Entrepreneurial Cafe Business: Market Research & Analysis in Australia

This report presents a market analysis for launching an entrepreneurial cafe business in Australia. It addresses the problem of limited market knowledge by delving into customer preferences, optimal locations, and essential business strategies. The research design incorporates both primary surveys to understand customer expectations regarding product preferences, pricing, and service quality, and secondary research to analyze market conditions, government policies, and competitor performance. Key areas explored include customer frequency of visits, preferred flavors, and the importance of sustainability and e-commerce presence. The sample design targets a diverse population of 200 respondents, using statistical sampling techniques in accessible locations like shopping malls. Data collection involves surveys and statistical analysis using software like SPSS, ensuring ethical research practices. The budget and timeline outline financial allocations and project milestones, emphasizing the importance of strategic resource allocation and compliance with Australian laws and regulations. Ultimately, the report aims to provide actionable insights for informed decision-making and successful cafe business expansion in the Australian market. Desklib offers a wealth of similar documents and study tools for students.

Running head: STARTING A CAFE
Entrepreneurial Café Business
Name of the Student:
Name of the University:
Author Note:

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Table of Contents
Problem statement/background:......................................................................................................2
Purpose of research:.........................................................................................................................2
Research design and questionnaire:.................................................................................................3
Sample design:.................................................................................................................................5
Data collection, processing and analysis:........................................................................................6
Budget and timeline:........................................................................................................................6
Dummy tables:.................................................................................................................................8
References:......................................................................................................................................9

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Problem statement/background:
The paper would delve into market analysis to measure the profitability of new café in
Australia. The proprietor of the entrepreneurial venture conducted the market research to gain
knowledge about the customer preferences and customer segments. The management of the
restaurant had very limited knowledge about the preferences of the consumers in Australia and
did could locate a convenient location for the business. They entrusted the responsibility of
gaining information about the market to a consultancy firm (Scarborough, 2016). The paper
would suggest the upcoming entrepreneurial café firm about customer preferences and a
profitable location. The research would require delving into the market conditions of Australia. It
should consider using models like PESTEL which alignment to food industry. The research
would pave ways for the business to form important strategies in terms products, pricing,
location, financing and salient aspects which have to be taken into account. Appropriate decision
making based on the market research would play significant role in ensuring success and
expansion of the café business in the Australian market (Kirzner, 2015).
Purpose of research:
The main purpose of the research is to gain information about information about the
market condition of Australia prior to embarking on food ventures like cafes. Success of new
business organisations, irrespective of sizes and scale is dependent on its power to deliver
products aligned to the needs of the customers. This is due to several factors which exist in the
market. First, the entrepreneurial ventures, especially the sole proprietorship ventures have
limited resources which they invest in the business. Secondly, new ventures face competition
from existing companies in terms of customer base, capital generation and revenue generation
(Drucker, 2014). Thus, they have to acquire considerable customer base and earn sufficient profit

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to succeed in the face of this competition. They thus have to introduce appropriate products
which are in line with the customer preferences. Moreover, customer preferences are dynamic in
nature and the business organisations require to remain abreast with it. This main purpose would
give way to forming strategies pertaining to marketing mix of the café.
Research design and questionnaire:
The research design should consist of gaining both secondary and primary research. This
is because the formation of an appropriate marketing strategy requires knowledge about present
customer preferences and future market trends. Entrepreneurial ventures, unless subsidiaries of
multinational companies have limited financial resources compared to the cut intense
competition in the global market. Hence, they require to allocate their resources judiciously in
areas like acquiring raw materials, human resources and production. This justifies use of primary
and secondary research. The primary research would consist of conducting surveys of customers
to gain knowledge about their expectations from cafés and restaurants (Dees, 2017). The
questionnaire would aim to gain certain specific pieces of information that would guide
formation of the marketing mix of the café. The information would revolve around their product
preferences form cafes, their pricing expectations, frequency of visits and their expectations as
far product range is concerned. The information would also revolve around expectations
customers have about ambience, services and location. The researcher should gain information
on the expectations which the customers have from the ecommerce portal of the restaurant, like
delivery, product viewing, availability of variants of products online and customer service
support.
The secondary analysis would include study of books, articles, journals, magazines and
internet websites. Business firms come under factors like government policies, laws, economic

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conditions, financial conditions and availability of talent. For example, the firms irrespective of
size and industry have to comply with the Safe Work Act and the WHS laws. Thus, the
entrepreneurial venture should gain knowledge on these matters. The café management fuirst
need to acquire license and approval in order to open and run a café business in Australia. Thus,
it requires to gain information from government websites regarding these facts. Proper
compliance would the laws and policies would enable smooth running of the business whereas
failure to comply with the laws would prove to be hazardous for the business (Parker, 2018).
Hence, it can again be justified that the café management should conduct secondary research to
gain information on market conditions in Australia.
Location of the outlet plays a very important role in deciding customer footfall and
profitability. For example, location of the outlet of the café at a strategic place would enable
customers to accede the café easily. This would result in generate a business and high
profitability. Similarly, location at a strategic position would enable the café to acquire supplies
of raw materials easily. Thus, location at a strategic place would directly impact customer
footfall and revenue generation. The researcher requires to apply both primary and secondary
analysis. The primary analysis would involve surveying the respondents on their preferred
locations. The secondary analysis would involve analysis of market performance of the existing
cafes situated in different locations (Kuratko, 2016).
The next analysis would involve collecting data regarding suppliers of raw materials
situated in different locations. The researcher would gain information on the different suppliers
from which the café can gain raw materials like coffee beans and milk. Then it would require
require to obtain quotes from them and gain information about their business conditions. The

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proprietor(s) would then decide on the suppliers from which the café would acquire raw
materials (Storey, 2016).
The discussion shows that both primary and secondary research should be adopted by the
café to gain information about the market conditions in Australia. It would then use the findings
as the bases of its business decisions as discussed above. The following are the question which
the researcher would ask the respondents:
1. How often do you go to a café or a restaurant?
2. What are the factors you consider before choosing a restaurant or café?
3. What is your preferred location?
4. What is your most preferred flavour?
5. To what extent does service quality and ambience matter to you?
6. What are the main food item/drinks you prefer to have at a café?
7. What is your income?
8. Is it important according to you, for cafes to operate sustainably?
9. Is is compulsory for cafes to have ecommerce presence?
10. What suggestion(s) would you give to the café owners?
Sample design:
The target population for the market research of the café would be 200 respondents and
the preferred sampling technique would be statistical. The sample size would consist of 200
individuals minimum. This would allow the researcher to gain sufficiently large body of data to

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carry out the research. The respondents should be from diverse professions, age groups, cultures
and other background types. This would enable the researcher to gain immense knowledge about
preferences of different individuals. The preferred locations of meeting the respondents would be
shopping malls where the researcher would be able to communicate with a large number of
respondents (Dentchev et al., 2016).
A large sample would also enable the researcher to get large amount of information
among he can choose the best pieces information which he can use to proceed with the research.
Incomplete and inappropriate responses can be discarded. The researcher should be particular
about the accuracy of the information which he would presenting in the research. The researcher
should obtain consent of the respondents before presenting their opinion in the report. The
researcher should abstain from asking any personal and inappropriate question to the respondent.
He should use the information gained from the interview only for the research purpose.
Data collection, processing and analysis:
The data would be gathered by the researcher firm by surveying minimum 200
respondents. The data would be collected using primary and secondary methods. The researcher
would analyse the data using software like SPSS and analyse it statistically. He should exercise
strict supervision on the accuracy of the information he would present in the research. He should
ensure strict supervision on the data he would collect. He should ensure that he does not distort
the data and responses. He should present authentic information in the research. He should
conduct the research ethically. He should not present counterfeit and fake data in the research.
Budget and timeline:
Amount

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($)
Sources of funds
Allocation from accounts
department 1000000
Loan from bank 150000
Total 1150000
Expenditures
Building(Note 1) 100000
Furniture 50000
Vehicle rent 2000
License 5000
Salary (100 employees) 60000
Advertisement 7000
Stationary 5000
Miscellaneous 5000
Raw materials 50000
Total expenditure 284000

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Budget surplus 866000
Note 1: The amount in building represents amount which would be spent to acquire a building.
The research firm needs to form a budget to estimate the like sources of income and
expenditure related to the start-up café business. It has been assumed that the sources of finanbce
for the start-up business in the initial business come from allocation of funds by the accounts
department and loan taken from the bank in the initial stage. The expenditures are shown. The
budget shows that the business would have around $866000 at the initial phase. The analysis
shows that the business requires to allocate more funds to fuel further operations.
Time line:
The research firm should follow a time line to conduct the research and present its
findings before the café management. The time line is as follows:
Activity 1: Conducting marketing research on macroeconomic situation in Australia.-6 months
Activity 2: Presenting findings of macroeconomic research before management- 1 month
Activity 3: Gaining approval from management of the café-1 month
Activity 4: Conducting survey-2 months
Activity 5: Presenting findings of survey before the management of the café-1 month
Dummy tables:
Attached

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References:
Dees, J. G. (2017). 1 The Meaning of Social Entrepreneurship. In Case Studies in Social
Entrepreneurship and Sustainability (pp. 34-42). Routledge.
Dentchev, N., Baumgartner, R., Dieleman, H., Jóhannsdóttir, L., Jonker, J., Nyberg, T., ... & van
Hoof, B. (2016). Embracing the variety of sustainable business models: social
entrepreneurship, corporate intrapreneurship, creativity, innovation, and other approaches
to sustainability challenges. Journal of Cleaner Production.
Drucker, P. (2014). Innovation and entrepreneurship. Routledge.
Kirzner, I. M. (2015). Competition and entrepreneurship. University of Chicago press.
Kuratko, D. F. (2016). Entrepreneurship: Theory, process, and practice. Cengage Learning.
Parker, S. C. (2018). The economics of entrepreneurship. Cambridge University Press.
Scarborough, N. M. (2016). Essentials of entrepreneurship and small business management.
Pearson.
Storey, D. J. (Ed.). (2016). Entrepreneurship and new firm. Routledge.