Business Plan: Tea Cafe for Small Business Management, Final Project

This business plan outlines the development of a tea cafe in Barrie, Canada, designed to offer customers a quaint and relaxing environment to enjoy high-quality tea and complementary bakery items. Targeting both local middle-class residents and tourists, the cafe aims to educate consumers on the benefits of tea and provide a superior alternative to commercially available products. The plan includes detailed sections on the product, target market analysis (demographics and psychographics), distribution strategies, optimal location considerations within Barrie, market potential, and competitive analysis. Furthermore, the business plan delves into pricing strategies, promotional tactics, organizational structure, operational procedures, and comprehensive financial projections, including start-up costs, revenue forecasts, and profitability analysis, which are crucial for the success of the sole proprietorship venture. The cafe intends to offer a unique experience, including a tea library and tea experts to guide customers, aiming to establish a strong brand identity and customer loyalty through quality products and excellent service.

Running head: BUSINESS PLAN
Small Business Management: Business Plan
Name of the Student
Name of the University
Author’s note

1BUSINESS PLAN
Executive summary
The purpose of this assignment is to develop a business for a tea café in Canada. The café is
located in a popular tourist place of Barrie city. The idea of the place is to offer the customers a
quaint and claim place to sit and enjoy the view as well as sip a good quality cup of tea. The café
will sell bakery items that compliment the tea as well as sell loose tea which is of far better
quality that what is available in the grocery stores commercially. The café will target the middle-
class localities as the primary consumer and the tourist of the city as the secondary customer.
The café not only wishes to provide people with good quality product or service they also aim to
educate people regarding the pros of tea consumption and how it is better than many other hot
beverages. With the help of the below stated promotional tools the company wishes to
communicate with the customers, build a valuable relation and establish the entity. It is a sole
proprietorship business and the owner is responsible and liable for all the operations and duties
of the business.

2BUSINESS PLAN
Contents
Part one............................................................................................................................................3
1.1 The Product............................................................................................................................3
1.2 Target market.........................................................................................................................6
1.4 Location.................................................................................................................................8
1.5 Market potential...................................................................................................................10
1.6 The competition...................................................................................................................11
Part 2..............................................................................................................................................12
2.1 Pricing..................................................................................................................................12
2.2 Promotion Strategy..............................................................................................................14
2.3 Organisation.........................................................................................................................18
2.3 Organisation.........................................................................................................................18
2.4 Operations............................................................................................................................20
2.5 Financial Plans.....................................................................................................................23
Reference List:...............................................................................................................................26
Appendices................................................................................................................................30

3BUSINESS PLAN
Part one
1.1 The Product
Drinking tea is known is often associated with sophistication and class, we intend to
bring the best flavors of the world to the customers so that they can experience the beauty of
brewing tea and clamming the senses (Summerfield, 2015). The café is going to be a warm hide
out for people who are looking for quaint, clam place to enjoy tea and time with friends and
loved ones. The idea of this kind of a “teahouse" experience is taken from the tea shops situated
in various hill stations of India. The customers will be open to experimenting with exotic tea
flavors from around the world as well as complement that with an assortment of various kinds of
bakery items form biscuits to pies etc (Alstete, 2014). The customers can also buy loose teas, tea
accessories like different types of kettles and cups from a collection of items from around the
world. There will also be premium chocolates, and gift baskets, along with souvenirs and gifts
for our tourist customers. Customers can also buy loose tea form our online website. The café
will apply to be a member of the Tea association of Canada (Summerfield, 2015).
The vision statement
The organisation seeks to be fist choice of the tourists as well as localities when it comes to
enjoying quality time with friends and loved ones.
The mission statement
To serve best quality tea from around the world and to offer a nostalgic good time to the
customers

4BUSINESS PLAN
Goals of the company
 To popularize the tea culture
 To introduce a new kind of café in the locality
 To educate people regarding the benefits of tea
It is a café and the customers can either choose to sit and enjoy a cup of tea and other
complimentary items from the bakery or they can take away their cup of tea in a to-go style
sipper they can also take away bakery items. The customers can buy loose tea form our variety of
tea section. The shop will also have tea accessories which are not easily available like tea cozies,
bone china tea sets etc.
Tea will be available from various parts of the world like: India, Nepal, Sri Lanka, China,
Japan, Morocco, Turkey at the beginning and slowly other flavors will be introduced. There are a
number of subdivisions of the kind s of tea that will be made available to the customers from
these countries. For example: there will be Assam, Darjeeling as well as tea from the Nilgiri
region of India. The café will have tea experts who will explain the benefits and tastes of each
tea so that it is easy for the customers to decide (Tea.ca, 2018). Apart from that there will freshly
baked items to compliment the tea and the customers can also take away the order.
From the perspective of the customers the café will be a place to talk and have a good
time with friends; people who love drinking tea will love the tea assortment that we have to
offer. It will also be a good place for the tourists to visit and spend time among the gorgeous
location of the quaint café. The company will focus on the quality of the product and the service,
the hostess and the waiters of the café will be provided with training regarding various kinds of
teas and their benefits this will ensure a value relation in between the company and the

5BUSINESS PLAN
customers. The customers will also get an opportunity to learn about various health prospects of
tea consumption and they will also be able to purchase tea from around the world. The customers
of the organisation will be also lured by the cozy environment of the café as the ambience of the
café will smell of tea and bakery items,.

6BUSINESS PLAN
1.2 Target market
The café will encourage young people to understand the benefits of the tea and use the
café as a place for afternoon meetings and discussions. People who have an idea about tea
drinking and are accustomed with the culture will enjoy their time in this café. People who are
tired of buying commercially packed tea from department stores and tea bags will get their
favorite tea in the café. The café also targets the tourist; the population of tourists is also
significant in the location of the café.
Demographics:
 The age group of the target market is in between 18-55 this is a wide target group as the
organisation does not want to promote tea drinking as the practice adopted by only older
people, the company wants to educate the young population regarding the benefits of tea.
 The café will provide the neighboring upper-middle-class community with a place to
socialize and meet people.
 Most of the people are localities and the ones who come to visit the place.
 Well-educated, aware, politically and socially conscious, responsible and aspirant citizens
Psychographics:
 The café will target people who enjoy and appreciate a good cup of tea and good
company.
Secondary customers

7BUSINESS PLAN
Tourists are the secondary customers of the café that are being targeted as potential buyers.
Tourists who are looking for a place to sit and rest along with a cup of tea and snacks can not
only enjoy the view of the area, but also enjoy the claim environment.
1.3 Distribution
The organization is a café cum tea store where the customers can come and sit and enjoy
the quaint and peaceful ambience of the café. There will be around twenty table arrangements
five on the ground floor and fifteen in the first floor with. The café will have strength to
accommodate maximum 50 guests at one time. In the ground floor there will be a counter of
display of the complimentary items which the customers can purchase along with the billing
counter. There will be an array of display of the various kinds of tea preparations that will be
available in the café, the person at the billing counter will help the customer to make their choice
in case they are unaware of what to order (Armstrong, 2014).
There will also be takeaway facility for the customers where they can choose to take their
cup of tea and sip it along the way back home or to the office.
The café will also have a tea library where people can go and choose to take loose tea. The
specialists will help the customers pick out the best kind of tea as per their choice of taste and
will also help them with the brewing instructions as different tea has a different brewing
procedure.

8BUSINESS PLAN
After a few years of establishment and enough popularity among the locals as well as the
tourists the company will develop e-commerce facility as well. This will help the customers to
order loose packaged tea online.
These distribution channels are decided based on the target market portfolio that has been stated
above, as the primary customers are the localities and the idea of the organisation is a café.
Hence the distribution of the product or service channel is justified.
1.4 Location
Barrie City is one of the quaint yet popular tourist sites in Ontario of Canada. This is a
famous tourist spot in the country and people usually come here to enjoy ski and snow.
Therefore it will be perfect to serve the target market as mentioned above (Tourismbarrie.com,
2018). Tourists from various parts of the world come to visit the beautiful city; it is popular for
the skiing destination and natural beauty.
Location criterions are as follows:
 The café should be located beside or near a famous tourist spot but not away from the
town. This will help in catering both the primary as well as the secondary customers. For
a small business it is essential to ensure that the target market can see the establishment
and the existence of the place.
 The place should be easily accessible by the employees and the owner of the café as the
opening times are from morning 8 am. This will help the café to attract people who are
going to office, as they can quickly grab a cup of tea and few bakery items on their way

9BUSINESS PLAN
 The location should also be on a main road so that people are aware of the existence of
the café without even promoting the place. As a small set up promotional aspects are
restricted hence location of the café will play an important role.
 The location should not be near any other café or restaurant as that would take away from
the secondary tourists who might visit the place to rest after travelling or shopping a lot
As mentioned above the café will have two floors where the ground floor will have some
seating arrangements with the billing counter and the bakery display and another side will have
the tea library where the customers can choose their choice of loose tea and also learn how to
brew them from the experts of the team. The owner will be available in the café and will look
after the management. The first floor will have 15 tables where arrangement of 40 people will be
made. Whereas there will be place for five table and 10 people accommodation on the ground
floor. Refer to the picture in Appendix 1.

10BUSINESS PLAN
1.5 Market potential
Tea is the second-most consumed beverage in the world, and sales are consistently
increasing. Drinking tea as a beverage is gaining popularity in Canada as well. According to a
market research firm, tea is the most popular drink after water in the world (Tea.ca, 2018).
Canadians are not only developing a taste for tea they are also experimenting with various kinds
of teas, one of the major reason for this increase demand for tea in Canada is immigration from
countries with strong tea-drinking cultures like India, China, the Middle East and Russia etc.
Another major aspect that is recognized to be increasing the popularity of the beverage is the
health benefits associated with tea; people are becoming more and more health conscious and
want healthy alternatives of every food aspect. The sales of tea reached $1.3-billion in Canada in
2015 – a 23 per cent increase from the previous years (Siddiqi, 2017). There are two tea markets
in the tea industry of Canada one is the packaged loose tea and tea bags that are found in
supermarkets and grocery stores etc. Another slew of players in the market are, the online e-
commerce market like the Davids Tea, There are also distributor like in cafes and tea houses etc.
Therefore it can be concluded that there is enough scope for the company as the tea industry is in
the growth stage (Siddiqi, 2017).

11BUSINESS PLAN
1.6 The competition
There are a number of cafés in the Barrie, but there are very few direct competitors of the
café in the region. There are just two cafes in the region that specialize in selling tea. This is a
great advantage for the company as it will not only make it unique but will also help in building
a new culture in the town. These two cafes are: Hamley's Tea & Coffee Co and Campbell's
British Food & Tea Room (Bah and Fang, L, 2015).
Other cafés that sell coffee and other hot beverages are indirect competitors of the
company as they are substitute for tea. For example: Alchemy café, Riverwest Bistro,
Cheekcakos bakeshop are the three important indirect competitors. The strength of these cafes
are that they have been here for a long time and people are more used to coffee than tea in this
region, but another important opportunity and weakness of the substitutes are the fact the tea is
gaining popularity and people like to enjoy change.