h � 348,6
Total hours of operation and total labour cost
Restaurant: 76 hours of operation/week (opened for customers) will have labour cost of 136+326.7+145.8+380.97= �987.47 per week x 52 weeks = �51,452.44 per year (P&L a/c)
Bar & club: 38 hours of operation/week (opened for customers) will have labour cost of 100+110= �210/week x 52 weeks = �10920 per year (P&L a/c)
Coffee shop: 84hours of operation/week (opened for customers) will have labour cost of 235.2+348.6= �583,8/week x 52 weeks = � 30,358 per year (P&L a/c)
*All the figures for all the estimations are in the profit and loss a/c.
COLLECTED MONEY FROM OTHER SOURCES 20%
The Cyprus government does not support economically small businesses. The total amount of our project that needs to be invested is �126,200, out of which, the 20% must be collected from other sources except for the bank. (The bank is expected to give us a loan for the other 40% of the total amount).
As we said the Cyprus government does not support small businesses generally in Cyprus. But this is not a problem for us due to our unique way of collecting money from other sources.
What we have researched, is that, many companies in Cyprus are willing to advertise through others. This is somehow done but in an indirect way. Our idea is that we are planning to advertise through our establishment other large companies in Cyprus. How? Advertising in the following ways: 1.By sticking signs on our tables and chairs.
2.Through our televisions with video format advertisements
3.The bill to be taken, in a paper case, with an advertisement printed on it.
STICKING SIGNS ON OUR TABLES
On the tables of the bar and the cafe we are planning to stick the advertisements. Formality in the restaurant does not allow us advertise through our furniture. What we are planning is to add a small sign of a selected company that wants to advertise through us on every chair in the cafe and the same sign on every table. Different Companies can advertise through our bar and club in the same way, by sticking signs to the stools and tables. This is something that will not bother the customer especially if the products of the selected company interest him/her.
ADVERTISING THROUGH OUR TELEVISION SCREENS
This advertising is somehow used in hotels; not to advertise others, but to give information to people about the hotel e.g. when the restaurant closes. On the peak hours of our restaurant background light music will be playing and on the screens of the television, advertisements will be played in a video format. This will include smaller companies. In the same way the bar and club TV screen will be operating with the difference that one will be advertising all night.
ADVERTISING THROUGH THE BILL.
This is a clever way to advertise also. The idea was to take the money/visa card, back to the customers in a small paper case where an advertisement is printed on. The design of the small paper case can be very modern and we do not believe it will affect any customer. The billing advertising will be done in all of the departments.
RESULTS OUT OF THIS.
The income of these advertisements is �25,240 (P&L a/c) (20% needed for the whole investment) is a small amount for others to advertise through our company. Of course it is estimated for over 10 major and minor companies to advertise through us, so the average amount that will be paid per company is �2,524 pounds per year. The amount of money they will pay will depend on the type of advertisement they desire. Huge companies such as Lanitis Co. showed great interest to advertise through this, under some terms that is profitable for them. E.g. to have a monopoly in Coca-Cola which is a product produced by their company. This average amount of �2,524 per year is nothing compared to the money they pay for advertisement these huge companies.
Overall what we believe is that this is a unique way of advertising and is also profitable, as the expenses of this are not high. It is a new way of collecting money from other sources and is profitable for you and for the companies they advertise through you.
CONCLUSION
As a result of our business plan, the estimations and the results that are shown in our Profit and Loss account, encourage us to move on to establish our International Students' Friendship Club idea. The positive figures shown in the Profit and Loss account, and the positive inflows shown in the CASHFLOW Statement, are what one business desires to see on their projected accounts. As we have seen from the results, the payback period of the �126,200, which is the amount we need to invest, will take us, approximately, to recover it 11 months. Investing this amount of money and recovering it within a year is called business success.
Our competition will be minimal due to the uniqueness of our idea. Obviously, competition always exists but in this case it can be said that it is indirect competition. Our two main competitors, as we have seen before, are the Syrian Friendship Club, which works mainly with people from the Arabic countries, who are one part of our selected market, but their weak point is that they do not operate as an actual Friendship Club, but as a common restaurant. Their prices are not as high as an average restaurant's in Nicosia, and their profit margin is approximately 7%, which is similar to ours. The 2nd competitor is The City Cafe, which attracts mainly students from the colleges of Nicosia. Their weak point is that they do not work with foreigners and they are concentrated on the local and the Greek market. Unfortunately for us, it is very close to our establishment and it has been working for 4 years in a successful way. They have a good reputation and the word of mouth substitutes their advertisement expenses. Another weak point is that they just operate as a cafeteria and they provide snacks and fast food.
Nevertheless, our indirect competitors do not frighten the prospects of our business. With the uniqueness of our idea, correct planning, proper management that will recruit the appropriate employees and offer them a working atmosphere they will be comfortable with, providing to your guest exclusive services and friendly environment, a business can not easily fail.
GENERAL PARTNERSHIP AGREEMENT OF THE
INTERNATIONAL STUDENTS FRIENDSHIP CLUB PARTNERSHIP
CITY OF NICOSIA COUNTY OF CYPRUS
(your name)and (partner's name) herewith agree to engage in the business of the club, and pursuant to the Uniform Partnership Act of the city of Nicosia, hereby form a general partnership.
The name of the partnership shall be the "International Students Friendship Club" partnership. The principal office of the partnership will be located at:
Makariou Avenue and additional or substitute offices may be agreed upon from time to time by the parties.
The partnership's existence shall commence on 4th of January 2000 and it shall continue until dissolved either by mutual agreement or by operation of law.
The initial partnership capital shall be 126,200CYP. The partners will contribute as follows:
(put name one here): 25,240 CYP,(name 2): 25,240 CYP
The partners shall share in profits and losses in the same proportion as their capital contributions. No interest shall be paid on capital contributions. No partner shall have the right to demand repayment of their capital contribution unless the same is through dissolution of the partnership and a winding up of its affairs.
Decisions by the partnership shall be made by consensus.
Books of account of the transactions of the partnership shall be kept at the principal place of business of the partnership. The books of account of the partnership shall be available for inspection by all times by the partners. Each partner shall be required to report all transactions related to partnership business promptly and accurately.
Each quarter of the year the partners shall determine the net profit and loss of the partnership and the same shall be divided in the same proportion as contributions to capital. The partners, may by consensus, agree to distribute any surplus or may allocate surplus to the capital account of each partner.
#1331 /* Paragraph 1331: Withdrawals */
The partners shall be entitled to withdraw the following sums from the partnership:
2000 CYP on a monthly basis.
Any and all withdrawals made shall be deducted from any profits of the partnership.
#1332 /* Paragraph. 1332: Governance, closing */
The affairs of the partnership shall determined by consensus, with votes cast in the same percentage as capital contributions.
Each partner shall have the right to manage the affairs of the partnership in the ordinary course of the partnership's business. However, no partner shall have the authority to:
a) Confess judgement against the partnership;
b) Borrow on the credit of the partnership or guarantee the debts of others with partnership credit except for minor transactions under �250.00 for regular operating expenses of the partnership;
c) Convey substantially all of the partnership assets
without prior approval by majority vote.
This partnership shall terminate upon the death, bankruptcy or incompetence of any partner. Thereupon the remaining partners shall act as trustees for the partners and shall promptly wind up the affairs of the partnership.
Dated: 2000-04-25
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Witnesses:
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