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Managing a business enterprise is not an easy task. One needs to focus on different factors while managing the business operations in an appropriate manner. During the pandemic the business operations has changed to a greater extent. The pandemic had affected the businesses negatively but has also developed new opportunities for the entrepreneur to start a new business. This report is about a new business plan. The entrepreneur is already having an coffee shop before the pandemic but due to the pandemic the sales is worst hit and now the entrepreneur is looking forward towards a new business plan (McKeever, 2018). Now the entrepreneur wants to start a new business and manage all the business operations online. The name of the new venture would be named as "FoodyWe". The start-up would be offering the food service to their customers with the help of an online application.
This report would be including a detailed business plan which would include all the details related to the finance, operation management, marketing, legal status and interrelationship among them. Along with this the report would be including the detail related to the investment, risk and the potential related to the business plan. After the pandemic the entrepreneur need to be very concerned while selecting the business strategy and has to focus on all the factors which can affect their business.
BUSINESS PLAN
Starting the new business is not an easy task. The entrepreneur need to focus on different factors while setting up a new business. The entrepreneur is looking forward to operate online food services in which online home delivery option would be provided to the customers. As the company was already offering coffee but now the entrepreneur wants to sell online food to their customers. FoodyWe would be the name of new startup which would be selling different healthy meals to their customers. The product line of the new venture would include healthy sandwich, smoothies, milk shakes, hamburger and many more. The major focus on the company is to offer healthy and taste food to the customers in an safe manner. While offering online food to the customers the company has to focus on ensuring that they must operate in an appropriate manner. Along with this the different factors related to the safety and the legal issues are required to be taken in concerned in an appropriate manner.
Business Strategy
The business strategy is something which is very important for the success of the company. It is very important for the firms to ensure that they are using best strategies at the beginning of the company. During the pandemic the customer are more concerned for the quality and the price of the products. Due to this reason the company would be using the cost leadership strategy and differentiation at the same time. Cost leadership would help in reaching out to the customers easily and seeking their attraction in an effective manner. Along with this the other online food stores are offering fast food but the company would be offering healthy alternatives to the junk food by substituting it with the healthy food options (Chepchirchir et. al. 2018). This change would be the best for the company as it would help them in getting competitive advantage over other firms operating in the same industry. The company need to focus on developing some of the effective objectives for the company which can help them in establishing the company in an appropriate manner. Some of the business objectives of the new venture are stated below such as:
To establish the new venture in an appropriate manner.
The financial objective of the company is to generate the profit of around $4000 in the first year of the business.
To develop better customer base for the new start-up.
Legal Status
Legal factor is something which is having an significant impact on the business. The companies need to make sure that they are working efficiently towards the legal rules and regulations. For offering food products the company need to have the food licence for selling the food products to the customers. The entrepreneur would be following all the legal requirements which are required according to the government in an appropriate manner. Along with this the other rules and regulations such as employment rights and others would also be taken in concern by the company in an appropriate manner. This would help them in establishing themselves in an authentic manner which would avoid the issues related to the legal rules and regulations (Kumar et. al. 2021). Although the company would be selling the healthy food alternatives to their customers. This would be reducing the legal issues but the company has to take care of the safety and quality of the food offered by them in an appropriate manner.
Operations
Managing the business operations is the most challenging task for the entrepreneur while setting up a new business. The new venture would be selling the foo through online platforms and will deliver the food directly to the customers so the outbound logistics would be very important for the company. For doing this in an appropriate manner the company would be tying up with the food logistic service operating firm. This would help the company in managing the outbound logistics in an effective manner. For managing the inbound logistic the company would be focusing on having suppliers from the same location which would help them in managing the inbound logistic in an appropriate manner. Along with this for food production, packaging and delivery it is very important operation for the case company. The organisation have to focus on better management of the business operations with the help of better interconnectivity among all the different departments. This would help them in managing the firm in an appropriate manner.
Marketing
Marketing is one of the most important business operations which need to be managed in an appropriate manner. The start-up needs to invest better capital for their marketing and promotion practices which can help them in attracting the customers in an effective manner. During the pandemic the case company would be making use of online marketing and using search engine optimization and social media marketing for attracting the customers in an effective manner. Along with this the company would be offering different types of promotions and offers to their customers. Discounts would help the company in getting more customers. Along with the online marketing the company would also be using the influencer marketing which will help in seeking the attention of the customer in an effective manner (Lupo, 2018). For attracting the customer the company would be doing market segmentation which would help them in using different practices for attracting the customers in an appropriate manner. Along with these different promotional strategies would be used for attracting the customers belonging to different segments of customer base.
Finance
For setting up the business it is very important for the firms to have the finance or the capital available. For the new venture the case company would be taking the bank loan which is one of the widely used method for funding. At the time of unpredictable market the entrepreneur is not willing to invest his own money and is also not capable of investing much large amount. Due to this reason the case company is taking loan for funding the start-up (Andrade et. al. 2019).
Interrelationship among the different components of the business
All the business activities are interrelated. It is very important for the firms to ensure that the business operations would align well with each other. The management of the company would be effective and will try to make best use of the selected strategies for running the business in an appropriate manner (Al-Surmi et. al. 2020). Along with this for better management of the business operations highly skilled and talented employees would be hired so that no issue should be faced while managing the firm.
FINANCIAL ANALYSIS
Finance is one of the most important factors which is required to be taken in concern by the entrepreneur while setting up a new business. There are different financial factors which are required to be taken in concern by the entrepreneur. The company has to think of long term and has to focus on the different factors such as cash flow forecast, breakeven, capital investment, costing, expenditure, projected sales and profits over 3 years. The entrepreneur would be focusing on all of these factors in an appropriate manner in detail.
Capital Investment
Capital investment is very important for the firms. It is very essential for the firms to ensure that they are making better investment in the company so that better output can be received. For starting the new venture for selling the food online the entrepreneur would be making a capital investment of around $10,000. The researcher would be managing the online food store from his own home only and this would reduce a lot of capital which is generally being invested for the place. The entrepreneur would be buying the different machine and would be managing all the resources from this capital investment (Hashim and Strong, 2018). Due to the pandemic the economy has been affected significantly and due to this reason the entrepreneur is not ready to invest large capital investment for starting up a new business.
Cash flow forecast
Cash flow forecasting is very important for the businesses to ensure that they are working in an appropriate manner. It generally involves the estimation of the future sales and expenses of the company. While forecasting the cash flow the company has to focus on making the assumption related to the different financial factors in an appropriate manner. The case company would be focusing on monthly forecasting. As the company is new so they are not having any of the data related to the previous sales so the company just have to estimate the things. The estimates sales of the first month would be $800. Although the company is investing better capital but for the first month the estimate income or sales is not much higher as the market is unpredictable due to the pandemic (Lyukevich and Agranov, 2019). There are different factors which can affect the cash inflows and if the entrepreneur would be investing more capital in the business then the inflows would be increased. Another important things which is required to be taken in concern is the cash outflow and the expenses. Then the estimation would be compiled with the cash flow forecast and then are compared with the actual once. This would help the company in better analysis of the financial performance of the company in an appropriate manner.
Breakeven
For a new business it is very difficult to estimate the breakeven point. Generally for the new start up business the breakeven point reached when the cost is equal to the revenue. In this stage of breakeven the company is not having profit and loss. The exact breakeven point for the company would be estimated after 1-2 years when the company would be offering profit to the entrepreneur.
Costing
There are different factors which would require cost while setting up the new business. The entrepreneur has to focus on all of them in an appropriate manner for doing costing property. There are different factors such as website, inventory, equipment, marketing and payroll (Pornupatham et. al. 2021). Along with this the taxes and the shipping or the delivery cost would be the important costs which are required to be used by the company while doing costing in an appropriate manner.
Projected sales and profits over 3 years
For the new venture the estimate sales for the first three years would be $8000 for first year, $12000 for the second years and $15000$ for the third year. In contrast to this the profit for the coming three years are in such a form that for the first year the profit would be 4000$, then $7000 then $10000.
INVESTMENT POTENTIAL, ISSUES AND RISKS ASSOCIATED WITH THE BUSINESS PLAN
Whenever the new business starts there are different factors which can create both the risks and issues for the entrepreneur in managing the business operations in an effective manner. Before setting up the business it is very important for the entrepreneur to understand that how much capital he or she can invest in the firm. Estimating the investment potential is very important (Watson et. al. 2018). During the pandemic and the upcoming new variants the market is highly unpredictable. Because of this it is very important for the entrepreneur to invest less capital in the business as the market is unpredictable at this time. There are different factors related to the internal and the external business environment which can create both the risks and opportunities for the new venture. It is very important for the company to estimate all these factors in an effective manner. For analysing the business environment SWOT analysis and the Pestle analysis are the widely models which are widely used by the entrepreneurs.
SWOT Analysis
Strengths: One of the biggest strength of the new business plan is that the company would be selling the healthy meal options to their customers. Along with this the another important factor is that they are offering home delivery service which is more convenient and safe during the pandemic time. So both the factors can be considered as the strength of the company.
Weakness: If we look onto the weakness then during the pandemic making an invest is not much safe because is higher unpredictability of the market. This is an important factor which can affect the company negatively.
Opportunity: The Company is having great opportunity to attract the customers in an effective manner. The different healthy eating meals offered by the company are having great opportunity to attract the customers in an effective manner. This can help the new venture in establishing them in an effective manner and having better customer base which is essential for generating higher sales (Huang al. 2021).
Threats: The changing rules and regulations of the government during the time of pandemic related to the way the business should operate are a threat for the company. Along with this the changing legal rules related to food production and sales are a threat for the company.
PESTLE Analysis
Political factors: With the growing concern for the safety and health of the people the government is continuously making the new rules and regulations related to the food production and sales which can create an issue for the new venture. But as the company would be only selling the healthy food so the threat related to this would be less.
Economic factors: The world economy is worst hit due to the pandemic so the company can fake issues related to the poor economic condition of the nation. This can affect the sales of the company in an negative manner.
Social factors: The social factors such as changing buying behaviour and more focus of the customers towards eating healthy would help the case company to grow in an effective manner.
Legal Factors: The legal rules related to food and the changing covid-19 rules for reducing the spread of the disease can create an issue for the company while managing their business operations in an effective manner (Oraman al. 2018).
Environmental Factors: The environmental concern is increasing so the new venture has to focus on operating in an sustainable manner otherwise they would be facing a lot of fines and issues related to it.
Technological Factors: The technology is growing at the fast rate and due to this reason the new venture has to use the latest technologies for managing their business operations in an effective manner.
On the basis of the environment analysis it can be said that the case company has to focus on different factors which can create risks and issues for them. Quality of the food need to be the priority of the company otherwise the company would be facing a lot of legal issues related to this. Along with this while managing the operations during the pandemic the company had to ensure that they are offering the products in a safe manner. Along with this the risks related to operations needs to be managed in an appropriate manner (Christiansen et. al. 2018). Apart from this the factors related to the economic factors and the legal factor can create an threat for the company. It can be said that the company need to ensure that they must develop better risk management which can help them in predicting the shifting changes in the market and adapting them for operating in an appropriate manner.
CONCLUSION
From the above mentioned report it can be said that the new venture is having better scope to grow and will be helping the entrepreneur in generating higher profit. The business is effective for the current market situation where the customers want to focus on having high quality and healthy food in an convenient manner. As the customers are not much in favour to go out for having the food then the online services offered by FoodyWe would be the best choice for the customers. Along with this the above mentioned business plan is also effective as it included all the factors and the details related to the business operations. If the entrepreneur would be focusing on using better strategies and marketing practices then it would help them in establishing themselves in an effective manner. Along with this if the risks are managed in an appropriate manner and the things went well then it would led the start up towards success and development. Moreover it can be recommended that the new venture should focus on making changes in their business strategies and the practices with the changing market trends and customer demands. This would help them in managing the business in an appropriate manner.
References
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