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SEVENTH HEAVEN CATERINGSEVENTH HEAVEN CATERING

2. Industry overview & Analysis

2.1 PORTER ’S 5 FORCES

2.1.1 RISK OF ENTRY OF POTENTIAL COMPETITORS

As stated before there is only one competitor in the region, which is North South

Photocopier. But, rather than thinking about the existing competitor we have to concentrate

more on the competitors who are about to enter in the industry. These competitors can take

away some of our potential market share. To minimize the risk we have to develop our core

competencies.

Being the low cost manufacturer will help us to be the cost leader in the industry. The

resources are readily available in the market. The bulk purchase will reduce the purchase cost

as a result the manufacturing cost will go down. With this we can provide the customer their

needed materials in a lower price.

Another is to develop is our capabilities. With the latest technology it is easy for us to

provide the promised quality study materials in a lower price.

Other things we have to take into account are the strategic advantages like, superior

efficiency, superior quality, innovation and customer responsiveness. Superior efficiency can

be achieved through employee training and motivation. Superior quality has to be achieved

through the best use of the resources. New and new innovation in the way to providing service

and the way of production can help us to gain advantage and the most valuable asset of the

business is the customers’ responsiveness. This will help us to lower the cost and gain

competitive advantage.

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2.1.2 Existing competitors & Rivalry

To have a clear view of the industry it is necessary to judge the rivalry among the

competitors inside the industry. Whether

To judge the condition of an industry it is necessary to judge if the rivalry among firms is

currently. Whether it is polite or stable? Rivalry refers to the competitive struggle between

companies in an industry to gain market share from each other using price, service, and

advertising expenses. This rivalry increases when many firms of relatively equal size compete

in the industry. In the catering industry this rivalry can be assessed by:

INDUSTRY COMPETITIVE STRUCTURE

In catering service business there is a large number of small or medium sized competitors, none

of which is in position to determine industry price. The pricing is not set and no new owner can

charge higher price until it is justified strongly through high product differentiation. In that case

superior quality will be the main armor for competing against the competitors. The risk and

uncertainty involved is thereby significant to some extent.

DEMAND IN THE INDUSTRY

The demand pattern of the industry also plays quite a significant role as a determinant of the

intensity of rivalry among established companies. If there is a growing demand from customers

or additional purchases by existing customers tend to moderate competition by providing

greater scope for companies to compete for customers. Since in Bangladesh nowadays people

want new things and brand intensive, they are always lookout on the unique services. Hence

industry demand is very high. Quality and uniqueness will help gain the upper hand in such a

situation.

EXIT BARRIER ARE NOT HIGH

Barrier may come from factors like economic, strategic, and emotional issues that prevent

companies from leaving the industry. In case of catering business this type of barrier is

moderate. We can assess the state of exit barrier based on the factors like investments in assets,

fixed costs, emotional attachment to the industry and economic dependence on a single

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industry. Due to the low investment in those factors the exist barrier is not that immense in a

catering business .

2.1.3 THREAT OF SUBSTITUTES In a catering business there are usually several competitors. The products category is also very

similar. The scope of differentiation is thereby quite insignificant. Threat of substitute for this

industry is also very high Substitute product limits the profit potential of an industry because

they limit the prices firms in an industry can change. Almost everything has a substitute but it

is necessary to determine how close the substitute is in price and function to the product of the

industry in concern. The catering business does suffer from the threat of substitutes to large

extents. In terms of satisfying customer needs, there are many catering service offering quality

food to customer.

2.1.4. BARGAINING POWER OF THE CUSTOMERS

The customers have a key that to a large extent determines the success of any business. Porter’s

5 Force Model has another factor, which is the bargaining power of buyers. An industry’s

buyers are individual customers who consume products and services like any other end users.

Buyers can affect the profitability of an industry because they can bid down prices of demands

higher quality or more services by bargaining among competitors. If the supply is large;

usually it creates the opportunity for buyers to pick up the product of their choice from a wide

range of varieties. So, it enriches the bargaining power of the buyers. The buyers have access to

large variety of outputs, and also the switching cost is pretty low. Hence the bargaining power

of the customers is high, which ultimately pushes us on the back gear.

2.1.5. BARGAINING POWER OF SUPPLIERS

Another porter’s five forces comprise the Bargaining power of suppliers. This refers to the

ability of suppliers to raise input prices, threat to stop selling products & delay in delivering

products. Suppliers can influence the future industry returns if they increase prices or reduce

the quality of the product or the service they provide. The suppliers are more powerful if they

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are few and if they are more concentrated that the industry to which they sell and if they supply

critical inputs to several for which few, if any, substitute exists. Hence, the suppliers are free to

change prices and services they supply to the firms in an industry. In the catering business the

bargaining power of the suppliers are moderate since there are large suppliers and the switching

cost for the companies are quite significantly low.

2.2 Core Competency

The core competence is the firm’s strength that allows companies to differentiate products

and/or achieve substantially low cost and at the same time offer a better and superior quality

than our rivals. There are various sources of core competences. These are discussed below:

• HUMAN R ESOURCES

Employees will be one of the biggest costs to incur while running the catering business,

because we will need other administrative and support staff to run the day-to-day operation

catering business. If we hire specialized employees who were already trained and know how to

attract customer through cooperation and interaction, then they will definitely charge higher

fees. Moreover, Employing specialized employees who will decide for us the superiority of the

products and product longevity, then he/she is also likely to charge a lot of money.

• INNOVATION/CREATIVITY:

If we can be innovative then we can use our creativity and innovation as our core competence.

If we can gain brand loyalty through offering distinctive food item and service then we can

become competent in terms of our service. Moreover, doing so we will also focus on providing

the best possible quality product.

2.3 Industry SWOT

The following SWOT analysis captures key strengths and weaknesses within the company and

describes the threats facing seventh heaven.

Strengths:

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• Starting up a catering business does not require investing huge sums of money. It is

very easy to open a catering business. There is minimal government interference or

regulations regarding pricing and other factors.

• Excellent staff who are highly trained and very customer attentive.

• Superior service offerings.

• World class chefs who have been trained and worked in different chain restaurants in

home and abroad.

• Despite having tremendous amount of competitors, we even large and yet increasing

amount of customers who want some different product. Hence demand for such items isimmense in the market.

• One can also achieve economies of scale and there produce more in order to reduce per

unit cost of production. This will enable the companies to rise their pricing.

Weaknesses:

• A limited marketing budget to develop brand awareness. Our investment is not that

much high and very small amount of budget allocate for marketing.

• Lack of experience in the catering market as we are new in the scenario. We do not

have enough experience about this business.

• An upcoming business in any industry and can be considered profitable business and

hence more competitors in the market. The existence of more entrants into the business

and thereby enhancing the competitors is likely.

•

Since there are many other catering services in the market, the buyers have lowswitching costs and hence risk of entry is again high.

• With so many competitors it is difficult to create brand loyalty and brand equity. It is

not impossible but here is a great amount of risk involved in it. A lot of time and effort

will have to be given to get into a good position in the market.

Opportunities:

• Growing market with a significant percentage of the target market still not aware that

such a service exists.

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• The growth in demand due to improving GDP per capita and the living standards of our

targeted group of customers. They can thereby be able to pay a bit more for a bit better

quality, which provides a large scope for our catering business.

• Due to the infrastructure we can mobilize our operations and make our products

available to more places to a large number of customers.

Threats:

• Since the entry barrier is low and the demand for such kind of business is high, thereby,

threat of new entrants will be higher.

• Competition from similar service providers in geographically segmented markets.

• Local, established competitors that wake up and realize that there is a huge market in

the city.

• The inherent high cost of quality food production.

• A slump in the economy that will decrease customer's budgets for parties.

• If the purchasing power of the buyer’s increase and their overall income rises, then

people will tend to buy products from abroad and purchase foreign products.

2.4 Competitive advantage

The competitive advantage for the Seventh Heaven catering is that we will employ specialized

skilled chef and the cost of hiring them is comparatively low in Bangladesh. Our competitive

advantage would also lie in the offering the service in a new innovative way that are unique and

moderately priced products. Meaning Sometimes we will provide some suggestion based on

their theme of the event. We will also have different food option for our customer and if they

want then we will customize the offering according to their needs. Moreover, the Employee

will be trained not only in their specific operational duties but also in the philosophy of our

concept to ensure the best quality of service. In order to provide quality service to our valued

customer we will do research on the quality and integrity of our products. All these would add

to our competitive advantage.

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2.5 Additional strategic

consideration

Situational Analysis:

Seventh Heaven catering is a start-up company for which the most vital issue to its success and

profitability in the long run is marketing. We will offer innovative, connoisseur admired food

and establish ground-breaking standards in service for a wide range of events. In Dhaka, the

market for a pure catering service is yet wide open as there is no such company which has

dedicated its concentration solely toward catering service. There are some well-known

restaurants that are providing with the catering service on contractual basis. We think, we have

likelihood to acquire the largest share of this yet-to-identify market as we possess the

knowledge and skills as well as the intention to do so. But, we must make sure that we

carefully perform all the marketing functions.

2.5.1 PEST Analysis

• POLITICAL AND LEGAL Analysis:

Political instability is the biggest barrier in Bangladesh for any business ventures. Frequent

strike or siege activities will hamper the transportation to the location challenging. Unstable

security system will also make it challenging to attract potential our target market. However,

catering business is less likely to be affected by the political stability and instability. This sort

of industry does not require following any sort of legal rules and regulations unlike other

industries. People can easily start up this business and carry on with their operations.We will

have to acquire a trade license from the City Corporation. We will need to prepare and submit

an environmental impact assessment report to the Directorate of Environment (DOE) to obtain

a clearance certificate for running the business.

Economic Analysis

Bangladesh has a low per capita income in comparison to other developing countries. But the

per capita income for middle class, upper middle class and upper class is increasing, which is

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our targeted market. Thereby it will not require intense effort to acquire the targeted market

share.

There will be an employment opportunity and as the educational requirement is not so high, it

will create an attractive opportunity to some low skilled people to get a job. And that will be,

may be to a very small extent, an important contribution to the economy.

• Social Analysis

As we will employ some people who are not so educated, so in that way we will be able to

reduce the burden of unemployed people from the society. Moreover we will take every

possible step for the welfare of the environment of the society. So we will sure that after proper

treatment almost pure and contamination free water will be thrown to nearby canal.

• Technological analysis

The use of internet has been increasing exponentially in Bangladesh. Moreover, with the

emergent of optical fiber, this usage and other related facilities will grow potentially. The

internet will help our business in promotional activities, communicating with our prospective

buyer more quickly. More over ,, the increased use of cell phone users and the existence of

dynamic and corporate friendly telecommunication service providers can be used to promote

the business’s products and offering via cell phone lines to potential customers.

3. Market Overview

Before starting up the catering service we should first and foremost analyze and evaluate the

market to find out whether it is appropriate and feasible to carry out the operations and

maximize profits. The market can generally be overviewed in terms of the following factors:

3.1Potential Customers

Regarding consumption the company will segment the market. There are two basic groups. The

first involves individual consumers who use catering services for personal consumption in

different parties.

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The second group involves commercial users like

• Cash and carry wholesaler

• Delicatessen wholesaler

• Health food wholesaler

• Frozen food wholesaler

• Restaurants and chains

• Institutional caterers

3.2 Size and Growth of the Market

If we consider over the social and economical structure of Bangladesh we can see that this

market is growing. The market for catering services is recently increasing. There are greater

opportunities to carry out this business in the market. Since it is easier to initialize these sorts of

companies, the market has become extremely competitive. Similarly the economical factors

and growing GDP of 6.51% shows that the people will have a higher income in future and they

will have more money to spend on their entertainments and luxuries.

The reason behind considering this segment as our potential customer is the populationstructure of Bangladesh. If we look closely to the population structure we will see that the

offices and business are the biggest and by targeting them we can increase our customer base.

From the above analysis we can say that our market is growing enormously and we have many

options to utilize this opportunities and increase our customer base. Here, is the opportunity for

us to make a mark and serve them to make profit.

3.3 Strategic Group Analysis

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The demands of catering services have been high in Bangladesh. In different occasions people

turn to catering houses. As mentioned earlier, there are some well-known restaurants that are

currently acting as prime catering services. They will be considered as our competitor in the

consumer market. Among them the key competitors are:

Baton Rouge:

Baton Rouge is a Canadian restaurant chain. Their packages include lunch and dinner

buffet with more than 100 of dishes including charcoal-grilled cuts of beef and fresh fish, crisp

salads and exquisite appetizers. The prices range is quite high which makes it a choice for the

upper class.

Pizza Hut:

The world's largest pizza restaurant company with almost 6,600 restaurants in the United

States and more than 4,000 restaurants in 100 other countries, Pizza Hut, Inc., a subsidiary of

Yum! Brands, Inc. Their product line includes: Pizzas, Breadsticks, Cheese Sticks, Baked

Cinnamon Sticks, etc.

Dhanshiri:

Dhanshiri is a local cater house which mostly focuses on the indigenous foods. They

provide lunch, dinner and other packages which include plain rice, fried rice, variations of

biriyani and kebabs. The also provide pickles along with their dishes which is a unique feature

of Dhansiri.

Helvetia:

Helvetia is also a chain shop mostly providing different products, such as salads,

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burgers, chickens, juices, ice creams, etc. Their price range is also quite high.

Cooper’s:

A well known chain of caterers Coopers has a limited but tasty line of products which is

different from the traditional caterers and helped them to gain wide consumer base serving in

the country with reasonable price.

Competitor Distribution in

BangladeshFeatures Packages

Price For 10

(Approx)

Baton Rouge Gulshan Various buffet

dishes.

Dinner Buffet, Luncheon

BuffetTK 6500

Pizza Hut Gulshan

A wide variety of

products tailored to

need

Pizzas, Breadsticks Buffalo

Wings, Cheese Sticks,

Baked Cinnamon Sticks and

Pepsi®

TK 5900

Dhansiri Uttara, GulshanMostly indigenous

food

Breakfast, Lunch, Dinner

Salads, Pickles, Kebabs TK 2610

HelvetiaBonani, Uttara,

Dhanmondi

Wide variety of fast

food tailored to need

chicken, salads, burgers,

ice cream, juiceTK 5620

Cooper’s Uttara, GulshanWide variety of

products.

Product line of coopers

which includes Pizza,

Cakes, Sweets, Pantaras and

so on.

TK 3900

The competition has become very sharp since the introduction of international chain

shops. The local cater houses have suffered most since they could not manage to gain a strong

consumer base competing with the well known brands. Struggling in this strong competition,

Pizza Hut has carved out a definite image and gained recognition among the targeted

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segments. The friendly service and the brand image provided the Pizza Hut an edge for

competitive advantage.

Despite the fact that some if these restaurants have gained a competitive advantage by being

backed up by strong international brand names, Acanthus believes that it can still position itself

well beyond the reach of its competitors by assuring high-end service, competitive low-price,

and by knocking the socks off customers with impressive food quality.

4. Overall strategy

Apart from the above mentioned strategies we strongly need to consider the long and the short

term strategies in order to attain market share and also acquire more profit.

Business Level Strategy

Generic Business Level Strategy

Differentiation: To gain a competitive advantage from superior innovative products,

excellent quality services and responsiveness to customer needs. We shall position our products

to customers that it appeals to their psychological desires.

Strategy to manage rivalry

• Cost leadership:

To gain a competitive advantage we will position our products as a quality product at a

relatively lower price. We will choose a low to moderate level of differentiation relative to

competitors. By targeting the average customer, we will provide service that will be desired by

the highest number of customer.

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• Market Development:

If we attain success in our current business activities then we would start looking for new

market segments for our business’s services. This way we would be able to capitalize on the

brand name we would have developed by that time in one market segment by locating newmarket segments. Thus, our customer base would also increase. In that way we could expand

our business to international boundaries. Going global could also be a wise idea.

• Product Development:

Updating our products along with time is undoubtedly the most significant aspect that we

would keep in our mind. By making the customers realize that we are always adjusting our

fashion along with time, which ensures a constant attraction of the customers to our store. Thecustomers will then feel among themselves that there is always a surety of getting the most

lately designed outfits in our stores no matter what.

Functional Level Strategy

Efficiency

We would try to attain higher level of efficiency through –

Attaining Economies of Scale: We can attain the economic scale by accepting

more order from our customer and efficiently use our resources in order to produce that

product. Hence, accepting more and more order will require larger amount of

production and in that way we can acquire economics of scale as total cost will be

divided among more and more outputs. Moreover, we will use efficient chef and

employee who can produce quality food in a moderately different way can help our

company to keep per unit cost down and thus achieve economic of scale. As our

workers become more efficient in carrying out their service, the number of employees

would increase. Thus, employees’ productivity over time would increase and cost per

worker would decrease.

Research & Development: We have decided to invest a large proportion of our

total capital into more research and development in order to find out what types of food

people actually want have in their various kind of events. . This is a very significant

proportion of our business. Since a significant proportion of our money being invested

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in the research and development, this would create a vibe and a positive attitude

towards our brand from the customer’s perspective.

Employee Training: In our business employees are major inputs in providing the

promised service. The chef will be trained on special food item inorder to upgrade their

skill and employees will be trained to be more cooperative and more humble to the

customers. They will also be trained with marketing knowledge so that they have the

convincing power and hence eventually convince the customers to make order from our

company. The employee will also be trained that customers are always right. That is

they will listen to the customer and provide suggestion based on their recommendation

rather than just push the customer to choose from our menu.

ACTION PLAN

Seventh Heaven Catering will be introduced in October. Following are summaries of the action

programs we will use during the first six months to achieve our stated objectives.

May:

Two tasting sessions will be organized with potential 35 to 40 customers. Press releases will be

sent from mid-May.

June:

Tasting sessions will stop after the third and we will officially start our operation. Primary

consumer market will be targeted for mass advertising for creating mass awarness.

July:

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As the advertising continues, we will publish brochures printed with all the information about

our various menus which will be sent to different corporate houses and other commercial users.

August:

We will hold a food fair along with some other catering services where we will focus on letting

the customers know how our products differs from that of our competitor’s in value and

quality.

September:

We plan to roll out five new delicious menus to keep pace with the growing and ever-changing

demand for new and innovative food.

October:

We will hold another food fair, but this time it will be in smaller ground where only we will

take part to let the customers know about our new menus as well as the previous ones.

5.Company value chain analysis and operational plan

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Companyinfrastructure

Financialsupport

QualityManagement

HumanResource

Customer Service

R e s e a r c h & d e v e l o p m e n t

ProductMarketing

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• Primary Activities:

We will use in-house R&D in order to gain insight about customer food preference regarding

specific event and can also get information about our competitors regarding their food offering

to the customer. Thus it will enable us to add more value to our products and also enable to

meet customer expectation. Our core service will be providing best quality food at a lower price

in a way that is consistent with customer preference. Marketing function will help us create

awareness about our existence and induce customer to purchase our product. We make our

employee to be responsive towards customers in order to providing exceptional customer

service.

• Support Activities:

In order to carry out primary activity our company will have supportive activity as well. Our

company’s organizational structure, control systems, company’s culture would shape the

attitudes of our employees and staff. The task of quality management and human resources arediscussed in later part.

5.1 Existing core competencies

In order to gain some substantial competitive advantage over the main competitors, our

catering service has to master in some core competencies that will not be easy for the

competitors to copy in the short run. Moreover, these existing competencies will be the base of

creating the Point-of-difference (POD) compared to others. After making sure that, Point-of-

parities (POP) of the industry have been met; our catering service will extensively and

vigorously concentrate in maintaining and gradually excelling in these existing competencies.

The main existing competence of our catering service that will go a long way to create a

distinctive and positive image in the mind of the target customer and target audience is the

strong dedication in practicing “Relationship marketing”. Here, we try to build and maintain

long term mutually profitable relationship with the customer instead of making short term sale.

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Even at the cost of some short term profit, we are always committed to not only fulfill the need

but also delight the customers by going beyond their expectation.

Along with this above mentioned intangible competence, we have got some differentiated

tangible competencies in the form of well trained chef with international experience who can

blow peoples’ mind with their wonderful art of cooking, a set of well trained stuff who are

trained to thoroughly emphasize on building relationship with customers, and a mouth watering

menu with the widest range of dishes from all around the world.

5.2 Future core competenciesWe will be continuously eyeing at acquiring some competencies that will enable us to gain and

maintain the position of market leader in the future. To serve the purpose, we will always

concentrate on developing the “Potential product” according to product level, which is the

product or offering that, resides in the imagination of manufacturer but does not exist in reality.

In the process, we will constantly come up with new PODs as the prior PODs become slightly

obsolete after being copied by the competitors and thus turn into POPs in the industry.

With the passage of time the main competence that we expect to consequence gradually is thecustomer based brand equity. In future the recognition, reputation and top of mind awareness in

consumers, mind will be the main during force of our business. We also expect to gain a very

strong financial backup based on which we can go on to ---relentless innovation and create a

revolution in the field of catering service. To be more specific, we will vigorously try to reduce

the lead time to the extent to reduce the lead time to the extent possible, make quickest and

safest delivery to the customer, and master the art of designing, conducting and managing

corporate parties with extra ordinary sophistication.

5.3 Product and service overview

Product overview:

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At the initial stage of our business, we will start with 10 menus’ (main and snack meals). And

some other menus’ will be gradually introduced into the range as the year progresses. The

following 10 menus’ will be available from the beginnings which are ---

1. Traditional Bengali items

2. Indian Dishes

3. Chinese items

4. Hors D’oeuvres

5. Cold Buffet

6. Deserts and Cakes

7. Chocolate Fondue

8. Boxed Lunch

9. Mexican items

10. Italian Cuisine

Service overview:

•

Weddings, receptions, open houses, box lunches, picnics and corporate catering for lunches, dinners and special events.

• Carefully prepared foods made only of the finest ingredients.

• Professional, trained staff to supervise or manage every detail of the event.

• Advising menus for special events.

• Total menu development, food production and staffing for corporate and social

functions and for some other special events also.

• Menus posted on-line for browsing pleasure and ease of communicating ordering.

5.4 Facilities

• Quick delivery system : When we get an order from our consumers we try to deliver

our service and products as quickly as possible for our consumers benefit, because we

believe in quality service on time.

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• Online/telephone ordering process : We take order from our consumers through

telephone and online. We have a website for our catering service where we have clearly

mentioned about our products and services and about our facilities and also mentioned

the ordering process. It’s taking less time and gives flexibility to consumers.• Bulk discount system: We give some kind of discount system to our consumers

according to their order amount. Suppose if any consumer order at tk10000 to tk15000

we will give him/her 10% discount. This facility will benefit them and they also will be

motivated to take this type of facility with a qualified service.

• Advice for appropriate menus according to the ceremonies: Sometimes customers

don’t understand what type of manus they actually want for their programs or different

type of ceremonies. So we have some specialists who can advice them about their

menus which will be appropriate for their occasion or ceremonies. So it will reduce

their tension about the proper manus which is a huge responsibility for preparing a great

occasion.

• Different menus for different occasion: we will provide different menus for different

occasions. Suppose if there will be marriage ceremony based on fully traditional based

then we will provide traditional food items and also will serve in that manner and if

there will be a wedding ceremony which will a kind of foreign style then we will give

them Chinese items or give them whatever they actually want. So here mainly we try to

say that we will provide our service based on consumers’ choice.

5.5 Equipment and machinery

There will be some equipment and machinery for processing our business---

Delivery van

Refrigerator

Nescafe vending machine

Food bars

Ice caddies

Gas caddies

Water tank Beverage service carts

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Meal delivery carts

Insulated bakery container

Heat keepers

Microwave woven

5.6 Production and manufacturing

process

In the manufacturing process, first of all we will receive orders from customers through three

channels. They are- through online services, through telephone calls, through physical visit.

Here, we will receive some partial payment as well. After receiving the orders, we will arrange

them in chronological order based on delivery date. Then, group of orders will be formed with

orders in close proximity in terms of delivery date. These groups will be formed to promote

better efficiency and gain economics of scale. This will also allow us to get bulk discount from

suppliers because of large supply orders. Then we will place orders to suppliers for necessary

ingredients and raw materials. It will allow us to follow JIT i.e just in time supply chain and

thus reduce our inventory storage expense. We will place the orders to suppliers with such a

dead line which is well ahead of the dead line of final delivery to customers that allows us

enough time to produce quality products and return the supply if defected and receive it again

with ample amount of time left.

After receiving the supply from suppliers in checking quality of it, we will make immediate

payment to suppliers to maintain healthy and loyal relationship with them. Here we will follow

some predetermined standard to assure quality of supplies.Then the supplies will be utilized in manufacturing the product. With the product service will

be provided as per the orders on due date. Finally, rest of the payment will be collected along

with feedback from the customers.

Here collecting feedback and responding to them immediately is very critical since we are

going for “Relationship marketing”.

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Through onlineservice

Through telephonecalls

Through physicalvisit by consumers

Receive orders withdeadline for delivery

Receive partial payment inadvance

Arrange orders inchronological orders

Place orders for necessaryingredients to suppliers withdeadline.

Receive supplies fromsuppliers on due date.

Check the quality of suppliesaccording to some standards.

Does thequality of supplies

meetstandards?

YES NO

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If the result is yes there will be some steps in Production and manufacturing process. This

are-----

If the result is no then returns the defected supply for necessary adjustments.

5.7 Research and development

During the initial phase of the marketing plan development, we need to do market research and

several focus groups will be held to gain insight into a variety of people that observe catering.

These focus groups will provide helpful insight into the decision making processes of potential

customers.

Here an additional source of active market research is a feedback mechanism based on asuggestion card system. The suggestion card has several statements that customers are asked to

rate in terms of a given scale. There are also several open ended questions that allow the

customer to freely offer constructive criticism or praise. So ……. will work hard to implement

reasonable suggestions in order to improve their service offerings as well as show their

commitment to the customer that their suggestions are valued.

Store it and make payments to suppliers

Manufacture product as per the order and providenecessary service on due date.

Receive the rest of the payment.

Collect feedback from customers and respondimmediately.

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5.8 Quality assurance

Quality is a main thing of catering service and we have to assure this thing for gain our

competitive advantage. Our catering services’ quality assurance begins with the people who

serve our customers. All our team members will be highly qualified and will pursue higher

knowledge in order to make the best service. Our catering services' will have strong ties with

some of the best suppliers in the industry and customers will guarantee the best products from

our sources. Our catering services will only accept the finest produce, the most reliable and

consistent service and the fairest price.

6. Marketing Plan

6.1 Sales and marketing

To create, communicate and deliver value for consumer its better to assemble fully integrated

marketing programs. One of the marketing tool that be used to pursue the marketing objective

of Seventh Heaven is 4 Ps of marketing. They are:

Product Strategy:

Building the Seventh Heaven brand is an integral part of our product strategy. Seventh Heaven

will start with 10 menus’ primarily with all the service features mentioned above. We will

gradually introduce more menus in the passage of time. The brand and the logo will be

displayed on every product’s packaging. The marketing strategy will seek to first create

customer awareness regarding their service offerings, develop a customer base, and work

toward building customer loyalty and referrals.

Pricing Strategy

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Initially it will be tougher to compete with high-end caterers who have professional chefs so we

will put a fine line in pricing our meals. We have decided to choose penetration pricing strategy

that proving good quality with higher price.

We are keeping in mind that the demand for our products will be high; we are expecting that

the demand being so high our sales will also be pretty high and it will require larger amount of

production Thus will help to achieve economic of scale and cost advantage as total costs will

be divided among more and more outputs.

More over, production costs will be identified and a margin will be added in order to cover

overheads. At the time of setting price we will consider the price of our competitors. There will

be a need for monthly reviews of costs of fresh ingredients and a quarterly review for other

ingredients.

Distribution Strategy:

Consumer Sales:

Orders will be delivered direct to the customer’s place in the firm’s own transport-

delivery to reduce the distribution cost. So we will not use any retailer for distributing our

product. By doing so we can ensure that the quality of fresh meal has not been diminished by

time in transit.

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Commercial Sales:

Central bulk deliveries will be made to identify distribution outlets that can then sell on

to individual outlets. In the case of contracts of groups, distribution will have to be agrees with

them as the time of negotiation. It is planned to deliver to distribution warehouses as far as

possible

• Marketing Communication Strategy:

Consumer Market:

•

Three tasting sessions to be organized for the end of May and early June for approximately 35 to 40 people already identified as potential customers during initial

research.

• A promotional leaflet will be delivered to identify areas.

• Press release will be sent from mid-May onwards to five newspapers.

Commercial Market:

•

Mailing: Identified commercial/group buyers will be sent a personally addressed letter introducing Seventh Heaven Catering, together with details of menus. This letter will

state that a follow-up telephone cal will be made to arrange an appointment and a full

presentation.

• Advertising/Promotion: Research will be undertaken with regard to a small advertising

and press release campaign in appropriate business journals.

• Brochure/Leaflet: a simple cost-effective leaflet initially which can be used in both

consumer and commercial markets. It will give brief details, including ingredients of dishes. The price list will be on a separate sheet for ease of reproduction and to allow

for price changes.

6.2 CUSTOMER SERVICE:

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In any business it is essential to have a good customer relationship. Although it is crucial to

build long-term relationship with customer but still we can do it by following some step such

as:

o Showing generosity

o Patience in handling customer complains

o Listen to the customer carefully

o Upgrading the quality of product

o Providing faster and quick service

o Efficiency and accuracy in billing

7. Human Resource Strategy and

Planning

9.1 Key Issue:

When we plan for the opening of Seventh Heaven Catering then it is not enough to think only

about how to finance that business, how to market our products and how to get the raw

materials or how much should we spend on our infrastructure. These things are important but

these will not be able to do anything unless the company has a very high potential workforce

that is human capital. We need to understand that it is the human resources of a company whodoes all the tasks, duties and responsibilities in order to achieve the organizational objective.

Therefore, before starting a company it is very important to determine the quality and as well as

the quantity of human capital that will be required in order to run the business smoothly and as

well as making profit. Nowadays, a lot of Bangladeshi companies are showing interest to

incorporate HRM functions in their companies, however, before moving ahead it is vital that

they understand the concepts of HRM really well.

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We all know that every organization has their own business strategy and the top management

decides that what particular strategy they will be following for a period of time. Here, it has

been seen that sometimes there is no link between the HR department and the people who

develop the business strategy. If the people of the HR department do not have any idea about

the business strategy that their company is following then whatever they will do or decide will

be of no use for the company. This is because when there is no link between them then they are

not able to align the HRM activities with the organizational strategy. Therefore, what do we

mean by organizational strategy and how can we align the HR activities with the specific

strategy will be now discussed in detail.

For example, if our company decides to follow the product differentiation strategy that it will

produce some products of superior quality and as well as unique in the eyes of the customers,

then it is important for the HR department to align its functions according to that strategy. By

this we mean that while recruiting new candidates, they should keep it in mind that what are the

qualities and traits the new recruits should possess so that they can work according to their

organizational strategy. Then they should decide the ways that whether they need to go for

normal training or extensive training, how they are going to develop them in future, how will

be the compensation structure and what are the best techniques to be used to retain these

workers.

Influence from The General Environment:

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We know that any company do not just operate within their product market environment rather

a range of other external factor might influence HR planner considerably. Some of the major

obvious factor that is relevance to Seventh Heaven Catering Hr planner is shown in a figure:

Linking HR Practices to Competitive Strategy

Now, we will be discussing about each and every step of HRM that we intend to follow in

Seventh Heaven Catering and before doing that; we would like to give some information about

the HR activities that will be conducted.

Strategic HRM / HR Planning/Ethical Foundation

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THE HR PLANNER

Economic

Socio cultural

Global Technologica

l

Demographic

Political

Industry/

Competitive

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Job Analysis / Job Design

Performance Appraisal / Training / Development

Compensation / Incentives / Benefits / Reward Management

Some basics and the Obtaining of Human Resources

When we talk about managing human resources in Seventh Heaven Catering, then we mean

that we have to manage people within the employer and employee relationship, we have to

plan, administer and review activities concerned with staff selection, training and development,

conditions of employment and other HR issues within the organization and it involves the

productive use of people in achieving the organization’s strategic business objectives and the

satisfaction of individual employee needs.

Ethical foundation: First of all, we feel that it is very important to build up an ethical

foundation in the company, otherwise with the current unethical practices of Bangladeshi

people; we will not be able to run our business in the long run. The human resource manager

and other HR executives should at first create an environment of trust in the organization; every

single employee and labour must respect the other people in the workplace.

Culture of the organization: The organizational culture should be like knowledge

sharing where people are willing enough to share their knowledge with others if necessary and

must if it is related to the completing of organizational objectives. The HR persons should

make the people understand that if we respect each other, then only we will be able to

synthesize the knowledge and the talents of all.

7.2 Staff Requirement Process Job Analysis: Before we conduct the recruitment and selection processes, a proper job

analysis should be done. Therefore, in the first place, the company is in need to perform a

manpower analysis so we can come up with the information that how many persons do we

actually need in the office as white collar workers and how many labours do we need that is the

blue collar workers.

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Job Description: After we have these details in our hand, we need to prepare the

different job descriptions and job specifications. In descriptions, we will give details about the

tasks, duties and responsibilities about the jobs and in job specifications, we will decide what

are human traits, skills, knowledge and competencies required to perform the job. When we

have completed doing these activities, then it will be the time for us to start the recruitment

process.

Requirements Process: Now, we have to consider it in our action that recruitment will

be done not only for the employees but we will also need to recruit labours. Therefore, for

employees the recruitment channels that we intend to use are:

Referrals

Personal contacts

Internal

Consultants

Newspaper

Websites

For the blue collar, the recruitment channels that we will prefer are: Referrals

Personal contacts

Internal

The reason we prefer these channels because, when we will recruit labours then we will be

more focused toward the behaviour and the attitudes of the labour rather than his or her

academic qualifications. Therefore, here we need some persons as referrals who will be able to

tell us about the work habits of that person and whether that person will be able to work properly in the factory or not.

Selection process: When we have finished recruiting the potential employees and

labours, then it will be the time for us to perform the selection process as now we need to hire

the most desired person from the pool of potential candidates. These are some of the Selection

tools that we may use whereas they will not be used equally for the selection of employees and

labours:

Interviews like stress, panel, etc

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Written tests

Assessment techniques like working in a team, e.g. giving them a group project

7.3 HR Structure

The company's management philosophy is based on responsibility and mutual respect. We will

environment and structure that encourages productivity and respect for clients and fellow

employees. The company's goal is to create an environment where:

• Creativity can flourish.

• Generating new ideas and products is well rewarded.

• Management structure is relatively flat and communication is encouraged.

• Mutual respect and sharing of knowledge is encouraged.

Organogram

31

Financialmana er

Junior

Executive

Marketingmana er

Junior

Executive

Junior

Executive

Managing Director

HR manager OperationalMana er

Cleaner Chef Guard

Sous Chef Assistant

Chef

Apprentice

Chef

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• Managing Director: Managing Director will be responsible for taking all the

strategic planning and decision by consulting with all the managers. However, a cross-

sectional team will be build to bring coordination and integrate all functional tasks with

each other so the alignment is ensured and synergy is created.

• Financial Manager: He will responsible for the overall financial plans and

accounting practices. More over his duties will be to manage treasury, accounting,

budget, credit, cash, and tax and audit activities of the organization. Most importantly,

he will have to provide timely financial and statistical report to the decision maker.

• Marketing manager: He will be responsible for the overall marketing and

promotional activity of our organization. That is he will need to focus on customer,

monitor competitors, build brand and communicate to the customers, create new ideas,

understand and manage the budget. In addition to this department need will need to

develop marketing strategy in order to gear up the sales.

• HR Manager: To carry out daily operation a company needs to have skillful

employee and this employee’s are recruit by HR department. This manager is mainly

responsible for recruitment and selection; provide training to upgrade the employee’s

skill, provide compensation (bonus, pension) to motivate the worker.

• Operational manager: This manager will be responsible for managing day-to-

day operation. A junior executive will work under this manager. The executive will

handle three chef, some cleaners and genitors, and two guards. Apart from this, the

manager will handle customers’ problems as well.

• Junior executive: In order to provide support to the upper level manager there

will be three assistant executives who will regularly report everything to the manager.

• Chef: One who holds the title of chef has quite a few different general

responsibilities related to their professional role. The chef is responsible for overseeing

subordinates in their daily work environment. That is, he will basically manage all

individuals who work under their charge in the kitchen. Moreover, the chef will oversee

the preparation of meals and ingredients, final presentation, sanitary issues and

timeliness on the part of the employees. Along with planning the menu, the chef is also

responsible for creating the recipes.

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• Guard & cleaners: here will be two guards for the office, who will work in

two different shifts. There will be two cleaners and genitors as well.

7.4 Expectations

Improving Performance in Seventh Heaven Catering

In Seventh Heaven Catering, the HR executives will be constantly monitoring that whether the

employees are able to perform their current job well or they are facing any kind of difficulty to

do their job. If they find that an employee or a labour is not able to do their current job well,

then at first their training needs will be identified and according to that they will be given

training. Moreover, the HR personals will be responsible for identifying the future workloads

and then they will come up with the details that in which areas the workers need to be

developed. We have planned that if we need to develop our employees so that they can attain

the skills and competencies required in future, then we will send them to different workshops in

the country like to improve managerial skills, we will send them to seminars and we will give

them simulated training in order to accomplish our goal.

In Seventh Heaven catering, we will be also concentrating on how to get the best performance

from the workers and while doing so we have to measure the performance of the workers, give

them the results of their performance appraisal and then giving them feedback on how to

improve their performance in future. Some of the techniques that we would like to use for

performance appraisal are:

♦ Graphic Rating Scale

♦ Alternative Ranking

♦ Behaviourally Anchored Rating

Compensation Structure of Seventh heaven Catering

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Compensation is the most important term to talk about when we think on how to motivate the

employees to do their current job well and as well retaining them for the future.

• Compensation Package: We have decided to link the compensation package of

the employees to their performance. This is because to remain competitive in our

business, it is vital to create a competitive mindset of the employees so that they can

compete well. Now, we cannot only focus on seniority or the loyalty of a person to the

organization but we will focus on performance. It is also important that the benefits are

liked by the employees because in most cases, employees tend to compare the benefits

of different companies while deciding to switch their job.

• Recognition Program: we also plan to do some Recognition programs, as we

strongly believe that a small recognition goes a long way. The performance of every

employee will be compared and at the end of every month, a star performer will be

selected to give special bonus or will be entitled to receive a small paid leave.

• Annual Picnic and Reward Programs: To motivate the employee we plan to

do annual picnic and reward programs where some of the best performers will be

selected to give away awards in front of all the labors. In addition, we will try to make

the benefits flexible to the employees so that they can choose the range of benefits they

want to receive.

Managing the Human Resources

When we talk about managing the human resources at Seventh Heaven Catering, we mean that

how are we going to manage the employment relation, industrial relation and what are the

activities that we intend to do to as our Corporate Social Responsibility. The HRM activities

that we have mentioned above that we plan to follow are really costly to incorporate and in that

sense we will make a contractual employment agreement of at least one year so that we do nothave any losses in case of employees leaving our company. Then for managing the industrial

relations, we have decided that we will not allow any sort of union practices in our workplace.

We know very well about the advantages of union and we also know about the disadvantages

of union. So far, in Bangladesh, it seems to be that the disadvantages are far more out weighted

than the advantages and so we have decided not be involve us in such complex situations.

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8 .Risk Analysis

In order to carry out business successfully we need to consider not only internal but also

external factor. No matter what the business is about but it associates some risk. There some

risk which may predict and there are some other which we cannot predict. So foreseeable risk

can be control by taking some action. But it will be difficult to deal with unforeseeable risk.

Because it occurs suddenly and affect the business operations badly and ultimately, hamper the

profit of the business. We have identified several risk our seventh heaven catering business

which are given below:

10.1 Foreseeable Risk:

1. Price of raw material: The price of every raw material is increasing day by

day. So, we will not be able to offer a stable price for our service. As the

increasing price will push us to increase the price of our product otherwise will

not be able to make profit out of our business.

2. Health conscious consumers: Consumers are also becoming more health

conscious these days. They look for hygienic in every food product. In order to

ensure the best quality we will have a neat and clean kitchen and the chef will

also make the product in hygienic way.

3. Differ in customer choice: Every customer has their unique choice and it is a

threat for us, if we cannot meet the need of diversified people. For this we will

have to come up with different food menu so that will not loose our valuable

customer.

4. Bargaining power of customer: Customer has a tendency to lower down the

price if there are many other competitors available. So definitely, it is another

most important criteria which we need to work on. In order to deal with this

problem we can offer discount based on our regular price.

10.2 Unforeseeable risk:

1. Economic Situation: Bangladesh’s economy is still in the developing stage. It is not

very strong and can fluctuate a lot. For example: High inflation rate is a very common

scenario here and this will lead to increase in price thus people purchasing power will

decrease. Mainly this will badly affect the our potential customer with lower income.

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2. Political Situation: Currently Bangladesh undergoing a political turmoil. It is affecting

the overall system of the country. Due to political matter, there may be massive

blockade in the business. This can come in the form of strikes, continuous disruptions

etc.

3. Saturated Market: The catering business in Bangladesh is reaching its saturation.

There are already too many catering companies like Baton Rouge, Sajna, faquruddin ect

are presence. Moreover, customer demands are increasing drastically and every

company try to offer product to satisfy customer need. So this will make the

competition tougher for Seventh Heaven

4. Weather: One of the most important unforeseeable risks that will affect operations is

the weather of Bangladesh. As Bangladesh has tropical climate with occasional natural

disasters, it will becomes difficult for us to maintain the operation. Since we will use

natural and fresh vegetable and fruits from the supplier who will collect it from village

firm may hamper because of these climatic disasters. Also, we may face problem with

the deliver of service during such disasters.

9. Financial plan

9.1 AssumptionsImportant financial assumptions are given below.

• The growth of will be moderate and the cash balance will always be positive.

• Being a retail environment we will not be selling on credit. We will accept cash,

checks, and all major credit cards.

• Marketing and advertising will remain at or below 5% of sales.

• We will continue to reinvest residual profits into company expansion, and personnel.

• All sales paid via credit cards will be deposited in our business checking account within

48 hours. Our business checking account will be with BRAC Bank.

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• Sales will increase in the second year by 10% and in the third by 15% compared to first

year.

• Tax rate is assumed to be 40%.

• Depreciation is calculated using straight-line method over 5 years.

• No new loan will be taken during the period.

• Operating expenses is assumed to increases in the third year.

9.2 Initial Investment

Start-up Cost

Start-up Expenses Taka

Rent 300,000

Telephone & Utilities (3 months) 35,000

Business Insurance 100,000

Advertising & Promotion 100,000

Store Fixtures/Decorations 150,000

Computer/Cash Register 85,000

Organizational Dues & Subscriptions 50,000

Business/Office Supplies 50,000

Other 50,000

Total Start-up Expenses920,000

Start-up Assets Taka

Cash Required 100,000

Start-up Inventory 800,000

Other Current Assets 0

Long-term Assets 850,000

Total Assets1,750,000

Total Requirement = Total Start-up Expenses + Total Assets

= 920,000 + 1,750,000

= 2,670,000 Tk

item taka

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Delivery van 550,000

refrigerator 100,000

oven 80,000

stove 70,000

Kitchen utensils 50,000

Start-up Funding

Means of Finance

• Owners Investment : Tk. 1,000,000

• Bank’s Term Loan : Tk. 1,700,000 (12% interest)

The Bank loan will be taken from southeast Bank at a 12% interest rate which is to be

paid in 5 equal installments at the end of each year for next 5 years.

• Bank’s Loan Repayment Schedule is following-

Loan Amount : Tk. 1,700,000 Interest Rate : 12%

PV = PMT (PVIFA, 12%, 5) PMT :

Year Installments

Interest

Portion

Repayment of

the Principal

Outstanding

Loan

1 471,596.54 204,000 267,597 1,432,403

2 471,596.54 171,888.41 299,708 1,132,695

3 471,596.54 135,923 335,673 797,022

4 471,596.54 95,643 375,954 421,068

5 471,596.54 50,528 421,068 0

9.3Income Statement

Pro Forma Profit and Loss

2009 2010 2011

Sales 1,050,000 1,250,500 1,300,000

Direct Costs of Goods 525,500 625,250 6500,000

Other ProductionExpenses

$0 $0 $0

------------ ------------ ------------

Cost of Goods Sold 525,500 625,250 650,000

Gross Margin 525,500 625,250 650,000Gross Margin % 50.00% 50.00% 50.00%

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Expenses

Salaries 65,000 79,000 92,000

Sales and Marketingand Other Expenses

52,500 62,525 70,000

Depreciation 17,000 17,000 17,000

Telephone / Pagers/Cell

8,500 8,500 10,000

Utilities 26,500 26,500 32,000

Total OperatingExpenses

169,500 193,525 221,000

Profit Before Interestand Taxes

356,000 431,725 429,000

Interest Expense 204,000 171,888 135,923

EBT 161,000 259,837 293,077

Taxes Incurred 64,400 103,935 117,231

------- ------- -------

Net Profit 96,600 155,902 175,846

Net Profit/Sales 9.2% 12.47% 13.55%

9. 4 Cash Flow Statement

Pro Forma Cash Flow Statement

2009 2010 2011

Cash Received

Cash from Operations

Cash Sales 1,050,000 1,250,500 1,300,000

Subtotal Cash fromOperations

1,050,000 1,250,500 1,300,000

Additional Cash

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Received

Sales Tax, VAT,Received

$0 $0 $0

New Current

Borrowing

$0 $0 $0

New Other Liabilities(interest-free)

$0 $0 $0

New Long-termLiabilities

$0 $0 $0

Sales of Other CurrentAssets

$0 $0 $0

Sales of Long-termAssets

$0 $0 $0

New Investment

Received $0 $0 $0

Subtotal Cash

Received1,050,000 1,250,500 1,300,000

Expenditures

Expenditures fromOperations

Cash Spending 117,500 141,525 171,000

Bill Payments 35,000 35,000 42,000

Prepaid rent 300,000 300,000 300,000

Subtotal Spent on

Operations452,500 476,525 513,000

Additional Cash Spent

Sales Tax, VAT, PaidOut

0 0 0

Principal Repayment

of Current Borrowing0 0 0

Other LiabilitiesPrincipal Repayment

0 0 0

Long-term LiabilitiesPrincipal Repayment

471,596 471,596 471,596

Purchase Other Current Assets

$0 $0 $0

Purchase Long-termAssets

$0 $0 $0

Dividends $0 $0 $0

Subtotal Cash Spent 924,096 948,121 984,596

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Net Increase in Cash 125,904 302,379 315,404

Cash Balance 125,904 428,283 743,687

9. 5 Balance Sheet

Pro Forma Balance Sheet

2009 2010 2011

Assets

Current AssetsCash 125,909 428,283 743,687

Inventory 1,500,000 1,650,000 1,700,000

Prepaid Rent 600,000 300,000 0

Total Current Assets 1,625,904 2,378,283 2,443,687

Long-term Assets

Long-term Assets 255,500 238500 221,500

Accumulated

Depreciation17,000 17,000 17,000

Total Long-termAssets

238500 221,500 204,500

Total Assets 2,447,403 2,257,695 2,648,027

Liabilities and

Capital

Current Liabilities

Accounts Payable 15,000 25,000 30,000Current Borrowing 0 0 0

Other CurrentLiabilities

0 0 0

Subtotal Current

Liabilities 15,000 25,000 30,000

Long-term Liabilities 1,432,403 1,132,695 797,022

Total Liabilities 1,447,403 1,157,695 827,022

Owner’s Equity

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Equity 1,000,000 1,000,000 1,000,000

Retained Earnings 0 100,000 571,005

Total Liabilities &

Owner’s Equity2,447,403 2,257,695 2,648,027

9.6Capital Budgeting Techniques

To analyze the acceptability of the project we use the techniques of internal rate of return and

net present value. Here we have calculated the individual cost of capital for each of the sources

of financing we have used. We have combined these capital costs into a single weighted

average cost of capital.

2009 2010 2011

Weights of Debt (Wd) 62% 62% 62%

Weights of Equity (We) 38% 38% 38%

Cost of Debt(After Tax) (K d) 7.20% 7.20% 7.20%

Cost of Equity (K e) 1.40% 20.60% 36.12%

WACC 3% 10.3% 16.35%

To estimate the weighted average cost of capital, we multiplied the cost of each source of

capital with the capital structure mix.

WACC = WdK d(1-T) + WeK e

From these calculated weighted average cost of capital, we have calculated the value of net

present value (NPV) to analyze the acceptability of our business plan to start our business. The

formula to calculate the NPV value is as below,

NPV = -CF0+∑PVn

The calculation for Free Cash Flow is

FCF = [NOPAT (1-Tax rate) + Depreciation Expense] - Change in Working Capital - Change

in Investment

= Operating Cash Flow - Change in Working Capital - Change in Investment

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2009 2010 2011

NOPAT756,388 830,922 850,819

Plus: Depreciation expense 17,000 17,000 17,000

Less: Change in NWC 100,000 342,578 312,226

Less: Change in capital

spending 0 0 0

Free Cash Flow (FCF) 673,388 505,344 555,593

Since we have considered the capital of investment in our project is Tk. 1,000,000, the value of

CF0 is 1,000,000 and by discounting the cash flows with the WACC we found the PV of all

our cash flows as follows:

2009 2010 2011

Free Cash Flow 673,388 505,344 555,593

WACC 3% 10.3% 16.35%

n 1 2 3

PV 653,775 405,750 433,889

Initial Investment = Tk. 1,000,000

NPV = -CF0+∑PVn=Tk. 1,493,414-1,000,000= Tk. 493,414

And by using the values of the present values of free cash flows and the weighted average cost

of capital we find the value of NPV = Tk. 493,414

And this positive value of NPV shows that the projected cash flows of the firm will be

profitable and thus acceptable.

10. Long Term Sustainability

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Sustainability is a characteristic of a process or state that can be maintained at a certain level

indefinitely. In order to sustain in the catering business for long-term is a big challenge for us

because the market is already very competitive and new competitors are rising each day. So to

sustain in such industry we must follow the following strategies.

• To be competitive in all aspects – cost, quality and efficiency.

• Continuous innovation of different items and also being up to date with the competitive

market.

• Not to compromise on quality at any time. In order to be a permanent player in the market,

we have to be consistent in our food quality.

• Providing high level of customer service. It means assisting the customers in finding them

the best outfit.

• Not to fluctuate the prices too often.

• Providing discounts in different occasions and year end sale will be a good way to create

new customers, thus it leads to extension in the customer base.

• Differentiation of products is essential for long term sustainability.

• Understanding the demand of the market is another key component to sustain in the market.

Before going for any differentiation, we must understand the demand of the customers.

• To have regular management meeting is necessary for long run sustainability. The more we

will have meetings, the more we will have the opportunity to identify any error and at the

same time will be able to correct it before it causes us a major loss.

• Managing the inventory is crucial for this business and proper monitoring can resist the

inventory to increase more than the market demand.

• Establishing community links will help the business to sustain in the long run. This is

because nothing works more effectively than word of mouth.

11.Conclusion

To conclude, we would like to say that we are not planning to start this business only to

compete with the restaurant and catering Service Company but we want to be the best amongall the catering business in Bangladesh. We have done an extensive analysis of the market and

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in that sense we know what kind of products are being demanded more frequently and by

which segment. Our analyzing of financial statements, marketing approaches and human

resource management strategy gives us an extra confidence to conduct our business and to

devote more time in it. Therefore we can conclude if all the activities are in align then we will

be able to make profit and provide superior service to our customer and can sustain for long

period of time.

Documents

489 Report