FOOD SIGNATURE – QSR

FOOD SIGNATURE – QSR
ABC
ADVANCEDBUSINESSCOMMUNICATIONS
2
CONFIDENTIALITY AGREEMENT
This Business Plan and its contents are confidential and remain the sole property
of Occasion Touch Limited (“the Company”). Its use is strictly limited to those
readers authorized by the Company. Any reproduction or divulgence of the
content of this Business Plan without written consent of the Company is strictly
prohibited.
It is acknowledged by the undersigned reader that the information provided by
the Company in this Business Plan is in all respects confidential in nature, other
than information which is in the public domain through other means and that any
disclosure or use of same by the reader may cause serious harm or damage to
Occasion Touch Limited.
The undersigned reader agrees not to disclose any information without the
express written permission of Occasion Touch Limited
Upon request, this document is to be immediately returned to Occasion Touch
Limited
This Business Plan is not an offer, which can only be made by an
approved Private Placement Memorandum. Participatory interest will
only be to Accredited Investors.
This Document includes “forward-looking statements.” All statements other than
statements of historical fact within this Document, including statements
regarding Occasion Touch Ltd for its subsidiaries‟ strategies, plans, objectives
and expectations, are all forward-looking statements.
Although the Company believes that the expectations reflected in such forwardlooking statements are reasonable at this time, it can give no assurance that
such expectations will prove to have been correct. Certain important factors that
could cause actual results to differ materially from expectations are set forth
herein. Any subsequent written and oral forward-looking statements attributable
to the Company or persons acting on its behalf are expressly qualified in this
regard.
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EXECUTIVE SUMMARY
The Nigerian fast food industry is in a vibrant growth phase, the EuroMonitor
International Market Report of February 2009 valued the sector at $2.5billion in
annual earnings and assets while the Association of Fast Food and Confectioners
of Nigeria (AFFCON) announced that the industry is worth over N190 billion.
Nigeria‟s population of about 150 million presents a large market for food
companies most consumers like to have a choice of eateries and loyalty switches
are common especially when a new entrant offers better service, quality
products and more entertaining environments.
Fast food restaurants are
typically concentrated in the
three major city states of
the country i.e Lagos, Port
Harcourt and Abuja this
makes location planning
essentially straight forward.
Local operators such as
Tastee Fried Chicken, Mr
Biggs, Tantalisers and Sweet
Sensations
have
experienced rapid expansion
in sales revenue and branch
network. This situation has
inevitably drawn foreign
participants to the lucrative
market
reflected
in
a
growing inflow of new South
African fast food franchises
and Chinese restaurants.
Occasion Touch Nigeria Limited is an events management/ interior decoration
company diversifying into the fast food industry under the brand name of Food
Signature. This business plan is an articulation of the Company‟s intention to
create a sustainable niche in the market via clarity of purpose and a passionate
determination to become Nigeria‟s fastest growing quick service restaurant chain.
Concise summaries of the product/ service offering, the market realities,
operating strategies and implementation plans are also included to create a tridimensional perspective of the startup business.
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Food Signature requires a N100M (approx $670,000) as a four year credit facility
to commence full production and sales. Expected payback period is 3years,
projected turnover will exceed N115M from the second year of operations with
after tax earnings in excess of N41M by the third year.
Management Team
The core management team is composed of Martina Dudu (CEO) and Suleiman
Parker (COO); Martina holds a BSc (Hons) Degree in Sociology. She started her
working career as the personnel manager of British Airways and proceeded to
work in Nigeria International Bank (CITIBANK) in 1989 as a human resource
specialist. She left the employ of the Bank seven years later and established
Occasion Touch Nigeria Limited. Her experience cuts across relationship
management, customer service, personnel management, business development,
events management and interior decoration.
Suleiman Parker holds a Bachelor of Arts Degree in English and his career path
is entirely centered on the hospitality/ food industry. He commenced his
professional career in Sheraton Hotel (Ikeja) in 1997 and moved on to work as a
restaurant manager of Sweet Sensations in 1999. He spent seven years in the
fast food chain, working in various departments and capacities such logistics and
supply, factory set up, marketing and internal control. In 2006, he was appointed
General Manager of Food Concepts Limited with the responsibility of coordinating
the operations and marketing of South African franchises: Chicken Republic and
the St Elmos brand.
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LIST OF CONTENTS
EXECUTIVE SUMMARY
CONTENTS
COMPANY PROFILE
1.1
OBJECTIVES
1.2
VISION & MISSION
1.3
KEY SUCCESS FACTORS
1.4
START UP SUMMARY
1.5
COMPANY LOCATIONS
PRODUCT SUMMARY
2.1
PRODUCT STRATEGY
2.2
SALES STRATEGY
2.3
PRIVATE PARTIES
MARKET ANALYSIS
3.1
TARGET MARKET CLASSIFICATION
3.2
MARKET SEGMENTATION
3.3
MARKET NEEDS
INDUSTRY ANALYSIS
4.1
CHALLENGES OF THE INDUSTRY
4.2
COMPETITION ANALYSIS – QUICK SERVICE RESTAURANTS
4.3
RECENT COMPETITIVE TRENDS
4.4
THE RISE OF ETHNIC MENUS – CASE STUDY OF MAMA CASS RESTAURANT
74.5
FOREIGN Vs LOCAL FRANCHISING
STRATEGY AND IMPLEMENTATION SUMMARY
5.1
COMPETITIVE EDGE
5.2
MARKETING STRATEGY
5.3
BRAND CHALLENGES
5.4
MARKETING PROGRAMS
5.5
POSITIONING STATEMENT
5.6
SALES STRATEGY
5.7
STRATEGIC ALLIANCES
5.8
MILESTONES
5.9
WEB PLAN
MANAGEMENT SUMMARY
6.1
ORGANIZATIONAL STRUCTURE
6.2
PERSONNEL PLAN
FINANCIAL PROJECTIONS
7.1
START UP FUNDING
7.2
FORECAST – BASIS AND ASSUMPTIONS
7.3
PROJECTED PROFIT & LOSS ACCOUNTS
7.4
PROJECTED BALANCE SHEET
7.5
SELECTED FINANCIAL RATIOS
APPENDICES
FINAL ACCOUNTS IN EXCEL FORMAT
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COMPANY PROFILE
Occasion Touch Nigeria Limited was incorporated in 1997 to provide events
management and product launch services. The company has also been active in
stage set design and lighting; these functions have invariably overlapped into
interior decoration for corporate organizations. The company has over the years
worked with UAC Nigeria Plc, Citizens Bank, Citibank, Dangote Group, First Bank
Plc, MOBIL, British American Tobacco, Nigerian Breweries, IMB, NAL Merchant
Bank, Ikoyi Club- the Golf section, Total Consult and several marketing
communications companies. The company handled the interior decoration of
Delta State Government House, the first ten outlets of Sweet Sensations
restaurants and scores of private homes of high net worth individuals (HNIs).
The directors of the company have identified the immense profit potential of
creating a world class local fast food company in densely populated Lagos. This
is the basic reason for diversification into fast food business under the brand
identity of Food Signature.
1.1




1.2
OBJECTIVES
To establish a presence as a successful local fast food company and gain
significant market share.
To identify and satisfy the needs of target markets
To make Food Signature a popular fast food chain in Nigeria.
To produce goods and services of the highest standards that would be
sold at a profit.
VISION & MISSION
Our goal is to be one of the top five fast food chains in Nigeria. Food Signature
will strive to be a world class local fast food brand. We aim to give our customers
a uniquely pleasurable experience when visiting our outlet(s) and website. We
will sell merchandise from pre-packaged sauces to T-shirts, all embossed with
our official brand. Our main focus will be serving high quality food at great prices.
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1.3






KEY SUCCESS FACTORS
We will create a distinct, innovative and entertaining menu that will
differentiate us from our competitors.
We will maintain the policy of strategic recruitment of administrators and
culinary professionals from the ranks of the top three fast food companies
so as to adopt and improve on best practices in the industry.
We will ensure effective cost management and implement a conservative
growth/ expansion policy.
We will encourage the three most important values in the fast food
business; brand, image and product quality.
We will establish our outlets at densely populated areas on one hand and
at high end residential/ commercial areas on the other hand.
We will promote the values of customer orientation as our company
culture and business philosophy.
Each location will feature its own unique originality in structural design, rich merchandise
display and other brand accentuating attributes.
1.4
START UP SUMMARY
Negotiations are at high gear to close the purchase of a property at No.50
Ishaga Road, Surulere Lagos for the sum of N19, 500,000 with the sum of N5,
500,000 having been deposited in lieu of the balance. Teams of consultants have
been assembled to provide management advisory services in the areas of
financial management, location development, equipment procurement, recipe
formulation, product development, raw materials sourcing and marketing
communications. We estimate an initial capital requirement of N100, 000,000 to
build and profitably operate two world class eateries in Lagos State.
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1.5
COMPANY LOCATIONS
Food Signature‟s locations will seat 75-150 guests; our first outlet will seat 150 at
full capacity while the 2nd outlet will seat 100 guests. Each location will feature
its own unique originality in structural design, rich merchandise display and other
brand accentuating attributes. The outlets will be equipped with modern interior
décor aimed at creating an open feeling. We are currently scouting ideal
locations for the 2nd outlet in Lagos central business district of Victoria Island.
Space




selection will be made with the following criteria in consideration:
Community size – Population density
Median income classification – High end commercial/ residential areas
Accessibility to artery roads
Proximity to large numbers of students and professionals
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PRODUCT SUMMARY
Food Signature will sell bread, pastries, pizza, cakes, chicken, fish, beef, cooked
meals (continental and local), soups, non alcoholic drinks and ice cream. Our
outlets would also provide excellent and friendly customer service to support the
ambience of a fun, energetic, youthful and family friendly lifestyle.
2.1
PRODUCT STRATEGY
We will adopt and improve on successful product strategies of the top five local
fast food companies in Nigeria. Product strategies of Tastee Fried Chicken in the
processing of rice variety, pies, burritos, burgers, pottage hash and chicken will
be improved upon in addition to innovations being made on the product
processing strategies of Tantalizers, Mama Cass and Sweet Sensations.
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2.2
SALES STRATEGY
We will use integrated marketing communications to promote general awareness
of our outlets and products/services. Handbills will be distributed at tertiary
institutions, hospitals, surrounding residential estates, banks and other corporate
organizations. Reviews will be sponsored in popular weekend and tourism
magazines. The sales marketing process will be coordinated with the use of 21 st
century marketing concepts and strategies. Openings of Food Signature outlets
will have similar marketing mixes. Grand openings of each outlet will be
supported by road shows, personal selling presentations, media blitzes and
massive outdoor signage. We will use „tray topper-handbills‟ to explain the
concept and philosophy of Food Signature. We will also grant frequent user
certificates, announce job openings and possibly mention franchise opportunities.
2.3
PRIVATE PARTIES
We will invest in the lucrative private parties market as well as providing
professional catering services to corporate organizations. Presentations will be
made at the upper administrative echelons of the banks, oil firms and other blue
chip corporate organizations to provide excellent catering services at great prices.
We will aggressively market our private party services using diverse awareness
creation vehicles, brochures will be widely distributed in high end market and
residential locations explaining our competence in the management of banquets
and private parties in addition to other brochures listing our daily entrees.
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MARKET ANALYSIS
Food business is attracting more investors because of the population of the
country. At more than 140million people and with an emerging middle-class,
Nigeria offers a lot of opportunity for anyone who wants to do business. One of
the basic needs of life is food, followed by shelter and clothing. According to
EuroMonitor‟s 2009 market report, Nigeria‟s fast food industry is worth over US
$2.5 billion a year. The Association of Fast Food and Confectioners of Nigeria
(AFFCON) in May 2009 put the Industry worth in excess of N190 billion with
potential for growth.
3.1
TARGET MARKET CLASSIFICATION
A broad appeal exists for weekend and holiday slots because those are the days
when most of our core target market enjoys eating out. The target markets are
classified thus:
 Adolescents, teenagers and students
 Working professionals
 Family units – especially young families with children
 Income – we will appeal to all in the medium income group
Our concept will have a very broad appeal. It is our goal to be the hip destination
for fast food cravings. According to the EuroMonitor‟s report, public survey of
people aged 15 to 45 revealed that 80% of those interviewed like fast food, 40%
of them eat fast food on a daily basis and about 65% are disposed to trying out
new fast food restaurants.
The survey also provided the following particular reasons for the increasing
popularity of fast food in Nigeria:
 People have 52 weekends and several public holidays in a year.
 Most white collar workers have ceased to bring home cooked lunches to
work. They prefer fast foods and ethnic meals from informal restaurants
in the vicinity.
 Parents give more money to children and students to buy lunch. Fast
food is naturally their first choice because of the industry brand building
efforts that are targeted at their age group.
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100
90
80
70
60
50
40
30
20
10
0
Workers
Students
Family Units
Family Units
Students
Workers
Like FF
Eat FF Daily
Figure:
3.2
Market Classification
MARKET SEGMENTATION
We are targeting young residents of Lagos as our primary target. Surulere is a
high density area in Lagos central with a lot of educational facilities in close
proximity to our flagship location. We intend to leverage on this factor in
attracting people to our outlet.
Our secondary market segment is the working class group in the area. The
growth of fast food business is closely linked to the urbanization phenomenon
which has brought about the situation that people can not eat before leaving
home for work because of heavy traffic in the metropolis. High cost of living has
also resulted in most couples working, both husband and wife work, there is
nobody to stay at home and cook. Hence most people have to eat outside their
homes with dinner being the only home meal eaten by many families.
Our lunch strategy is dual purposed; we would place premium on ethnic dishes
served hot and fast food for customers who seek a quick bite as opposed to
heavy ethnic meals. We aim to keep the price point at lunch as fair as possible.
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3.3
MARKET NEEDS
We have identified the following needs among the target markets; our core focal
groups:
 Wants variety and flavor in its food
 Looks for speedy service
 Wants an entertaining and fun experience
 Insists upon a clean, friendly and attractive environment
 Adopts a global lifestyle and has an active lifestyle
 Is computer literate
 Enjoys eating out
 Comes from various ethnic backgrounds
The re-emergence of the middle class in the last ten years of democratic
governance has a created a young and expanding professional population with
rising income profiles. These changes have inevitably influenced consumer
purchases, food and entertainment choices, associated changes include more
working women and greater average disposable income.
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INDUSTRY ANALYSIS
The Nigerian fast food industry has been growing since the 1970s and is now
worth over N190 billion. The large population creates a vast market for investors
in the food business. A fast food restaurant, also known as a Quick Service
Restaurant (QSR) is a specific type of restaurant characterized by both its fast
food cuisine and by minimal table service. Effective operation of QSRs requires
the services of thousands of people starting from outside suppliers and various
service providers (architects, builders, estate agents, auditors, financial
accountants, engineers, cooks, scientists, IT professionals, service
representatives etc). It is therefore a labor intensive industry involving several
people in the food supply chain from farm to the table.
Labor intensive food Industry
4.1
CHALLENGES OF THE INDUSTRY
Challenges faced by fast food restaurant operators in Nigeria include:
 Inadequate food processing industries for value added chicken, meat and
fish products, frozen and canned vegetables, seasonings, condiments,
sauces and spices.
 High cost of funds – high bank lending rates, the implications of the
economic meltdown on the falling naira value against international
currencies.
 Poor infrastructure like poor power supply (this is the major recurrent
expenditure of QSRs), lack of potable water, poor road networks and
inadequate waste disposal facilities (especially outside Lagos).
 Multiple taxation regimes and overlapping roles from different tiers of
government.
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4.2
COMPETITION ANALYSIS - QUICK SERVICE RESTAURANTS
Mr. Biggs
This is Nigeria‟s first fast food chain, full operations was launched 22 years ago.
It is owned by the conglomerate UACN Plc and it has over 180 locations in
Nigeria and Ghana. It is styled after McDonald‟s and is known for its red and
yellow color scheme and meat pies. The fast food chain experienced rapid
expansion after becoming one of the first Nigerian companies to sell franchises
to entrepreneurs. It is however gradually losing market share to its smaller
competitors who are presenting better value propositions such as quality food,
innovative operations and total quality marketing management.
Estimated Market Shares
Tastee Fried
Chicken
24%
Mr Biggs
28%
Others
8%
Sweet Sensations
15%
Tantatalizers
20%
Food Concepts
5%
Source: AFFCON Market Report 2008
Tantalizers
The company opened its first outlet on Broad street Lagos Island in 1997 and
presently has about 38 locations being company owned and franchises in Lagos,
Ibadan, Abuja and Port Harcourt.
Tastee Fried Chicken
The company began as an extension of Tastee Pot, an outdoor catering company
serving Nigerian and continental food at special events. The company is based
on the business model of Kentucky Fried Chicken and has grown to about 10
company owned restaurants.
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Sweet Sensations
The company has in the few years of its existence, grown to become a
household name in Nigeria. It has 17 outlets in Lagos and 1 outlet in Ogun State.
Food Concepts
The company commenced business operations in 2000 with franchise licenses
from South African firms. These include Chicken Republic, St Elmos and Reeds.
The company‟s foray into bakery business is reaping great dividends with its
Butterfield Bakery having an aggregate sales figure of 20,000,000 loaves in 2007.
4.3
RECENT COMPETITIVE TRENDS
An emergent trend in the fast food industry is the development of strategic
alliances between downstream petroleum companies and fast food chains to site
restaurants in filling stations. The „On the Run and Creamy Inn‟ concept is an
offshoot of such an alliance between UAC Foods and MOBIL. Tastee Fried
Chicken and Oando oil marketing company have a similar relationship.
Strategic partnerships between petroleum marketers and fast food chains
Another recent trend is the development of separate sections within the
restaurants, serving traditional ethnic cuisines like efo riro, egusi, ewedu,
edikaikon,oha, amala, eba,iyan, locally processed sea foods, roasted bush meat
etc. These sections are gaining increasing popularity and are very profitable for
the operators because many educated professionals have a strong desire to eat
Nigerian ethnic meals but cringe at the prospect of eating in or even buying food
cooked at often times filthy informal restaurants with unhygienic preparation
processes and appalling surroundings.
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4.4
The Rise of Ethnic Menus - Case study of Mama Cass Restaurants
Limited
Mama Cass has revolutionized the concept of QSRs in Nigeria by making the
ethnic menus its pivotal offering. The company offers western fast foods in its
daily entrees like its competitors but it sought to differentiate its brand by
emphasizing the sale of African ethnic foods at competitive prices. This idea paid
off with the company experiencing outstanding growth in less than 4years. The
company has diversified into other aspects of the food business and back end
integration. The company regularly opens new outlets with locations in Lagos,
Abuja, Edo, Ogun and London (where it has captured the large Nigerian Diaspora
market).
4.5
FOREIGN Vs LOCAL FRANCHISING
South African companies with immense financial resources, control almost 50%
of the fast food franchising in Nigeria with rapid expansion by Famous Brands, St
Elmo‟s, Steers, Nandos etc into the mass market.
Nigerian fast food companies are however preferred by young entrepreneurs
because of lower franchise fees and dynamic mix of advertising, customer
intelligence and market understanding to create loyal customer bases; the No. 1
local franchise is UACN Plc‟s Mr. Biggs.
Chinese Restaurants are entirely targeted at the premium customer segment of
HNIs and corporate organizations; they maintain traditional service protocols of
table service, priced table menus and table/hall reservations.
New players in the Nigerian market are Indian companies notably YUM!
Restaurants International (YRI), the franchisee of Pizza Hut, Taco Bell and
Kentucky Fried Chicken in sub Saharan Africa. KFC commenced operations in
Lagos on the 17th of December 2009.
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STRATEGY AND IMPLEMENTATION SUMMARY
We will commence operations by opening the first outlet in densely populated
Surulere. We plan to open a second outlet in Victoria Island - Lagos Central
Business District within 12 months of operation. We will provide a see through
kitchen, so that people can assess our commitment to hygiene and freshness in
our products.
The mini bakery and kitchen will also let out an aroma of freshly prepared food
into the surrounding area so that people will be drawn to trying our products.
5.1
COMPETITIVE EDGE
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
Excellent food products
Enthusiastic and friendly staff
Supporting merchandise items that promote the company‟s brand
Tastefully modern interior décor
Innovative packaging that will position us at par with the top local
franchises
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5.2
MARKETING STRATEGY
Our strategy is based on serving our markets well. We will start our first outlet as
a „market tester‟ that could become a model of future outlets. Emphasis will be
on maintaining quality and establishing a strong identity in the local market.
The best form of advertising is the word of a satisfied customer – buzz
A combination of media and local store marketing programs will be utilized at
each location. We believe that the best form of advertising is still „ buzz‟. This will
be actualized by providing a fun and interesting environment with unbeatable
quality at acceptable prices. Therefore the execution of our concept is the most
critical element of our plan. We will actively build our brand through the sale of
supporting materials such as merchandise, promotional items and other
marketing tools.
PRICING
Our pricing strategy is positioned as „generic‟ meaning that N700 is the average
consumer spending for a lunch of rice and chicken in fast food outlets in Lagos.
We will endeavor to keep our operating costs as low via effective cost
management strategies so as to price our products competitively and make more
profits.
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5.3
BRAND CHALLENGES
Food Signature will establish a distinct brand to stand out from its competitors,
we are liaising with Adstrat, a frontline marketing communications and ID
creation firm, to develop a compelling logo which would be positioned as fresh,
energetic and playful with color elements that are eye catching.
Our product names would be easily remembered and geared towards the core
target markets.
5.4
MARKETING PROGRAMS
We will deploy three different marketing tactics to increase market awareness of
our outlets. Our basic tactic will be the use of in-store marketing and customer
delight strategies to engender „word-of-mouth‟ marketing.
The second tactic will be local store marketing; this will consist of low budget
plans that will provide community support and awareness of our facility, this will
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include the use of temporary marketing personnel to all the secondary and
tertiary institutions in the area in addition to hospitals, banks, and other middle
income commercial establishments within 20km radius of the outlet. Emphasis
will be placed on University of Lagos, Yaba College of Technology and Lagos
University Teaching Hospital.
The third tactic will be the use audio visual media and print media. We will
patronize popular radio stations like Unilag FM, Cool FM, Brilla FM, radio jingles
with spread the gospel of our product, services and locations. We will explore the
prospect of using popular local music artistes and Nollywood stars in our
promotional adverts.
In store marketing
 In store brochures containing our concept and philosophy
 Wall posters
 Location design concept
 In store viewing of the food preparation process
 Outdoor signage ( as large as possible)
 Grand opening promotion
 Party catering
 Merchandising items
Local store marketing
 Road shows
 Handbills distributed to establishments and estates in the vicinity
 Free occasional T-shirts at local store events
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Media
 Audio visual media – diverse forms
 Print media – newspaper, magazine adverts
 Web page - containing company philosophy, product catalogue, news etc
5.5
POSITIONING STATEMENT
Our main focus in marketing will be to increase customer awareness in the
surrounding community. The thrust of our marketing programs will be directed
towards the goal of explaining who we are and what we are all about. We will
price our products fairly and keep our standards high.
5.6
SALES STRATEGY
Our strategy is to build and open new outlets in well surveyed areas. Individual
locations will have different design concepts and resident business managers
vested with the responsibility of building local customer base via relentless
marketing programs. The business managers will be target driven and expected
to come up with weekly reports of business development strategies implemented,
expected outcomes and product sales reports.
5.7
STRATEGIC ALLIANCES
Our business requires harmonious
relationships with raw material suppliers as well as partner vendors. We would
explore the prospect of partnering with beverage companies like Coca-Cola
(Nigerian Bottling Company), 7UP, Chi Foods (makers of Hollandia drinks) and
malt drink makers in order to reduce ordering costs. We will also consider
strategic alliance with petroleum marketing company franchises to replicate the
commercial success of the On-the-Run and Creamy Inn concept in alliance with
MOBIL.
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5.8
MILESTONES
Planning and construction will last approximately six months; a month will be
slated for the revision and refinement process ahead of the grand opening in
April 2011.
5.9
WEB PLAN
The website will show visitors everything about us. We will offer gift cards and
promotions via the Internet so that our visitors can print the promotional coupon
in PDF format and bring it when they visit our outlet. Our extranet will help to
coordinate supply from sources and allow premium customers to order meals
online for home or office delivery.
Our website will provide an effective feedback mechanism for customer
comments and suggestions in addition to the traditional customer service hotline
and in-store form. In the future our website will show information on franchising/
licensing our brand name. We will use popular social networking sites like
myspace and facebook to advertise our brand, locations and website. Other
traditional advert channels like billboards and newspapers would also be used to
give the website greater market exposure. We will use the services of top notch
website developers and content providers to make the site attractive, up to date
and interactive.
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MANAGEMENT SUMMARY
Our core management team is composed of professionals with experience in
banking, events management, fast food and hospitality industries.
Mrs. Martina Dudu: Chief Executive Officer
Mrs. Dudu holds a BSc (Hons) Degree in Sociology. She started her working
career as the personnel manager of British Airways and proceeded to work in
Nigeria International Bank (CITIBANK) in 1989 as a human resource specialist.
She left the employ of the Bank seven years later and established Occasion
Touch Nigeria Limited. Her experience cuts across relationship management,
customer service, personnel management, business development, events
management and interior decoration.
Mr. Parker Suleiman Bala: Chief Operating Officer
He holds a Bachelor of Arts Degree in English and his career path is entirely
centered on the hospitality/ food industry. He commenced his professional career
in Sheraton hotel Ikeja in 1997 and moved on to work as a restaurant manager
of Sweet Sensations in 1999. He spent seven years in the fast food chain,
working in various departments and capacities such logistics and supply, factory
set up, marketing and internal control. In 2006, he was appointed General
Manager of Food Concepts Limited with the responsibility of coordinating the
operations and marketing of the South African Chicken Republic and the St
Elmos brands.
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6.1 ORGANIZATIONAL STRUCTURE
Our organizational structure will include a director of branch operations when the
branch locations exceed five units. This will provide a supervisory level between
executive management and branch management level.
Other managerial positions will include; operations managers, internal control
managers, personnel manager, research & development manager. We will
attract experienced staff from our competitors and establish a management
trainee program to groom a pool of future managers for our restaurants and
bakery.
6.2 PERSONNEL PLAN
Our initial employees will consist of 15 full time workers. This will be increased
gradually in line with the outlet expansion strategy. Part time workers will include
cleaners and marketing representatives.
Table:
5 Year Staffing Projections
MD/CEO
ED/ CFO
COO/ HRM
Finance Manager
Marketing Manager
Chef
Quality Controller/ Supervisor
Client Service Representatives
Assistant Cooks
Drivers
TOTAL
2011
2012
2013
2014
2015
1
1
1
1
1
1
1
4
2
2
15
1
1
1
1
3
2
3
6
3
2
23
1
1
1
1
3
3
4
8
4
3
30
1
1
1
3
4
4
6
10
6
4
36
1
1
1
3
6
6
8
16
8
6
56
FOOD SIGNATURE QSR
26
FINANCIAL PROJECTIONS
7.1
START UP FUNDING
The company requires N100, 000,000 and it is expected that the majority of
funds needed would be sourced as a long term loan from a bank. First Bank of
Nigeria Plc and United Bank of Africa Plc are the company‟s bankers; they have
indicated some interest in a syndicated financing arrangement – this document is
a working paper to actualize the Company‟s vision.
7.2
FORECAST – BASIS AND ASSUMPTIONS
The forecast has been arrived at on the following basis and assumptions:Basis
 The projected financial statements were prepared using the historical cost
concept taking similar business entities into consideration.
Assumptions
 There will be no significant changes in the rate of inflation currently
hovering at about 16%.
 There will be no significant changes in the official foreign exchange rate
hovering at about N150 to the US Dollar.
 Government will neither enact new laws nor pursue policies that will
negatively affect the fast food industry.
 The company‟s financial year will run from January to December.
 Average number of customers per day is 500
 Average cost of meals is N700
 Flagship outlet construction and equipment installation will be completed
in six months.
 Projections are based on a single outlet of Food Signature.
FOOD SIGNATURE QSR
27
7.3
PROJECTED PROFIT AND LOSS ACCOUNT
For the years ending December 31st 2011, 2012 & 2013
Turnover
COST OF SALES
GROSS PROFIT
LESS EXPENSES
Staff Salaries
Directors‟ Emoluments
Marketing
&
Advertisement
Repairs- Kitchen
Repairs – Furniture
M. Vehicle maintenance
Repairs – Generator
Repairs – Office equip.
Electricity
Entertainment
Depreciation
Gas expenses
Security
Printing
Cleaning
Public Relations
Bank Charges
Telephone
Staff welfare
Insurance
Diesel – Generator
Net Operating Profit
Interest Payment
Taxation
Earnings After Tax
Dividend Provision
Retained Profit for the
year
Retained Profit B/F
Retained Profit C/F
2011
N (‘000)
100,000
41,000
59,000
2012
N (‘000)
115,000
49,000
66,000
N (‘000)
127‟000
57,000
70,000
4,500
1,800
1,500
4,500
1,800
1,500
5,000
2,000
1,500
50
50
600
200
50
1,300
50
8,500
2,000
5,000
200
300
250
400
200
300
1,000
12,000
18,750
(3,500)
(500)
14,750
(2,500)
12,250
40
40
630
230
40
1,300
50
9,015
2,100
5,200
200
300
300
450
200
300
1,000
13,000
23,805
(3,500)
(1,525)
18,780
(2,500)
16,280
100
60
750
300
80
1,500
50
9,300
2,900
6,360
300
500
400
600
400
500
1,500
15,000
20,900
(3,500)
(1,850)
15,550
(2,500)
13,050
12,250
12,250
28,530
28,530
41,580
FOOD SIGNATURE QSR
28
7.4
PROJECTED BALANCE SHEETS
For the years ending December 31st 2011, 2012 & 2013
ASSETS EMPLOYED
2011
N (‘000)
2012
N (‘000)
2013
N (‘000)
FIXED ASSETS @ COST
Land
Building
Motor Vehicle
Kitchen Equipment
Office Equipment
21,500
24,520
6,000
32,410
3,000
21,500
24,520
7,500
32,410
3,000
21,500
24,520
9,500
33,000
3,500
3,120
2,500
93,050
3,500
1,500
93,930
5,000
2,800
99,820
CURRENT LIABILITIES
Short term Creditors
Taxation
Accrued Expenses
Proposed Dividend
3,500
500
500
2,500
3,670
1,525
750
2,500
3,700
1,850
890
2,500
LONG TERM LIABILITIES
Creditors
Accumulated Depreciation**
30,000
8,500
35,000
9,015
35,000
9,300
TOTAL ASSETS
47,550
41,470
46,580
FINANCED BY:
Share Capital
Share Premium
Revenue Reserves
5,000
30,300
12,250
5,000
7,940
28,530
5,000
41,580
47,550
41,470
46,580
CURRENTS ASSETS
Debtors & Prepayment
Cash & Bank
Stock
FOOD SIGNATURE QSR
29
7.5
SELECTED FINANCIAL RATIOS
Profitability Ratios
60
50
40
30
20
10
0
Gross Profit %
Net Profit %
ROCE
2010
2011
2012
Liquidity Ratios
1
Current Ratio
Acid Test
0.5
Acid Test
Current Ratio
0
2010
2011
2012
Earnings Profile
Revenue Reserves
2012
Earnings After Tax
2011
Earnings Before Interest
and Tax
2010
0
10000
20000
30000
40000
50000
FOOD SIGNATURE QSR
30
OUTLOOK
As we grow further, we will have dedicated outlets selling only Nigerian ethnic
meals and expand our product categories in other outlets to include European
and Asian cuisine.
Chinese Take Out
Our growth strategy overtime will be to enfranchise of food entrepreneurs in
Nigeria and Ghana with our brand and ethos. The success of the Mr. Biggs
franchise is an example of regional growth potentials and we intend to adopt
such effective practices in our expansion drive.
Overtime we will expand our bakery facilities to become a full fledged mass
producing and distribution operation with various product offerings such as cake
bread, short bread, wheat and white bread.
FOOD SIGNATURE QSR