Kaffee-Coffee Business Plan: Strategy for Global Coffee Market

This report provides a comprehensive business plan analysis for Kaffee-Coffee, a British startup aiming for global coffee market dominance. It details the company's vision, mission, and examines broad market trends through a PEST analysis. The report explores industry trends using Porter's Five Forces, market segmentation strategies (geographic, demographic, behavioral, and psychographic), and consumer behavior. It identifies key resources, conducts a SWOT analysis, and outlines an implementation plan including activities, timeframes, and responsible departments. A three-year profit plan is also presented, projecting sales, costs, and profits. The report concludes with a discussion of the company's strategic approach to growth and sustainability in a competitive global market.

Running Head: Business Entrepreneur
Business Entrepreneur

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Contents
Introduction.................................................................................................................................................1
Vision...........................................................................................................................................................1
Mission........................................................................................................................................................1
Broad Trends...............................................................................................................................................1
PEST Analysis...........................................................................................................................................1
Industry trend porter...............................................................................................................................2
Market.........................................................................................................................................................2
Segmentation..........................................................................................................................................2
Consumer Behavior.................................................................................................................................3
Segregation..............................................................................................................................................3
Resources....................................................................................................................................................3
SWOT...........................................................................................................................................................4
Implementation plan...................................................................................................................................5
Profit Plan....................................................................................................................................................5
Conclusion...................................................................................................................................................6
References...................................................................................................................................................7

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Introduction
Kaffee-Coffee is a British startup company which is aiming to serves coffee all around the world.
The company is headquartered in Bedfordshire, United Kingdom. In total Kaffee-Coffee has its
coffee house in 340 locations and in 15 countries till now which shows that the company is
working on large scale in global competitive world. Coffee is the many products which are
served in coffee house of Kaffee but sandwiches and iced drinks are also liked by people over
there. The net income of the company earned in the previous year is $ 40 million. Kaffee-Coffee
the company further aims to grow and achieve the target market against is competitors. The
below-mentioned report discusses about the business plan which the company shall use to
sustain its growth and develop in competitive world (Scarborough 2015). Further details about
the task are discussed below:
Vision
The vision which the company holds is that it wants to be the best office for dialogue over a cup
of coffee. The company aims to bring people out from the circles and initiate conversation and
contract with each other of a cup of coffee. This will develop flow of ideas and growth of the
company as well.
Mission
The mission whom Kaffee-Coffee holds is that it wants to become the best café chain by offering
world class innovative coffee experience to people at an affordable price. With this the company
wants to create a solid brand image which can influence other target customers and it also wants
to satisfy people with their offering of products at affordable prices.
Broad Trends
PEST Analysis
Political: As the political environment of UK changed due to coalition government due to which
the company faced many changes. The value added tax (VAT) rates started fluctuating

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continuously. Lower VAT rates resulted in lowering the price of coffee but increase in such rates
made the coffee costly due to which it negatively impacted on the sales of the company.
Economic: As the cost prices of the product reduced this resulted in increase in sale volume of
the company. But the economic crisis held in UK led to heavy unemployment due to which
purchasing power of people reduced and again affected on the sales of Kaffee-Coffee. Also it
shall be noted that decrease in value of pound also majorly affected the company as it initiates
transactions with other countries through Foreign exchange (Baker 2014).
Social: Talking about social culture in UK it shall be noted that now day’s people are more
inclined to intake coffee during their regular day to day activities to reduce stress. Resulting to
which, the sale volume of the company has increased overtime. A change in lifestyle and attitude
of people is majorly acting as a positive factor for the growth of the company.
Technological: With the used of advanced machines to make coffee and introduction of different
types of coffee in the organization, the organization growing. The introduction of Electronic
Point Of Sales (EPOS) helped the company to increase the efficiency of retail customers in
coffee houses as well. The technological implementation helped the company to gain the
competitive edge in the target market (Morland 2017).
Industry trend porter
Threat of new entrants: threat of new entrants in the market depends upon the barriers levied on
the whole industry. So, talking about the barrier, it shall be noted that there is less barriers
present in the industry to which there is more threat of entrants in the coffee industry.
Threat of Substitute: coffee has many substitutes present in the external environment like tea, hot
chocolate, iced tea etc. But at the end it all depends upon on the willing of the customer and their
purchasing power to purchase the product in the target market. Similar level of price with
substitutes acts as a major threat for the company (Armstrong, et. al., 2015).
Bargaining power of customer: Presence of very few famous suppliers of coffee in market makes
difficult for the customers to use their bargaining power. Resulting to which, the customers are
willing to pay any amount for the products. All it depends upon the taste of coffee due to which
people are insisted to buy the product in the market which makes their power low.

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Bargaining power of suppliers: The bargaining power of the suppliers is low in Kaffee as the
company has eliminated competition due to which suppliers bargaining power also reduced.
Industry Rivalry: There is high degree of competition in the market due to which there is more
degree of rivalry in industry (Doppelt 2017).
Market
Segmentation
Segmentation refers to the process of dividing the customers present in the business market on
the basis of the features of the product served in the market. It tells the company about the actual
prospective customer which the company shall target in the market. Further there are four types
of segmentation processes used to evaluate the customers of Kaffee in the market which are
discussed below:
Geographic Segmentation: UK, Dubai, Middle-East, Asia Pacific Region etc. are some of the
areas where the company shall majorly lay stress to target the customers in the market.
Demographic: The company adjust their flavors and taste of coffee according to the
segmentation depending upon age group of people. Adult people more prefer having caffeine as
it stimulates their brain cells which help them to work better. The privileged classes are more
targets by the company and more of professional people drink coffee as it is also a way for them
to release their stress and tension of work (Cramer 2017).
Behavioral: This approach is related to the need of customers present in the market, so people
like coffee according to their tastes. Some like it too strong like Americano and some like it
normal like espresso. So the company has introduced a wide range of products according to the
taste and preference of customers of different group. This helped them to target a large base in
market.
Psychographic: Mainly people who ar busy all day working or having professional meeting
drink more coffee as it charge up their energy and help them to remove their dizziness and work
efficiently (Tran 2013).

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Consumer Behavior
The behavior of the consumer is mainly affected by two factors that are taste and preference and
their purchasing power. The base of company shifted due to economic disruption but now people
are becoming loyal customers due to their taste and affordable prices. Wide variety gives the
customers a chance to purchase coffee according their taste resulting to increase in sales.
Segregation
Segregation is a term which is similar to segmentation of customers of Kaffee-Coffee in the
market. With the help of the above mentioned segmentation process it becomes easy for the
company segregate the customer and look for the prime customers in the target market.
Resources
The company Kaffee-Coffee has a diversified range of resources and capabilities present in the
market with the help of which they have eared such unique value till date. So, the resources with
the help of which Kaffee is growing well in the market in discussed below:
High employee retention: employees of the company are the biggest resource with the help of
which they ear profit in the target market. Thus employee rendition is an important factor which
shall be taken care of by the managers. The company retains the employees by providing them
services which satisfies their esteem needs (Burns 2014). Due to this process a bond is created
with the employees and the company also does not faces training cost again and again.
Machineries: Automated machineries helps the company to make coffee in less time which
increase the satisfaction level of customer by reducing their waiting period. Also the coffee
created is also made according to the perfect margin of all the ingredients. These resources help
the company to build a brand entity in the target market and increasing consistency in their
services as well (McKenzie 2017).
Product diversity: With difference in the taste of coffee preferred by customers, the company
also introduced coffee with different flavors depending upon the requirement in the market. This
line helps the company in increasing the level of satisfaction of customers.

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SWOT
Strengths: the biggest strength of the company is its essence taste which they provide to the
customers in the target market. People get attracted to the company because of the fragrance of
its coffee and its differential taste as well. The bargaining power of supplier is also one of the
strength to the company as the company has maintained an image to due to which they enjoy
high power in the market. Also there is moderate power of buyer due to which the company
pushed itself to develop more product line and increasing its sales. (Corbaci, et. al., 2014).
Weakness: Increase in price of the prices of coffee beans resulted as a disadvantage for the
company as it increased the prices of coffee subsequently. Further were many other factors as
well which didn’t work in favor of company like taxes etc. also increased the prices of coffee due
to which the product became out of purchasing power of the customers in the market. (Do Tu
2017).
Opportunities: The Company has potential opportunities to grow in Europe and China by making
a strategic alliance with other company. India and Brazil are also the major areas where the
company gains the opportunity to grow and initiate its overall sales (Finch 2016). Expansion in
different countries will provide an opportunity to Kaffee-Coffee to grow in the market and
diversify their business as well. They get the opportunity to exploit the market share by
diversifying their business.
Threats: threat of entrance of new comer and substitutes are major threats present for the
company in the market which can harness their growth. It all depends upon the pricing strategy
of companies present in the market and preference of customers present in the market (Saunders
2016).
Implementation plan
Initial activity of business plan is to increase the number of outlets worldwide, further with the
office set-up activity they initiated to reduce wastage. Then with website development the
company aimed to increase the sales by the way of online transaction. And lastly the recruitment
activities initiated selection of experts for the new outlets of the company.
Activity Time Period Manager Growth Concerned

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(in hours) Objective Department
Initiation of
Business Plan
382.5 Marketing Head Increase in outlets
of company
Marketing
Division
Office set-up 382.5 Administration and
HR head
Reduction in
wastage
Owners
Website
Development
382.5 Creative and
Designing
managers
Initiate sales 30%
Sales online.
Information
Technology
department
Recruitment of
experts
382.5 HR manager Hiring of experts
for new outlet
Human
resource
department
Profit Plan
The three year profit plan provides an idea and a path on which the employees of the company
shall run in order to gain excellence for the organization.
Year-1 (In $)
Particulars Qtr-1 Qtr-2 Qtr-3 Qtr-4
Sales 50 54 60 63
Less:
Cost of material 12 10.8 12 12.2
Cost of labor 20 17.77 19 17.245
Variable
overheads 6 8 10 13
Fixed overheads 5 5 5 5
Total 43 41.57 46 47.445
Profit 7 12.43 14 15.555
Year-2
Particulars
Qtr-
1 Qtr-2 Qtr-3 Qtr-4
Sales 65 67 70.77 73.3
Less:

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Cost of material 14 14 17.99 20
Cost of labour 20.4 22.8 24 29
Variable
overheads 9.1 6.7 2.56 4.1
Fixed overheads 5 5 5 5
Total 48.5 48.5 49.55 49.9
Profit 16.5 18.5 21.22 23.4
Year-3
Particulars
Qtr-
1 Qtr-2 Qtr-3 Qtr-4
Sales
85.5
2 89 101 112
Less:
Cost of material 22 23 26 26.66
Cost of labour 30.1
30.11
8 31.56 33.349
Variable
overheads 3.42 3.112 5.44 6.986
Fixed overheads 5 5 5 5
Total
60.5
2 61.23 68 71.992
Profit 25 27.77 35 40.008
Conclusion
The above presented business plan has been developed for Kaffee-Coffee which is one of the
famous brand of coffee. The entity has been focusing on development of the business plan so as
to increase attraction of investors for collecting funds which will be used for strategy
implementation.

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References
Armstrong, G., Kotler, P., Harker, M. and Brennan, R., 2015. Marketing: an introduction.
Pearson Education.
Baker, M.J., 2014. Marketing strategy and management. Palgrave Macmillan.
Burns, P., 2014. New Venture Creation: A Framework for Entrepreneurial Start-Ups. Palgrave
Macmillan.
Corbaci, L., Hungaro, F., Wang, S.F. and Lee, J.W., 2014. Corporate Social Responsibility in
International Business.
Cramer, J., 2017. Corporate Social Responsibility and Globalisation: an action plan for
business. Routledge.
Do Tu, L., 2017. Business Plan a Vietnamese Coffee Shop in Helsinki.
Doppelt, B., 2017. Leading change toward sustainability: A change-management guide for
business, government and civil society. Routledge.
Finch, B., 2016. How to write a business plan. Kogan Page Publishers.
McKenzie, D., 2017. Identifying and spurring high-growth entrepreneurship: experimental
evidence from a business plan competition. American Economic Review, 107(8), pp.2278-2307.
Morland, L., 2017. Rounton Coffee and Bedford Street Coffee Shop: From rural coffee roaster to
urban coffee shop. The International Journal of Entrepreneurship and Innovation, 18(4), pp.256-
263.
Saunders, W., 2016. A Strategy for Academic Global Expansion: An Action Plan for Business
Schools in a Global Age.
Scarborough, N.M., 2015. Entrepreneurship and effective small business management. Pearson
Higher Ed.

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Tran, V.A., 2013. Business plan for a european style coffee shop in Ho Chi Minh city: case: AT
Ltd. Company.