Business Transformation Strategy for Rustic Fig Café: A Report

This report provides a detailed analysis of the Rustic Fig Café, an Australian Lebanese café, and its strategic transformation from a rustic-style establishment to an exquisite fine dining restaurant. The report outlines the café's current operations, highlighting its strengths such as a well-trained team, diverse Lebanese food options, strong supplier relationships, and a favorable location, while also acknowledging weaknesses like limited space and brand recognition. The core of the report details the procedures necessary for accomplishing this transformation, including defining the restaurant concept, securing investment, evaluating costs, obtaining necessary licenses, and designing a stellar menu. It emphasizes bridging gaps in innovation and variety of cuisines, suggesting a blend of Mediterranean and Australian flavors. The report concludes by underscoring the importance of these strategic measures for the café's successful evolution into a high-quality dining destination, offering an enhanced evening experience and broader appeal to the Adelaide community and beyond. Desklib provides access to similar reports and solved assignments for students.

Running Head: BUSINESS REPORT
Business Report
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Table of Contents
Introduction......................................................................................................................................2
Discussion........................................................................................................................................3
Overview of the café................................................................................................................3
The current operations.............................................................................................................3
Strengths..................................................................................................................................3
Weaknesses..............................................................................................................................4
Procedures for accomplishing transformation.........................................................................5
The gaps to be bridged.............................................................................................................8
Approaches to be adopted for the complete transformation....................................................9
Conclusion.....................................................................................................................................11
References......................................................................................................................................13

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Introduction
In the competitive market, every company follows a specific business model for the
growth and development of their organization and gain the competitive advantage over their
market rivals. A business model is the company’s plan for generating the revenues a make a
profit in the industry (Xie and Chou 2017). It especially elaborates the product or services relate
to the manufacturing in the market along with sketching the expenses it might incur. In specific
marketplace, a business model is the step –by-step layout of the business operations. Taken for
example, the business model of a café or restaurant is completely different than the business
model of an online operating company. In order to form a good business model, one needs to
have the knowledge of the value proposition (Roy 2015). The value proposition is the
straightforward statement of the company offerings which is worth value of the potential
customers which differentiates it from the other market dealers. There are many types of
business models such as the brick-and –mortar, e-commerce, online marketplace, brick –and –
clicks, retailer and manufacturer and many others. In order to comply with the changing business
environment and global market, organizations are often found to be transforming their business
models (Zohdy and Rakha 2016).
The method of establishing innovative process in the business model varies company
wise. There are many challenges too of implementing a new business model such as
organizational inertia, fear of cannibalization, resistance to change and also the risk aversion.
The current report will deal with the Rustic Fig Café situated in Australia. This restaurant is on
the verge of transforming their business from a rustic style café into an exquisite fine dining

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restaurant. The purpose of the report is to determine the operational and strategic measures
required to the café in order to address some of the vital issues while executing the overall
transformation. The report will elaborate the current operations of the café along with its
strengths and weaknesses. It will then propose the actions which are needed for the business to
accomplish the transformation. It will also analyze the gaps to be bridged and conclude by giving
an overview of the entire report.
Discussion
Overview of the café
It is a Lebanese café that serves breakfast, drinks and snacks situated in Adelaide,
Australia. The café has been holding the legacy of the flavors of the eastern suburb of Erindale.
The Rustic Fig Café is known for the casual relaxing friendly atmosphere that helps the visitors
relish the taste of Lebanese cuisine. They also offer vegan items along with a variety of meat
and fish dishes. The owners of the café are Naji and Erica Rizk who opened the café after
spending and experiment the flavors of Lebanon for nineteen years. As found from the reviews
of the customers, the menu card they serve consists of a detailed information of every dish so
that the customers feel free and do not hesitate before ordering (Therusticfigcafe.com. 2019).
The café is also loved by the visitors due to the affordable price range of the food and beverage
they serve. The Café has opened just a year ago and has become a preferable choice for the
people who love exploring the different flavors and dishes.
The current operations
The Rustic Fig Café is a café that sells the affordable range of products to a casual bit
upscale market. Among the well-known dishes of this café, the zaatar extra, falafel platter, lamb

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kafta, Lebanese dips are the most favored. It also provides other baked dishes associated with
the breakfast. It keeps a selected range of out –of –town newspapers to attract the customers. The
food and beverage services of the café is personally observed by the owners and the guests are
supported with all necessary help. The competitors of the café are “The Flying Fig “, “The
Coffee Club Café” and “ My Kingdom For a Horse” mostly. The raw- materials are taken from
the local suppliers to maintain the freshness of the food. It also targets and maintains a net profit
of minimum of 14 % by the third year. It aims at cultivating monthly sales of $ 167,000 by the
end of the fourth year (Therusticfigcafe.com 2019). the mission of the cafe is to establish the
rustic favors of Lebanon in the form of a fine dining restaurant.
It is dedicated at providing better quality food, coffee and beverage products no less than
a five –star restaurant. It concentrates at earning the position of becoming the “destination” of
choice to most of the Adelaide residents and outside too (Zhou, Fu and Yang 2016). The
transformation from a small rustic style café into an exquisite fine dining restaurant will help it to
provide a complete and high quality evening experience for those people who are searching for
the same. The transformation will enable not only the patrons to dine and receive comfort but it
will be open for people of all class and all race. People will have the opportunity to enjoy the
extensive range of dishes and enjoy the entertainment shows every organized every evening
(Zendzian, Carter and Jones 2017). The focus of the café is quite simple. It desires to provide a
sensual, sophisticated but casual dining experience to the Australian residents. It will bring
about those dishes in the menu which are unavailable in the entire Adelaide.
Strengths
The strengths of the café are the well qualified and well trained team who have sufficient
experience in managing the customers and serving the food. There is undoubtedly a wide range

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of Lebanese food along with the Italian pizza. It helps the customers to find the dish of their
choice. The quality of the product is always kept high and there is a strong relationship with the
suppliers who supply the raw materials. It helps the café to receive on time delivery of products
at affordable range. The stocks in the kitchen are also maintained and refilled before running out.
It further helps to retain their good will and customers never return dissatisfied (Dash and Bajpai
2015). The selection of menu is done with extra care experimenting the taste of the Australian
people. The location is another big strength of the café as it attracts the tourists too. There is no
other such restaurant nearby who serve such Lebanese food. The flexible timing of the café has
made it more favorable to people especially to the youngsters. It is open from 9 am – 11 pm on
weekdays and 9 am – 12 am on the weekends. The café welcomes all including the family,
friends, couple, children and others too. The customer reception and management is smooth and
swift. It plays the traditional Lebanese music at the evening time and also affords daily
newspaper for those who desire to relish the morning breakfast along with the news headlines.
Overall, it is a comfortable atmosphere and people want to visit it several times (Hora, Bouwma-
Gearhart and Park 2017).
Weaknesses
The weaknesses of the café are comparably lesser than the strengths. The business was
started having known the target market. Hence, there is no issue with the customers. The
products are also designed according to the customer’s preferences. Among the very few
weaknesses, one of the biggest weakness is lack of space (Rejikumar et al. 2018). It is a small
restaurant /café and do not have large space for arranging other events. There is space for
maximum of 50 people at a time. Hence, the café is aiming at expanding into an exquisite dining
restaurant along with the support of proper investors and financers. The second weakness is that

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its popularity is limited within Adelaide and not beyond that. Hence, the café needs to focus on
the branding too and invest on opening other braches too across Australia. Although the aim of
the café is to bring about the Lebanese flavors to the people of Australia, it must think out of the
box and bring something innovative combining the Mediterranean flavors with the Australian
essence. The café lacks innovation and variety of cuisines.
Procedures for accomplishing transformation
The Rustic Fig Café is on the verge of transforming their small café into a fine dining
restaurant. However, the process of transformation is not that easy and there are certain steps.
The general steps are- deciding the concept of the restaurant, getting investment to fund the
restaurant business, evaluating the cost of the restaurant involved, getting all the license needed
to expand business deciding the location, designing the stellar menu, getting suitable workforce
for the business, arranging the vendors along with the suppliers for the restaurant and installing
the right technology at the restaurant (Asl-Najafi, Yaghoubi and Azaron 2018). . These are the
general outlining of the procedures of the transformation. A deeper insight is always required for
better outcomes.
Deciding the concept of the restaurant
The first step is to consider the concept of the restaurant Before deciding the concept
there are many aspects which must be kept in mind. The major aspect is the amount of capital to
be invested. The average price per customer will be useful in providing a fair overview of the
money a customer would be spending in the restaurant. After deciding that, the theme of the
cuisine must be focused on (Dash and Bajpai 2015). The theme of the cuisine must be in terms
with the restaurant interiors. The following of the theme, the business plan can be made and it
will also be helpful in the future developments.

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Getting investment to fund the business
It is one of the most important aspect in a business plan because without proper funding,
many businesses are seen to be failing. The café must consider the funding. The funding and the
concept of the restaurant is completely interlinked. It must be finalized how much capital is
required. There are three ways through which funding can be received. Self-funding is the way
by which the owner can himself invest on the restaurant(Eddy, Gooi and Chen 2015). Loans can
also be taken or getting investors on board is another good idea. The investors usually notice the
growth potential, the scalability and quality of the business model. The performances are also
taken into consideration. The Rustic Fig Café an opt for the Angel funding or search for the
investors.
Evaluating the costs involved
The restaurant costs are a considerable part of operating a restaurant business. The costs
need to be evaluated and also planned carefully. The food costs will be increased with the
transformation of the café into a dining restaurant. The restaurant costs include the rent, the
interiors, the kitchen equipment, the license, the POS and marketing too. There will be rent costs
which can be affected by the business location. Since the Rustic Fig Café needs renovation in
the infrastructure, there will be added cost of it. The interiors can be decided based on the
concept, theme and budget of the restaurant. The kitchen equipment will also be changed as per
the concept. The restaurant licenses are few of the most essential expenses of the it and the
license fee varies with place and time. In the modern world of digitalization, the new restaurant
will need to reach the common people which can increase the revenues of the business upto 15
%. The more the restaurant bridges the gap between owner and customer, the more brand

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recognition it will receive. The digital marketing and the social media marketing are the most
cost –friendly and quick method of reaching at the doorsteps of the target market.
Extended manpower for the restaurant
The staff selection of a café and restaurant is not so much different but there are certain
facts which differentiates the two. In a fine dining restaurant, the selection and hiring of the right
talent is extremely important. The selection of staff is also important in a café but a café is a
comparably smaller space where few people come. On the contrary, in a fine dining restaurant,
the list of visitors is long and they come from different places and backgrounds. The
transformation of the business model will require different staffs at different departments with
specific skills. First of all, the skilled kitchen staffs such as the cook, support staff, the food
preparation staff are required (Papantoniou, Kolokotsa and Kalaitzakis 2015). There will be
required more skilled and talented waiters, the housekeeping staffs who would be interacting
properly with the customers. They need to good in their communicating skills and should be
trained properly. The chef, the manager, the store manager is the management staff who must be
up to the level of the restaurant.
Arranging the suppliers and vendors for the restaurant
A strong relationship with the vendors and the suppliers is important for the operations of
the restaurant. Since, the size of the restaurant will be increased from a small café, there should
be at-least 2-3 vendors. It would help the restaurant owner to compare the prices and will be kept
as a backup during the case of unavailability (Zendzian, Carter and Jones 2017). there should be
a different department of inventory which will be useful in the emergency situation. The items
and the operations should be monitored every day at every level. There also will be a waste

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management team/department. The regular monitoring of the quality and quantity will retain the
reputation of the restaurant. There will also be long term contracts with the vendors as it will
help to maintain the raw material consistency.
Installation of the right technology
The restaurant technology is one of the most important part of a restaurant business. In
the modern world, there will be a demand of new technology in the restaurant. The installation of
the modern technology such as POS with a range of integrated features. It will help to streamline
the business operations of the restaurant a lot.
Image – Business model transformation
Source – (Holmström, Liotta and Chaudhuri 2017)

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The gaps to be bridged
In the recent times, the change in the environments has caused the organizations to
change their way of operations and business model too. There are some fixed factors of these
changes which includes the customer preference change, the digitization, the regulatory changes,
the entry of new competitors or the globalization (Otley 2016). All these factors have
collaboratively created the situation of change in the businesses. Hence, it can be said that the
transformation and innovative change of the existing business models is becoming a basic aspect
that guarantees the competitiveness of the organizations (Papantoniou, Kolokotsa and
Kalaitzakis 2015). In the case of the Rustic Fig Café the transformation in the business model
will bring hike in the revenues and ensure the competitiveness in the market. The gaps/risks or
challenges of the transformation of the business model are as follows:
The gap in the internal vision - The restaurant will have to understand the requirements of the
most relevant components of a successful initiative and recognize the change factors which can
leave greater impact on the present business model (Gofuku, Inoue and Sugihara 2017). In this
terms, the café will have to think out of the box in order to address this aspect.
The organizational inertia- The complexity of overcoming the previous logic of the café can
limit the generation of new ideas (Ferreira et al. 2015). It puts the conventions on the current
business model on question. In order to address this issue, the application of analogies and
critical questioning is mandatory.
The service/product focused vision - The restaurant might face difficulty in the business model if
it starts acting too product/ service oriented. The restaurant might be needing a more systematic
vision.

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The fear of cannibalization- The transformation into a new business model might sometimes
require the dropping of current income source in order to replace it with others. It might delay
the decision making process (Holmström, Liotta and Chaudhuri 2017). Hence, often
cannibalization of the self is necessary, otherwise it ca be cannibalized by other companies.
The resistance to change - The transformation of the business model implies change, either
small or huge. There are certain reasons behind people being reluctant to adopt the change and
even boycotting the new initiative. The implementation of the new business model can fail due
to this reason (Eddy, Gooi and Chen 2015). The restaurant can keep the empathy, transparency,
personalized responses and communication strong to address this gap.
The aversion of risk – It is likely that the launching of the new business model can damage the
image of the company if anything goes wrong.