The assignment requires the student to conduct market research and analysis for vegan businesses, providing insights into the competitive landscape, consumer behavior, and business prospects. References from books, journals, and online sources are included to support the analysis.
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Unit 27 – Identifying Entrepreneurial Opportunities
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Table of Contents INTRODUCTION...........................................................................................................................1 MAIN BODY...................................................................................................................................1 1. Background information about inspirational ideas of setting up new business.................1 2. Introduction to business idea..............................................................................................2 3. Analysis of competitive market, failure and success in this industry and ideas for the growth purpose.......................................................................................................................2 4. Gap analysis, analysis of present situation of restaurant business and of objectives of business ideas.........................................................................................................................5 5. Market researches for showing viability of business idea and identification of market potentials.................................................................................................................................7 6. Strengths and weaknesses of the business idea along with its viability and feasibility.....8 7. Opportunities and threats of the business and recommendation for the business............11 CONCLUSION..............................................................................................................................11 REFERENCES..............................................................................................................................13
INTRODUCTION Entrepreneurialopportunitiescanbedefinedasvarioussituationsinwhichan entrepreneur can enhance its profits or raise efficiency level of business. This assignment includes brief evaluation of numerous sources of entrepreneurial innovations and ideas. It also shows use of different rational business ideas and market gap. Further it includes different statistics to support the overvcom strategy based on gap analysis along with its interpretation to appropriately provide them as an evidence of market potential. It describes objectives of entrepreneurial ideas and evaluation of competitive and market evaluation along with a business idea regarding its potential customers and targeted audience. MAIN BODY 1. Background information about inspirational ideas of setting up new business For settingup an entrepreneurial business, an idea to open a new restaurant on a hill station Attleborough situated in England, has been identified. This idea of opening the restaurant has been inspired from various factors(Richardson, 2018). These factors include conversion of huge number of population into vegan which leads in increasing the demand of vegan restaurants in all over the world. Increase in demand in market Attleborough is a beautiful hill station of UK, which attracts the tourists at the most. It increases the demand of vegan foods in Attleborough.Further, there is also few numbers of vegan restaurants at Attleborough, which fails to fulfil all the demands of customers. It enhances the probability of profit generation by the restaurant. Recent trends Further, as per the resent trends, most of the Attleborough population has turned their preference from non vegan to vegan foods. It is also the biggest factor to inspire the idea of opening a vegan restaurant idea over there, as it would result in attracting local customers as well. Investment Opening a new restaurant in this location needs less amount of investment and can provide maximum profit to entrepreneur(Lehmann and Seitz, 2016). In this regard, being a start up and entrepreneur, it is always a better idea to enter into a restaurant business. 1
Self effeciency Entrepreneurial has done Hotel management course which has enhanced the capability to effectively manage the restaurant. In addition, it is also a primary goal of entrepreneurial to open a restaurant at a big level. It is the key motivational factor behind the idea of opeining a restaurant. In addition, as at Attleborough, numerous tourists love to spend their holidays. Opening a restaurant over there will lead in attracting them as well (Here's Why You Should Turn Your Business Vegan In 2018,2018). Attraction of number of visitors is a key factor inspirational factor to open the restaurant. Number of visitors In addition, as at Attleborough, numerous tourists love to spend their holidays. Opening a restaurant over there will lead in attracting them as well (Here's Why You Should Turn Your Business Vegan In 2018,2018). Attraction of number of visitors is a key factor inspirational factor to open the restaurant. In this regard, by analysing all the above inspirational factors, the entrepreneurial has decided to open a vegan restaurant at Attleborough, as it will help in generation of huge return from lower value of investment. 2. Introduction to business idea Being an entrepreneur, there is an idea to enter into a restaurant business. Restaurant will sale vegan food. Further, restaurant is going to be open in a hill station of UK namely Attleborough with a name Springled Food Restaurant. In recent times, vegan food is in more demand in all over the world. As per the recent statics 80% of the total population of the world and 60% of the Attleborough population, have changed their preference from non vegan foods to vegan foods(Wang, 2016). In this way, the restaurant can generate huge profit. As it will attract most visitors towards its food. Springled Food restaurant is going to include organic foods in the list of vegan foods. It will also increase the profitability, as in recent trends, people are becoming more health conscious. Restaurants at Attleborough fails to provide quality of hospitality to their consumers (Owusu-Amankwah, 2016). Springled Food restaurant will focus the hospitality of restaurant as 2
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well, it would help in providing more customer satisfaction to the consumers and increase the profitability as well. In this regard, restaurant will gain a profit of€90 million in first year of the business and will continuously grow definitely in the future. 3. Analysis of competitive market, failure and success in this industry and ideas for the growth purpose. Competitor analysis Before starting any new business, entrepreneurial need to analyse the strategies and businessofcompetitorsofthemarket(ALTAŞ,2017).Competitorsdirectlyaffectthe profitability of any firm. The Mulberry Tree restaurant is the highest competitor of the Springled Food restaurant. Its competitive analysis can be done as under: BasisThe Mulberry TreeSpringled Food restaurant Target audienceThe Mulberry Tree targets all the vegetarian tourists. It can target all the tourists by including vegetarian and non vegetarian vegan foods in the menu. Potential consumersVisitors of Attleborough.Visitors along with the local customers of Attleborough. Pricing strategiesItoffersfoodswiththe cheapest price. Springled Food restaurant can provide some extra discount to its customers along with the cheapestpricewhichcould substitutethecustomersof Mulberry towards it. Design of Menu cardMenu card has been designed to give the message of eating healthy foods to the customers MenuofSpringledFood restaurant can be designed by usingtraditionof Attleborough.Itcouldcatch the attraction of the customers. key strategyRestauranthasfastservingRestaurant will give a coupon 3
facility(Goethals,2018). Whichhelpsitinproviding satisfaction to customers. to each customer. It will lead inmaintainingpatienceof customersandalsotogive themahigheramountof satisfaction. Key Marketing strategyMulberry tree advertise itself byplacinghoardingsat different places. It will also advertise itself by posting adds on social media platformalongwithplacing hoardings everywhere. It will help in attracting more number of customers towards it. Availability of Social media integration There is lack of social media integration by Mulberry Tree restaurant. Springled Food restaurant cam enhancethesocialmedia integrationtokeepintouch withitscustomersvia messages, mails, etc. in would leadinsustainingthe customers for long time. Ameance of restaurantIt has a great interior including beautiful colour of walls which gives message of healthiness to the customers. Springled Food restaurant will place some quotes on the all the walls of restaurant which could attract the attention of customers and make them feel happy in the restaurant. Annual salesApprox€200 millionItsestimatedannualsalesis €90 millions. Locations of competitorsStation roadNear white house Failure and success in the industry 4
In recent time, at Attleborough, people have started preferring vegan foods which leads to continuously increasing the demand of vegan food is. It increases the probability of success of the industry(Macharia, 2016). At Attleborough, chances of success of the Springled Food Restaurants are much higher, because, approx 60% of population at Attleborough have changed their preference from non vegetarian to vegetarian foods. Cost of organic foods is quite higher in the Attleborough due to lack of harvesting of organics.(The Problems with the UK's New 'Big Vegan' Industry,2019). it increases the cost of preparing organic dish by the restaurant. It may cause the reduction in profit by the Springled Food restaurant. High low risk analysis From the above analysis, it can be said that vegan restaurant industry isat low riskas cost of dish can be reduced by the restaurant by purchasing a farm and harvest all the raw ingredients there. It can result in huge reduction in operating cost of business. Apart from the high level of operating cost, there are numerous opportunities which can be absorbed by the Springled Food Restaurant andgain maximum profit from the business. 4. Gap analysis, analysis of present situation of restaurant business and of objectives of business ideas Gap analysis Gap analysis is the process of management in they can be analyse and compare the current performance with the desired performance of the business(Cattani, 2018). It could help managers in bridging gap between the current status and set performance of the company. As the Springled Food restaurant has not established yet, managers of it can perform gap analysis to compare the latest market trends and demands and compare them with the range of supply which can be provided by it by using its current resources. BasisCurrent position StandardsGapsOvercome strategy LocationNearwhite house Customer prefers to go theirnearby restaurants. Not each visitor wants to visit white house Can open a new branchnear morepopular place of visitor. 5
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Varietyof foods Vegan foodsSome people also like dairy food products. Menu of restaurant do notincludedairy foods. Entrepreneur can add some dishes includingdairy foods to provide more satisfaction. Cost of dish to restaurant €20-40 per dish €15-35 per dish€30-50 per dishItcandevelop morestrategies for having better controlover cost. Marketing plans Advertises itselfby postingadds onsocial media. Advertisementby usingthelatest technology. Can'treachtomore consumers. Itcandevelop better advertising strategyby inventingmore fundsforthis purpose. As per the latest market trend analysis, customers prefer to go to those restaurants in which they can get each type of food under a single roof. Recently Springled Food restaurant is providing only vegan foods(Schmutz, 2018). Managers can develop a plan to increase the list of menu and include all kind of foods in it along with vegan foods. It would help it in grabbing more market share. Further, currently roof top restaurants are more trending. Its managers should plan to locate the restaurant at a place where they can open it with roof top facility with beautiful view all around to attract more customers. In addition, as per the latest market research, competitors of Springled Food restaurant are more cost efficient which help them in serving the best quality of food at cheap price 6
(Goethals, 2018). On the other hand cost involved in dishes served by Springled Food restaurant is quite high. In this regard, it managers need to develop strategies like harvesting ingredients at their own farms, to make it more cost efficient. It would help them in efficiently competing in the market and enhance its profitability as well. Business objective The restaurant is going to be opened with some major objectives like Building restaurant brand, achieving financial goals, business expansion, development of customer loyalty and providing excellent food service. All these objectives can be achieved by Springled Food restaurant by developing the best strategies for it. Making the best usage of its current sources to develop it with more efficiency. By comparing the market situations with the current business resource, managers can determine the need of resources in the firm in order to achieve all the set objectives of it(Fuller, 2016). It can purchase a new farm to reduce its operating cost. Further, including dairy products in the menu, it can increase the satisfaction level of the customers. Springled Food restaurant more cost efficient and also increasing its quality of food to achieve its objective of providing excellent food service to the customers and enhance the customer loyalty of firm. 5. Market researches for showing viability of business idea and identification of market potentials Identification of market potentials Mainly there are two sources to identify the market potentials for the business i.e. primary and secondary sources. Market researches from primary sources Q.1 What cuisine do you prefer to eat? 1.vegan 2.non vegetarian food 3.Italian food 4.Chinese food Q.2 What type of food do you prefer? 1.Organic foods 7
2.fast and junk foods Q.3 What Ameance you like in a restaurant? 1.modern 2.traditional Q. 4 how much amount you want to pay for a vegan meal? 1.€50-70 2.€30-40 3.€70-100 4.any cost Interpretation The primary research has been done by asking the above questions to 450 people at Attleborough including visitors. From which, entrepreneur got that people 75% of people prefers vegan foods and 60% like a peaceful environment in the restaurant. Further, 53% prefers traditional design in a restaurant and 86% can pay around€50-70 for a vegan meal. In this regard, entrepreneur has decided to open a vegan restaurant which would cost approx€50-90 per meal to a consumer. Market researches from secondary sources As per the secondary sources, restaurant businesses are highly profitable business in a tourist place(Wright, 2018). Most of the people love to eat foods while travelling to enhance their experiences. It results in increase in probability of success of the restaurant businesses there. The sales of vegan food restaurants has been increased by 10.3% in UK comparing to recent past statistics. It increases the probability of huge sales of the vegan restaurant business. Further, as per the research, at Attleborough, 40 restaurants was opened in last 4 years from which 30 have achieved enough growth in the market. As per the current market research, people nowadays likes to eat vegan foods over other foods (Marketing research for restaurant and food service companies,2018). On the other hand, at Attleborough, there are not sufficient number of vegan restaurants to fulfil the demand of food. 8
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There is also a huge increment in the success rate of vegan restaurants. Along with it there is also approximately 13% increase in the number of restaurants which have added vegan foods in their menu. It has lead in increasing the competition in the market. Viability of business idea In this way, a vegan restaurant will provide a sufficient amount of profit. There is also chances of increase in number of sales by the business due to lack of supply of the food in the market. Further, the success rate of restaurants at Attleborough is also high. All these enhances the probability of success of Springled Food restaurant and viability of the business idea as well. 6. Strengths and weaknesses of the business idea along with its viability and feasibility The success of the Spangled Food restaurants can be estimated through analysing its budgeted cash flows. Estimated cash flow statement Particula rs Initial invest ment Janu ary Febru ary Marc hApril Ma y Jun e Jul y Augus t Sept emb er Octo ber Nove mber Decem ber Sales of food Number of consumers 2800 030800 3388 0 3726 8 409 95 450 94 496 0454564 6002 0 6602 37262579887 Average cost383838383838383838383838 Total revenue from food 1065 167 11716 83 1288 852 1417 737 155 951 1 171 546 2 188 700 8 20757 08 2283 279 2511 607 27627 68 303904 5 Sale of beverages Number of consumers 3200 040000 4200 0 4410 0 463 05 486 20.2 5 510 51.2 625 53603. 82562 5 5628 4.01 6906 25 5909 8.217 7515 625 62053 .1286 39140 6 65155. 785071 0977 9
(cash outflow) Net cash flow16200 1498 487 17150 33 1860 572 2015 303 218 816 7 237 827 6 258 247 3 28066 47 3049 397 3317 799 36081 69 392788 8 Loan90000 Grant50000 Owner's capital10000 Opening balance of cash 15000 0 1662 00 16646 87 3379 720 5240 292 725 559 5 944 376 2 118 220 38 14404 511 1721 1158 2026 0556 23578 354 271865 23 Closing balance of cash 16620 0 1664 687 33797 20 5240 292 7255 595 944 376 2 118 220 38 144 045 11 17211 158 2026 0556 2357 8354 27186 523 311144 12 Viability From the above research and estimation of cash flows in the restaurant, it can be stated that business idea to open a Vegan restaurant is viable and feasible as well. It is providing a huge market share in the future. Further, by opening Springled Food, entrepreneur can earn a range of cash inflow from its business. StraightensWeaknesses Pricing structure Variety of food Location of restaurant High profitability in market Cost inefficiency No experience Less capital investment 11
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7. Opportunities of the business and recommendation for the business Opportunities Enhancement of preference of vegan food over others. Increase in concern of population towards their health Development of strong inventory management. Competitive analysis By analysing the business strategies and plans, it has been identified that, restaurants of Attleborough fails to provide a quality of hospitality services to the customers. It results in lack of satisfaction to their customers(Ristic, 2019).Further, due to lack of resources, operating costs of the restaurants are also quite high which reduces the profit earning capacity of the food industry. In this regard, to avoid these problems in Springled Food restaurant, entrepreneur will have major focus over providing hospitality services to the customers. In addition, it will also invest money in purchasing a farm for the harvesting of ingredient purpose, which would lead in reduction of operating cost of the restaurant. Recommendation Fromtheanalysisofabovebusinessideas,itsstrengths,weaknesses,various opportunities of market following points can be recommend to the entrepreneur: It should increase its managerial capacity to control to cost of the restaurant. As it would help it in reducing the price of its food and increase its quality as well. In addition, it should addition the number of varieties in its menu in order to provide all kinds of food under one roof to the customers. It would help Springled Food restaurant in enhancing its strength and profitability as well. It should invest a sum in purchasing a farm for harvesting purpose, it will lead in reducing the operating cost of business and making the restaurant more cost effficient. With the help of adopting these recommendations, Springled Food restaurant can achieve its objectives and goals easily in the near future. It will also lead in the business expansion and grabbing more market share in the competitive market. 12
CONCLUSION From the above study it can be concluded that, opening a restaurant in Attleborough can provide a huge return to the entrepreneurial. The business includes lower level of risk. In this regard being a start up company, the idea of opening restaurant can increase the amount of return from the investment of fund. Further, from the recent market research, it has been analysed that population is more preferring the vegan foods. Therefore, vegan restaurant will have greater opportunity to grow in the market. Springled Food restaurant has decided to open the restaurant in Attleborough which is the most beautiful place of UK and there are a continuos increase in demand of the vegan and organic foods. It will result in attracting more tourists towards the restaurant. In addition, recent market statistics has also shown that growth rate of vegan restaurant is increasing day by day as well. If the business adopts all the recommendations in the future, it could grow in the market and could get the expansion at the highest along with the highest profitability. 13
REFERENCES Books and Journals ALTAŞ, A., 2017. Vegetarianism and Veganism: Current Situation in Turkey in the Light of Examples in the World.Journal of Tourism and Gastronomy Studies.403. p.421. Cattani, G. and et.al., 2018. Competitive sensemaking in value creation and capture.Strategy Science.3(4). pp.632-657. Fuller, J., 2016. The cultural creation of affect amongst vegan consumers: An ethnographic analysis of online consumption communities. Goethals,M.,2018.BUSINESSPROSPECTSOFTHEFIRSTVEGANPASTRYIN LUXEMBOURG: Market Research, Risk Analysis & Concept Creation. Lehmann, E. E. and Seitz, N., 2016. Creativity and Entrepreneurship: Culture, Subculture, and New Venture Creation. Macharia, J. and et.al., 2016, November. Connecting farmers to high value markets: a case study of smallholder vegetable growers in Ntcheu District, Malawi. InInternational Symposia on Tropical and Temperate Horticulture-ISTTH2016 .1205.(pp. 165-178). Owusu-Amankwah, G. and et.al., 2016. Restaurant tax feasibility: determinants of restaurant thresholdprice.InternationalJournalofHospitalityandEventManagement.1(4). pp.333-354. Richardson, N., 2018. Entrepreneurial insights into sustainable marketing: A case study of UK music festivals.Strategic Change.27(6). pp.559-570. Ristic, R. and et.al., 2019. Wine-related aromas for different seasons and occasions: Hedonic and emotional responses of wine consumers from Australia, UK and USA.Food Quality and Preference.71. pp.250-260. Schmutz, U. and et.al., 2018. Sustainability impact assessments of different urban short food supplychains:examplesfromLondon,UK.RenewableAgricultureandFood Systems.33(6). pp.518-529. Wang, Y., 2016. Diet, Lifestyle, Ideology: Vegetarians in Modern Beijing. Wright, L., 2018. Vegans in the Interregnum: The Cultural Moment of an Enmeshed Theory. InThinking Veganism in Literature and Culture(pp. 27-54). Palgrave Macmillan, Cham. Online 14
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Marketing research for restaurant and food service companies.2018. [ONLINE] Available through<http://impactcr.com/consumer-market-research/restaurant-market- research.php> Here's Why You Should Turn Your Business Vegan In 2018.2018. [ONLINE] Available through <https://www.forbes.com/sites/katrinafox/2017/12/27/heres-why-you-should-turn-your- business-vegan-in-2018/#298871ea2144> The Problems with the UK's New 'Big Vegan' Industry.2019.[ONLINE] Available through <https://www.vice.com/en_uk/article/qvwxzv/the-problems-with-the-uks-new-big-vegan- industry> 15