Business Plan on the Establishment of Cafe in Addis PDF

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Page 1####### ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT (CODE-_____)PREPARED BY: ABENET AJEMESUBMITTED TO: ____________________________MAY, 2020 ADDIS ABABA, ETHIOPIAPage 2AMEN BUSINESS CENTERSTART-UP BUSINESS PLAN####### MAY, 2020####### ADDIS ABABA, ETHIOPIA####### 1. BACK GROUND INFORMATION#...

Description

ENTREPRENEURSHIP AND SMALL BUSINESS MANAGEMENT (CODE-_____)

PREPARED BY: ABENET AJEME

SUBMITTED TO: ____________________________

MAY, 2020 ADDIS ABABA, ETHIOPIA

Page 1

AMEN BUSINESS CENTER

START-UP BUSINESS PLAN

MAY, 2020 ADDIS ABABA, ETHIOPIA

Page 2

Executive Summary AMEN BUSINESS CENTER is a service oriented business under formation by young and energetic individual ------------------------------, who intended to establish multi-service rendering business lines that primarily located in Addis Ababa City Administration, Yeka SubCity, Woreda-10, H.No. 081.

The legal formation of envisaged service center will be as a sole proprietorship business company, in which the promoter has a future plan to open other branch offices at different regions and cities of the country with similar business name. Despite the fact that adequate market is available to absorb the establishment of the business and the business is located at an accessible area by any means of transport, at any time and throughout the year makes it tremendously strategic for aforementioned business.

More important of all, the conducted brief business plan reveals the overall viability of the project even at worse situations. The total investment cost of the plan is estimated to be Birr 1,701,238; out of this the promoter’s equity contribution is assumed to be Birr 998,450.-. Whereas, the remaining investment cost of ETB 1,723,991.80 and working capital requirement of Birr 1,234,588, which in total amounting of Birr 702,788.-; is expected to be financed by one of the local banks.

In addition the project is profitable and liquid throughout its operation years and contributes a lot to the development in general and services Industry in particular. It also creates employment opportunity to citizens and becomes an income source to the government.

1. BACK GROUND INFORMATION 1.1 General Description  Business Name : ………………AMEN Business Center  Project Owner : ………………..  Address: ……………………… Somali Regional State, Jigjiga Town, Wer:- -- Company Formation: …………...Sole Proprietorship  Business Registration: ………….Under Process  Business License No. …………...Under Process  Licensing Organ…………………Somali Regional State Gov’t, Trade & Industry  Business Status…………………..New

1.2 The Business Promoter and Company The establishment of envisaged Service Business Center is owned by an Ethiopian Citizen, Young and energetic person, -------------------, who is a graduate of multi disciples and attained different academic levels that enables him to properly administer the underlying service business. On top of all, the founder earned experiences in various business activities, humanitarian works and other business development activities, especially in the following areas: 

Co-coordinating the establishment of small and medium business operators in different regions;

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Capacity Building and Business development activities for rural and urban small scale holders;



He also grasped an experience of working on development activities of rural micro-finance institution as a partner with international organizations.

Hence, the envisaged business is intended to take part on the development activity of the country by involving in the service oriented business through making efforts on surrounding community’s need identification, in which there is an existence of potential market demand in the vicinity and thereby contribute to the overall development of the nation.

1.3 Business Location

The promoter has strongly inspired for the establishment of new and modern service business center initially using an existing building registered in his name and located in Somali Regional State, Jigjiga City Administration, Wereda -----, around Jigjiga University, on the road from Jigjiga – to – Togo-Chale. 1.4

Business Objectives

The main reason for pursuing this business is that the promoter strictly identified the existing problem of intended service delivery systems and needs in the surrounding area that residing communities could not find proper business centers to full fill their daily life as needs arise. Therefore, the Owner, Ato Wubie Demissew has inspired to open quality/standard service business center using modern facilities with affordable price to the surrounding community in particularly as well as university students at large.

Furthermore, this start-up business plan is prepared with the following specific objectives that go in line with systematic business establishment towards end target. Hence, these objectives are:  To secure loan facility of Birr 1,000,000.-; that enables the business partially for building lay-out works as suitable for intended service delivery; and partially to fulfill initial/start-up working capital requirements,

 To establish a services business that will make available a wide range of goods and products from top production brands at affordable prices to the residence in the vicinity;  To provide multi-service facilities that focuses on entertainment and energy efficient environment.  To introduce all-in -one shop by creating information center, coffee houses involving local patrons to prepare local favorites, and others.  Boost image and awareness by establishing baseline customer satisfaction of 100%.

 To retain our long-term contracts with local business companies as well as government offices to provide sustainable services to their employees  Become the premier multi-services provider in community assisting manner at affordable services price.  To create a service center that will exceed patients' expectations

 To provide high-quality services to residents of the area  To fully engage in the service delivery operations with further expansion activities to other surrounding regions and more towns.  To embark on a sustainable plan to achieve a reliable supply of fast moving goods needed for the local, regional and national market,  To generate income for the company in order to expand the operation and other development activities in the country.

1.5 Mission AMEN BUSINESS CENTER is committed to satisfying customers by providing a broad selection of high quality and competitively priced service products as well as exceptional customer service. The focus of AMEN BUSINESS CENTER is to create an environment that is warm, friendly, and clean. We are committed to our employees by treating them with respect, fairness and integrity and exposing them to an atmosphere that fosters teamwork and professional development.

The suppliers of AMEN BUSINESS CENTER are also partners in the success of the company and we expect the same in return. It is our responsibility to be active stewards in our communities and to promote local involvement.

1.6 Keys to Success The keys to success for AMEN BUSINESS CENTER are:  Customer Side  Quality products and friendly service.  Creating a positive relationship within the community.  Focus on customer need and care  Support Customer on product usage after sales  Implement an aggressive and accurate recall system for regular service delivry  Employees/ Staffs 

Recognize that the office staff is as crucial in the success of the business

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Create incentives by allowing the staff to benefit from profits generated by the business

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Create a streamlined business system to minimize customers' waiting time

 Finances 

Keep a low overhead

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Optimize the number of customers while providing quality services

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Use the latest in electronic billing and/or utilize an outside billing company

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Use this business plan to review and guide further decisions

 Marketing and Sales 

Aggressively market and create a presence in the community by giving personal talks,

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Have a business working station at front on a busy street with accessible parking

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Locate in an area with a high customer usage ratio

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Locate in close proximity to the learning institutions with easy access

1.8 Implementation The promoter has planned to start modern services business center as soon as the financial support from external sources may possibly secured. After receiving the financial support from the lender, at the beginning of establishment

year, it is intended to deliver the entire services at capacity rate of 70% and then increase by 10% yearly until it reaches 100% service delivery capacity. Therefore, the following table shows the Implementation Type of Activity

S.No

2017 March

1

Licensing & Loan Processing

2

Remodeling & Lay-out works

3

Hiring Specialized Experts

4

Procurement of Stocks & Others

5

Commencement of operations

plan.

April

May

June

July



3. Services Classification and Description AMEN BUSINESS CENTER is a medium size and community based business center that offers store brand and national brand products. Entire facilities for the business center are planned to be complete and are far nicer than anything around. Hence, our service classifications are:  Supermarket Services  Internet Café Services  Mini Cafeteria Services  Financial Transaction Agency Services (Like, ATM Facility, Money Transfer, etc.) 3.1 Supermarket Services  We offer a meat department where fresh cuts are available daily and there are no pre-package meats for sale.  The store offers home delivery for local residents that are unable to travel to the store for grocery items.  Because of the diversity of the community, specialty items and natural/organic food products are available.

 Supporting "local" is a firm belief of the owners and therefore; have partnered with local farmers for produce and natural/grass fed beef and ruminant animal meats.  AMEN BUSINESS CENTER also serves its customers by special ordering items that are not available within the store or that cannot be found at a competitor location.  Fruit and vegetables  Beauty products and jewelry  Children’s toys and baby stuffs  Fresh and frozen meat  Dairy products (distributing milk and milk products) by collecting from local community as well as being an agent distributer for livestock products, such as milk and meat processing companies in the area.  Drugs and health products  Stationery Items, etc

3.2 Internet Café Services  We provide internet services using Wi-fi/Broad band connections for daily users.  Printing, Copying and faxing facility 3.3 Mini Cafeteria Services  Our cafeteria service include:  Ethiopian traditional coffee

 Special Tea  Soft drinks  Breakfast services 3.4 Financial Transaction Agency Services AMEN BUSINESS CENTER will provide financial transaction services with surrounding customer conveniences that include:  Money transf er services (to become agent for Somali Microfinance)  Deposit Mobilization Service (for Somali Microfinance) 

Loan repayment Collection services (for Somali Microfinance)

4. Market Analysis 4.1 Overview It is a known fact that business centers that provide similar services has been in existence for as long as human started trading goods, but one thing is certain, the supermarket and grocery store industry is still evolving. The introduction of technology and subsequently retail store has indeed helped in reshaping the industry. As a matter of fact, it is now a common trend for business centers offering multiple service outlets to leverage on technology to effectively predict consumer demand patterns and to strategically position their shop to meet their needs; in essence, the use of technology help retailers to maximize supply chain efficiencies. No doubt data collected from customers goes a long way to help the business center serve them better. Another common trend in the business industry is the pricing system. Aside from having varieties of products in a store, one of the easiest ways for service stores to sell the goods on their racks as fast as they can and keep re – stocking is to ensure that the prices of their goods are a bit lower than what is obtainable in elsewhere.

4.2 Service Business Focus AMEN BUSINESS CENTER seeks to be a one stop shop for the local community, whether it be copying, faxing, shipping, or just daily shopping, we want local residents to know that we will be able provide for their diverse needs in a store with them in mind.

4.3 Competition and Buying Patterns

The customer base of AMEN BUSINESS CENTER is very diverse in that there is a group of general customers that just purchase store brand and national brand products, another group high end customer who request select shopping as an entertainment, such as university students and other university community, and healthy choice customers who request a selection of natural/organic products. In order to maintain our customer loyalty base and continue to increase sales revenue, we make these products available. The community has become accustomed to these products and expects them to continue.

4.4 Our Target Market It will be safe to categorically state that the business center and commodity store industry has the widest range of customers; everybody on planet earth has one or more things that they would need in such store. It is difficult to find people around who don’t patronize especially supermarket and commodity stores. In view of that, we have positioned our business center to serve the residence of Jijiga town in general and university community in particular, including other key organizations working with in the vicinity. We have conducted our market research and we have ideas of what our target market would be expecting from us. Hence, Our primary target markets include: 

University Students. The large number of Jigjiga University student population will become an important part of the customer base. The student population continues to grow with the success of the University. Daily entertainment, access to commodity store, access to the Internet, and the up-scale ambiance will attract this demographic.



Business people. The downtown business community is growing rapidly with the addition of a new expansion and urbanization of the area and new professional centers. AMEN Business Center will provide a perfect setting for business activities. It will also give

traveling business people an opportunity to visit the center for convenience and uses the internet service to check email communications. 

Households. Residing community uses our business center to buy goods as well as services for personal and household consumption.

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Corporate private and Government institutions.

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Tourists and /or walking customers

4.5 Our Competitive Advantage Research and studies carried out in the services business center and commodity store industry reveals that the market has become much more intensely competitive over the last decade. As a matter of fact, you have to be highly creative, customer centric and proactive if you must survive in this industry. We are aware of the stiffer competition and we are well prepared to compete favorably with other leading business centers, supermarkets and grocery stores in Jigjiga town.

AMEN Business Center is launching a standard and highly secured business center that will indeed become the preferred choice of residence of Jigjiga town. Our business center is located in a corner piece property on a busy road directly left of Jigjiga to Togo-Chale trip, which is closely nearby Jigjiga University. We have enough parking lots that can accommodate well over 30 cars at a time. We will ensure that we have a wide range of products from different manufacturers available in our store at all times. It will be difficult for customers to visit our store and not find the product that they are looking for. One of our business goals is to make our place one stop shop. Our excellent customer service culture, product store, various payment options and highly secured facility will serve as a competitive advantage for us.

4.6 Service Positioning AMEN Business Center will position itself as an upscale Supermarket, Coffee house and Internet service provider. Business people of all types will use the center as a place to hold meetings and catch-up on email communications. Students from nearby institution will use our services as a place to socialize and discuss

the latest information. Seniors and Bachelors from nearby community will experience the entertainment for the first time at AMEN Business Center.

4.7 Strategy Pyramids The following are the three key strategies that AMEN Business Center will focus on:  First strategy focuses on attracting University Community, who is basically Entertainment and Refreshment lovers, as well as major Internet service users. AMEN Business Center plans on attracting these customers by:  Providing a technology-friendly environment. Our center will be staffed by knowledgeable employees focused on serving the customer's needs.  A Customer Service desk will always be staffed. If a customer has any type of question or concern, our employee will always be available to assist.  Our Business Center will offer service discount and credit sales for university students who registered as package users at our business center.  Providing Typing, Scanning, Photo Copy and Printing Services.  Second strategy will be focused on attracting Youths in nearby community. AMEN Business Center plans on attracting this type of customer by:  Providing the latest in computing technology based Sports Shows,  Providing computer based Play Stations,  Providing better access to Ethiopian Traditional Coffee and special Tea services,  The third strategy focuses on building a social environment for our customers. A social environment that provides entertainment will serve to attract customers that wouldn't normally think about using the Internet or having cup of coffee. Once on location at AMEN Business Center, these customers that came for the more standard entertainment offerings will realize the potential entertainment value that our service center can provide. Thus, they will then ready to permanently buy other facilities availed at our place.

4.8 Marketing Mix AMEN Business Center marketing efforts will focus on building a loyal base of customers that will use the services provided on an almost daily basis.

4.8.1 Services and Service Marketing As the popularity of similar services continues to grow at an exponential rate, easy and affordable access to the easy entertainment facility, latest information, fresh/organic products are quickly becoming a necessity of life. AMEN Business Center provides the local community with the ability to access the Internet, enjoy a cup of coffee, buying fresh/organic products, and share experiences in a comfortable environment. People of all ages and backgrounds will come to enjoy the unique, upscale, educational, and innovative environment that we provide.

4.8.2 Pricing AMEN Business Center bases its prices for every services and products on the Cost Vs Profit Analysis. Hence, our pricing strategies are listed hear under.  Pricing strategy for Supermarket/store items will be fixed at 35% profit margin over inventory costs including local government tax.  Determining a fair market, hourly price for Internet services @ birr 0.75/minute = birr 45/hour.  Prices for Sport Show and entertainment will be @ bi...