Zizzi Restaurant: Comprehensive Analysis and Business Plan Report

This report provides a comprehensive analysis of Zizzi Restaurant, a small business enterprise in the United Kingdom. It begins with an introduction to the concept of small businesses, highlighting the characteristics and distinctions between entrepreneurship and small-scale businesses, using Zizzi Restaurant as a case study. Task 1 focuses on profiling Zizzi, conducting an internal assessment using SWOT analysis to identify strengths, weaknesses, opportunities, and threats. Comparative measures, including profit and loss statements and balance sheets, are used to evaluate the company's financial performance. Task 2 addresses strategies to overcome weaknesses, such as financial resource limitations, lack of experience, and limited market coverage, proposing solutions like securing finance, open communication, expansion strategies, and clearly defined objectives. It also explores methods to strengthen existing performance by focusing on quality goods, workforce development, and cost efficiency. Task 3 involves producing a business plan and setting business objectives, reviewing and revising the plan, and developing an action plan. Task 4 examines the impact of proposed changes on the business and personnel, outlining change management strategies and methods for monitoring improvements in performance levels. The report concludes with a summary of findings and recommendations for future business development, supported by references.

SMALL BUSINESS
ENTERPRISES

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Profile and Internal assessment of the company...................................................................1
1.2 Analysis using comparative measures..................................................................................2
TASK 2............................................................................................................................................4
2.1 Actions to overcome weaknesses of the organisation...........................................................4
2.2 Strengthening the existing performance................................................................................6
2.3 Justification of areas of expansion........................................................................................7
Task 3 ..............................................................................................................................................8
3.1 Producing a business plan and business objectives...............................................................8
3.2 Revision of a Business Plan................................................................................................10
3.3 Develop an Action plan.......................................................................................................11
Task 4 ............................................................................................................................................12
4.1 Impact of proposed on Business and Personnel..................................................................12
4.2 Ways in which changes will be handled.............................................................................13
4.3 Monitoring improvements in performance level of Business.............................................15
Conclusion.....................................................................................................................................16
References......................................................................................................................................17

INTRODUCTION
Business can be defined as the economic activity aimed at earning profits. A business can
be categorised on the basis on size, scope and functions. A small business enterprise is a business
venture owned privately aimed at surviving in the market and earning profit. The company
consist of employees under 50 and annual turnover of under 10 million euros are kept in this
segment. However there is an difference between entrepreneurship and business in the small
scale segment. Entrepreneurship focuses on offering an innovative product in the market which
may not be the case in small business segment. The various forms of small scale business are
manufacturing, bakeries, service stations and restaurants. This report takes into consideration of
Zizzi Restaurant. This restaurant is famous in the United Kingdom for its ambience and quality
foods at cost friendly prices. This report will conduct analyses of the internal and external
ecosystem of the company. The various tools of analysis will be utilised to find the performance
and to compare it with the standards established. Considering in mind the strengths and
weaknesses the business plan will be evolved.
TASK 1
1.1 Profile and Internal assessment of the company
Zizzi is one of the emerging restaurant in the United Kingdom. The enterprise fulfils the
need of quality foods in the streets of London. The main attraction of restaurant is the ambience
it offers to people. Amazing dining tables and environment really compliments the place. The
beverage option which are offered by this enterprise are popular and hugely demanded among
local people (Altman, Sabato and Wilson, 2010). Employee contribute largely to the success of
this enterprise as they are skilled and well-behaved.
Company's Profile
Name: Zizzi Restaurant
Address: 21st Street Birmingham lane, London
Email: [e-mail]
Telephone: [phone]
Hours of operation: 10 AM to 10 PM
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Website: https://www.zizzi.co.uk/
Average Prices: 75 euro ( 4 courses)
Speciality: Italian Dishes
SWOT is an important tool helps in the assessment of the internal environment of the
company. This tool helps in acquainting the organisation with the strengths and weaknesses of
the company (Battisti and Perry, 2011). This tool is widely used to enhance the productivity of
the company by finding the non performing components in an enterprise. The SWOT of Zizzi is
as follows:
Strengths
 Price Effectiveness
 Enhanced Brand Name
 Skilled Employees
 Low cost of production Subsidies from the government
Weaknesses
 lack of experience
 Financial resources
 Access to latest technology
 low-level market coverage
Opportunities
 Market expansion
 Development of offices and residential
colonies nearby Home delivery
Threats
 Mighty restaurant chain for example
McDonald's
 Threat of new entrants
It is very important to assess the strengths and weaknesses of the business. This
assessment helps an enterprise in overcoming the hurdles in the ideal performance. The lack of
experience and low financial condition hinders the performance of the company. The strengths
can be further utilised up to their maximum potential. The business plans and policies can be
constructed wisely when an enterprise is aware of its strengths and weaknesses.
1.2 Analysis using comparative measures
Comparative measures are the tools which are used to compare the financial records of
the company with the rivals or comparing the present performance with the past records.
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Changes in the items of the financial statement is considered to be most common tool of
comparative analysis (Blackburn, Hart and Wainwright, 2013). Zizzi is a small business
enterprise therefore the company's analysis will be done with its past data. The profit and loss
account and Balance sheet are utilised by the company to evaluate the performance of the current
financial year.
Profit and loss account is an financial statements which records the profit and losses
ascertained by a company in the defined financial year. It helps in measuring the performance by
the level of profitability of business. The profit and loss account of Zizzi is as follows:
Profit and loss A/c of Zizzi limited as on 31st March, 2017
(Value in thousand)
Particulars 2016
£
2017
£
Sales 150 300
Cost of Sales 80 180
Gross Profit 70 120
Overheads 10 20
Net. Profit 60 100
It is evident from the above profit and loss account that there have been a 200% rise in
the sales of the company in the financial year of 2017. the sales volume have a direct positive
impact on the profitability of the business. There have been rise of in profits of the company
from 60,000 to 100,000 euros.
Balance sheet is another financial statement which depicts the performance of business.
The balance sheet of a company is mainly categorised into two major components i.e. Assets and
liabilities (Bridge and O'Neill, 2012). The company's net worth and is determined with the help
of balance sheet as it helps in definition of every component in monetary terms. The financial
standing provided by the balance sheet helps in formulating strategies for business. The balance
sheet of Zizzi is as follows:
Balance sheet of Zizzi limited as on 31st March, 2017
(in thousands)
Year 2016 (value in £) 2017 (value in £)
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Fixed assets 40 30
Stock 10 15
Debtors 8 5
Bank 2 5
Total Assets 60 55
Creditors 40 35
Bank overdraft 20 20
Total Liabilities 60 55
Current ratio = current asset / current liability
2016 2017
Net profit margin = net profit/ net sales * 100
60/150 * 100= 40
Net margin = 100/300 *100= 33.33
Gross profit margin= gross profit/ net sales *
100
70/150 *100= 46.66
Gross margin = 120/300*100= 40
Quick ratio = current asset – stock/ current
liabilities
20-10/60 = 0.166 times
Quick ratio = 25-15/55 = 0.181 times
It can be assessed from the above financial statements that the company is improving the
performance. Balance sheet depicts the fall in the fixed assets and the rise in working assets of
the company. The decrease in the net profit margins states the declines in organisational
profitability and efficiency. Rise in the quick ration states the rise in liquidity in an company.
TASK 2
2.1 Actions to overcome weaknesses of the organisation
Weaknesses can be defined as the non performing or underperforming areas of a
business. The various types of analyses undertaken helps in uncovering the areas which are not
performing to their potential and carries a scope of improvement with them. The business
enterprise formulated several strategies to overcome the same (Buck, 2011). It is necessary to
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overcome the barriers to survive in the market and to perform profitably. The major weaknesses
of Zizzi are:
 Availability of financial resources
 lack of experience
 Low market coverage
 Accession to technology
To counter these weaknesses the enterprise have to come with various measures so that the
performance can be enhanced in sales and profitable manner.
Availability of finance
Finance is known to be the blood of the organisation. The availability of the finance can
aid a company in gaining access to the technology and strong financial position can help take
expansion programs more seriously (Burns, 2010). The subsidies provided by the government as
they are focusing on spending every euro out of three on small business enterprises. Other than
this a business can take help of the financial institution for fulfilling their financial needs. A
stable financial position supports promotional and marketing measures.
Open Communication:
A communication is the exchange of ideas, emotions and queries between two or more
people. Communication is essential in an organisation and it is duty of management to develop
effective communication channel between the employees. It facilitates ideas for problem solving
and innovative ways of doing a business (Demil and Lecocq, 2010). The involvement and
engagement of employees help in business operations assists in forming synergy and will have
an positive impact on the productivity of the organisation. An environment of open
communication will help in understanding the problem the employee face and its resolution.
Expansion:
The business enterprise is confined to a limited share of market which acts as a weakness
of the business. The limited share in market makes a business more vulnerable if the only
restaurant faced with some uncertainty. It is very beneficial to have more than one restaurant for
division of resources and minimizing the risks (Fassin, Van Rossem and Buelens, 2011). The
company can adopt various expansion programs by opening a store in a different geographical
location and collaboration with some other restaurant and the most preferred Franchising
business.
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Definition of objectives:
Clear definition of business objectives equips employees with the sense of direction. It is
very crucial for the employee to know what business is expecting to achieve and what's their role
in it. The sense of responsibility will make the employee more productive and gives them a
sensed of commitment towards the organisation. The goal provides them a standard to achieve
and evaluate their performance.
2.2 Strengthening the existing performance
It is very crucial for a business to make full use of the strengths i.e. the best performing
areas of business. The enterprise needs to compete in the market and the only possible way is to
exploit the best performing areas up to their potential. The strengths of Zizzi are its emerging
brand name, skilled workforce, subsidies from the government, quality services at nominal
prices. These are the areas to be focused to achieve a better market position. The possible ways
to enhance the performance of the enterprise are:
Production of quality goods: Rizzi is known to produce quality goods at effective prices.
So the company should focus on the factors which contribute positively to the quality of the
goods. If the company keeps on enhancing the quality it will have a direct impact on the brand
awareness and brand value of the company. Increase in the sales will have a positive impact on
the profitability of business. Adding value to the food will spread a positive word of mouth about
the firm.
Development of Workforce: There is no denying in the fact that employee contribute to
the success and failure of the company. The workforce of Zizzi is skilled and acts as a strength
for the company. It is necessary to have a competent workforce in order to compete in the market
(Gronum, Verreynne and Kastelle, 2012). The company can focus on enhancing the skills and
capabilities of the employees so that they are able to fulfil the requirement in a competent
manner. Development of employees gives rise to innovation and creativity in an organisation for
customer retention. The goals can be achieved effectively with the help of a skilled workforce.
Cost Efficiency: Cost efficiency is a situation in which the company is successful in
providing the same quality of the services at the effective prices. Zizzi is known for giving
quality outputs at effective prices. This is a strength of the company which can be enhanced
further so that a business sees a increase in the footfall into the restaurant. The enterprise by
effectively using its skilled workforce should focus on achieving cost efficiency in its operations
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to increase in the profit margin against every good sold and increase in the sales volume
otherwise.
Feedbacks: This is one of the most common ways to find out the customer experience in
the restaurant and how that can be enhanced. It involves a series of question about service,
ambience, quality of food and cleanness. The customer ranks on the scale of 1 to 10 with 10
being the ideal number. The feedback forms help in finding about the areas which are performing
good and the areas which are to be improved.
2.3 Justification of areas of expansion
The areas of expansion are the domain in which a business sees a rise in the sales volume
or better market coverage. Zizzi can expand its services in the areas using the following
measures.
Market Penetration
Expansion of a business not always comes with launching of new restaurant. The
company can increase the size of expansion within the existing market. This expansion strategy
is believed to be most risk free way to expand. The company can launch new services such as
home delivery coupled with sales promotional tools for the purpose of increasing the footfall of
the people thus increasing the sales volume (Helms, and Nixon, 2010).
Strategic Alliance
Alliance is defined to be an association formed between two or more people for the
purpose of earning profit. It is one of the oldest form of expansion which states the combining
two companies through merger and acquisition. When Zizzi will form an alliance with another
restaurant it will help in expanding the customer base and will assist in forming operational
efficiency. The partner of Zizzi can be another restaurant, delivery service provide or can be a
hotel owner. The facilities of proper lunch menu can be introduced as there is huge number of
working population nearby. The development in the offering helps an enterprise cover a wide
range of prospects.
Franchising
It is a form of business expansion in which the owner grants license to franchisee to carry
out the operations under its name. This is a way in which the franchisee pays an agreed amount
to franchisor as a fees for the licence. This form also carried low amount of risk. But however the
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franchisor have to give up control over the new franchise. Companies like McDonald's and Cafe
Coffee day operates with this expansion strategy (Herbane, 2010).
Product Development
Zizzi is successful in serving that italic food cravings of the people. But there is scope of
of development in other food categories as well. The company can launch variety of salads for
health conscious people. Which horizons to expand into can be determined by the valuable
feedback provided by the consumers. They should be provided with an blank to specify the
things which is lacking at present.
Geographical Expansion
The most orthodox way of expansion is moving into new geographical territory. This
comes with a greater amount of risk and high financial requirement. It is very important to
conduct a market research before actually moving into new areas. There will be a need of beta
testing, new marketing strategies and huge amount of finances before an enterprise move into an
area.
Task 3
3.1 Producing a business plan and business objectives
Business plan is a structure which help to look forward in market run including allocation
of resources, resolving issues and conflicts and enhancing key points along with grabbing
opportunities. For smooth running of a business process, planning is highly important as they
need to ensure development and market growth. Decision takers has to set several tasks as per
their priorities while making business planning. It is a written document involves certain
strategies so as to achieve aims and objectives of the firm in an effective manner. Business plan
mainly consists of vision and mission, break even and market analysis, path to success etc. which
is enough to decide its worth and life cycle.
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(Source: Business Plan, 2017)
Before making of a business plan, managers have to certain objectives. Below are the business
objectives of small-business entities:
 More opportunities to the lower section of community.
 To support equality and discourage regional partialities.
 Enhancing standard of living.
 Adoption of latest technology for efficient production.
Steps of a Business Plan:
 Generating of Ideas: It is an essential step through which an effective business
plan can be made. First of all, managers have to generate innovative concepts by
which growth and dynamic structure can be established in market place. In
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Illustration 1: Business Plan

addition, concepts can be related with market gap and add values in products and
services of an organisation.
 Market Research: In this stage, managers have to conduct a deep market
research in which content should be of relationships with existing and new
customers, along with that current market value, trends analysation and
competitor's strengths. After results of research, according to needs and wants a
proper and effective planning and policies can be structured in order to lead
market (Business model vs. Business plan, 2017).
 Developing a marketing strategy: An adequate marketing strategy should be
developed to implement successful business planning by managers. This will be
helpful to gain competencies advantage in global environment.
 Analysation of financial situation: Financial situation can be analysed by
different tools and techniques made for financial research. If Financial condition
strong,then it will be an advantage in adopting efficient methods of production
so that performance level of staff members can be increased.
 Formulation of Plan: In last, overall plan is applied within business
organisation. It is necessary for managers to continuously monitor the progress
of business plan (Change management, 2017).
3.2 Revision of a Business Plan
Revision of business plan is most productive work in small business enterprise as it is
conducted to make positive changes in business plans and policies. It should be done as per the
need of time frame. An effective business plan is responsible for growth and success of an
organisation as it is capable of covering all elements which are helpful in achievement of vision
and mission of firm. Main benefit of business plan revision is that sometimes while making plans
some sections are missed which can cause trouble in future, so while revising management can
determine all hidden issues and situations that will affect current market position. Alteration in
current plan and making it more sustainable is the basic fundamental role of revision in business
plan. Furthermore, it also affect on decision making process and also determine future risks and
uncertainties (Malhotra and Temponi, 2010). Owners have the help to find out unenlightened
areas in which they can grab opportunity and can expand along with market growth increment.
Owners of Zizzi restaurant must have to revise their business plan and make positive
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