Foodie Friends: Launching a Vegetarian Restaurant Venture in London

This report details the launch of "Foodie Friends," a new vegetarian restaurant venture in London, UK. It begins with an introduction highlighting the challenges of launching a new business and the importance of proactive planning. The report is structured into tasks, starting with an analysis of the target market, which includes behavioral, demographic, and geographic segmentation, along with a competitive analysis using Porter's Five Forces model. The second task focuses on the tangible and intangible resources required, particularly the financial aspects and the importance of intellectual property. The report then formulates a credible proposal, including an executive summary, company description, market analysis, and financial projections. It further outlines the skills and capabilities necessary for a successful launch, emphasizing financial management and adaptability. The report also addresses promotional activities, including the determination of appropriate channels, and concludes with a discussion of the legal form and a monthly cash budget for pre- and post-launch phases. The report provides a comprehensive overview of the critical aspects of starting a new restaurant venture, offering insights into market analysis, resource management, and strategic planning.

Launching a New
Venture

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1...........................................................................................................................................1
P1 Identification of specific target markets and competitive analysis...................................1
P2 Specific tangible and intangible resources that required for a new venture......................3
TASK 2............................................................................................................................................4
P3 Formulation of credible proposal to launch a new venture...............................................4
P4 Skills and capabilities required to launch a new venture..................................................5
TASK 3............................................................................................................................................6
P5 Determination of promotional activities and channels for launching new venture...........6
TASK 4............................................................................................................................................7
P7 Monthly cash budget for the pre and after launch phase...................................................7
P8 An appropriate legal form for the venture.......................................................................11
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Starting up a new venture amid dynamic business market and cut throat competition is
fraught with immense challenges. It is so as commencing of new business in new territory,
navigating through over saturated market etc. comes out to be hard affair for company.
Therefore, to ensure the success and growth of a new venture it is requisite for an entrepreneur to
be proactive in finding out ways to overcome potential obstacles that business is subject to
encounter (Baron and Tang, 2011). The project is on launching a new venture idea. The chosen
option is of a small scale restaurant “Foodie Friends” which will be launched in UK. The report
will discuss about range of resources that is required to introduce a new venture. Also a synopsis
about skills and capabilities requirement will be provided along with various promotional
activities that could be determined for the venture launch.
TASK 1
P1 Identification of specific target markets and competitive analysis
Foodie friends Foodie Friends will be a sophisticated restaurant that serves global
vegetarian cuisines. The vision behind starting this restaurant is to make this one of the leading
SMS restaurant that provides a wide range of freshest vegetarian dishes such as Wraps,
Courgette, Salads, burgers, Curries, Cocktails, Wines and other food items. The most prominent
feature of this restaurant will be that it will regularly change its menu according to season and
what's most delicious and fresh available on a particular day and charges exceptionally
reasonable in comparison to other food ventures.
. The firm will continue with the menu along with certain additions in variations of
Chinese, Continental, Spanish and desserts. The reason to choose London as a destined location
is because of the fact that it is among the top ten foodie destinations in UK and is around 46
miles from Brighton. Also, being a multi culturecosmopolis it has a major footfall of tourists
from around the globe. This make it most appropriate place for Foodie Friends to satisfy the soul
and palate of its population who is fond of food. Before starting up their new venture it is of vital
significance for Foodie Friends Foodie Friendsto gain knowledge about competitor's analysis and
to choose out its target market.
Market Segmentation: It leads dividing the potential target population into smaller
subsets based on factors like age, gender, income, occupation and so on. It is one the important
marketing concept that enables firm to select most appropriate group for whom products and
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services offered by firm is best suitable (Bijker and et., al., 2012). This further leads company to
formulate various policies related to pricing, marketing, promotion etc. by keeping in mind the
demands and expectation of its target audience. Foodie Friends divides it target market in
mentioned below three forms: Behavioural segmentation: The basis of this segmentation is perception, attitude,
demographic profile etc. of customers in context to purchasing a particular product. In
reference to Foodie Friends who is launching new food chain in London the venture is
expected to reap positive outcome. It is due to the fact that London being a hub of multi
culture diversity, its people are fond of eating different variety of cuisines. As Foodie
Friends is offering large variety of cuisines with add of Spanish, Continental etc. and
desserts too this will readily meet the demands of consumers of this city. Demographic segmentation: This segmentation take into consideration factors like
income level,age, gender etc. The city of London as a whole forms top 10 foodies
destinations of UK where consumers belonging to every age group like to go out to eat
Thus, for foodie Friends all the consumers belonging to age group of 15- 60 years
belonging to middle and higher income groups forms its target market. It is so as even
family prefers to dine outside in restaurants their family apart from going out with friends
or colleagues.
 Geographic segmentation: It includes segmenting the whole market on basis of cities,
towns and villages etc. In this context, Foodie Friends as decided among various UK
cities like London, Liverpool, Oxford etc. London forms most profitable place to launch
its new venture.
Porter's 5 forces model:
Threat for new entrants: In UK, the restaurants industry forms easy business to
commence for SME's as investment in payroll, inventory, rent etc. do not require large upfront
investment. Thus, for Foodie Friends Foodie Friends the threats from new entrants are high.
Threat of Substitute Products: In UK, restaurant industry is to tough competition
leading to availability of large number of substitutes in market. Not only this even the
supermarket and grocery chains proves out to be great substitutes to the restaurant industry.
Thus, for Foodie Friends threat for substitute is high. To cope up with this threat it is essential for
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restaurant to maintain food quality, variety and affordable price levels that will induce customers
to choose it over other substitutes.
Illustration 1: Porter's Five Forces Model
(Source: Porter's Five Forces Model, 2013)
Bargaining Power of Suppliers: The bargaining power of suppliers are quiet high in
restaurant industry especially with trendy and the ones offering exotic ingredients (Burns, 2017).
In context to Food for Friends Foodie Friends as firm is using finest quality of organic and other
ingredients in addition to fringe products like wild porcini mushrooms, truffles, organic
watercress etc. it reduce down firms ability to bargain with suppliers. However as Foodie Friends
encourages working with local farmers and friends for the supply of organic ingredients such as
coffee, cold pressed juices, vegan treats etc. it makes bargaining power of suppliers moderate too
low for firm.
Bargaining Power of Buyers: In case of restaurant although a customers can not
typically bargain for food prices however as they are well aware of other substitutes available,
their pricing, menu etc. it gives them power to greatly impact restaurants business. Although
restaurants offering exotic dishes or extra ordinary services such as celebrity chef, 15 course
tasting menu etc. can set high price levels that is justifiable to consumers. Thus for Foodie
Friends who is offering high quality organic ingredients, variety of cuisine with so many
variations at reasonable price levels the bargaining power of buyers is moderate.
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Competitive Rivalry: Restaurant industry is subject to high competition as it does not
involve high up front cost to start a business. In UK there are enormous number of food chains,
food trucks, casual venues like cafe and independent eateries. Thus for Foodie Friends the
competitor rivalry is quiet high (Caselli and Negri, 2018). Thus, to cope up with this it is
requisite for firm to besides maintaining its quality with reasonable price levels to provide
various discounts and offers such as combo meals, food coupons etc.
P2 Specific tangible and intangible resources that required for a new venture
For Foodie Friends mentioned below are tangible and intangible resources for its new venture:
Tangible Resources: It comprises description about the physically visible resources that
assist firm in effectively launching restaurant in new market. For Foodie Friends tangible
resources for its new restaurant chain includes land and building, furniture, employees , food
materials, finance etc. Out of all these resources funds form the most important resources for
restaurant as it is essential and basic requisite to acquire all other resources.
Intangible resources: These comprises resources that are not physically present but they
still greatly contributes in success of a new business. For Foodie Friends intangible resources
could be its trademarks, goodwill, culture, quality, customer relations etc. Further in case of its
new venture creative ideas and technologies also form important resources that help in securing
various intellectual property rights such as patent, copyright, trademarks etc. Further branding of
restaurants that includes use of symbols that enables customers to easily recognize restaurant
also counted as tangible resource.
TASK 2
P3 Formulation of credible proposal to launch a new venture
For Foodie Friends to successfully launch its new venture it is requisite to prepare
appropriate plan that could help firm to determine its objectives and strategies to attain them.
Mentioned below is a credible proposal for Foodie Friends that should be prepared by restaurant
with all the details as specified:
Executive Summary Foodie Friends is UK based restaurant with its chains in Brighton and
London. The restaurant offers a large variety of global continental
cuisines and desserts all prepared with organic ingredients at
affordable prices.
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Company description Foodie Friends is a sophisticated multi cuisine restaurant that provides
large variety and variations in its dishes. With gaining popularity of
its food quality and with motive to diversify its business restaurant is
opening new branch in London (Simon and Shrader, 2012). It is due
to fact that London is among top 10 foodie destination in UK and is
about 46 miles from Brighton.
Market Analysis To be successful in its new venture it is of critical importance for
Foodie Friends to develop an innovative concept , to formulate
effective and attractive strategies. Thus for attaining its objective of
diversifying business operation Foodie Friends is required to thorough
conduct a market analysis by through SWOT and PESTLE analysis to
study its prevailing micro and macro environment opportunities
Financial projection To open up a new venture in new market and city Foodie Friends is
subject to huge capital investment. Thus, to fulfil this requirement it is
essential for owner to ascertain various sources of funds from where
needs of finance could be fulfilled.
Benchmarking Benchmark s all about setting standards for performance that induces
and encourages people to give their best efforts to met those criteria.
Thus, for Foodie Friends to gain success in its new business, to earn
large market share and to satisfy its customers it is requisite to
establish certain benchmark that will guide performance of company
and its workforce.
P4 Skills and capabilities required to launch a new venture
Success of any venture is just not the result of its numerous tangible resources or
effective intangible resources but also the skills and capabilities of the entrepreneur plays vital
part in taking business into new heights and in gaining edge over others (Fernhaber and Li,
2013.). These skills and abilities induce a person to think differently from others, identifying
those opportunities that are uncaptured and to apply creative solutions to various business related
issues and risks. They forms the core competencies for a venture and assist it in coping up with
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dynamics of market by applying new and innovative ideas to attain its desired objectives.
Mentioned below are certain prominent skills and capabilities that essential for owner of Foodie
Friends to develop and enhance to gain success and generate large profits in their new venture in
London: Ability to manage money: Money forms essential resources in a project from planning to
execution phase. As launching a new business requires huge capital investment therefore
its s essential for managers to properly allocate its limited financial resources into various
activities of firm without any wastage. Therefore it is essential for managers of Foodie
Friends to have ability to manage money so as to effectively and efficiently cater the fund
requirement of various activities. Ability to identify strengths and weaknesses: For an entrepreneur it is highly requisite to
ascertain the core competencies of business as well as areas of lacking. For owners of
Foodie Friends it is important to possess this skill as it assist them to take qualitative and
accurate decisions related to various activities of new venture such as hiring employees,
business partnership, new adds to the menu etc.
 Ability to raise funds:: For an entrepreneur it forms one of the key skill and capability as
new venture is always subject to high funds requirements. In context to Foodie Friends it
is essential for business owners to not only to be knowledge about probable sources of
funds available in market but also to convince potential investors to have faith on
business idea and its financial creditability (Hmieleski, Cole and Baron, 2012). Here in it
interpersonal skills of entrepreneur are also to be tested as it enables then to efficiently
convey future prospects of new venture and to pursued investors, shareholders and other
financial institution to have faith in vision, mission and objectives of the firm.
TASK 3
P5 Determination of promotional activities and channels for launching new venture
In this era of digitalization, in UK social media has become integral part of its people.
Apart from this media, Foodie Friends could opt of various other promotional activities so as to
capture the attention of its target audience. Mentioned below are some prominent promotional
ways through which restaurant could publicize its new venture: Social media platform: In UK, according to 2017 statistics, there are around 39 million
users that are soon to be reached to 42 million. If ascertained in terms of penetration rate
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its reveals out to be over 58% (Read and et. al., 2016). Thus, for Foodie Friends social
media sites can be prove to be the most cost and time effective media to reach out large
target audience. By using various popular social media websites such as Facebook,
Twitter, Instagram etc. firm could post about its various cuisines, discounts, combo
offers and other relevant information to communicate to its target consumers in most
effective and attractive manner. Personal Promotion: By using personal selling techniques managers of Foodie Friends
can encourage and suggest its consumers to order more from menu other than what they
have already ordered (Kariv, 2013). Also restaurant could apply public relations by
getting associated with certain foundations or NGOs that will help firm to gain trust by
developing bond with them and enhance its brand image among people.
 Other media: Apart from social media, Food For Friend could also make use of other
mediums like print media comprising magazines, brochures, leaflets,electronic media
including TV, radio ads, online and social media like Facebook, Instagram, websites etc.
The reason for choosing these medium is due to the fact that about 39 million people use
social media sites in UK that are soon to reach 42 million. Thus , it proves to be a cost
and time effective medium that will enable firm to effectively communicate its target
audience about its new venture in most creative and attractive manner.
P6 Formulation of appropriate promotional activities plan for both launch and pre-launch
To create buzz in the market and to be effective in capturing attention of its target
consumers it is of utmost importance for marketing team of Foodie Friends to design and
prepare various creative, distinctive and effective promotional activities for both pre-launch and
launch phase of restaurant. These promotional activities will help the restaurant to build up the
interest of potential consumers towards opening of new venture in the market where already big
restaurants are having good consumer base. Pre-Launch: Under this phase, managers will formulate activities to be conducted
before the launch or opening of the new venture. This involves preparation of restaurant
websites that forms one of the most common and effective medium to communicate any
information to their customers related to product, services, offers, price etc.
 Launch: This phase involves opening of the new restaurant by Foodie Friends. For this
company should plan to host grand opening where in media representatives and low
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profile celebs, models or media persons could be invited as it will help in gaining high
attention of public (Klotz and et., al., 2014). Further it will also assist firm to get their
launch published in newspapers and to be telecast on local TV channels and radio
stations. Thus, a grand launching party will help Foodie Friends to get in eyes of
customers at very initial stage.
TASK 4
P7 Monthly cash budget for the pre and after launch phase
Mentioned below is the monthly cash budget for pre and post launch phase of Foodie friends.
Cash budget of Foodie Friends restaurant before launch
Year 2018 Jan Feb Mar April May
Food Sales amount 42,152 42,563 43,526 43,568 44,124
Beverage Sales 19,751 12,451 12,456 13,452 14,528
GROSS SALES
(Total) 61,903 55,014 55,982 57,020 58,652
COGS
Food 14,525 14,046 14,364 14,377 14,561
Beverage 6,515 3,113 3,114 3,363 3,632
GRAND TOTAL 21,040 17,159 17,478 17,740 18,193
GP 40,863 37,855 38,504 39,280 40,459
General and
Administrative
Workers Salaries 15,476 13,754 13,996 14,255 14,663
Management Salaries 3,400 3,400 3,400 3,400 3,400
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Employer
Taxes/Benefits (15%
Wages) 2,265 2,058 2,087 2,119 2,168
Employees
Compensation (6%
Wages) 1,133 1,029 1,044 1,059 1,084
Advertisement 800 800 800 800
800
Bookkeeping 150 150 150 150 150
Credit Card Charges
(1%) 619 550 560 570 587
Insurance 250 250 250 250 250
Legal and Professional
Fees 100 100 100 100 100
Misc. Other 250 250 250 250 250
Office Supplies 175 175 175 175 175
Rent 3,200 3,200 3,200 3,200 3,200
Repair and
Maintenance 300 300 300 300 300
Small Equipment 200 200 200 200 200
Telephone [phone]
Garbage 200 200 200 200 200
Utilities 1,200 1,200 1,200 1,200 1,200
Total Gen. and Admin.
(Fixed) 29,867 27,766 28,062 28,378 28,876
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NET PROFIT OR
LOSS 10,996 10,089 10,443 10,901 11,583
SBA Loan 3,582 3,582 3,582 3,582 3,582
Cash Flow After
Financing 7,414 6,507 6,861 7,319 8,001
Draw 4,000 4,000 4,000 4,000 4,000
Net Cash Flow 3,414 2,507 2,861 3,319 4,001
Accumulated Cash
Flow 5,921 8,782 12,101 16,102
Average Daily Sales /
22 days 2,814 2,501 2,545 2,592 2,666
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