Business Proposal for Vegan Fiesta

This business proposal outlines the plan for Vegan Fiesta, a new venture in the United Kingdom that aims to provide authentic vegan fast food. The proposal includes market research, the unique selling point of the restaurant, operational requirements, cost and pricing strategy, and financial forecasting. The restaurant will focus on the psychographic segment of the market and will target individuals interested in vegetarian food with no animal tissue. The pricing strategy will be competitive, and the restaurant plans to open multiple branches in the UK.

Business Proposal
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Business name: Vegan Fiesta
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EXECUTIVE SUMMARY
A medium scale restaurant is planned to be established which will have the USP of
authenticated vegan food. This restaurant will bridge the market gap of short vegan menus and
expensive vegan food. Physiographic segment will be used to target vegan population of United
Kingdom. For this project, the initial investment of £ 465200 is sought from investors.
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Contents
EXECUTIVE SUMMARY.............................................................................................................3
FOCUS OF NEW VENTURE.........................................................................................................5
MARKET RESEARCH...................................................................................................................7
Secondary data collection............................................................................................................7
Unique Selling Point....................................................................................................................8
OPERATIONAL REQUIREMENTS.............................................................................................8
Tangible and intangible requirements.........................................................................................8
Legal Requirements.....................................................................................................................9
COST AND PRICING STRATEGY...............................................................................................9
FINANCIAL FORECASTING.....................................................................................................10
Calculating the sales and costs forecast for the Products/ Services...........................................10
Considering if this is affected by seasonal trends......................................................................10
Calculating overall business running costs................................................................................11
Cash flow forecast.....................................................................................................................11
Investment required...................................................................................................................12
CONTINGENCY PLAN/ EXIT STRATEGY..............................................................................12
REFERENCES..............................................................................................................................13
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OWNERS EXPERIENCE/ BACKGROUND
The new business venture “Vegan Fiesta” will be a private limited company operated by
four equal profit sharing shareholders (partners). All these four shareholders will be owners of
this restaurant and will share profit and loss equally. Experience and background of these owners
of this entrepreneurial venture are stated as follows:
Owner 1 – Have years of experience being a chef in a vegan restaurant and has a
background of working in varied food sector organisation.
Owner 2 – Entrepreneur by profession having a store of vegan food products.
Background and experience of familiarity with vegan products will help in making this
restaurant an authentic vegan restaurant.
Owner 3 – Corporate professional. Having a background of managing large restaurants
and other organisations’ financial stability and auditing their financial statements. This
background of being a financial analyst will help this restaurant to be profitable and using prices
strategies effectively.
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Owner 4 – Background of working in a vegan restaurant as a food manager. This
background and experience of working at the front end of a vegan restaurant will help in
analysing the demands of consumers better.
FOCUS OF NEW VENTURE
Vegan Fiesta is a new business venture which is planned to be established in United
Kingdom. It has been planned that in in initial period only one branch of this restaurant will be
established in London, United Kingdom and within the period of 7 years, three new branches
will be opened in different places in UK which will be controlled and operated by four owners of
this restaurant. The main focus of this new venture is upon providing vegan fast food products to
the consumers.
According to Robert Booth (2019), Vegan food has become the fastest growing takeaways.
Orders for vegan meals have observed to be grown between 388% between 2016 and 2018.
Observing this market trend, it has been analysed that this is an appropriate time to establish an
authenticated vegan fast food restaurant. All the current operating vegan restaurants in United
Kingdom either are not authenticated or have a limited menu or are highly expensive. A market
gap has been identified in the market of UK that all vegan restaurants in this region are super
expensive and if not they only have 20 to 25 vegan dishes options and out of which only few are
fast food dishes. Vegan Fiesta focuses upon the agenda of providing people an experience in
which they can celebrate using Vegan food (Vegan food becomes UK’s fastest growing
takeaway, 2019).
The name of this restaurant is intended to be Vegan Fiesta in which the term “Vegan”
represents the vegan food and a large menu full of vegan fast food dishes and “Fiesta” which
represents celebration and parties (Balachandra and et.al., 2019). This restaurant intends to
encourage people to celebrate the occasions using vegan food. This restaurant aims to bridge the
market gap in the food sector of United Kingdom. This restaurant will be an authenticated vegan
place where the entire menu will be filled with vegan fast food dishes and unlike other
restaurants no anti vegan dish will be served. This restaurant aims to target huge audience due to
which the prices of the food products will not be high.
This restaurant will work as a private limited company having four equal profit sharing
shareholders. This profit will be distributed equally in shareholders after paying off all the
expenses, taxes, inventors’ fund and dividends. Each shareholder will have same voting power in
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the restaurant with the shareholding of 25%. These shareholders will also act as four main
personnel members of this restaurant. Keeping in mind the background and experience of
shareholders, owner 1 will be chief food officer (CFoO), owner 2 will be chief operating officer
(COO), owner 3 will be chief financial officer (CFO) and owner 4 will be the chief executive
officer (CEO).
The products and services served in this vegan restaurant will be rustic ambience of the
restaurant, table serving services, online food order services and lastly the most important 72
vegan fast food dishes and 28 vegan beverages. These products will be combined as a wide
variety menu. The fast food dishes will be provide inspired from Mexican, Indian and continental
cuisines.
While planning for this restaurants, various entrepreneurship theories and models were
considered such as innovation theory, need for achievement theory, social change theory,
cultural theory and psychological theory (Baucus and Mitteness, 2016). After effective market
research, the entrepreneurship theory of innovation was selected. This implies that the main
focus of this new venture is to establish an innovative vegan restaurant which will bridge the
market gap of food industry of United Kingdom (Croce, Tenca and Ughetto, 2017).
MARKET RESEARCH
Secondary data collection
Market research is the process of organising the efforts of gathering information about
the target market (Davis and et.al., 2017). In this context, secondary data collection technique is
used for the market research. Secondary data is the information which gained from pre published
data such as newspapers, journals, articles and many more. The reason behind selecting
secondary data collection technique over primary is that this technique provides quick and
accurate results (Faff and et.al., 2017). It has been considered that primary research results are
more appropriate but it can only be possible if the numbers of respondents are high. For the
purpose of eliminating conducting survey with hundreds of people, the technique of secondary
data collection is selected.
This market research is used to outline the market of United Kingdom so that market
segmentation can be done, marketing strategies can be developed and competitors can be
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identified. For this purpose, the model of STP (segmentation, targeting and positioning) is used
and analysed below:
Segmentation (Market segmentation) – The process of market segmentation involves
classifying whole market into different classes. This process helps in identifying which segment
is required to be targeted by an organisation in order to earn higher revenue, profit and customer
satisfaction in low marketing funding (Fisher and et.al., 2017). For Vegan fiesta, the market
segment of psychographic is selected. There are various sub segments in this psychographic
segment which are interest, attitudes, values and lifestyle. Being a vegan, is a choice of an
individual which shows their interest in vegetarian food with no trace of animal tissue, their
values of protecting animals and their lifestyle of being healthy. For Vegan Fiesta,
psychographic segment involving sub segment of interest, values and lifestyle is selected.
Targeting (Competitors) – This is the second phase of STP model, in which people are
targeted according to their segment. For Vegan Fiesta, segment of psychographic was selected.
Using this segment, people will be identified using secondary sources that have interest, values
and lifestyle of consuming vegetarian food which involves no animal tissue.
This process of targeting is important as if Vegan Fiesta intends to gain a competitive edge,
it is important to offer services and products which are not offered by their prospect competitors.
As the Vegan Fiesta is based upon an innovative idea, there will be no direct competitor of this
restaurant but there are various large restaurants which has various fast food vegan dishes on
their menu. These competitors are Mildreds Soho, Manna Wild Food Café Covent Garden etc.
Positioning (Marketing strategies) – In this third phase of STP, a new venture decides
the marketing strategies which they will use to position their brand in market. The marketing
strategies which this venture is intend to use are digital marketing (Frydrych and et.al., 2014). In
digital marketing, the menu of this restaurant will be used as its asset and will be advertised on
social media sites such as Facebook, Twitter, Instagram etc. Besides this, paid media marketing
strategy is also intended to be used in the initial months of this restaurant, so that Vegan Fiesta
can become a common name in UK. Once the brand is fully established in UK, then the
marketing efforts will be relied upon digital marketing and word of mouth marketing strategy
only.
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Unique Selling Point
USP is the factor that differentiates a product, entity or individual from its competitors
(Lackéus and Williams Middleton, 2011). Vegan Fiesta is a new venture which is based upon the
entrepreneurial theory of innovation in which USP is considered as a main element. Vegan Fiesta
will not be another vegan restaurant but it will be an authenticated vegan restaurant, which will
make people believe that it is possible and even fun to celebrate occasions by vegan food. Unlike
various restaurants of UK, Vegan Fiesta will provide only vegan food products which are healthy
and are in the category of fast food. This restaurant will not consider only vegetarian food as
vegan food but the food which does not have any animal tissue such as milk or processed milk
products will be considered as vegan food. This restaurant will also provide a large variety of
vegan dishes and beverages which will be sold at lower prices than its competitors.
OPERATIONAL REQUIREMENTS
Tangible and intangible requirements
In order to establish the new venture of Vegan Fiesta, there are various tangible and
intangible assets which will be required for the effective operations of this restaurant. Tangible
requirements are those which can be seen or can be touched and which has a value that can
provide future benefit of the organisation (Navis and Glynn, 2011). For Vegan Fiesta, tangible
requirements are the restaurant premises, restaurant interiors, furniture, kitchen equipment, staff
members including cooks, chefs, waiters and cleaning staff.
Along with above mentioned requirements, there are few intangible requirements for
restaurant as well. These requirements include trade secrets which can protect the recipes of
innovative vegan food products and beverages. It is also required to procure a trade mark over
the name of this restaurant so that authenticity can be maintained.
Legal Requirements
There are various legal requirements which need to be fulfilled before starting operations of
Vegan Fiesta. The most important legal requirement is food hygiene certificate. It is important to
acquire such certificate before commencement of operations as this certificate proves that
restaurant is aware of all health and safety regulations. Another legal requirement is pest control;
it is important for a restaurant to procure such certificate which provides evidence that the food
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premises are free from pests and all the future operations will be aligned with The Food Safety
(General Food Hygiene) Regulations.
It is also important to procure a certification from Food Standards Agency (FSA) of United
Kingdom. By this, evidence can be gained that all the food products served in this restaurant is
free of animal tissue and is authentic vegan. Other legal requirements for operating a restaurant
can involve building permit, restaurant license and music license (Restaurant licence and
regulation laws, 2020).
COST AND PRICING STRATEGY
Cost strategy refers to the costing plan which an organisation will follow. For Vegan Fiesta,
the cost strategy which has been selected will allow company to spend less on the operations but
these low expenses will not have an impact upon the quality of the restaurant’s dishes.
Pricing strategy is the planned price at which Vegan Fiesta will offer their products to
consumers. The pricing strategy set for this restaurant is competitive pricing. According to this
strategy, organisation sets a price of their products which are based upon the prices their
competitors (Huang, Frideger and Pearce, 2013). As this new venture is based upon an
innovative idea, there are several food dishes of this company which are not served by their
competitors. For such products, the pricing strategy of value based is selected. According to this
strategy, the prices of food products and beverages will be based on how much consumer
believes. By this strategy, restaurant will be charging the price which can satisfy the worth of
that product.
FINANCIAL FORECASTING
Calculating the sales and costs forecast for the Products/ Services
All amounts in £
Sales and costs forecast
Particulars Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Revenue
Vegan Dishes 2600 3100 3600 4100 4600 5100 5600 6100 6600 7100 7600 8100
Vegan Beverages 680 705 730 755 780 805 830 855 880 905 930 955
Total revenue 3280 3805 4330 4855 5380 5905 6430 6955 7480 8005 8530 9055
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Direct costs
Vegan Dishes 1200 1245 1290 1335 1380 1425 1470 1515 1560 1605 1650 1695
Vegan Beverages 320 335 350 365 380 395 410 425 440 455 470 485
Indirect costs
Paid media 4500 3700 2900 2100 1300 500 500 500 500 500 500 500
Total costs 6020 5280 4540 3800 3060 2320 2380 2440 2500 2560 2620 2680
Considering if this is affected by seasonal trends.
All amounts in £
Sales and costs forecast seasonal trends
Particulars Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Capacity 100% 100% 90% 90% 75% 70% 70% 85% 85% 85% 100% 100%
Vegan Dishes 2600 3100 3240 3690 3450 3570 3920 5185 5610 6035 7600 8100
Vegan Beverages 680 705 657 680 585 564 581 727 748 769 930 955
Total revenue 3280 3805 3897 4370 4035 4134 4501 5912 6358 6804 8530 9055
Direct costs
Vegan Dishes 1200 1245 1161 1202 1035 998 1029 1288 1326 1364 1650 1695
Vegan Beverages 320 335 315 329 285 277 287 361 374 387 470 485
Indirect costs
Paid media 4500 3700 2900 2100 1300 500 500 500 500 500 500 500
Total costs 6020 5280 4376 3630 2620 1774 1816 2149 2200 2251 2620 2680
Calculating overall business running costs
All amounts in £
Particulars Annual
Direct costs:
Vegan Dishes 17370
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Vegan Beverages 4830
Indirect costs: 0
Paid media 18000
Total costs 40200
Cash flow forecast
All amounts in £
Cash flow forecast
Particulars Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Cash inflows
Vegan Dishes 2600 3100 3600 4100 4600 5100 5600 6100 6600 7100 7600 8100
Vegan Beverages 680 705 730 755 780 805 830 855 880 905 930 955
Total cash inflow 3280 3805 4330 4855 5380 5905 6430 6955 7480 8005 8530 9055
Cash outflows
Vegan Dishes 1200 1245 1290 1335 1380 1425 1470 1515 1560 1605 1650 1695
Vegan Beverages 320 335 350 365 380 395 410 425 440 455 470 485
Paid media 4500 3700 2900 2100 1300 500 500 500 500 500 500 500
Total cash outflow 6020 5280 4540 3800 3060 2320 2380 2440 2500 2560 2620 2680
Net cash flows -2740 -1475 -210 1055 2320 3585 4050 4515 4980 5445 5910 6375
Investment required
All amounts in £
Required investment amount
Particulars Amount
Lease 200000
Kitchen equipment 150000
Furniture 75000
Operating costs for one year 40200
Total investment amount required 465200
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From the above financial analysis, it has been seen that the total amount which will be
required from investors is £ 465200.
CONTINGENCY PLAN/ EXIT STRATEGY
If due to external factors, the business of Vegan Fiesta fails the exit strategy of Merger will
be adopted in which business of this company will be merged with other vegan restaurant of
United Kingdom.
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REFERENCES
Books and Journals
Balachandra, L., and et.al., 2019. Don’t pitch like a girl!: how gender stereotypes influence
investor decisions. Entrepreneurship Theory and Practice. 43(1), pp.116-137.
Baucus, M.S. and Mitteness, C.R., 2016. Crowdfrauding: Avoiding Ponzi entrepreneurs when
investing in new ventures. Business horizons, 59(1), pp.37-50.
Croce, A., Tenca, F. and Ughetto, E., 2017. How business angel groups work: Rejection criteria
in investment evaluation. International Small Business Journal. 35(4). pp.405-426.
Davis, B.C. and et.al., 2017. Funders' positive affective reactions to entrepreneurs' crowdfunding
pitches: The influence of perceived product creativity and entrepreneurial passion.
Journal of Business Venturing. 32(1). pp.90-106.
Faff, R.W. and et.al., 2017. Fantasy pitching. Available at SSRN 2782778.
Fisher, G. and et.al., 2017. Legitimate to whom? The challenge of audience diversity and new
venture legitimacy. Journal of Business Venturing. 32(1). pp.52-71.
Frydrych, D. and et.al., 2014. Exploring entrepreneurial legitimacy in reward-based
crowdfunding. Venture capital. 16(3). pp.247-269.
Huang, L., Frideger, M. and Pearce, J.L., 2013. Political skill: Explaining the effects of
nonnative accent on managerial hiring and entrepreneurial investment decisions. Journal
of Applied Psychology. 98(6). p.1005.
Lackéus, M. and Williams Middleton, K., 2011. Venture Creation Programs: entrepreneurial
education through real-life content. In Babson College Entrepreneurship Research
Conference (pp. 1-16).
Navis, C. and Glynn, M.A., 2011. Legitimate distinctiveness and the entrepreneurial identity:
Influence on investor judgments of new venture plausibility. Academy of Management
Review. 36(3). pp.479-499.
Online
Vegan food becomes UK’s fastest growing takeaway, 2019. [Online]. Available through:
<https://www.theguardian.com/food/2019/aug/28/vegan-food-becomes-uk-fastest-
growing-takeaway>
Restaurant licence and regulation laws, 2020. [Online]. Available through:
<https://startups.co.uk/restaurant-regulations/>
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APPENDIX
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