Down Under Cafe: Menu, Pricing, and Business Sustainability

Contents
Executive Summary.....................................................................................................................................2
1. Introduction.........................................................................................................................................3
1.1 Purpose of the Report.......................................................................................................................3
1.2 Background........................................................................................................................................3
1.4 Scope of the report............................................................................................................................4
1.5 Organizational Goals..........................................................................................................................4
2 . The Restaurant and the Menu................................................................................................................5
3. Lessons from the Mystery Shopper Surveys............................................................................................7
3.1 Mystery Shopper Design Observation and Concept Congruence......................................................7
3.2 Mystery Shopping: Key Lessons.........................................................................................................8
3.2.1 Menu..........................................................................................................................................8
3.2.2 Pricing.........................................................................................................................................9
4. Menu Mix and Pricing..............................................................................................................................9
4.1 Menu Mix Analysis.............................................................................................................................9
4.2 Pricing................................................................................................................................................9
5. Improving Business Sustainability: Key Strategies Implemented...........................................................11
5.1 Re- Structuring the Menu Mix.........................................................................................................11
5.2 Rebranding: The Bay Leaf Café to Down Under Café.......................................................................12
5.3 Key Strategy Recommendations for the Future:..............................................................................12
6. Conclusion.............................................................................................................................................12
Bibliography...............................................................................................................................................13

Executive Summary
The “Down Under” Café is a café operating in the world renowned Apollo Bay area. A popular
café in the area, previously known as “The Bay Leaf Restaurant” the Down Under Café is now
facing business constraints with increasing pricing of inputs such as protein (sea –food, meat
etc.) and labour.
This report aims at providing a broad perspective on the restaurant, the context in which the
restaurant operates as well some of the recent changes made as a part of the re-branding and
re-structuring. In a shifting environment where profit-margins are increasingly under threat
while exciting opportunities are available for the café to expand, the Café business needs a
fresh infusion of investment. The report aims at being more broad based and general, that
provide comprehensive and detailed understanding of the restaurant, in order to help investors
make their decisions.

1. Introduction
1.1 Purpose of the Report
Down Under is a casual Dining Restaurant located in Apollo Bay area of Australia.
Currently under re-branding process, the restaurant was previously know as “ The Bay
Leaf Cafe”
1.2 Background
A tourist hotspot by the ocean, the Great Ocean Road has some of the world’s most
recognized tourist spots such as Twelve Apostles. Hence, this area is a good location for
casual dining restaurants.
The Menu selection includes homemade Muesli for breakfast, a selection of gourmet
beef burgers, local seafood etc. along with freshly brewed coffee available throughout
lunch as well as a beer and wine selection that includes local and international names. It
distinguishes itself by providing, vegan, gluten free and vegetarian friendly food options.
Open throughout the week from 7 am to 2 pm, Down Under is a good venue for
breakfast and lunch for customers.
The strength of the restaurant is its intimate setting which reduces the feel of being to
commercial in a tourist hotspot. (Trip Advisor, 2019)
The layout of the café is designed to seat 30 people comfortably in the main dining area
and 20 people in the front seating area. The restaurant consists of a well equipped and
well stocked standard commercial kitchen, a loading dock and ample storage space.
The restaurant is a popular rest stop for buses plying from different parts of Australia to
the Apollo area, especially the 12 Apostles. (Trip Advisor, 2019) Hence, tourist economy
affects the business of the café to a very large extent.
The popularity of the restaurant is at a high. However, seasonality of tourism affects the
business. In addition, increasing prices of key ingredients like protein and fluctuating

availability and rising costs of labour are threatening the profit margins, while affecting
quality.
Competition in the restaurant area is increasing rapidly in the area due to the popularity
of the location. Hence, the café has re-invented itself recently. The feel of the café is
quaint and local. This can be improved or highlighted further with the help of a re-
branding exercise. The “local” vibe can be emphasis with more local oriented dishes but
keeping in view, the cosmopolitan nature of Australia.
1.4 Scope of the report
The scope of this report is to produce a concept for the restaurant by assessing the
supply side and the demand side scenarios of the current market. Various challenges as
well the strengths of the market within this area will be discussed. The scope of the
report is more related to providing a broader perspective on the context in which the
restaurant is based and the changes expected from the on –going re-structuring
rebranding. It does not provide a background on the restaurant or financial details
regarding the restaurant other than It is hoped that the report will provide enough
information to potential investors to help them make primary decisions regarding
investment potential.
1.5 Organizational Goals
The restaurant aims to serve the highest quality of food with as emphasis on providing
“local taste” to the tourists while maintaining competitive prices that make it accessible
to tourist from all classes. (Great Ocean Road Regional Tourism, 2019)
The Bayleaf Restaurant is well known as a “local favorite” and is a recognizable part of
Apollo Bay Tourism. (Great Ocean Road Regional Tourism, 2019) However, the
restaurant is not seen as Australian Icon. “Down Under” hopes to fit in the Apollo Bay
tourism destination more conceptually.
It is important to make the restaurant an “Apollo Bay Icon” and a brand that people
instinctively associate with Australia and Apollo Bay.