Entrepreneurship Report: Business Functioning Analysis of Lucky Cafe

This report presents a detailed business analysis of Lucky Cafe, a food and beverage company operating in the United Kingdom. It examines the company's business model, market opportunity, and competitive advantages. The report includes an overview of the industry and market analysis, including market demand, segmentation, and potential. It also provides an in-depth analysis of the macro and micro-environment using PESTLE and SWOT analysis, respectively. Furthermore, the report delves into the financial feasibility of the business, including start-up capital requirements and financial projections. The conclusion summarizes the key findings and insights, highlighting the potential for success and challenges faced by Lucky Cafe. The report is a comprehensive resource for understanding the business functioning of a startup in the food and beverage industry.

RUNNING HEAD: Business Functioning analysis of Company
1
Name of the student-
1. Topic - Business Functioning analysis of Company
2. University name-

Business Functioning analysis of Company 2
3. Executive summary
Each and every organization is accompanied with the complex business activities and
functioning which are operated to achieve certain goals and objectives. In this report, Lucky Café
Company offering food and beverage business has been taken into consideration. This report has
shown the clear understanding on the business performance and how an entrepreneur could start
a new business.

Business Functioning analysis of Company 3
4. Table of Contents
2. Executive summary..................................................................................................2
4. Introduction..............................................................................................................5
5. Present description of organization..........................................................................5
5.2 Location of starting of new business........................................................................5
5.3 Founding Team........................................................................................................ 6
5.4 Business model of Lucky café...................................................................................6
6. Opportunity-product/service idea...........................................................................8
6.1 Window of opportunity for the product/service (gap analysis)...............................8
6.3 Features and benefits of the product/service..........................................................9
6.4 Product/service differentiated from others in the market.......................................9
7. Industry and Market Analysis...................................................................................9
7.1 Market demand....................................................................................................... 9
7.2 Market segmentation.............................................................................................10
7.3 Market potential/Target market............................................................................11
7.4 Macro-environment analysis..................................................................................11
7.5 Micro-environment................................................................................................13
7.6 SWOT analysis of company....................................................................................14

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8. Financial feasibility.................................................................................................15
8.1 Start- up capital requirement.................................................................................15
8.2 Financial analysis....................................................................................................16
9. Conclusion..............................................................................................................17
10. References............................................................................................................. 18

Business Functioning analysis of Company 5
5. Introduction
In this report, business analysis of Company and the opportunity available in market
have been taken into consideration. This research report reflects how an organization could earn
high amount of profit by running its business effectively in market.
6. Present description of organization
The name of organization is Lucky café which will be incorporated to offer coffee and
other beverage products in market. In United Kingdom market, lucky café business has been
started to provide foods and beverage products in market. The main marketing factor of business
is to increase its overall productivity and increase the efficiency of business. This lucky café
business could help investors to create value on their investment. Once lucky café establish its
brand image in United Kingdom market then it will increase the overall productivity and
efficiency of business in determined approach.
5.2 Location of starting of new business
It is evaluated that this Lucky café business would be opened near to multinational mall
of the UK. This area will be accompanied with the employees, college going boys and couples
who like to drink coffee and other drinks (Palia, 2014). The location of Lucky café business
would be in the mid of the Shepherd's Bush, London near Westfield London shopping centers. It
is highly potential area which will be useful to grab more clients in market.

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5.3 Founding Team
This business is started by five members in which three were promoters and rest two
were directors who instruct and manage the business functioning. This founding team will be
indulged in key activities to run the business effectively.
5.4 Business model of Lucky café
This business model will be useful for the lucky café to start up new business and
effectively run the business (Brigham & Ehrhardt, 2013).
Key strategic
partner
Promoter’s alliance.
Key Activities
Generating systematic
app
Implementing proper
action plan
Taking franchise and
other plans.
Value Proposition
Creating
dashboard
Establish new
marketing
channel.
Grasping more
clients.
Understanding
clients’ needs and
demand.
Customer
Relationships
Direct sales
through offline
business channel.
Using cyber system
to sell goods
through online
channel.
Customer
Segments
UK clients.
Focusing on
walking clients
near to malls
College going
girls and boys
Key Resources
IT solutions:
Channels
Generate website of

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IT staffs and members
Investment in
development work
education support
Use of social
network sites and
values
E-mail marketing
and Referencing
Cost Structure
Website cost
Maintain charges
Use of IT development
App development cost
Hiring IT staff members
Management of dashboard
Installing cyber computing system plan
Minimum Viable
Product
 Use of highly
advanced cyber
computing system
 IT dashboard
 Use of Google
image section
 Implementing
strategic alliance
Revenue Streams
Developing posters
Installing cybersystem
IT team
Use of new system
Developing app and new system

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7. Opportunity-product/service idea
The main business which is introduced to start up new business is related to food and
beverage products. It is observed that selling food and beverage products near malls and
multinational companies. These offered products will increase the overall turnover of company
and will increase the profit throughout the time (Brigham & Ehrhardt, 2013). Hub area crowed
with the many people will strengthen the overall turnover of the market and strengthen the
opportunities available in the market and will increase the overall outcomes of the business.
6.1 Window of opportunity for the product/service (gap analysis)
This gap analysis is used to identify the gaps between optimized allocation, integration of inputs
and current allocation of resources. This gap analysis helps company to identify the areas which
need to be improved. It is accompanied with the following steps given as below (Brigham &
Ehrhardt, 2013).
Usage gap
It is determined by identifying the gap between the total potential for the market and actual
current usage by all the consumers. Lucky café is a new start up in which there is high potential
of market and existing usage is very low. However, there is around more than 2 million people
who could be potential clients and company has no achieved clients in market. Therefore, the
whole market potential is included in usage gap of the company.
Product gap

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This product gap is called the segment gap which could be used by Lucky café to diversify its
business. For instance, including dinner, lunch and other product selling could also be included
in the business of lucky café (Romme, and Reymen, 2017).
Implementing better process system
This process will help Lucky café to start up new business in effective manner. Company could
adopt cyber computing system in its business to attract clients and increasing the overall output
from its business (Mohd, Idris and Momani, 2013).
6.3 Features and benefits of the product/service
Lucky café has planned to offer the foods and beverage products in market. Providing best
quality and offering best services are the key competency of the products. These factors have
shown that company could keep its price and quality of the products high with a view to increase
its overall efficiency of the business. This will help company to increase its overall brand image
on international level.
6.4 Product/service differentiated from others in the market
Lucky café has determined to develop core competency by following cost leadership and product
differentiation strategy throughout the time. This level of business functioning will allow
company to increase its overall output throughout the time.

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8. Industry and Market Analysis
7.1 Market demand
This food and beverage market is having high growth in market. However, with the
ramified changes and economic condition of business, new entrants or businessman is gaining
momentum in market with the help of innovative and creative technologies in market. It is
considered that if proper level of business functioning is implemented then it will increase the
overall productivity and efficiency of business. The innovative technologies in market are related
to use of cyber computing enterprises resources planning in market. It will help company to
grasp more clients through online portal and increasing the brand image in effective manner
(Mohd, Idris and Momani, 2013).
7.2 Market segmentation
However, existing business organizations who are indulged in providing foods and
beverage to clients are lacking with the new innovative and creative technologies. It has resulted
to low level of client’s satisfaction in market. Therefore, new ventures who are indulged in
running business by using cyber computing enterprises resources planning in market could easily
increase the overall turnover and market share. This cyber computing enterprises resources
planning will help new ventures to develop cost leadership and product differentiation strategy in
market. This will reduce the overall cost of the products and services and increase effectiveness
of the communication channel of organization (Loza, 2017). In addition to this, if proper level of
business is implemented then new ventures could easily create effective brand image in present
United Kingdom market. The main innovative strategy of lucky café would be to take orders

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through its cyber computing enterprises resources planning or developed dashboard. This will
increase the satisfaction level and experience level of clients on the edge of their satisfaction
(Mohd, Idris and Momani, 2013).
Application to industry/sector
There are several market segments such as restaurants business, hotels and coffee centers.
Lucky café could focus on grasping the restaurants business in starting. After that it could
planned to increase its overall products selling. This food and beverage industry has been
offering good amount of business growth and high potential which will showcase the positive
result to the future business growth.
7.3 Market potential/Target market
People in United Kingdom are more inclined towards the organizations and business
enterprises that uses highly advanced technologies in their business functioning. However, the
main advantage of implementing the business in United Kingdom which lucky café could have is
related to how well it could offer its products and services to its clients. If clients find the
services and products offered by Lucky Café are more attractive and accompanied by newly
innovative technologies then it will increase the overall market share of business (Rashid and
Ghose, 2015).
7.4 Macro-environment analysis
PESTLE analysis

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It is evaluated that PESTLE analysis helps company to evaluate all the internal and other
factors of business. This will help to optimize the resources of organization and implement
effective market strategy (Schmidt, Spann and Zeithammer, 2014).
Political- These are the political factors which influence company’s corporate governance,
government leadership, legal policies and laws of the company. In United Kingdom, starting of
food and beverage business is very easy and political view point of the United Kingdom
government is also very stable. Therefore, Lucky café could easily prepare its corporate policies
on the basis of existing law and political parties of United Kingdom (Siguaw and Simpson,
2015).
Social- It is accompanied with the value, belief, perception and wants, needs of the clients in
market. If proper levels of strategies are implemented then it will not only increase the turnover
of the business but also brand image of company. Lucky café has to keep its beverage products
sugar free in order to make its products customized as per the needs and wants of the clients
(Solomon, 2014).
Legal- It is related with the applicable rules and regulation of company. Lucky café needs to
evaluate all the tariff and traits of the business. It will also have to comply with the CSR rules,
regulations, international laws, workmen compensation act. Lucky café also have to evaluate all
the domestic and international rules and regulation which will also increase the effective
corporate governance of company (Wei, Samiee and Lee, 2014).
Economical- It is evaluated that GDP of the United Kingdom is growing with the average rate of
9% on the basis of last 5 years data. It is considered that with the increase in the GDP rate,
standards of living of the United Kingdom people is also increasing. In addition to this,

Business Functioning analysis of Company 13
employment rate and National income of the United Kingdom is also increasing with the
tremendous rate.
Technologies- These factors directly affect the business functioning and productivity of the
business. It will help company to provide product differentiation strategy in market. Lucky café
could follow cloud computing enterprises resources planning. This cloud computing enterprises
resources planning will allow company to customize its offering as per the clients demand in
market. It will also allow company to follow product differentiation strategy (Palia, 2014).
7.5 Micro-environment
Company
These above factors have shown that company
needs to evaluate all the policies and measures to
provide best quality of foods and beverage in
market. This will allow company to increase its
overall market share and brand image of company.
However, company needs to cover at least 10%
market share in this foods and beverage sector with
a view to cover up its invested capital within 3
years (Ramoglou, and Tsang, 2017).
Customers
There are several clients in UK who are
inclined towards availing best quality services.
Company could focus on customizing its
products and services to grasp more clients.
Competitors Collaborators

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Star bucks, Dunking’ donuts are the main
competitors for lucky café. These companies
are coming up with innovative business ideas
and plans to run its business.
In order to finance the business funding and
marketing of its products, Lucky café could
enter into strategic alliance with ITC for IT
marketing and banks for financing the project.
7.6 SWOT analysis of company
Strength
Lucky café by using ERP cyber computing system
could grasp more clients and increase its turnover
(Diggle, 2013).
Existing laws and regulations in UK is very
liberal. Lucky café could easily prepare its
corporate policies on the basis of existing law
and political parties of United Kingdom.
Weakness
Company could face litigation and proceeding
from the existing rivals in market.
There is high start-up cost which may result to
increased cost of production.
Opportunity
Lucky café could diversify its business in other
markets in future to increase the output of
business.
Threats
There is high growth in restaurant business
which attracts various businessmen to invest in

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Availability of experts employees may also
create core competency in product
differentiation strategy
this business.
Tough competition may result to facing high
loss in business.
9. Financial feasibility
There are several expenses which are required to start up new business (Brigham & Ehrhardt,
(2013).
8.1 Start- up capital requirement
Details Cost £
Restaurant expenses 40K
Employees hiring =
Employees salary= 1K* 13 employees=13K
Expenses for HR team 7K
Salary to managers and Key persons= 5k*2
=10K
30K

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Management expenses 20K
Marketing advertisement expenses 10k
Legal expenses 5K
Tender filling cost with vendors 1K
Licensing cost for the product 1K
Space hired 10K
Project escalation cost 5K
Total cost 122K
8.2 Financial analysis
Pricing strategy- Lucky café has planned to sell its products at its production cost. In addition to
this all the products are sold at cost plus 25% profit margin. The cost of Mojito drinks are
classified at the rate of £8.50 for the small one, £10.00 for medium size, and the largest size
is£12.50 (Petty, et al. 2015).

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Computation of the profit For the lucky café in 2017
Details Amount
Sales 2000000
Raw material 500000
Warehouse expenses 300000
Labour expense 100000
Other variable expenses 200000
Total variable expense 1100000
Contribution 900000
Fixed cost 500000
Profit 400000
Break even analysis –This reflects the point at which there will no profit no loss in business.
\.
(Source by author)
10. Conclusion
It has shown that there are various internal and external factors of business which an
entrepreneur should consider while implementing effective business functioning in market. If
company could use these factors in its strategic planning then it could easily establish effective
business functioning in UK business segment.

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11. References
Brigham, E. F., & Ehrhardt, M. C. (2013). Financial management: Theory & practice. Cengage
Learning.
Diggle, P. J. (2013). Statistical analysis of spatial and spatio-temporal point patterns. CRC
Press.
Mohd, W., Idris, S. and Momani, R.A., 2013. Impact of environmental dynamism on marketing
strategy comprehensiveness and organizational performance. International Journal of Business
and Management, 8(9), p.40.
Palia, A. P. (2014). Target profit pricing with the web-based breakeven analysis
package. Developments in Business Simulation and Experiential Learning, 35.
Petty, J. W., Titman, S., Keown, A. J., Martin, P., Martin, J. D., & Burrow, M. (2015). Financial
management: Principles and applications. Pearson Higher Education
Rashid, S. and Ghose, K., 2015. Organizational culture and the creation of brand identity: retail
food branding in new markets. Marketing Intelligence & Planning, 33(1), pp.2-19.
Schmidt, K.M., Spann, M. and Zeithammer, R., 2014. Pay what you want as a marketing strategy
in monopolistic and competitive markets. Management Science, 61(6), pp.1217-1236.
Siguaw, J.A. and Simpson, P.M., 2015. A marketing plan for marketing instruction: A satirical
look at student comments. In Creating and Delivering Value in Marketing (pp. 129-133).
Springer International Publishing.