Analysis of Financial Ratio and Business Planning

The assignment provides a detailed analysis of financial ratio and business planning, including topics such as entrepreneurs' talent, temperament, and opportunity, production and operations management, corporate strategy function, and effective strategy implementation. The document also includes case studies and tools for decision making, risk assessment, and feasibility studies.

BUSINESS PLAN
EVALUATION

TABLE OF CONTENTS
Section 1: Executive summary.........................................................................................................1
1.1 Business ideas and goal....................................................................................................1
1.2 Market...............................................................................................................................1
1.3 Operation..........................................................................................................................1
1.4 Finance.............................................................................................................................1
Section 2: Background.....................................................................................................................2
2.1 Mission statement.............................................................................................................2
2.2 Business goals..................................................................................................................2
Section 3: Marketing........................................................................................................................2
3.1 Marketing research..........................................................................................................2
3.2 Market analysis.................................................................................................................3
3.3 Marketing plan..................................................................................................................3
3.3.1 Product or service and target market........................................................................3
3.3.2 Promotion and advertisement...................................................................................3
3.3.3 I C T marketing strategy...........................................................................................3
3.3.4 Pricing policies.........................................................................................................4
3.4 Evaluation of marketing...................................................................................................4
Section 4: Operations.......................................................................................................................4
4.1 Legal and licensing requirements.....................................................................................4
4.2 Management details..........................................................................................................4
4.3 Organisation structure and staffing..................................................................................5
4.4 Professional advisers........................................................................................................5
4.5 Insurance and security issue.............................................................................................5
4.6 Business premises.............................................................................................................5
4.7 Equipment required..........................................................................................................6
4.8 Production process............................................................................................................6
4.9 I C T and critical risk or contingency plans.....................................................................6
Section 5: Financial Projections.......................................................................................................6
5.1 Basic assumptions and information..................................................................................6
5.2 Analysis of financial forecasts..........................................................................................6

5.2.1 Sales mix forecast.....................................................................................................6
5.2.2 Cash flow forecast....................................................................................................7
5.2.3 Project profit and loss statement...............................................................................7
5.2.4 Owner's personal expenses.......................................................................................7
5.2.5 Owner's personal assets and liabilities......................................................................8
REFERENCES................................................................................................................................9

Section 1 Executive Summary
Tetsuya restaurant is considered as one of the popular hospitality provider of Sydnay. The
organisation is providing services by considering their heritage and tradition. It helps in
influencing customers and also provides unique image into market. Along with this they are also
promoting the Japanese culture across the world. With the help of this business concept they are
able to get competitive advantage into the market. They are offering degustation menu to their
customers, which is based on the nature and seasonal flavour of the company. The goal of the
company is to expand their business across the world and also promote their tradition and
culture. In order to expand their services company is launching multiple cuisines such British,
Indian, Italian through mobile van home delivery services. To promote their product they are
considering social media and digital advertising platform, such as social media, etc. in this
process user is able to place their order through mobile apps, on the basis of their booking the
hotel authority is delivery services at home. Through this they are providing flexibility to their
customers. Along with this they are providing the option of cash on delivery, which helps is
attracting maximum number of customers. They are providing various offers for promoting their
services and attracting large amount of users. In this process the strong brand image of the
company is creating positive impact. It helps in covering large area in small duration of time.
Along with this effectively present their message among customers. During this process they are
considering various operations such as developing strategies for targeting audience. It helps in
expanding their business and provides strong brand value into the market. On the basis of that it
is analysed that company is able to launch their service effectively into the market and able to
attract huge crowd.
Section 2 Background
Tetsuya is located at Sydney. Cited firm aim at understanding the needs and requirement of
customers and deliver high quality services. All the chef that are included in the restaurant are
high skilled and professional. Further, there are different type of awards that are provided by
cited firm. The reasons for providing awards are for the high quality services that are delivered to
customers. Further, they focus on understanding the needs and requirement of customers and as
per the findings made improvements are made in the type of services that are delivered. As per
the business plan that is to be developed, they are planning to deliver online services to
customers. This is an effective way with the help of which better services can be delivered and
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the rate of satisfaction can also be raised. For this they are considering internet platform. They
are offering services with the help of mobile apps, accepting orders and providing home
delivering. In this process option of cash on delivery is influencing customers at great extend and
helps the company in expanding their services. During whole process strong company image
helps in promotional activity and attract maximum customers.
Section 3: Marketing
3.1 Marketing Research
Marketing research is the set of process which consists of various opportunities, current
problems future market and potential customers regarding to the marketing of the existing
products, for this it the responsibilities of an entrepreneur to search for all aspects for carrying
out their business operation more effectively (Allen, 2012). After searching all these aspects
entrepreneur and their business will be able to gain their sale and in the establishing of the new
business entrepreneur have to search for the market where he wants to open their business. In
this Tetsuya Restaurant had searched for their potential market and work accordingly to start up
their business restaurant in their desired location.
3.2 Market analysis
Analysing of the potential growing market is the most crucial part for starting up of new
business strategies which contains the analysis of the dynamic environment of the business and
all the other factors which are plays an importance in the functioning of business. Marketing
analysis also consists of the procedures and which are responsible to carry out the business more
smoothly and efficiently. In order for the success of Tetsuya restaurant, an entrepreneur have to
analyse their market more carefully which will enable them in the making of strategies and plan
in accordance for the success of their business. In this entrepreneur can perform SWOT analysis
in order for the development of their knowledge about their toward their strengths and
weaknesses in business.
3.3 Marketing plan
In order to over come the market condition and to develop their profit in Restaurant,
Tetsuya has developed some marketing plan which included introduction of new Cuisines and
upgraded their delivering process (Allio and Randall, 2010). The marking plan consists of the
four P's which should be kept in mind by the entrepreneur while forming their plans.
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3.3.1 Products or services and targeted market
The market plan consist of the market place or the market in which an entrepreneur wants
to establish his restaurant and other products and services he wants to deliver to their costumes
(Araujo, Finch and Kjellberg, 2010). In this context Tetsuya restaurant has introduced new
Cuisines in their menu which are Indian, Mexican, Italian, Inter-Continental and Chinese. The
restaurant had also started their home delivering services with the help of their mobile van.
3.3.2 Promotion and advertisement
The promotion and the advertising put very powerful impact on the increase in sale rate
of any of the company, in relation to this Tetsuya restaurant is continuously promoting their
products and services for the development of their restaurant (Babalola and Abiola, 2013). As it
is very important for an entrepreneur to popularise and promote their set up, in this they can also
use other sources of the promotion such as social media, street hoardings and others. For the
promotion of tetsuya restaurant entrepreneur should focus on to use such promotional activities
which covers large area and affordable.
3.3.3 Pricing policies
The policies for the pricing of Tetsuya restaurant should be in such manner that it will
provide more profit to the restaurant and their prising should be in such way that it will attract
more customers towards their restaurant as compared to their rival firms (Bamford and Forrester,
2015). Tetsuya can also provide affordable pricing in their home delivery van services which
will act as the main source of the income for the restaurant.
3.4 Evaluation in the marketing
Evaluation consists of the development in the strategies and plans which the Tetsuya
restaurant is applying in the marketing plan for the better and smooth running of their restaurant
(Bolton, 2013). It is very much important for the business to modify according to the time and
acceptance of new marketing plan which will provide new and upgraded ideas in order for the
further development of the business activities.
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Section 4 Operations
4.1 Legal and licensing Requirements
(A) Business name and Legal structure
For expanding the business into some other areas there will be requirement of
legalization and licensing in the country. Tetsuya’s Restaurant is a unique hotel which is based
on the Japanese belief. The company is already established in Sydney's and is registered to the
world's renowned chef Tetsuya Wakuda. Complete shareholder of the company is under him and
he serve their as chief chef.
(B) Structure, Operating laws and licensing
The organization has taken all the licence which are required to operate the business in
Sydney. They have adopted simple structure for the business operation which is based on the
ethics and cultural values of the Japan. They have taken permission from all the legal authorities
which are there in Australia. Moreover, they are paying all the taxes at regular intervals. There
are having their own Australian Business Number and paying taxes such as Goods, Services and
Payroll Tax. They are also having Tax file number which is required to pay the tax. All the legal
formalities related to the place, location, trade, business-type and finance are maintained by
them. Being a restaurant business they follow all the hospitality rules and regulation.
4.2 Management details
The managing director of the new plan will be Robert Robertson
Home address: 45, Dekin markus, Sydney NSW 3000
Ph: (564)456464 Fax: [phone]
Date of Birth: 19 April 1984
Qualification: Masters in Business
Experience: Served the same restaurant from past 20years.
He is also management consultant of Darren Robertson, Luke Powell
(Professional Chef in Australia)
4.3 Organizational structure and staffing
These are the task which will be accomplished by the managing directors:
 All the details required new expansion will be consulted through him.
 He will provide the training to new staff.
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 He will be head of the Serving broad of directors.
 Moreover, marketing and public feedbacks will be accessed by him.
Managing directors: For expanding the business through new ways business consultant is
required. They will make planning, monitoring and will provide the training and development
plan. Moreover, they will be part of the business decision, strategic planning and other
administration services. They will receive salary as per industrial standards.
Training: Training to the new applicants will be provided for every 20 hours per week. More
focus on the hospitality, ethical and corporate social responsibilities will be given.
Driver and delivery providers: New members will be required in this areas. Person should be
able to drive and deliver the product at the accurate address within time limit. He must have
driving licence and should be aware about the local areas. Salary as per industrial basis.
4.4 Professional Advisers
For expanding any part in the business there is requirement of the professional advisor. They
help to identify the key areas and reduces the losses on investments (Bowhill, 2008). In the
current expansion people required are accountant, lawyer, Partners, financial supporters,
Insurance broker, manager and sales person for the vehicles.
All the details will be maintained by the managing director and without their decision further
steps will not be followed.
4.5 Insurance and security issues
For expanding the business following insurance and licence are required such as Public
liability and Professional indemnity. Further, details like the emergency supply like first aid kit
and number so police station, ambulance and fire department should be there. Moreover, security
plan must be made and safety must be maintained. Insurance of the vehicles and other employees
must be there. All the security issues should be maintained under the Australia’s Privacy Act of
1988, Corporations Act 2001. Further, security from the cyber crimes need to be insured by the
company.
4.6 Business premises
It helps to decide up to which areas business must be expanded or run. There are various types of
premises but for the following case permanent details are required. In this all the taxes which
company needs to pay must be maintained and evaluated. Business areas and up to which
reguion in Australia will be operated for that permission must be taken.
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4.7 Equipment required
New Vehicles and other devices related to it are required by the company. Moreover,
other automotive and material for the food deliver will be required such as packets, poly bags
etc. Other than this more products will be required to make the dishes.
4.8 Production Process
All the foods will be made by the professional chef, then it will be packed and delivered b
the suppliers. The production process will be manage by the Tetsuya.
4.9 Information and communication technologies
There are important part of for business expansion. In this modern technologies and
techniques will be used for the information sharing and communication( Brunsman, DeVore, and
Houston, 2011). A separate staff will be there for maintaining the related activities.
4.10 Critical risk and contingency plans
The managing director is required to evaluate all the details which are necessary for
minimizing the risk and prepare contingency plan for the betterment of the new plan.
Section 5 Financial Projections
5.1 Basic assumption and information
Some of assumptions that are taken in to account for making projections are as follows.
 It is expected that on yearly basis sales will increase by 25% on yearly basis.
 Expenses percentage of sales revenue will remain same across all years.
 Number of customers in initial months will increase by 5% and then this rate will
increase at fast rate.
5.2 Analysis of financials forecasts
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5.2.1 Sales mix forecast
Table 1Sales mix forecast
Revenue
per
person
Feb
ruar
y
Ma
rch
Ap
ril
Ma
y
Jun
e July
Aug
ust
Sept
emb
er
Octo
ber
Nov
emb
er
Dece
mbe
r
Janu
ary Total
British
180
0
22
50
29
25
32
17.
5
434
3.6
25
477
7.98
75
479
1.48
75
5270
.636
25
5797
.699
88
7247
.124
84
7262
.624
84
1089
3.93
73
6057
7.62
31
Indian
280
0
28
23
28
46
28
70
387
4.5
390
0.5
392
7.5
3955
.5
3984
.5
5578
.3
5609
.3
8413
.95
5058
3.05
Mexican
180
0
18
13.
8
18
27.
6
18
42
248
6.7
250
2.3
251
8.5
2535
.3
2552
.7
3573
.78
3592
.38
5388
.57
3243
3.63
Chinese
500
0
50
28.
75
50
57.
5
50
87.
5
686
8.1
25
690
0.62
5
693
4.37
5
6969
.375
7005
.625
9807
.875
9846
.625
1476
9.93
75
8927
6.31
25
Interconti
nental
324
0
32
60.
7
32
81.
4
33
02.
1
445
7.8
35
447
8.53
5
449
9.23
5
4519
.935
4540
.635
6356
.889
6377
.589
9566
.383
5
5788
1.23
65
Revenue
146
40
15
17
6
15
93
8
16
31
9
220
31
225
60
226
71
2325
1
2388
1
3256
4
3268
9
4903
3
2907
52
Table 2Sales mix forecast
Revenue
per
person
Feb
ruar
y
Ma
rch
Ap
ril
Ma
y
Jun
e July
Aug
ust
Sept
emb
er
Octo
ber
Nov
emb
er
Dece
mbe
r
Janu
ary Total
British
180
0
22
50
29
25
32
17.
5
434
3.6
25
477
7.98
75
479
1.48
75
5270
.636
25
5797
.699
88
7247
.124
84
7262
.624
84
1089
3.93
73
6057
7.62
31
Indian
280
0
28
23
28
46
28
70
387
4.5
390
0.5
392
7.5
3955
.5
3984
.5
5578
.3
5609
.3
8413
.95
5058
3.05
Mexican
180
0
18
13.
8
18
27.
6
18
42
248
6.7
250
2.3
251
8.5
2535
.3
2552
.7
3573
.78
3592
.38
5388
.57
3243
3.63
Chinese
500
0
50
28.
75
50
57.
5
50
87.
5
686
8.1
25
690
0.62
5
693
4.37
5
6969
.375
7005
.625
9807
.875
9846
.625
1476
9.93
75
8927
6.31
25
Interconti
nental
324
0
32
60.
7
32
81.
4
33
02.
1
445
7.8
35
447
8.53
5
449
9.23
5
4519
.935
4540
.635
6356
.889
6377
.589
9566
.383
5
5788
1.23
65
Revenue
146
40
15
17
6
15
93
8
16
31
9
220
31
225
60
226
71
2325
1
2388
1
3256
4
3268
9
4903
3
2907
52
7

Expenses
Aug
ust
Sept
emb
er
Octo
ber
Nov
emb
er
Dec
emb
er
Jan
uary
Febr
uary
Mar
ch
Apri
l May
Jun
e July
Marketing
expenses 200 200 200 200 200 200 200 200 200 200 200 200
Administratio
n expenses 600 600 600 600 600 600 600 600 600 600 600 600
Finance cost
166.
666
667
166.
666
667
166.
6666
667
166.
666
667
166.
666
667
166.
666
667
166.
666
667
166.
666
667
166.
666
667
166.
666
667
166.
666
667
166.
6666
67
Salary and
wages
200
00
200
00
2000
0
200
00
200
00
200
00
200
00
200
00
200
00
200
00
200
00
2000
0
Depreciation 325 325 325 325 325 325 325 325 325 325 325 325
Premilinary
expenses
written off 650 650 650 650 650 650 650 650 650 650 650 650
Other
operaitng
expenses
100
0
100
0 1000
100
0
100
0
100
0
100
0
100
0
100
0
100
0
100
0 1000
Sum of
expenses
229
41.6
667
229
42
2294
2
229
42
229
42
229
42
229
42
229
42
229
42
229
42
229
42
2294
2
Net month
profit
-
830
2
-
776
5
-
7004
-
662
3 -911 -382 -271 309 939
962
2
974
7
2609
1
5.2.2 Cash flow forecast
Table Cash flow forecast
Au
gus
t
Sept
emb
er
Oct
obe
r
Nov
emb
er
Dec
emb
er
Jan
uar
y
Feb
ruar
y
Ma
rch
Apr
il
Ma
y
Jun
e July
Opening
balance
200
00
2228
6.7
251
08.
6
2869
0.8
326
53.5
423
27
525
28.
6
628
40.
3
737
30.
8
852
50.
6
105
452
125
777
Sales
146
40
1517
6.3
159
37.
5
1631
9.1
220
30.8
225
59.
9
226
71.
1
232
50.
7
238
81.
2
325
64
326
88.
5
490
32.
8
Total
346
40
3746
2.9
410
46.
1
4500
9.9
546
84.3
648
86.
9
751
99.
7
860
91.
1
976
11.
9
117
815
138
141
174
810
Expense
Marketing
expenses 160 160 160 160 160 160 160 160 160 160 160 160
Administration 480 480 480 480 480 480 480 480 480 480 480 480
8

expenses
Finance cost
133
.33
3
133.
333
133
.33
3
133.
333
133.
333
133
.33
3
133
.33
3
133
.33
3
133
.33
3
133
.33
3
133
.33
3
133
.33
3
Salary and
wages
100
00
1000
1
100
02
1000
3
100
04
100
05
100
06
100
07
100
08
100
09
100
10
100
11
Depreciation 260 260 260 260 260 260 260 260 260 260 260 260
Premilinary
expenses
written off 520 520 520 520 520 520 520 520 520 520 520 520
Other
operaitng
expenses 800 800 800 800 800 800 800 800 800 800 800 800
Sum of
expenses
123
53.3
3
1235
4.33
123
55.3
3
1235
6.33
1235
7.33
123
58.3
3
123
59.3
3
123
60.3
3
123
61.3
3
123
62.3
3
123
63.3
3
123
64.3
3
Net balance
222
86.6
7
2510
8.58
286
90.7
5
3265
3.52
4232
6.97
525
28.5
8
628
40.3
5
737
30.7
6
852
50.5
9
105
452.
2
125
777.
4
162
445.
9
5.2.3 Projected statement
Table projected income statement
2017 2018 2019 2020 2021
Revenue 290752 436128 545160 681450 851812
Less: Cost of goods sold 116301 13197 16496 20620 25775
Gross profit 174451 422931 528664 660830 826037
Expenses
Marketing expenses 2400 4061 5076 6345 7931
Administration expenses 7200 12182 15227 19034 23792
Finance cost 2000 3384 4230 5287 6609
Salary and wages 240000 276000 317400 365010 419762
Depreciation 3900 6598 8248 10310 12887
Other operaitng expenses 12000 65419 81774 102217 127772
Sum of expenses 267500 367643 431954 508203 598753
PBIT -93049 55288 96709 152627 227284
Tax 0 11058 19342 30525 45457
Net profit -93049 44230 77368 122101 181828
5.2.4 Owner personal expenses and income statement
Table 3 Owner balance sheet
Assets
9

Own house 700000
Other real estate 30000
Motor vehicle 7000
Cash in hand 26000
Furniture 30000
Total assets 793000
Liability
Outstanding mortgage 100000
Persoanl loans 30000
Current bills 1500
Other debts 0
Total liability 131500
Networth 661500
5.2.5 Owner Expenses.
Table 4 Owner expenses
Monthly expenses
Food 4800
Health 1000
Cloths 5000
Entertainment 700
Credit cards 100000
Other 5000
Total 116500
Evaluation from the above financials details
On evaluation of forecasted statements, it can be observed that in first year loss is made but then
good amount of profit is earned in the business. This reflects that business idea is viable in
nature. On analysis of budget, it can be observed that cash flow are increasing consistently in the
business. In table of sales mix forecast it can be observed that number of customers are
increasing consistently which means that business idea is viable in nature.
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