Entrepreneurship Project: Kedai Kopi Pun Sim Proposal Analysis

This project is a comprehensive business proposal for Kedai Kopi Pun Sim, a traditional Malaysian coffee shop, prepared as a group assignment for an entrepreneurship course at Universiti Tunku Abdul Rahman (UTAR). The proposal covers various aspects, including the company's background, recognizing business opportunities through economic, social, and technological trends, and a detailed feasibility study. It also includes an industry and competitor analysis, pro-forma financial statements, a business model, and growth strategies. The project addresses challenges faced by the business, such as declining customers and increasing costs due to the COVID-19 pandemic, and proposes solutions like diversifying sales channels and implementing social media marketing. The assignment demonstrates an understanding of entrepreneurial principles and practical application of business planning tools within the context of a real-world business scenario. The proposal also provides an analysis of the company's strengths and weaknesses, and suggests strategies for future growth and sustainability.

Universiti Tunku Abdul Rahman
Faculty of Business and Finance
(Academic Year 2021/2022)
MAY 2021 SEMESTER
UBTE 2013 ENTREPRENEURSHIP
GROUP ASSIGNMENT COVER
SHEET
Appendix II
Course Details
Course : Bachelor of Marketing (Hons)
Year and Semester : Year 3 Semester 1
Tutorial Group : T4
Tutor’s Name : Mr. Adi Wira Bin Mohd Zin
Lecturer’s Name : Mr. Adi Wira Bin Mohd Zin
Assignment Details
Topic : Proposal for Kedai Kopi Pun Sim
Due Date : 30th July 2021
Important Note : Submission of assignment is the responsibility of the students.
Student Details
Name Student ID
1. Chong Yun Rui 1903268
2. Choy Jey Ni 1801962
3. Lee Qi Xuan
4. Tan Yi Ko 1902325
5. Teh Zi Xiang 1901624
Assignment overall marks:

Universiti Tunku Abdul Rahman
Faculty of Business and Finance
(Academic Year 2020/2021)
MAY 2021 SEMESTER
UBTE 2013 ENTREPRENEURSHIP
MARKING SCHEME FOR GROUP
ASSIGNMENT
Appendix III
No. Assessment Marks
Allocation
Marks
Given
1 Company, Product, Service and Industry Background 2
2 Recognizing opportunities/techniques for generating ideas 3
3 Feasibility Analysis 8
4 Industry Analysis and Competitor Analysis 8
5 Pro-Forma Financial Statements and Funding Aspect 8
6 Business Model 8
7 Growth Strategies 5
8 Quality of the Written Assignment 3
Total Marks 45
Comments: _
_
_
_
Name of Marker : _ _
Signature of marker : _ _
Date : _ _

TABLE OF CONTENTS
CONTENTS PAGE NO.
1.0 Company, Product, Service & Industry Background 1
2.0 Opportunities & Techniques for Generating Ideas 2-4
3.0 Feasibility Analysis 5-9
4.0 Industry Analysis and Competitor Analysis 10-13
5.0 Pro-Forma Financial Statement & Funding Aspect 14-18
6.0 Business Model 19-25
7.0 Growth Strategy 26-27
REFERENCES 28-30
APPENDICES
-Figures
-Financial Statements (2019 & 2020)
-Interview Transcript
31-45

1.0 Company, Product, Service & Industry Background
Kedai Kopi Pun Sim is a restaurant owned by Lee Pei Sim in 1989. It is an old Chinese
restaurant located at Jalan Pasar, Bidor 35500, Perak, Malaysia. Its operation hours are from
5.30 am to 1.00 pm on every day except for Thursday. It is engaged in selling a series of
coffee such as “kopi kau”, white coffee, “kopi ais” and other beverages such as milo,
Horlicks and Chinese Tea. Also, it sells tradition local breakfast such as kaya butter toast,
half-boiled egg, etc. Besides, it also provides the takeaway services for customers which
allowed them to eat at home or at work. Ms Lee rented out her restaurant for another two
food stalls which sells signature “Chee Cheong Fun” and “pau” respectively (refer to
Appendix 1.0). Until today, Kedai Kopi Pun Sim is one of the famous tradition food
restaurants in Bidor with the signature “kopi kau” and “Chee Cheong Fun” (refer to
Appendix 1.1). Its target market are the customers who prefer having tradition breakfast at
morning market, secondary school students who likely to have breakfast before attending
school classes, and the customers who would like to take away the food and beverages for
their families after buying groceries from the morning wet market.
Before starting up her business, she went through a series of process in investigating the
technique of brewing a nice coffee, including doing primary research in other “kopitiam”. Ms
Lee’s husband also assisted her a lot in building the restaurant which includes financing,
business planning and so on. As she mainly sells her beverages in the restaurant, she opened
for other food stalls for rental. Therefore, when the customers having breakfast in the
restaurant, they will order food with the drinks as well. Hence, it creates the opportunity for
customers to order her drinks. Kedai Kopi Pun Sim has rented out for a noodles stall and a
“dim sum” stall. The noodles stall basically sells different types of noodles which includes
prawn noodles, side dishes and its signature “Chee Cheong Fun” while another “dim sum”
stall sells “pandan pau”, “vege pau”, “lo mai gai”, etc. Normally, customers will order
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noodles, side dishes alongside with the beverages as a complete breakfast or lunch (refer to
appendix 1.2).
2,0 Recognizing Opportunities/Techniques for Generating Ideas.
2.1 Observing Trends
2.1.1 Economic forces
Malaysia faced an economic downturn due to COVID-19 pandemic (Shah et al., 2020). When
the economy is poor, people not only have less money to spend, but they are also more
hesitant to spend the money they do have, because they are afraid that the economy will
worsen and that they will lose their jobs. Hence, customers become more price sensitive and
decide to buy only what they depend on for survival. A weak economy could provide
business opportunities for old food stall as they sell affordable food and beverages which
enable to help consumer to save money. Consumers may switch from restaurant to old food
stall for purchasing food and beverages due to the more affordable prices. However, instead
of dining out, people may prefer to increase consumption of ready-to-eat meals and snacks
during pandemic (Focus, 2020). Hence, Kedai Kopi Pun Sim could come out with different
set of breakfast meals packages which allows for taking away or even allow the customers
to customize their ideals set of breakfast meals at a valuable set meal price in order to attract
more price-sensitive customers. By doing so, Kedai Kopi Pun Sim also could generate high
profit margin by selling large volumes of products.
2.1.2 Social forces
Frequently, the existence of a product or service is due to the satisfaction of a societal need
rather than the more obvious need that the product fulfils. People would like dining outside or
consume ready-to-eat meals due to people's hectic schedules and insufficient time to prepare
their meals. Likewise, social networking sites like Facebook and Instagram are popular
because it acts as an intermediary which allows people to connect and communicate with
each other. Changes in societal trends have an impact on how companies act and prioritize
their goals. These shifts have an impact on how goods and services are developed and
marketed.
The social trends that Kedai Kopi Pun Sim could take into consideration are the increasing
interest in social networks. Nowadays, people spend most of the time on social media such as
Facebook, Instagram and Tiktok. As Bidor residents especially middle-aged customers are
more likely to use Facebook compared to other social media platforms, Kedai Kopi Pun Sim
could focus on implementing social media marketing on Facebook. After creating its own
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Facebook Pages, it could regularly update the latest advertisement and share it to the
“Bidor” public group in order to reach maximum of Bidorian (refer to appendix 2.0).
Besides, Kedai Kopi Pun Sim could collaborate with affiliate Facebook page to help them
advertise their products so that it could exposed to larger communities (refer to appendix 2.1).
Moreover, Kedai Kopi Pun Sim could use Facebook as a platform to offer order pickup
services to customers as it is more cost-effective. After Kedai Kopi Pun Sim creating its own
Facebook Pages, it could advertise their daily products offered and set different sections of
pick-up time on its own pages. By doing so, it enables to provide convenience to the
customers which allow them to order the food and beverages by leaving down their comment
or contacting the stall by phone number that stated on the pages. Customers could straight
away receive their ordered food once they reached the stall during the stated pickup time.
2.1.3 Technological advances
The system was made feasible by advancements in wireless technology. Most of the time,
technology is not the determining factor in recognizing business opportunities. Instead, the
key is to recognize how technology can be used to meet basic or evolving needs of the
companies. Technological advancements also offer opportunities to assist companies in doing
daily operation in a more efficient or effective manner. Nowadays, many small businesses
utilize technology in payment method by using digital wallet applications in money
transaction activities as it is user-friendly and convenience (Putri & Sumitra, 2020). During
the COVID-19 pandemic, as money changes hands frequently and it may consist of all sorts
of bacteria, people are encouraged to use e-wallet in order to reduce the chances of spreading
the viruses. Hence, Kedai Kopi Pun Sim could implement digital wallets payment method
such as Touch ‘n Go and Boost which provides another payment option for their customers.
It could reduce the risk of spreading the viruses as it allows customers to purchase the food
and beverages through scanning the QR codes without having any cash transaction.
Therefore, customers may feel safe to purchase their food and beverages as they allow for
using e-wallet applications.
2.2 Solving Problems
Due to COVID-19 pandemic, Kedai Kopi Pun Sim currently facing some problems in their
business. The first problem that Kedai Kopi Pun Sim faced is the sharp decline of
customers. During MCO period, with health and safety taking precedence over the love of
food, many customers were not able to dine-in at the stall. Even currently Kedai Kopi Pun
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Sim is allowed to offer take away services, there are getting less customers due to limited
operation period which could only allow to operate from 8 am to 12pm and increasing
reported COVID-19 cases in Bidor. As the COVID-19 pandemic in Bidor are getting serious,
most customers are rarely step out of their house which lead to decreasing in the number of
customers.
In order to solve the first problem, Kedai Kopi Pun Sim could diversify its sales channels by
introducing delivery services. Kedai Kopi Pun Sim could partner with QuickSent which is
one of the online food delivery platforms that available at Bidor area (refer to appendix 2.2).
By offering delivery services, it could attract back the regular customers or even new
customers. This is because it could satisfy the needs of the customers who eager to having
their products but anxious of leaving their home. Customers could consume their products
without stepping out from their house as the food and drinks would be delivered to them.
The second problem is the increasing of cost expenses. Ms Lee claimed that the cost of the
purchase materials has increased during this period, however government did not allow food
stalls to increase the prices of their products and the suppliers still request them to make the
payment on time as usual. Moreover, Kedai Kopi Pun Sim have to pay for the variable costs
such as cleaning supplies, electricity, gas fuel, water charges, packages and so on. As
currently, only take away services are allowed, the expenses on packages have increased. In
addition, Kedai Kopi Pun Sim still have to pay fixed costs which includes licensed fee,
business renewal fee, rental fee which is the rental of outside area around the stall and so on
regardless the negatively impact of COVID-19 pandemic. Therefore, Kedai Kopi Pun Sim is
undergoing a hard period especially when the sales drop due to declining of customers.
In order to solve the second problem, Kedai Kopi Pun Sim could find the members of
parliament to assist for applying financial assistance from the government as she
mentioned that she is unfamiliar process of procedures during the interview. Moreover, the
owner of Kedai Kopi Pun Sim could negotiate with the suppliers about the payment
postponement or price adjustment during this COVID-19 pandemic period. Besides, if
Kedai Kopi Pun Sim would like to introduce order pick up and online delivery services, it
could narrow the physical area by ending its rental on the outside area around its stall.
Hence, it could decrease the burden of Kedai Kopi Pun Sim to afford those expenses.
Besides, Kedai Kopi Pun Sim could focus on marketing efforts in order to boost up its sales.
When the sales increase, it could increase the ability to afford the increasing cost of business.
For example, Kedai Kopi Pun Sim could introduce valuable set breakfast meals, implement
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social media advertising on Facebook and diversify to different sales channels which includes
take away services, order pick up services and delivery services.
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3.0 Feasibility Study
According to Kampira (2018), feasibility analysis is a way to analyze the practicality of the
business idea. Here, the four feasibility analysis to be analyzed are product/service feasibility,
industry/target market analysis, organizational feasibility, and financial feasibility.
3.1 Product / Service Feasibility Analysis
The product/service feasibility is to analyze the viability of the proposed products or services
to be implemented (Barringer & Ireland, 2019). The opportunities and ideas generated will be
analyzed in 2 sections which are the product/service desirability and product/service demand.
3.1.1 Product / Service Desirability
The first idea generated from the opportunities is to come out with different sets of
breakfast meals packages. During Movement Control Order (MCO), many people have less
or no income at all. Thus, due to the economic forces, the old food stalls with cheaper prices
may attract those people to consume in Kedai Kopi Pun Sim. Besides, by launching some
new breakfast meals packages, the customers could have more buying choices and not easily
feel bored. Which means the repurchase rate of customers could be increased.
The second idea is to upload the restaurant information to Facebook and offer the pickup
order service. Due to the pandemic COVID-19 lockdown order, the usage of social media
showed an increasing trend (Fernandes at el., 2020). Physical socialization activities are
restricted, thus most people spend more on social media to fulfil their social needs. If the
promotion is distributed to the Bidor online community or collaborates with affiliate pages,
the customer may be increased. Furthermore, the customers who use the pickup order service
could directly get their foods in the pickup time set by the food stall. Beside fast in speed, the
contact among people could also be minimized and lower the risk of contracting COVID-19.
The third idea is the implementation of e-Wallet. Due to the development of technology, the
e-Wallet payment method with cashless required appears to the public. The convenience of
using a smartphone to make payment gets the attention of many people. Moreover, the
touchless characteristic makes the e-Wallet becoming a preferable paying method during the
pandemic COVID-19. Besides, the encouragement of the government is also one of the
reasons why the e-Wallet is widely adopted by the public. Thus, the implementation of e-
Wallet payment methods could provide a sense of security along with technological
convenience.
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The last idea generated is the cooperation with the online food delivery platform. By
increasing the price and delivery fee, the customers could enjoy the food delivered directly to
their home. Moreover, it is an additional channel for Kedai Kopi Pun Sim to reach the
customers. The selling area will not be more restricted just around the food stall, it could
cover all the places the third-party delivery platform can reach.
3.1.2 Product / Service Demand
To understand the demand of the proposed products and services, a simple questionnaire
survey was done. With the help of Kedai Kopi Pun Sim’s owner, this little survey was
responded by 20 respondents, which means the statement may be low in accuracy. But it
could show the typical status the owner could get in touch with in her daily life. According to
Figure 1, 14 of the respondents will have breakfast in their daily life. Inside these 14
respondents, 8 of them are having breakfast every day (Figure 2). These two statements show
the high demand of breakfast. Besides, Figure 3 shows how respondents think about the
current choices of breakfast. 12 out of 20 respondents feel that the breakfast provided by
Kedai Kopi Pun Sim lacks choice. Thus, it shows there is a demand for expanding the meal
of breakfast.
Next, in Figure 4 show the respondents’ time length of using Facebook in a day. The average
time length is at least 2.2 hours per respondent. Which means, the promotion using Facebook
could be considered as a usable way. Furthermore, the willingness to use pickup order service
through Facebook has shown in Figure 5. It states that 50% of the respondents are willing to
use this kind of service if Kedai Kopi Pun Sim implements it in future.
For the aspect of e-Wallet, according to Ismail (2021), the e-Wallet user in Malaysia in the
year 2020 had come to about 40% and maybe higher now. In the survey conducted, 13 out of
20 respondents are using e-Wallet to make payments in their daily life (Figure 6). Thus, the e-
Wallet is concluded as high in demand.
Lastly, Figure 7 shows there are 14 respondents who are willing to use the online food
delivery service. According to Nathan (2020), the online food delivery platforms increased in
demand during the pandemic COVID-19. Even in the Recovery MCO, the delivery orders
were still high in number. These statements show the food delivery is high in demand and
maybe higher in the future.
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3.2 Industry / Target Market Feasibility Analysis
3.2.1 Industry Attractiveness
According to the Food & Beverages Industry Report Malaysia (2020), the food and beverages
industry is a fast-growing market. It is one of the largest contributors in the national account
in these few years. Besides, humans have to drink and eat to keep alive. Based on the
Maslow’s Hierarchy, the most important human basic needs consist of food, water, warmth,
and rest (Mcleod, 2020). Thus, in the national lockdown due to the pandemic COVID-19, the
food and beverages industry is still needed to open while the other industries that have not
related to human basic needs are forced to shut down. The industries that are not allowed to
operate may continue to suffer losses each day the MCO doesn’t end. The small and medium
corporations that are high in fixed cost will be the first to bear the brunt.
3.2.2 Target Market Attractiveness
The business of Kedai Kopi Pun Sim is the food service market. Food service means the
economic activities that serve the food to the people out of their home. Also based on the
Food & Beverages Industry Report Malaysia (2020), 31% of Malaysian are use their
disposable income to eat outside. As mentioned in industry attractiveness, the restaurants are
allowed to operate within a certain time range. The profit may be lower than normal, but the
business can be supported for a longer period.
3.3 Organizational Feasibility Analysis
3.3.1 Management Prowess
The owner of Kedai Kopi Pun Sim builds the business of food stalls with her own hands. The
passion to operate the business still exists even though it is already 32 years after the
founding. Besides, the food stall is her only income source, the thought to improve the
business is much stronger when the number of infections is increasing every day. Thus, they
are willing and passionate to implement the business ideas proposed.
3.3.2 Resource Sufficiency
Beside the owner, Kedai Kopi Pun Sim has only one worker who is 58 years old to assist in
the business operation. Because they have run the business for a long time, the new set of
breakfast could be handled easily by themselves or using their social connection. However, if
they want to adopt all other business ideas, they need to learn the function of Facebook, the e-
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Wallet payment process, and online food delivery order taking. If they think it is hard to
learn, they may have to hire an additional worker who is familiar with technology.
The location of the restaurant is just in front of the Bidor Bazaar. The people who go to or
leave from the bazaar have high probability to consume and rest for a while in Kedai Kopi
Pun Sim. Furthermore, there is a row of parking spaces between the bazaar and the restaurant.
So, the customers who use those parking spaces may raise their awareness when they are
hungry. Moreover, there are various stores around Kedai Kopi Pun Sim, those stores’ staffs
may also have their meals here. In addition, the food stall has had its loyal customers for 32
year running the business.
Furthermore, they are not familiar with the government policy and procedure, thus they
didn’t receive any support from the government no matter before or during the pandemic
COVID-19. Moreover, Kedai Kopi Pun Sim was able to make the payment to the supplier
within 30 days after receiving the payment invoice. But the payment postponable period had
been changed to 15 days from August 2020.
3.4 Financial Feasibility Analysis
3.4.1 Total Start-Up Cash Needed
First and foremost, for the new breakfast meals, the cost required is only the cost of material,
which is as much as RM300 to RM400 for a week. Additional cost about RM100 to RM200
if they want to make improvement. Assume that the new meals are sourced in the form of
finished goods supplied from a third party, the cost may be RM400 to RM500.
Furthermore, the promotion on Facebook does not need to spend any money. For the pickup
order service, the communication between Facebook users is also free of charge. But, using a
personal smartphone to take the order may make the owner feel annoyed due to the high
frequency usage. Thus, a new smartphone for business use is suggested. The cost is estimated
around RM1,999. In addition, the new smartphone could also be used to take orders from
online food delivery platforms. QuickSent is the chosen online food delivery platform and
there is not any fee charge to be a merchant. Besides, the receipt printer could be purchased
to support both the food delivery and pickup services. This receipt printer is around RM700
in price.
For the setup of e-Wallet, Touch ‘n Go and Boost are providing free setup costs to the
merchants. If the owner of Kedai Kopi Pun Sim has no idea how to deal with the
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