Small Business and Operations Coffee Mart

Question: Discuss about the Report for Small Business and Operations of Coffee Mart. Answer: Introduction This assignment aims to plan for a small new business, namely Coffee Mart. During the assignment, the plan is made for several aspects of a new business like, marketing, operations, human resource, financial and risk management plan. At the same time, the description is given regarding the new business, its products and its mission, vision and values statement. Apart from that, the industry analysis is also done in the assignment. Background of the business Coffee Mart is a new firm that is going to start its business at a small scale. The organization will operate its business in the local market at Dauphin, Canada. The organization will start its business as a partnership firm. Mission, vision and values statement Mission statement: To provide the taste of pure coffee with personalized service Vision statement: Promote humanity by providing high quality hygienic products to the guests Values statement: The best way to achieve sustainability is providing the best quality products at affordable price range. Products / service description Coffee Mart is going to deal with the coffee products. The product range of the company will include Hot Coffee, Cold Coffee, Coffee with chocolate sauce, Coffee with cream and dry coffee powder. The company is planning to provide the home delivery service to the customers, who stay within 2 kilometers from the outlet. Industry description In Canada, coffee comes under the most consumed products. The average rate of coffee consumption by the adults in Canada is 3.2 cups per day. In Canada, 85% of the people (adults) prefer to have coffee in their breakfast. As per the recent data published by CAC (Coffee Association of Canada), the average sale of the industry in each year is $4.8 billion in Foodservice. However, the country imports huge amount of coffee each year from 30 developing countries (Hawaiicoffeeassoc.org 2016). The current state of the Canadian coffee industry can be understood by the following SWOT analysis: Strength Availability of better quality coffee beans High domestic demand Weaknesses Less production of coffee beans High cost to import the coffee beans from the foreign countries Opportunities Increasing demand for the Canadian coffee products (Goss 2015) Availability of advanced production technology in the international market Threats Production of high quality coffee beans in the other countries like, Brazil, Ghana High competition in the international market (Van Auken and Horton 2015) Table 1: SWOT analysis of Canadian Coffee industry (Source: Lussier and Corman 2015) Analysis of external factors: Five Forces Situations Industry rivalry Industry rivalry is much high. Threats of new entrants As the revenue earning capacity and profitability of the industry is high, there is threat of new entrants in Canadian Coffee industry. Threats of substitute products Threat of substitute products is moderate because maximum people prefer coffee Bargaining power of customers Bargaining power of the suppliers is high because number of suppliers is less and most of the coffee beans are imported. Bargaining power of suppliers Bargaining power of the customers is less because maximum numbers of people in Canada prefer coffee and so the numbers of customer are large. Table 2: Porters Five Forces analysis of Canadian Coffee industry (Source: Weinzimmer and Nystrom 2015) Feasibility study of the business Coffee business in Dauphin, Canada is expected to be a successful business. The current trend of Canadas coffee industry is positive and the demand is at increasing rate. However, the cost of purchasing the high quality coffee beans is bit high because the high quality coffee beans are imported (Steingold 2015). The risk of coffee business in Dauphin is low because the area is small and no such large coffee company is available there and so the competition is less. Therefore, coffee business in Dauphin, Canada is feasible enough. Marketing plan Coffee Mart includes the people of all the social classes in its target market. The company targets the people, who are above 18 years age group. The major competitors of the company will be Coffee Creation, Forbidden Flavors on 18th, Cafe 37 and Russell Inn (McKenzie and Woodruff 2015). The marketing plan of Coffee Mart can be described by the following 4Ps analysis: 4Ps Plan Product The company will include less number of products in its product range. However, each of the products will be made of high quality coffee beans. Price The company will keep the price at affordable range. The company will apply the psychology pricing strategy. Place The company aims to sell its products at the local market in Dauphin. The products of the company will be available only in the outlet of the company. Promotion The company will promote its products through newspaper and television advertisement. The television advertisement will be provided in the local channels. Table 3: 4Ps analysis of Coffee Mart (Source: Created by author) Operational plan Initially, the company will include 11 people. The operating hours of the people will be 8 hours per day and there will be two shifts. The first shift will be from 7a.m to 3p.m and the next shift will be from 3p.m to 11p.m. Human resource plan The company will include total 11 employees in the beginning. Among these 11 people, 4 will be cook, 2 people will be recruited for home delivery service, 2 people will be the marketing persons. 1 employee will deal with suppliers. 2 employee will work as the service provider in the outlet. Legal requirements In order to start the coffee business in Dauphine, Canada, Coffee Mart needs to meet the food safety standards and labeling regulations provided by Canadian Food Inspection Agency (Pakroo 2016). The company will need to take permission from BizPal or Association of Municipalities. Risk management plan As the competition in the market is high, the company needs to take proper measures to manage its risk level (Goffee and Scase 2015). In order to manage the risk, the company needs to manage the cash flow statement properly. At the same time, the company has to make a proper marketing plan and implement the same. Financial plan Finance is one of the main parts of the business. For the new business of Coffee Mart, a proper financial plan is important (Birch 2016). As per the first year financial plan, the company will be able to generate net profit of $1260 and in the second year the net profit will increase to $1600. (Refers to appendix) Action plan In order to start the business successfully, the marketers of Coffee Mart need to conduct a market survey at first. This survey will include minimum 300 people in Dauphin. In the market survey, the marketers need to identify the demand, taste and preferences of the prospective customers. At the same time, the company also needs to identify the strong points of the competitors. After conducting the market survey and analyzing the same, the company needs to identify the initial purchase quantity of raw materials. As per the need, the company has to contact the suppliers of coffee beans. After communicating with different suppliers, the company needs to select the supplier, who provides the best offer to the company. In the mean time, the company needs to contact with the external fund providers, like, creditors and banks and arrange for the additional finance required for the business. After that, the company has to start promote its brand in the market. This stage is very important for a new company. At last, the company needs to start its production. The total action will require 15 to 20 weeks. Reference list: Birch, H.G., 2016. Campus Concierge: A Business Plan to" Do College Better". Goffee, R. and Scase, R., 2015.The Real World of the Small Business Owner (Routledge Revivals). Routledge. Goss, D., 2015.Small Business and Society (Routledge Revivals). Routledge. Hawaiicoffeeassoc.org. 2016. Hawaii Coffee Association - HOME. [online] Available at: https://www.hawaiicoffeeassoc.org/ [Accessed 7 Aug. 2016]. Lussier, R.N. and Corman, J., 2015. A business success versus failure prediction model for entrepreneurs with 0-10 employees.Journal of Small Business Strategy,7(1), pp.21-36. McKenzie, D. and Woodruff, C., 2015.Business practices in small firms in developing countries(No. w21505). National Bureau of Economic Research. Pakroo, P., 2016.The small business start-up kit: A step-by-step legal guide. Nolo. Steingold, F.S., 2015.Legal guide for starting running a small business. Nolo. Van Auken, H.E. and Horton, H., 2015. Financing patterns of minority-owned small business.Journal of Small Business Strategy,5(2), pp.31-44. Weinzimmer, L.G. and Nystrom, P.C., 2015. The search for opportunities by small business owners.Journal of Small Business Strategy,7(3), pp.1-14.