DESTINY CAFE, REASTAURANT& RECREATION CENTER BUSINESS PLAN

HARAMAYA UNIVERSITY
COLLEGE OF BUSINESS AND
ECONOMICS
ENTREPRENEURSHIP ASSIGNMENT

SECTION-FS 15 GROUP-1

Group Members

NAME ID
1.MESFIN ZENA........ 0915/12

2. MESFIN ESHETU...... 0913/12

3.MISOMSA ANGASA...... 0961/12

4.MILKESA LEMA ...... 0942/12

5. MILLION DEJENE...... 0941/12

6. NETSENAT 09/12

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7.ASIA AMIN....... 09/12

ACKNOWLEDGMENT

First of all we would like to thank the instructor of this

course for giving us the assignment and letting us know
concepts about Business plan and understanding how to
create our business plan And second of all this
assignment is done with the continuous collaboration of
each and every group member. So we may need to take
some time here to give the members of the group alittle
gratitude.

People who helped us one way or another, directly or

indirectly should also be thanked here. So Thank you.

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Table of Contents
Contents..........................................................................................................................................................
....3
1. Executive business plan summary...................................................................................................53
2. Business description............................................................................................................................3
2.1. Locations and nature of the business...............................................................................................3
2.2. Mission statement (business purpose).............................................................................................3
2.3. Vision statement about business growth.........................................................................................3
2.4. Business goals and objectives...........................................................................................................3
2.5. Brief history of the business.............................................................................................................3
3. Description of Products and Services................................................................................................3
3.1. Market position................................................................................................................................3
3.2 .insurance.........................................................

4. Market research and analysis.............................................................................................................3

4.1. Potential customers..........................................................................................................................3
4.2. Market..............................................................................................................................................3
4.3. COMPITATORS..................................................................................................................................3
5. THE MARKET PLAN...........................................................................................................................3
5.1. Product and service..........................................................................................................................3
5.2. Positioning........................................................................................................................................3
5.3. Pricing system...................................................................................................................................3
5.4. Promotion.........................................................................................................................................3
6. Operation plan......................................................................................................................................3
6.1...................................location

6.2 Equipment.........................................................................................................................................3
6.3. Suppliers...........................................................................................................................................3

7.1. Organizational chart.............................................................................................................................3

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8. Entrepreneurial team or Management/Owners................................................................................4

8.1 The personnel plan............................................................................................................................4
8. Financial documentation......................................................................................................................4
Profit and Loss Statement.......................................................................................................................4
Break-even Analysis.................................................................................................................................4
Appendices................................................................................................................................................4

1. Executive business plan summary

This is a business plan proposal for the establishment of cafe ,restaurant and recreation
having the name 'Destiny cafe,restaurant and recreation' around BATE area Finkile building. It
is a startup that is going to provide Prepared Food and packed food Beverage and
Refreshment services. There is an increasing demand for good prepared and packed food
refreshment. This demand refreshment highly when you finished studying and classes and
especially packed foods during late hours of the night. As the lounge is ar closed, students have
to wait out their hunger till the end of their study and keep on studying with an empty stomach.
We would provide quality, simple and fast foods for students for service 24/7. Even though our
main attraction is availability the foods and services will be top shelf and

These items are mostly easy, quick and safe to prepare in an open air environment which is
already provided thanks to the buildings terrace. The many reasons our business will flourish
and stand out from our competitors will be Accessibility, Quality, Affordability, Speedy, delivery,
Adaptability and Upgradability.

We the entrepreneurs at destiny cafe,restaurant and recreation , would like to let you know
even though this is our first business venture into the food and recreation industry, we can
ensure the success of the business as we have done extensive study of the market and know
the area very well. Additionally as we are accustomed to the locals we are able to acquire the
right people for labor.

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Although there are some of food providing businesses in the area they can’t seem to satisfy
the very core needs of there customers; quality and availability. Destiny cafe,restaurant and
recreation will establish a service that can fulfill these needs with the atmost efficiency. And as
one might expect the 24/7 is going to require at least a medium amount of man power leading
to job opportunities to the locals.

2. Business Description
2.1 Location and nature of business

Name

Destiny cafe,restaurant and recreation

location
The Destiny cafe, restaurant and recreation located around Bate area bate
building. It is also an average place for customer short distance from Haramaya
university entrance and it can also give the service for the lectures, students and for the
others university society and local people around it.

Business owners

This business is established by 7 members and it overseens by these founders. These

founders are

1. Mesfin zena
2. Mesfin eshetu
3. Misomsa Angasa
4. Milkesa Lema
5. Million Dejene
6. Netsenat
7. Asia Amin

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2.2. Mission statement (business purpose)

The business is become very necessary and important in the region:-

Because of the following visible problems;

1. High number of student at present and increase per year.

2. Need of quality supply.
3. Increasing non-café student.
4. Low in quality and in quantity of the present cafeteria.
5. No place for refreshment.

Due the above problem the start up of this business is like lottery for the university
society and local people especially for the students which cover higher number of the
society and also higher number of costumer because of there is no other choice.

In general the purposes of business are listed below:-

 Supply food and beverage for the society in good quality and in sufficient
quantity.
 Replacing the existing cafeteria and it became competitor.
 Reducing the contaminated disease due to low quality of the existing cafeteria.
 Supply and service its product 24 hours per a day.
 Best site of business place
 Because of it is located around the entrance of the campus it is best for
enjoyment.

2.3.Vision statement about business growth

The key to the success of this business is the proposed expansion into all over the
branches of campus of the university and also to dire dawa campus.

The main products or services to be sold or to be worked here are.

 Food preparation and packed food(fasting food ,meat etc)

 Beverages(Coca-Cola, mineral water, milk, juice e.t.c)
 Refreshment service

The key to our success that will help establish a branches into other branches of
campus and town are:
 Product quality - Food, coffee, tea and other beverages with a comfortable
environment.

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 Service - Our patrons are paying for high quality food, delivered in a short
timeframe in a comfortable environment and each member of the staff will
becourteous, efficient, and attentive.
 Marketing - We will need to target our audience early and often. While the
business is located in a central and accessible location, many people will have to
be re-introduced to the café/restaurant.
 Management - We maintain a firm grasps on costs, such as food, beverageand
labor costs. Stock is maintained by a dedicated stock system by employee
management, and quality control is critical.

2.4. Business goals and objectives

Objective
 To provide good quality of service and adequate quantity of products and
satisfy the need of refreshment.
 To provide suitable place for recreation
 Being established as the primary source of fast food for the campus and local
community.

Goal
 To increase the availability of good and service product for our campus
 To become one of the major fast food and suitable recreation place providers with in
the next 5 years.
 To enrich it’s primary customers as the company keeps building on its share holders.
 To create job opportunities for the locals of where ever our services are established.

2.5. Brief history of the business

The Destiny cafe,restaurant and recreation is owned and operated by business
owner Ltd and is 100% group share of the group member.
The business is assumed to be started up to the next year and it has no working and
customer experiences before hence, the idea of opening this business is not based
success and reputation the business but due to high shortage or completely there are
no restaurants in the area and the existing food providers have low quality and leads the
students and others society to the food contaminated diseases.
This Terminal is open for business seven days a week and 24 hours a day.
The average spend split between beverages, food and others is:
 Beverages –16%
 Food – 80%
 Others – 4%

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Beverages likes

 Coca-Cola,
 mineral water,
 milk,
 coffee\tea,

Refreshment service

 Pool house
 Tennis table

Product/Service Description Price

Fasting food Birr 12.00 average

Meal Pasta,collection,meat,etc Birr 20.00 average

Cake Cream cake,dry cake,etc Birr 10.00 average

Coca-Cola coca-cola,mirinda,pepsi,sprite,7up,fanta Birr 9.00 per bottle.

etc.

mineral water It includes to,best,aquaaddis etc. Birr 8.00 per 1 LIT.

It include packed mama milk, cheese,
Milk Birr 15-20one packed.
etc.
coffee\tea It includes coffee, tea,makiyato, e.t.c. Birr 2.00-4.00
Juice Papaya,avocado,e.t.c Birr 15-20
Ps4 Recreation
Birr 25 per person

Tennis table Birr 0.500 per game

Pool house Birr 4.00 birr per game

3.Description of product and services

3.1. Market position
The products and services for this terminal are given only at main campus.

Our product and service are competitive in terms of quality, price, and quantity.

Unique selling position:

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Our products and services have quality and less costly than others competitors and our
service like play station 4 has no competitor in the campus and its surrounding.

Anticipated demand:

Every costumers visit the café one time per a day or anticipated quantity of
products/services customers are likely to purchase are enough to start up our business.

Pricing strategy:

The pricing system is based on first cash method because most of our customers are
student and they have not monthly salary.

Value to customer

Our customers are very happy and interested by start-up of this business because
these products have good quality and services are new and basic necessity considering
environmental condition.

3.2. Insurance
Product liability:
Our company takes risk and gives insurance due to damage and death due to product
and services.

Professional indemnity
Our companies pay insurance to cover any legal action taken out as a result of your
professional advice.

Business assets:
Our companies pay insurance for the damage that occurs suddenly on the property.

Business revenue:
Our companies pay insurance for event of business interruption where you cannot
trade.

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4. Market research and analysis

4.1. Potential customers
Our potential customers are mainly Haramaya university main campus students
and local society.

In main campus around 12,000 students are available and from this 40 percents are
female.

About 90 percent of our students are young (their age is between 18 and 25).due to
their age and lack of good recreational centre most students have an interest to use our
restaurant.

Around 80 percent of students have monthly income above 500 ETB gained from their
family and they spend half of their income for recreational activities.

Due to our pool house and ps4 our customers are not only campus students, but also
people live in bate town are our customers and other recreational activity.

So, the potential customers are going to be familiar with our products like food and
drinking service and also interested in our recreational center. And they will rely
accepted our market.

Complementary products are already uses by our customers are ps4, table tennis, pool
house, and chess.

Customers are highly motivated by our good quality of foods and fair price and also by
our complementary activities .and another factor is our site is very favorable for young
couples.

4.2. Market

Our customers are Haramaya university main campus students and other society
in HU And also bate society.

We will try to get an agreement with Haramaya university student dean to supply soft
drinks for different conferences, and in different holidays that the university celebrated in
spatial ceremony.

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4.3. Competitors

Although the area of implementation and most of the items on the menu are unique the
idea is not a first. There are a number of small cafes and lounges providing food and
beverages for the members of the campus like;

 Small cafes in the university (such as; liyu cafe, master cafe, cottage cafe....)
 Some Outside of the campus

SWOT of cafe and restaurant

Strength

 The food stands are flexible potentially, easily updated as need be.
 The stands can serve as many as 10 customers within 20 minutes.
 The food stands are cost effective.
 Most of the foods are ready-to-go.
 The service are going to provided 24 hours a day.

Weakness

 There will not be much of sitting areas.

 A constant supplier for raw materials especially meat for our food hasn’t been
established.

Opportunity

The campus is accepting of small business that can create job opportunities for the
locals of the area.
There is a massive customer potential as the school embodies a large number of staff
and student members.

Threats

The smell of the cooking meat and potatoes may be deemed discomforting to the
students using the library.

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SWOT of the Competitors

Dormitory Lounges

Strength

A hard working employee intel

Affordable products
A convenient area of business

Weakness

 Unsatisfying food quality

 Slow service
 Rigid to upgrade
 Rigid to expansion )
 Almost exclusively service students

Out of Campus Cafes

Strengths

 Relatively better quality of food compared to the Dormitory Lounges.

 Have a variant clientele.
 Have a good relationship with it’s customers.

Out of Campus Cafes

Weakness

 Sanitation
 Inconvenient placement
 Slow service
 Can’t handle more than 15 customers in an hour

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4.4. Pricing system

Our market place is found in jimma institute of technology campus around varneru
building. It is very strategic place for café and restaurant.

Our pricing system is totally by cash because products individual price is very small
(between 8-20 ETB).

4.5. Method of distribution

Our products are distributed by our waiter in our café.

5. THE MARKET PLAN

5.1 product and services

Our products are mainly Ethiopian foods like enjera and wott, bread and some are
foreign foods like pasta, macaroni, rice e.tc.

Our foods have high qualities and fair price.

Our swimming pool is our spatial product and our swimming pool has international size
and standard.

5.2. Positioning

Our café is positioned in JIT campus around varneru and it is also put in appropriate
position from student’s dormitories.

5.3. Pricing system

Our food and drinks, and entertainment options are priced to give us an attractive
margin while at the same time offering value to the consumer.

Our pricing system is mainly in cash.

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We have 2 percent discount at holidays and for active customers.

5.4. Promotion

As much as possible we tried to create a good environment with the public by

participating in different charity activities and also by sponsoring some ceremonies in
the campus.

Our advertizing is mainly focused on distributions posters’ in different area of the

campus.

5.5. Distribution channels

Our products are totally distributes in our café. We have no repair services

6. Operation plan

6.1 Location

The Destiny café, restaurant and recreation center is Located in the middle of the
JIT campus .this location is very important location for this business because it is easily
accessible for all campus community, it is aesthetically attractive and since it is a
home-based business there are efficient homes for kitchen and store.

We get this location by rental from the campus management. The term of rental is
based on yearly payment of rent. The payment is based on rental per square metre and
we have a deal to pay100 birr per square meter. There is no anticipated increases in
rent is included in the deal. There is a swimming pool in the location and it is included in
the business. The deal for rent of the swimming pool is done apparently and the rental
is based on monthly payment of10000birrs including 2500m 3 of water which is filled
three times in a month.

6.2 Equipment

Since we are starting a business, we have to list equipments and any other assets we
need or have acquired to establish our business and we have to List items individually,
or by type. The table below shows to present this information as follow.

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Schedule of equipment and other fixed assets needed at start of business

Asset Value in birr

Tables and chairs 5,000

furniture’s 2,500
Kitchen objects 2,000
Swimming pool chairs and umbrella 1,000
Total 10,500
Schedule of assets to be purchased over the next three years

Asset Year 1 Year 2 Year 3

In birr In birr In birr

Load carry vehicle 80,000

Machine 60,000
Motor vehicle 40,00
0
Computer 10,00
0
Total 50,00 60,000 80,000
0

6.3.Suppliers
The materials required to produce our products and services are supplied from
suppliers and farmers who lives around the campus.

6.4. Human resource requirements

The Destiny Café, restaurant and recreation center is owned by Business group which
has eleven members with equal share. It is staffed by;

- One Shift Managers

- One Deputy Shift Managers
- One Head Chef
- One Assistant Chefs
- Six Waiting staff
- Onecashiers
- Two life savers+
- Two guards

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One of the members of the business group operate a ‘hands on’ approach doing all the
purchasing and inventory control. One of them have experience to work as shift
manager, the other member can work as deputy shift managers ,one as cashier and
rest works are by other student as employers.

7.Organizational Structure

The kitchen is the responsibility of the Chef who will manage kitchen operations
including keeping it clean. The critical task of maintaining the food inventory and
Assisting in menu development will be performed by the head chef and the two
members who are responsible for doing all the purchasing and inventory control.

The Deputy Shift Managers will assist in all areas and will be in charge when the
Shift Managers are absent.

The cleaning and waiting services will be performed by the waiters. The guards will
protect the area by two shifts.

7.1. Organizational chart

Business Group

Owner/Manager]

Deputy Shift Managers

One Head Chef

One cashier Guard and life One Assistant 6 waiting staff

saver Chefs

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List our available current staff

Job Title Name Skills or strengths

Purchase and inventory Bereket Beginner
control
Purchase and inventory
Tewodross kuma Beginner
control
Shift manager Ahmed Beginner
Deputy Shift manager Tewodross Beginner

Cashier Wabi Beginner

Shift manager 2 Tesfaye Beginner

List our required staff

Job Title Quantity Skills necessary

Life saver 2 2 year experience
Waiter 6 1 year experience
Guard 2 1 year experience
Head chef 1 1 year experience
Assistance chef 3 1 year experience

8.Entrepreneurial team or Management/Owners

The Destiny Café and restaurant is owned by five pre engineering Jimaa institute of
technology students with all have equal share .

One of the members of the business group operate a ‘hands on’ approach doing all the
purchasing and inventory control. One of them have experience to work as shift

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manager, the other one members can work as deputy shift managers and one as
cachier and the rest works by other student will work it.
The group of owner had no job experience on this type of job and also not trained as a
chief, but they are a students in which they have a desire and prosperity of work that are
supported by three year academic performance.

The marketing function will be handled by two of group members and business
consultant on market. The accounting function will be handled by the group of owner
and also there will be a meeting every evening at the close of business.

8.1 The personnel plan

The personnel plan for the Destiny café,restaurant and recreation are

- One Shift Managers

- One Deputy Shift Managers
- One Head Chef
- Three Assistant Chefs
- Six Waiting staff
- Two cashiers
- Two life savers
- Two guards

Employee salaries are as follows

Position salary /birr

Shift Managers 3000

Deputy Shift Managers 3000
Head Chef 2000
Assistant Chefs 1500
Waiting staff 1100
Cashiers
Life savers
Guards

Personnel plan

Year-1 Year-2 Year-3

Shift managers 2 2 3
Deputy Shift 2 2 3

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Managers
Head Chef 1 2 2
Assistant Chefs 3 4 4
Waiting staff 6 8
Cashiers 5 6
Life savers 2 2 8
Guards 2 2 3
2
Total people 2
22 24
Total payroll
400000 45000 26

500000

8. Financial documentation
 The Financial Plan includes:

 Important Assumptions
 Start-up cost
 Profit and Loss Statement
 Cash Flow Statement
 Balance Sheet
 Break Even Analysis

Assumptions

The financial plan depends on important assumptions, most of which are showning the
following. The key underlying assumptions are:

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We assume a constant growth in the economy, without major recession.

We assume of course that there are no unforeseen changes in technology to make
equipment immediately obsolete.
We assume access to equity capital and financing sufficient to maintain our financial
plan as shown in the tables.

Profit and Loss Statement

The most important assumption in the Projected Profit and Loss statement is the gross
margin. We show an adjustment increase in Year 3 as we exit our start-up phase of the
business and move into our expected annual sales forecast.

This transition shows the restaurant managing through its start-up period, and gaining
efficiency and customer loyalty. In summary, the restaurant will develop its customer
base and reputation and the growth will pick up more rapidly towards the second and
third years of business. Month-by-month assumptions for Profit and Loss are included in
the appendices.

Break-even Analysis

For our First Year Break-Even Analysis, we have an average running fixed costs of
60,230 birr per month which includes our full payroll, rent, and utilities, and an
estimation of other running cost.

Appendices

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START-UP COSTS FOR (2013)

START-UP COSTS cost( in birr) EQUIPMENT/CAPITAL COSTS Cost ($)

Registrations ETB 200.00 Business purchase price ETB100.00
Business name ETB 500.00 Franchise fees ETB500.00
Licences ETB 1,000.00 Start-up capital ETB500,000.00

Plant &
Domain names ETB 500.00 Plant & equipment equipment
Trade marks/designs/patents ETB 2,000.00 Computer equipment ETB2,500.00
Membership fees ETB 200.00 Phones ETB500.00
Accountant fees ETB 100.00 Fax machine ETB1,000.00
Solicitor fees ETB 100.00 More… ETB500.00
Rental lease cost (Rent advance/deposit) ETB 7,000.00 Security system
Stock/raw materials ETB 5,000.00 Office equipment
Insurance Furniture ETB3,000.00
Product liabeility ETB 500.00 Shop fitout ETB5,000.00
Professional indemnity ETB 500.00 More… ETB2,000.00
Workers compensation ETB 20,000.00
Business assets ETB 1,000.00
Business revenue ETB 500.00
More… Total equipment/capital costs ETB515,100.00
Total start-up costs ETB 39,100.00

Balance sheet forecast

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BALANCE SHEET FORECAST [Year 1] [Year 2] [Year 3]

Current assets
Cash ETB400,000.00 ETB450,000.00 ETB500,000.00
Petty cash ETB200,000.00 ETB225,000.00 ETB250,000.00
Inventory ETB200,000.00 ETB210,000.00 ETB220,000.00
Pre-paid expenses ETB100,000.00 ETB105,000.00 ETB110,000.00
Fixed assets
Leasehold ETB50,000.00 ETB52,000.00 ETB55,000.00
Property & land ETB0.00 ETB0.00 ETB0.00
Renovations/improvements ETB10,000.00 ETB5,000.00 ETB10,000.00
Furniture & fitout ETB50,000.00 ETB30,000.00 ETB40,000.00
Vehicles ETB0.00 ETB70,000.00
Equipment/tools ETB10,000.00 ETB12,000.00 ETB12,000.00
Computer equipment ETB10,000.00 ETB0.00 ETB0.00
More…
Total assets ETB1030,000.00 ETB1089,000.00 ETB1267,000.00
Current/short-term liabilities
Credit cards payable ETB50,000.00 ETB50,000.00 ETB70,000.00
Accounts payable ETB20,000.00 ETB20,000.00 ETB25,000.00
Interest payable ETB10,000.00 ETB10,000.00 ETB15,000.00
Income tax ETB20,000.00 ETB25,000.00 ETB30,000.00
More…
Long-term liabilities
Loans ETB100,000.00 ETB150,000.00 ETB155,000.00
More…
Total liabilities ETB200,000.00 ETB255,000.00 ETB295,000.00

PROFIT AND LOSS FORECAST

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PROFIT & LOSS FORECAST [Year 1] [Year 2] [Year 3]

Sales ETB1500,000.00 ETB2000,000.00 ETB3000,000.00
less c ost of goods sold ETB850,000.00 ETB900,000.00 ETB950,000.00
More…

Gross profit/net sales ETB650,000.00 ETB1100,000.00 ETB2050,000.00

Expenses
Ac countant fees ETB1,000.00 ETB1,100.00 ETB1,150.00
Advertising & marketing ETB5,000.00 ETB5,100.00 ETB5,100.00
Bank fees & charges ETB1,000.00 ETB1,000.00 ETB1,000.00
Bank interest ETB1,000.00 ETB1,000.00 ETB11,050.00
Credit card fees ETB500.00 ETB500.00 ETB500.00
Utilities (electricity, gas, water) ETB1,500.00 ETB1,500.00 ETB1,600.00
Telephone ETB500.00 ETB500.00 ETB500.00
Lease/loan payments ETB100,000.00 ETB100,000.00 ETB100,000.00
Rent & rates ETB1,000.00 ETB1,000.00 ETB1,000.00
Motor vehic le expenses ETB100,000.00 ETB100,000.00 ETB100,000.00
Repairs & maintenanc e ETB6,000.00 ETB6,000.00 ETB6,000.00
Stationery & printing ETB50.00 ETB54.00 ETB55.00
Insuranc e ETB50,000.00 ETB50,000.00 ETB55,000.00
Superannuation ETB500.00 ETB500.00 ETB500.00
Income tax ETB1,000.00 ETB1,000.00 ETB1,100.00
Wages (including PAYG)
More…

Total expenses ETB269,050.00 ETB269,254.00 ETB284,555.00

NET PROFIT ETB380,950.00 ETB830,746.00 ETB1765,445.00

Break-even analysis

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BREAK-EVEN CALCULATOR
Timeframe (e.g. monthly/yearly)
Average price of each product/service sold ETB300,000.00

Average cost of each product/service to make/deliver ETB200,000.00

Fixed costs for the month/year ETB250,000.00

Percentage of price that is profit ETB0.33

Total sales needed to break-even ETB750,000.00
Number of units sold needed to break-even ETB2.50

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