AA & Z's Restaurant Business Plan

The assignment involves analyzing the business plan for AA & Z's Restaurant, focusing on cost management, infrastructure design, employee hiring, and material sourcing. Recommendations are made to ensure high-quality services and profitable operations. The analysis takes into account potential challenges such as competition from larger organizations and the need to maintain a strong reputation.

Running head: INTRODUCTION TO ENTREPRENEURSHIP
Introduction to Entrepreneurship
Name of the Student:
Name of the University:
Author’s Note:

INTRODUCTION TO ENTREPRENEURSHIP 1
Table of Contents
Introduction......................................................................................................................................2
Founders and Vision........................................................................................................................2
Market Analysis...............................................................................................................................3
Target Customers.............................................................................................................................3
Segmentation...............................................................................................................................4
Targeting......................................................................................................................................4
Positioning...................................................................................................................................4
Market Opportunities...................................................................................................................5
Industry Analysis.............................................................................................................................6
Competitor Analysis....................................................................................................................6
Business Model............................................................................................................................6
Profitability of the Business.............................................................................................................7
Recommendations............................................................................................................................7
Reference List..................................................................................................................................9

INTRODUCTION TO ENTREPRENEURSHIP 2
Introduction
Entrepreneurship can be defined as the activity of taking up a creative idea, developing
and designing a business around the idea, managing the business activities as well as accepting
the risk associated with the success of the business (Burns, 2016). This start up guide will focus
on developing a restaurant business in Lahore, Pakistan. It is a widely accepted fact that food
business can be identified as that kind of business which can yield substantial revenue
irrespective of the economic condition. It has been observed that in Lahore there is a lack of fast
food restaurants where people can find quality food at an affordable price. As a result opening a
restaurant in this area has been considered to be a profitable business. This guide will provide a
detailed overview of the business along with the key insights of the industry.
Founders and Vision
Mr. Abbas Ali, Mr. Adeeb Hasan and Mr. Zunaid Ali are working together for
materializing the idea of opening the fast food restaurant business. However, this specific idea
was the brain child of Mr. Abbas Ali who proposed the idea and elaborated the benefits and
prospects of this business before Mr. Adeeb Hasan and Mr. Zunaid Ali and they also agreed to
invest in this business.
The trio agreed on naming the restaurant as “AA & Z’s Restaurant”. They have planned to start
the business with the vision of selling delicious and high quality food as per the customer’s need
and also providing the customers with commendable service through the demonstration of
efficiency, warmth and graciousness.

INTRODUCTION TO ENTREPRENEURSHIP 3
Market Analysis
In this section the relevant information regarding the marketplace that can affect the
business activities of AA & Z’s Restaurant will be collected and analysed. As opined by
Henrekson and Sanandaji, (2014), it is quintessential to perform an appropriate market analysis
before starting a business because this helps the business to get an insight of the marketplace
where it is planning to operate. In this context it can be stated that the entrepreneurs should
analyse the recent market trends, demographic features of the location so as to design their
products in accordance with the choice and preference of the target customers (Lee et al., 2016).
Target Customers
In order to identify the most suitable target customer group the business organisations
mainly use the STP tool. AA & Z’s Restaurant will use the STP or segmentation, targeting and
positioning technique for identifying the customers who are needed to be targeted and thereby
designing the strategies through which it will be able to cater the needs of the customers (Storey,
2016). STP is a sequential process such as the organisations should first focus on dividing the
entire customer base into a few suitable segments this segmentation can be done on the basis of
demographic features, geographical features or cultural differences. Then in the targeting activity
the most suitable customer segment is selected for targeting through specific marketing strategies
and techniques (Spence et al., 2018). In the positioning the strategy the organisation determines
where to position its business on basis of the nature of the targeted customer base. The STP
analysis of AA & Z’s Restaurant can be stated as follows,

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Segmentation
The entire population of Lahore can be divided in to several age groups, such as people
below 20, 20-40, 40-60, 60 and above. This demographic classification of the population clearly
depicts the fact that a majority of the population falls in the age group of 20-40 and 40-60.
Therefore, it would be appropriate for the organisation to target the people falling in this age
group. The customers of this age group generally demand high quality foods at an affordable
price with the least delivery time (Zahra et al., 2016).
Targeting
The AA & Z’s Restaurant will therefore target the people within the age group of 20 to
40. The main reason behind targeting these people is that most of them are either student or are
working (Jin et al., 2015). The students are expected to find the restaurant affordable as it will
sell fast food at a comparatively lower price. On the other hand, the working professionals will
found the place trendy that serves good foods (Mathe et al., 2017). They are expected to opt for
the high priced foods as they will be possessing the higher purchasing power.
Positioning
The positioning map features four quadrants,

Price
Quality
High Price,
High Quality
Low Price,
Low Quality
High Price,
Low Quality
Low Price,
High Quality
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Figure 1: Positioning Map
(Source: Created by Author)
AA & Z’s restaurant will place it on the low price, high quality segment. This is because
mainly the organisation is addressing or catering the needs of the middle class consumers and
students as per their affordability placing the business in this segment will help the organisation
to attract a huge customer base.
Market Opportunities
AA & Z’s Restaurant will try to address the customer pains as efficiently as possible. It
effectively implies that effective staffing and market research will help the organisation to
determine the needs of the customers. The employees of the organisation will focus on serving
the customers dedicatedly and politely (Walker, 2016). Foods will be prepared using fresh and

INTRODUCTION TO ENTREPRENEURSHIP 6
high quality ingredients. This will allow the organisation to provide good foods at an affordable
price.
Industry Analysis
Competitor Analysis
In the era of globalisation and advancement it has been observed that various fast food
restaurant chains are spreading their wings in the international market (Lee et al., 2016). Lahore
is not an exception the two gigantic organisations in this regime, Subway and KFC are already
operating in the restaurant industry. These organisations are old and have already gained a
reputation among the customers for their quality foods and services (Kimes, 2016). Hence it can
be expected that AA & Z’s restaurant will face significant competition from these two rival
organisations. On the other hand, there are some small budget friendly fast food restaurants as
well which can also become a threat before the organisation. Therefore, it can be expected that
during the initial stage AA & Z’s Restaurant will face certain difficulties but with the passage of
time as it will start gaining reputation for quality and lower price it would develop a niche
customer segment for itself.
Business Model
The business model of AA & Z’s restaurant will focus on developing an unique value
proposition, menu choice, target customers and effective financial projections. In the context of
unique value proposition it can be stated that the key unique selling point of AA & Z’s
Restaurant will be providing high quality fast foods at a friendly price which will be affordable
to the students and the middle class working professionals. Moreover, it will also include a
cafeteria alongside the restaurant; a wide range of coffees will be available in there.

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Analysing the market has helped the organisation to identify the customer segment as the
people between 20 to 40 years of age and 40 to 60 years of age. This targeting is appropriate as
most of the people within these age groups are found to be inclined towards eating outside and it
has become a lifestyle trait among them as well.
A perfect financial projection will also help the restaurant to effectively estimate the
future costs and potential benefits that could be derived from the business. It will also play an
important role in analysing the business risk as well.
AA & Z’s Restaurant will accrue the key ingredients from farmers which will ensure the
quality of their foods. It will also supervise the preparation to delivery stages as strictly as
possible to ensure that quality is not compromised (Kim et al., 2014). This will ensure that the
customers of the restaurant are satisfied they keep visiting the restaurant.
Profitability of the Business
As a start up the business may face a few issues which may arise in the form of stringent
competition on the part of the gigantic organisations already operating in this industry. This will
affect the profitability of the business initially (Yang, 2017). However, it is expected that in near
future the restaurant will be able to provide the customers with high quality foods at an
affordable price which will help it to develop a better reputation. Then with the passage of time
AA & Z’s Restaurant will be able to operate profitably.
Recommendations
On the basis of the above analysis it can be recommended that the restaurant should
always focus on keeping the cost associated with infrastructure as low as possible. It could hire

INTRODUCTION TO ENTREPRENEURSHIP 8
an efficient architect who will be able to design a spacious restaurant for them which will be cost
effective. This is because investing more on these may reduce the quality of services. Hence, it
should focus more on hiring expert employees and accruing fresh materials directly from the
farmers which will help it to maintain the quality of its foods.

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Reference List
Burns, P., 2016. Entrepreneurship and small business. Palgrave Macmillan Limited.
Henrekson, M. and Sanandaji, T., 2014. Small business activity does not measure
entrepreneurship. Proceedings of the National Academy of Sciences, 111(5), pp.1760-1765.
Jin, N., Goh, B., Huffman, L. and Yuan, J.J., 2015. Predictors and outcomes of perceived image
of restaurant innovativeness in fine-dining restaurants. Journal of Hospitality Marketing &
Management, 24(5), pp.457-485.
Kim, M.G., Lee, C.H. and Mattila, A.S., 2014. Determinants of customer complaint behavior in a
restaurant context: The role of culture, price level, and customer loyalty. Journal of Hospitality
Marketing & Management, 23(8), pp.885-906.
Kimes, S.E., 2016. The evolution of hotel revenue management. Journal of Revenue and Pricing
Management, 15(3-4), pp.247-251.
Lee, C., Hallak, R. and Sardeshmukh, S.R., 2016. Innovation, entrepreneurship, and restaurant
performance: A higher-order structural model. Tourism Management, 53, pp.215-228.
Lee, C., Hallak, R. and Sardeshmukh, S.R., 2016. Innovation, entrepreneurship, and restaurant
performance: A higher-order structural model. Tourism Management, 53, pp.215-228.
Mathe, K., Scott-Halsell, S., Kim, S. and Krawczyk, M., 2017. Psychological capital in the quick
service restaurant industry: a study of unit-level performance. Journal of Hospitality & Tourism
Research, 41(7), pp.823-845.
Spence, L.J., Frynas, J.G., Muthuri, J.N. and Navare, J. eds., 2018. Research Handbook on Small
Business Social Responsibility: Global Perspectives. Edward Elgar Publishing.
Storey, D.J., 2016. Understanding the small business sector. Routledge.
Walker, J.R., 2016. Introduction to hospitality. Pearson Higher Ed.

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Yang, F.X., 2017. Effects of restaurant satisfaction and knowledge sharing motivation on eWOM
intentions: the moderating role of technology acceptance factors. Journal of Hospitality &
Tourism Research, 41(1), pp.93-127.
Zahra, K., Zafar, T. and Khalid, M., 2016. Marginality, social exclusion, labour force
participation and urban poverty: a case study of Lahore, Pakistan. Pakistan Development
Review, 55(4), pp.521-541.