Business Plan for Coffee Shop in UK

This business plan is developed for a coffee shop in the UK that offers a combination of coffee drinks and bakery food items. The plan includes an overview of the business idea, target customers, market and competition analysis, PEST and Porter's five force analysis, SWOT analysis, marketing and sales plan, operational plan, and backup plan.

Business Plan

Table of Contents
INTRODUCTION...........................................................................................................................3
Overview of business idea...............................................................................................................3
Target Customers.............................................................................................................................3
Market and competition...................................................................................................................4
PEST.......................................................................................................................................4
Porters five force analysis......................................................................................................4
SWOT..............................................................................................................................................6
SWOT analysis.......................................................................................................................6
Marketing and sales plan.................................................................................................................7
Operational plan...............................................................................................................................7
Backup plan.....................................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................8

INTRODUCTION
Business plan is considered an blueprint of a new concept, idea or business. It is also
identified as the effective practice that is used by business organisation at the time of introducing
any new product or service at marketplace. The current project is based on business plan for
coffee shop which will be opening in UK. The proposed business plan is composite of bakery
and cafe. This means that this cafe will going to offers food products belonging to both the
segments such as coffee as well as bakery products. This coffee shop will be introduced in UK
with name of “Mugs Coffee and Bakery House” House in London, UK. This report will include
in depth discussion on basic concept of the business idea, evaluation of external environment,
competition, targeted market for the business plan etc.
Overview of business idea
This business plan is developed with the idea of serving customers with high quality of
food items and drinks in the coffee house. The uniqueness of this coffee house will be
composition of coffee drinks and bakery food items. In this, host will offer baked food products
like cookies, breads, pies, cakes, range of coffee flavours, snacks and other items falls into the
same category. In this Mugs Coffee and Bakery House, customers will also given seating
facilities within the premises only. All the offering of Mugs Coffee and Bakery House, will be
offered to customers at nominal prices only.
The main influence of owner is to target youth as well tourists. In order to attract
maximum range of these customers location will be finalised at Mayfair. This place is quite
popular in UK where around thousands of people visits the same place. Mugs Coffee and Bakery
House will also provide party space to its customers where they can easily enjoy and celebrate
with their friend circle. This will work as the opportunity for the cafe as the respective cafe will
be able to attract maximum number of visitors with its unique services in rightful manner.
Target Customers
Mugs Coffee and Bakery House has targetted the customers on a number of
demographical basis. These are acknowledged to be age, gender, income, types and target
regions. The description and justification of target customer segments for the upcoming venture
are given as follows:-

Element Selected customer
segment
Justification
Age 18-30 years This age group is quite attracted to cafe and bakery
items. Thus, the decision to target this segment is
justified.
Gender Males and females Males and females, both are attracted towards fast
food and bakery items and looking upon this, Mugs
Coffee and Bakery House would be targetting both
the genders.
Income £10000-25000 The individuals belonging to this income group are
targetted as the products of the bakery cafe are
affordable.
Types Individuals and
businesses
Business class persons need a soothing atmosphere
for meetings and get together. Further, individuals
find bakery cafe an attractive place to relax and
chill.
Target Region Local The venture would be targetting customers within
the confines of London, United Kingdom.
Market and competition
PEST
Political: Political stability of UK is strong which develops opportunity for Mugs Coffee
and Bakery House as they are able to make to use of strong policies and establish their business
effectively at marketplace without facing an sort of error. Regulation of associated to hygiene,
food quality, wages etc. are required to complied by Mugs Coffee and Bakery House for
establishing their business successfully in UK.
Economical: BREXIT has resulted in increasing influence if recession within the UK.
This has impacted negatively on the Cafe industry because spending power of customers in their

eating habits has also been declined. This becomes major threat for Mugs Coffee and Bakery
House as the company might not attention of their targeted customers.
Social: Changing taste and preference to customers in their eating habit can be seen as
the negative influence of social factor for Mugs Coffee and Bakery House. It can be said the
company is required to bring lots of innovations in their offering along with the healthy quality
food so that they can easily attract customers towards them for longer period of time.
Technological: UK is technological advanced nation, this develops opportunity for Mugs
Coffee and Bakery House as it is able to make use of numerous of advance technological tool
that are helpful for them in attracting maximum number of customers towards them. This is
because; advance technology allows Mugs Coffee and Bakery House in delivering effective
customers services which ultimately results in enhancement of customers’ satisfaction towards
them. As a result, it influences their sales performance in positive manner which will also
increase its profitability as well.
Porters five force analysis
In order to develop understanding on the competition available in the same industry,
business manager of this proposed plan will make use of Porter's five force analysis in order to
develop their knowledge on the competitiveness within the industry. Analysis of this framework
is defined as below:
Threat of new entrants (High): Influence of this force within this sector is higher as
entry barriers within this industry are very low. This simply means that new companies can
easily enter into field and open up their business in the same that will directly increase
competition with affect their sales performance in negative manner. Along with this, requirement
of capital in this sector is quite nominal which works as the bonus point for new entrants. In
order to deal with this, Mugs Coffee and Bakery House will emphasise on offering high quality
food items to customers. They will focus on offering healthy bakery items and will serve it with
Tea or coffee to customers in order to develop their unique image among customers. With this
strategy, Mugs Coffee and Bakery House will face less affect from the new entrants.
Threat of substitutes (Low): Buying behaviour of customers could get changed with the
change in their own needs or requirement or entrance of any new trend at marketplace. Here,
customers mostly get attracted towards new products or differentiation product that could give
them higher level of satisfaction.

In context to Mugs Coffee and Bakery House, influence of this force is seen as quite
lower for them because they will be offering food item to customers with uniqueness. Along with
this, managers of the cafe will also provide complimentary services to customers that will work
influencing factor for them as according to current market situation there is no substitute
available for the same range of services. This depicts that Mugs Coffee and Bakery House can
easily gain competitive edge at that marketplace.
Rivalry among existing competitors (High): Competitiveness within Cafe sector is
relatively high it has numerous of companies who are leading the UK market and owes good
customers. The competitors for Mugs Coffee and Bakery House are Cafe Coffee Day, Greffs Plc,
Starbucks etc.
It can be said that main positive point for Mugs Coffee and Bakery House in this situation
is that the cafe will be offering separate party space to its customers that will attract maximum
range of customers especially health conscious people towards them. In order to develop their
own customer space, it will be required by them to adapt effective marketing strategies and
deliver quality services to customers in rightful manner.
Bargaining power of supplier (Low): Influence of this force for Mugs Coffee and
Bakery House is relatively low as there are numerous of supplier available for this company at
marketplace. If the chosen suppliers does not gets agrees to the given rate then Mugs Coffee and
Bakery House have option to move to another supplier.
Bargaining power of buyers (High): Bargaining power of buyer is always high for every
sector as if their customer does not get satisfactory products and services they will definitely
move to another shop. In order to develop strong customer base and attract maximum number of
customer manager of Mugs Coffee and Bakery House will ensure to offer healthy products to
customers and provide them quicker and quality services
SWOT
SWOT analysis
SWOT analysis is seen as the effective framework used for analysing core strength and
weakness of company along with the opportunities and threat for it at marketplace. In this, owner
of Mugs Coffee and Bakery House has conducted SWOT analysis in order to develop their
knowledge on probable strengths, weaknesses, opportunities and threats which would be

expected by them post launch of their proposed coffee house that is Mugs Coffee and Bakery
House in London, UK.
Particular Explanation
Strength The main strength for Mugs Coffee and Bakery House is its healthy offering
at lower prices to customers with the composite idea of bakery and coffee
shop. Healthy food with new concept will help them out in grabbing attention
of maximum number of customers belonging to localise and visitors
segments. Also, the respective company can also covert this support of
company into higher brand loyalty.
Weaknesses Existing bakeries and coffee house in London has strong customer base
which could be main drawback for this company at the time of its expansion.
In order to reduce influence of issue, it is required by Mugs Coffee and
Bakery House to adopt effective marketing strategy and provide best possible
discounts and offers to customers for developing their own customer’s base.
Opportunities Main available opportunity for Mugs Coffee and Bakery House in London is
its low price strategy with high quality healthy foods. In order to maintain
this, it is important for them to conduct regular based market analysis in
order to identify changing demand of customers at market place in effective
manner. This will allow them to modify their workings and strategies
according to the changing time in effective manner.
Threats Existing market leader of the industry are considered as the main threat for
Mugs Coffee and Bakery House. Its main competitors are Greggs in bakery
zone and Costa Coffee in cafe sector which could develop main threat for the
proposed business plan. In order to handle this situation, it is important for
them to offer unique food combination to customers according to their
preferences in order to attract themselves towards them for longer period of
time.

Marketing and sales plan
Product: Mugs Coffee and Bakery House will be offering vast range of food products and
drink item in their shop. Its offering be based on both the coffee and bakery food products based
which will offer healthy range food items to customers. This will mainly include breads, pies,
cakes, range of coffee flavours, snacks etc.
Price: The Mugs Coffee and Bakery House will make use of value pricing strategy in order
to influence customers towards them in positive manner. In this the company will offer all of its
food products and coffee drinks at affordable prices to customers which will work ass the
supportive factor for them in attracting maximum number of customers towards them in rightful
manner.
Promotion: Manager of Mugs Coffee and Bakery House will use social media
advertisement in order to promote its products and services among them targeted customer zone.
This medium of promotion is helpful for them in reaching maximum number of customers in
rightful manner.
Place: This shop will be initially opened in London only. After analysing its success and
performance at marketplace, the comapny will open its some of the more outlets in the periphery
region too.
Operational plan
Backup plan
Owner of Mugs Coffee and Bakery House has also developed backup plan for this proposed
business. According to this plan if this business does not succeed in the market then they will
merge up with one of their rivalry company in order to grab their success towards them. This will
help them in establishing their business plan at the same marketplace along with the success.
JUSTIFICATION
From the above mentioned report, it has been analysed that business plan is an effective way
by which company can establish their business and attain success at the targeted marketplace.
For establishing it in successful manner, it is essential for them to make use of range of
frameworks such as PEST, Porter five force analyses, SWOT, Marketing mix etc. in order to
analyse the marketplace in effective manner and attain their success quickly. Along with this, it

is essential for the business leaders to make effective backup plan for their proposed business as
well in order to manage the situation in case of failure.
REFERENCES
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