Deline Cafe Business Plan

This business plan focuses on the financial aspects of establishing a new coffee shop called 'Deline Cafe'. It outlines financial objectives such as increasing revenue, return on investment, and sales growth. The plan details the required funding, assuming a loan of $230,000 with an interest rate of 2.47%. It also presents assumptions regarding tax rates, customer traffic, and profit projections over two years. Furthermore, the assignment touches upon financial statements such as balance sheets, profit & loss forecasts, cash flow expectations, and break-even analysis. To support its claims, it includes a questionnaire designed to gather insights into consumer preferences and behavior.

1Running head: BUSINESS PLAN
[ ]
[Your Name]
[Your Title]
[Deline Cafe]
[Main Business Address]
ABN: [ABN 13 784 556 001]
Business Plan
Prepared: Date Prepared

2BUSINESS PLAN
Table of Contents
1. Business Plan Summary..............................................................................3
1.1. The Business...............................................................................................................3
1.2. The Market.................................................................................................................4
1.3. The Future..................................................................................................................4
1.4. The Finances...............................................................................................................5
2. The Business..............................................................................................5
2.1. Business details..........................................................................................................5
2.2. Registration details.....................................................................................................5
2.3. Business premises.......................................................................................................6
2.4. Organization chart......................................................................................................6
2.5. Management & ownership.........................................................................................7
2.6. Key personnel.............................................................................................................8
2.7. Products/services........................................................................................................9
2.8. Innovation.................................................................................................................10
2.9. Insurance...................................................................................................................10
2.10. Risk management...................................................................................................11
2.11. Legal considerations...............................................................................................12
2.12. Operations...............................................................................................................12
2.13. Sustainability plan..................................................................................................14
3. The Market.............................................................................................. 15
3.1. Market research........................................................................................................15
3.2. Market targets...........................................................................................................15
3.3. Environmental/industry analysis..............................................................................16
3.4. Target customers......................................................................................................16
3.4. S.W.O.T. analysis.....................................................................................................17
3.5. Competitors..............................................................................................................18
3.6. Advertising & sales..................................................................................................22
4. The Future............................................................................................... 24
4.1. Vision statement.......................................................................................................24
4.2. Mission statement.....................................................................................................24
4.3. Goals/objectives.......................................................................................................25
4.4. Action plan...............................................................................................................25
5. The Finances............................................................................................26
5.1. Key objectives & financial review...........................................................................26
5.2. Assumptions.............................................................................................................26
5.4. Balance sheet forecast..............................................................................................28
5.5. Profit and loss forecast.............................................................................................29
5.6. Expected cash flow...................................................................................................30
5.7. Break-even analysis..................................................................................................30
5.8. Supporting documentation........................................................................................30

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1. Business Plan Summary
1.1. The Business
Business name: Business name selected for the new coffee shop business is Deline
Café that will be situated in Melbourne, Australia.
Business structure: The new coffee shop business will be situated in Melbourne. For
setting up the business, the new coffee shop will initiate its business as a company. Operating
as a company Deline Café will have three functioning groups in the firm including
production, sales along with marketing and administrative group.
ABN: Deline Café’s ABN number will be ABN 13 784 556 001.
Business location: The new coffee shop business will be situated in Melbourne,
Australia.
Date established: The date on which the business will be set up is on 5th March, 2018.
Business owner(s): The business owners of the Deline Café are James Polk who will
hold 51% shares and Todd Megan who will have minority shares in the company.
Relevant owner experience: James Polk has 10 years of experience as a head chef in
a renowned Australian restuarnat and has attained food championship trophy in Australian
food festival.
Products/services: Deline Café will offer expresso-based coffee beverages including
mochas, lattes, cappuccinos, etc. Such coffee beverages will be prepared as per the tastes and
preferences of the target consumers in Melbourne. As the consumers prefer perfectly brewed

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quality coffee, the café will maintain efficient preparation techniques in preparing such
beverages.
1.2. The Market
Target market:
The target market of Deline Café includes consumers those prefer gourmet coffee
along with enjoying exotic and unique coffee flavors. The company offers variety of coffee
beverages as per the demands of the target market. The target consumers prefer enjoying
better tasting coffee that belongs to every age group. However, as the coffee shop will be
situated beside a university majority of its consumers will be students and faculties.
Marketing strategy: Deline Café will develop a marketing strategy that will employ
low cost advertising strategy. The promotional campaigns include drive-time radio and
bulletin relationships with schools and charities. Distinctive logo of “Deline Café” with a
flower blooming in a pot symbol will be the unique promotional strategy that will indicate
happy and conspicuous ambiance. The marketing strategy of Deline Café is focused on
promoting the value proposition of the new café through social media and hoardings in the
nearby universities.
1.3. The Future
Vision statement:
Deline Café will have a vision in generating an exceptional place where the customers
might socialize with others in a relaxing and comfortable surroundings. The café will have an
intention to make people enjoy freshly brewed espresso and coffee in the town.
Goals/objectives:

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Deline Café has set certain objectives that it considers to be addressed in the first year of
the business:
 Maintaining a gross margin of 65%
 Attain profits from the initial month of the business operation
 To position itself as the “best new coffee shop in the locality”
1.4. The Finances
The new coffee shop will attain funds through obtaining loan of $ 230, 000 from the
bank. Deline Café expects 65% gross profit margin and anticipates that its net profit will grow
from $507,304 to $ 666, 672 in two years.
2. The Business
2.1. Business details
Products/services Deline Café will offer expresso-based coffee beverages including
mochas, lattes, cappuccinos, etc. The coffee shop will also prepare pastries and sandwiches of
different flavors. Such coffee beverages will be prepared as per the tastes and preferences of
the target consumers in Melbourne. As the consumers prefer perfectly brewed quality coffee,
the café will maintain efficient preparation techniques in making such beverages.
2.2. Registration details
Business name: Business name selected for the new coffee shop business is Deline
Café that will be positioned in Melbourne, Australia.
Trading name(s): Deline Café is the proposed trading name for the new coffee shop
Date registered: The date on which the business will be set up is on 5th March, 2018.

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Location(s) registered: The new coffee shop business will be situated in Melbourne,
Australia.
Business structure: Deline Café will operate its business as an established company
ABN: Deline Café’s ABN number is ABN 13 784 556 001.
GST: Deline Café will register itself for GST on 10th February, 2018
Domain names: The domain names that are considered to be registered for Deline
Café include DelineCafe.com.au and DelineCafe-Registration.com.au.
Licenses& permits: The licenses and permits that will be registered for the new
coffee shop business are registration with ABN, attaining licenses for hospitality service and
food handlers permit.
2.3. Business premises
Business location: The new coffee shop business will be situated in Melbourne. For
setting up the business, the new coffee shop will initiate its business as a company. The
company will relatively be a flat one as most of the employees are associated with production.
Operating as a company Deline Café will have three functioning groups in the company
including production, sales along with marketing and administrative group.
Buy/lease:Deline Café will take the ground floor of a residential complex in
Melbourne for lease in order to start a new coffee shop business.
2.4. Organization chart

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(Figure 1: Organization Structure)
Source: Authors Note
2.5. Management & ownership
Names of owners: James Polk and Todd Megan will be the business owners of the
newly established coffee shop “Deline Café”.
Details of management & ownership: The business owners of the Deline Café are
James Polk who will hold 51% shares and Todd Megan who will have minority shares in the
company.
Experience: James Polk has 10 years of experience as a head chef in a renowned
Austskian restuarnat and has attained food championship trophy in Australian food festival.
Todd Megan has more than 2 years’ experience to work as a manager in a renowned
Australian restaurant.
OwnerandsupervisorChefsCounterManagerTableattendentsAccountantandMarketing

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2.6. Key personnel
Current staff
Job Title Name Expected staff
turnover
Skills or strengths
Accounting and
marketing
manager
Stefen
King
[12-20 months] Qualifications in accounting and five
years of experience as marketing
manager
Head chef Brantley
Hoopers
[10-15 months] Qualification in hotel management
with 4 years of experience as chef
Counter manager Chris
Hooper
[9-20 months] Qualifications in accountancy with 3
years of experience as an accountant
Table attendants Rimi
Sanon
[12-18 months] Graduate in hotel management with 1
year experience as table attendant
Required staff
Job Title Quantity Expected
staff
turnover
Skills necessary Date required
Table
attendants
[4] [2-3 years] [Relevant qualifications in
hotel management with at
least 2 years’ experience.]
[10thNovember
2018]
Recruitment options

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Deline Café will recruit its staff through employing three recruitment options such as
advertising on local newspapers, online advertising and through employee referral programs.
Training programs
New staff recruited for the new coffee shop will be trained through offering a training
manual, training them to interact with consumers and through trading them regarding the
ways in which the coffee shop works at different levels.
Skill retention strategies
Skill retention strategies that will be used by Deline Café includes hiring retainable
employees, assigning work to employees that is suitable to their skills and by investing in line
managers.
2.7. Products/services
Product/Service Description Price
Gourmet Freshly brewed with cream [$10]
Sandwiches Will contain baked chicken and seasonings [$10]
Espresso Coffee with chocolate drizzling’s [$10]
Pastries With chocolate and lemon flavours [$10]
Market position: In comparison to its competitors, the products will be high end with
exceptional quality.
Unique selling position: Sustainably sourced and prepared with finest quality coffee
beans with free addition of flavors based on consumer’s demand.

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Anticipated demand: The demand for the coffee shop’s coffee beverages is deemed
to increase by 15% and food products by 20% at the end of the first year.
Pricing strategy: The new coffee shop will develop premium pricing strategy that
will justify the quality of its products.
Value to customer: The target consumers will perceive the company’s products as
luxurious and premium that can provide them superior experience of enjoying coffee of great
taste.
Growth potential: Increasing demands of espresso and gourmet coffee in Melbourne
will increase the growth of its coffee products in the upcoming years.
2.8. Innovation
Research & development (R&D)/innovation activities
Products and coffee brewing techniques will be innovated regularly for coming up
with innovative food products and new machineries in order to make coffee beverages of
better quality.
Intellectual property strategy
Deline Café will register its trademark for the company name and logo that will
provide the coffee shop with protection from risk of imitation without permission.
2.9. Insurance
Workers compensation: Deline Café will attain worker’s compensation insurance
through which it will make sure to offer wage replacement and medical benefits in case
employees are injured.

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Product liability: Deline Café will attain product liability insurance to safeguard the
business from damage or injury claims arising from its products.
Business assets: Deline Café will attain business assets insurance that will protect
assets of the new business including burglary cover and business interruption.
Business revenue: Deline Café will attain business interruption insurance that will
cover income loss of the business that is caused by disaster related business closure.
2.10. Risk management
Risk Likelihood Impact Strategy
Operational risk likely Medium Effective management must
be maintained along with
having effective quality
control and consumer
service.
Financial risk Likely High Adequate capital must be
maintained to pay owners
living expenses till the
business attains a profit
Market risk Likely High Market risks can be
managed through carrying
out market analysis that can
facilitate in determining
market potential

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Risk Likelihood Impact Strategy
Reputational risk Highly likely Low This risk might be mitigated
by rapid damage control
measures through social
media networks
2.11. Legal considerations
The licenses and permits that will be registered for the new coffee shop business are
registration with ABN, attaining licenses for hospitality service and food handlers permit. The
new coffee shop will follow legal regulations regarding consumer laws and employee benefit
laws.
2.12. Operations
Production process
The coffee beverages, sandwiches and pastries will be prepared in front of the
consumers as per their likings. High quality brewing machines will be used for preparing
superior tasting coffee.
Suppliers
Deline Café will have suppliers of coffee beans and other raw materials for food.
Manufacturers of milk products will also be the suppliers of the new coffee shop.
Plant & equipment
Plant and equipment of the company will include computers, sofas, furniture’s and
building on lease.

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Equipment Purchase date Purchase
price
Running
cost
Computer 10th October
2018
$2100 $90 a
month
Furniture’s 10th November
2018
$1100 $100 a
month
Building 10th December
2018
$3000 $100 a
month
Inventory
Inventory item Unit price Quantity in stock Total cost
Flour $5.00kg Five kilograms $25
Coffee beans $4.00kg Four kilograms $22
Milk $3.00kg Two kilograms $20
Technology (Software): Point of sale technology and accounting sales software will
be used by Deline Cafe
Trading hours: The coffee shop will be open from 10 am to 8pm every day. During
the peak season when the universities will be open the Café is deemed to attain high
profitability. During lean season when the university will be closed and the cafe it is expected
to have fewer profits.
Communication channels: Consumers will be able to communicate with Deline Café
through social media, websites and through their contact number.

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Payment types accepted: Deline Café will accept payment types such as cash, credit
cards, PayPal and gift cards
Credit policy: Collection through staffs and agents and bank overdraft will be the
credit policy of Deline Café. Through employing these policies, the coffee shop will gather
money from consumers and suppliers.
Quality control: Process control quality measure will be employed by Deline Café in
making sure that product preparation quality is maintained. ISO 9001 standard will be
employed by the coffee shop in ensuring its product quality.
2.13. Sustainability plan
Environmental/resource impacts
Deline Café can face the environmental impacts of disposable cups. The coffee shop
can decrease such negative impact on the environment through developing good recycle
solution for cups.
Community impact & engagement
In decreasing the local impact of the new coffee shop’s coffee products, Deline Cafe
will design, build operate the shop through sourcing sustainable products and organic coffee.
Risks/constraints
Climate changes in Melbourne can impact the products of the café that will be offered
to its consumers as their quality might get hampered. To maintain the health benefits of the
products the company will improve its coffee restriction and preparing strategies.
Strategies

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Deline Café has developed sustainable strategy of collaborating with Cocoa
Foundation in order to maintain ethical coffee sourcing. Moreover, it will also develop
strategy of using responsible building materials along with energy efficient resources.
Action plan
Sustainability milestone Target Target date
Ethical sourcing of coffee [20% reduction] [5th July 2018]
Reduce water wastage [30% reduction] 5th August 2018
Reduce energy wastage [40% reduction] 5th October
2018
Waste reduction [25% reduction] 5th December
2018
3. The Market
3.1. Market research
Questionnaire survey technique will be employed by Deline Café in carrying out the
market research before commencing the new coffee shop business. The questionnaire will
investigate the consumer preferences and intensity of competition within the market (Stark
2015).
3.2. Market targets
Cost of beverages and foods is deemed to be 20%. Proximity to university campus
will indicate the seasonable of sales and revenue might decrease slightly. Sales of the new

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coffee shop’s beverages is estimated to increase by 10% and for pastries and snacks sales is
anticipated to increase by 15% at the end of first year.
3.3. Environmental/industry analysis
Gourmet coffee consumption in Melbourne is observed to attain steady increase.
Consumers here are generating increased liking for great tasting coffee and relaxing
environment. Due to outgoing populace in Melbourne and along with long rainy winter, the
location has been traditionally an excellent place for coffee establishment. For this reason,
there is an increased opportunity for the new coffee shop in developing a loyal consumer base
through offering quality coffee beverages as per the likings of target consumers.
3.4. Target customers
Customer demographics
The target consumers prefer enjoying better tasting coffee that belongs to every age
group. These consumers include men, women and children of all age group. As Deline Café
will mostly offer beverages and food products in high quality and premium prices, consumers
of high income group will be targeted.
Key customers
The target market of Deline Café includes consumers those prefer gourmet coffee
along with enjoying exotic and unique coffee flavors. The company offers variety of coffee
beverages as per the demands of the target market. However, the coffee shop will be situated
beside a university majority of its consumers will be students and faculty.

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Customer management
To grab attention of huge consumer base, Deline Café will develop additional quality
factors within the coffee shop. These factors include small indulgencies for something highly
exotic and exceptional along with offering effective selling opportunities for coffee shops.
3.4. S.W.O.T. analysis
Strengths
 The target consumers are the young
generation
 Including variety within the menu
 Excellent quality of coffee
 The company will provide frequent offers
Weaknesses
 The products offered will be a bit
expensive
 Existence of several established
competitors such as CCD and Barista
 The menu offered is not innovative
Opportunities
 Expanding business in smaller cities and
towns
 Introduction of new variances in the
beverages
 Introducing affordable options
Threats
 Increased competition from local and
established cafes
3.5. Competitors
For attaining a competitive edge, Deline Café will position itself as an exceptional
coffee shop in which its consumers can enjoy freshly brewed coffee along with comfortable
sofas and relaxing environment. This will differentiate the café from its competitors.

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Competitor details
Competit
or
Establis
hed
date
Size Marke
t share
(%)
Value to
customers
Strengths Weaknesses
CCD In the
year
1996
The
compan
y has
10,000
employ
ees and
turnove
r of
4429
million
in the
year
2017.
The
compa
ny has
market
share
of
35%.
Offers a
range of
coffee
beverages
that is
innovative
flavours
Huge teenager
consumers as
target group
Less
diversification
in food menu

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Competit
or
Establis
hed
date
Size Marke
t share
(%)
Value to
customers
Strengths Weaknesses
Barista In the
year
2000
The
compan
y has
12,000
employ
ees and
turnove
r of
3665
million
in the
year
2017.
The
compa
ny has
market
share
of 20%
Excellent
Arabia and
Italian
coffee at
high value
prices
Strong brand
name and
increased brand
visibility
Perceived as a
premium brand

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Competit
or
Establis
hed
date
Size Marke
t share
(%)
Value to
customers
Strengths Weaknesses
Starbucks In the
year
1971
The
compan
y has
25000
employ
ees and
turnove
r of
6566
million
in the
year
2017.
The
compa
ny has
market
share
of 25%
Offers
excellent
gourmet
coffee in
better
surroundin
gs
Efficient human
resource with
good ambiance
and decor
There is a
threat from
other coffee
shops

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Competit
or
Establis
hed
date
Size Marke
t share
(%)
Value to
customers
Strengths Weaknesses
Frespress
o
In the
year
2011
The
compan
y has
21000
employ
ees and
turnove
r of
3600
million
in the
year
2017.
The
compa
ny has
market
share
of 30%
Great
tasting
Italian
coffee at
high value
prices
Strong brand
name and
increased brand
visibility
Perceived as an
expensive
brand

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Competit
or
Establis
hed
date
Size Marke
t share
(%)
Value to
customers
Strengths Weaknesses
Coffee
World
In the
year
2012
The
compan
y has
10000
employ
ee and
turnove
r of
1200
million
in the
year
2017
(Van
Der, et
al.,
2016).
The
compa
ny has
market
share
of 38%
High
popularity
and brand
recall
among
young
population
Loyalty
programs to
attract
consumers
Lesser
beverage
options
3.6. Advertising & sales
Advertising & promotional strategy

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Planned promotion
/advertising type
Expected business improvement Cost
($)
Target
date
Website and social media Increased visibility among consumers
that can boost the chances of consumer
demand
[
$1500]
[10th
October
2018r]
Promotion of local
newspaper
Increased consumer reach that can
promote the brand among locals
[
$1200]
[10th
Novemb
er 2018]
Sales & marketing objectives
The sales team of Devine Café will include the marketing team, wholesalers and the
counter sellers. The sales team has an objective to attain increase in sales percentage of 10%
at the end of the first year. The selling strategies that will be used by the coffee shop includes
offering free postcards with endorsement that will be printed for increasing company visibility
among target consumers.
Unique selling position
For attaining a competitive edge, Deline Café will position itself as an exceptional
coffee shop in which its consumers can enjoy freshly brewed coffee along with comfortable
sofas and relaxing environment. This will differentiate the café from its competitors. Regular
innovative products and discounts will facilitate the coffee shop in maintaining a competitive
position.
Sales & distribution channels

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Channel type Products/
services
Percentage
of sales
(%)
Advantages Disadvantages
Shopfront Coffee
beverages,
pastries and
sandwiches
80% Through visiting the
shop the consumers
can attain high
chance to inspect the
food they purchase
regarding quality
It might be
extremely tiring for
the consumers to
visit the shop just to
have some coffee.
Wholesale Organic coffee
beans and
powder
20% Distribution through
this channel is much
cheaper as there is
no rent to pay like
counter stores
Certain products
might have
increased prices in
comparison to
physical stores
because of high
delivery charges.
4. The Future
4.1. Vision statement
Deline Café will have a vision in generating an exceptional place where the customers
might socialize with others in a relaxing and comfortable surroundings. The café will have an
intention to make people enjoy freshly brewed espresso and coffee in the town.

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4.2. Mission statement
The mission statement developed by Deline Café will be focused on attaining vision
of the new coffee shop. These mission statements integral to the success of the new coffee
shop’s business are:
 Product mission- To offer consumers with superior quality beverage within the
definite time
 Community mission- To offer community support by increased consumer
involvement
 Economic mission- Operate and develop a profitable rate by taking effective
economic decisions
4.3. Goals/objectives
Deline Café has set certain short and long term objectives that it considers to address in
the first year of the business:
 Maintaining a gross margin of 65% will be a long term objective of the cafe
 Attaining profits from the initial month of the business operations will be a short term
objective of the cafe
 To position itself as the “best new coffee shop in the locality” will be a long term
objective of the cafe

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4.4. Action plan
Milestone Date of
expected
completion
Person
responsible
Structuring the new coffee shop along with
responsibility of every working employee are
explained
01/04/1
8
James Polk
Registration of the new business will be done with
the suitable authority
03/04/1
8
Todd Megan
Gathering fund for the business that will be
gathered from the bank
11/04/1
8
Todd Megan
The appropriate location must be selected for the
business
16/04/1
8
James Polk
The organization’s logo along with the brands are
chosen
21/04/1
8
James Polk
The online marketing along with advertising
campaign will be developed
23/04/1
8
Todd Megan
5. The Finances
5.1. Key objectives & financial review
Financial objectives
The financial objectives of Deline Café are mentioned under:

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 Increasing revenue by 10% in the first year of its business is the major financial
objective
 Increase return on investment by 5% in the initial year of this new business
 Increasing sales by 5% at the end of the first year is another major financial objective
of Deline Cafe
Finance required
The new coffee shop will attain funds through obtaining loan of $ 230, 000 from the
bank. Deline Café expects 65% gross profit margin and anticipates that its net profit will grow
from $507,304 to $ 666, 672 in two years.
5.2. Assumptions
Certain assumptions are made for attaining better financial results for the company
and these are explained below:
 The rate of tax is assumed to be 11% for that is the standard tax rate in Australia
 In the first three months the consumers are anticipated to visit the coffee shop will
increase to 500
 The loan will be paid at rate of interest of 2.47% on the amount of $230,000
 5.3. Start-up costs for the Year
The new coffee shop will attain funds through obtaining loan of $ 230,000 from the
bank.
Initial investment:

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5.4. Balance sheet forecast

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5.5. Profit and loss forecast

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5.6. Expected cash flow
5.7. Break-even analysis
5.8. Supporting documentation
Questionnaire:

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1. Tick your gender:
 Male
 Female
2. Tick your age group:
 Below 18 years
 18-25 years
 26-35 years
 36-45 years
 46 years and above
3. What is your monthly income?
 Below $3,000
 $3,001 - $5,000
 $5,001 - $7,500
 $7,501 - $9,000
 $9,000 and above
4. How often do you visit a coffee shop?
 Once a week
 Twice a week
 Once a month
 Twice a month
 Once in two months
5. Which criteria is most significant for you when you visit a coffee shop?