Starbucks Franchise Business Plan for Murray Hill Area

Running head: BUSINESS ADMINISTRATION
Business Administration
Name of the Student:
Name of the University:
Author Note:

1
Executive Summary:
Starbucks Corporation has become a one-stop destination for the coffee lovers. It
provides an inviting atmosphere away from daily stress. It is also a place comfortable enough for
meeting friends or reading a book over a superb cup of coffee that is richly brewed and expertly
roasted. Starbucks franchise in Murray Hill area plans to capitalize on its proximity of Manhattan
Academy for Arts and Languages Campus and post graduate residents from other campuses for
building a group of repetitive customers. Starbucks will offer the customers with the one of the
best quality coffee in complemented with snacks and pastries. The franchise will be responsible
for operating 2,200 square feet coffee store located within the walking distance of various
university campuses in and around Murray Hill. Owners secured the location with the help of
five-year lease agreement with further option for extension. The startup funds provided was
$130,000 out of the total $255,000 with the rest of the capital to be obtained as commercial loans
from Bank of America. The sales revenue of the franchise expected to grow from $484,000 in
the financial year of 2018 to $ 807,000 in a matter of three years. Besides, Starbucks will try
hard in maintaining a profit margin of 75 percent along with operating expenses thereby having a
net profit growth ranging from $90,000 to $115,000.

2
1.1 Objectives
Starbucks objectives for its first year operations include (starbucks.com, 2018):
1. Ensure cultural development, high performance, accountability and innovation in
addition to becoming a customer’s paradise.
2. Earn substantial revenue from the operations of the first month
3. Maintaining a profit margin of 75 percent
1.2 Factors Determining Success
1. Visually attractive store designs for faster and efficient operation.
2. Providing employee training for covering best techniques of coffee preparation
3. Suitable marketing strategies for building a stronger customer base for maximizing
sale of higher margin products.
Year 1 Year 2 Year 3
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$800,000
$900,000
Sales
Gross Margin
Profit