1. SUMMARY OF THE PROJECT
The goal of the project is the organization of a street fast food in the format “snack bar on wheels”. Trademark - Restaurant Car. It is planned to purchase and equipment for a van diner. The location of the project is the city of St. Petersburg. Project success factors are:
the growth of the segment of street fast food due to other formats of catering
year-round demand
high market capacity due to the features of the city: tourist flow, a large number of students
format flexibility: a quick change of location throughout the day is possible in order to maximize the reach of the target audience
Key performance indicators of the project are given in Table. one.
Table 1. Key performance indicators of the project
Discount rate (r), % | 2% |
Discount rate (r-month), % | 0.165% |
Payback period (PP), months | 18 |
Discount payback period (DPP), months | 18 |
Net present value (NPV), rub. | 2 178 937 |
Return on Investment (ARR), % | 6.03% |
Internal rate of return (IRR), % | 5.49% |
Profitability Index (PI) | 1, 04 |
2. COMPANY DESCRIPTION AND INDUSTRY
The catering market can be segmented as follows (by narrowing the niche):
catering in general (cafes, restaurants, canteens, fast food);
fast food (cafes, stationary and non-stationary points of sale);
street fast food.
In general, today, the catering industry in Russia is in a rather difficult condition: according to experts, up to 30% of large players left the market in 2015. This is primarily due to the difficult economic situation and the decline in the solvency of the population. Attendance at cafes and restaurants decreased by about 30%. In addition, an increase in food prices associated with Western sanctions and import restrictions has a negative impact on the industry; domestic producers are not coping with the growth in consumption. According to the Federal State Statistics Service, the turnover in the field of public catering decreased by 6% in 2015. However, the decline is primarily due to traditional cafes and restaurants of a high price segment. Amid a general drop in demand, some regions and segments of the catering market are on the rise. From the regions, experts single out the Tula and Voronezh regions, as well as the republics of Mordovia and Khakassia. As for the segments, even in times of crisis fast food (+ 10% in 2015) and pizza delivery (+ 6%) are growing.
Among the most noticeable trends, the following can be distinguished:
orientation in food purchases to domestic suppliers;
rejection of unreasonably expensive ("status") establishments in favor of more democratic, but with good cuisine;
the spread of monospecialization (for example, on meat grills, steaks or burgers)
the revival of interest in Russian cuisine or the cuisine of certain regions of Russia;
increase in the share of vegetarian dishes in the menu of most institutions.
It is advisable to consider the segment of street fast food at the level of a geographic distribution region. Today, stationary pavilions with street food prevail: pies and other pastries, pancakes with fillings, shawarma, hot dogs. Shawarma, estimated, ranks first in demand among all types of street fast food. Nevertheless, there are also restraining factors for demand growth: many potential consumers are afraid to purchase this type of product due to uncertainty about the origin and quality of the starting ingredients, as well as due to the potential lack of proper sanitary conditions in the pavilions during the preparation of the product.
The project involves the acquisition and equipment of a specialized van (food truck), the determination of the most interesting points of sale, between which the food truck can move during the day, and obtaining permission from the city administration. The basis of the restaurant-car menu is burgers. The price segment is “medium” and “medium +”. The main competitive advantages of the project include:
using quality ingredients to make burgers
high quality products
high speed service
courtesy and neat appearance of staff
eye-catching appearance of the food truck and original design that attracts attention
The food truck is purchased new on the basis of a Chinese-made van, which allows to reduce the amount of investment costs (compared with European brands vans); its equipment, development of a technological map and menu based on the wishes of the project initiator, is carried out by a specialized company.
It is supposed to be located at three main points and one additional seasonally (white nights); the time of presence is indicated for reference and may vary in accordance with the conjuncture of demand:
The area of St. Isaac's Cathedral (09.00 - 14.00)
Nevsky Prospect, the area of the Savior on Spilled Blood (14.00 - 19.00)
Mariinsky Theater District (19.00 - 23.00)
Palace Bridge District (23.00 - 02.00, during the white nights season)
Table 2. Investment costs for the project
NAME | AMOUNT, rub. | |
Equipment | ||
one | Delivery van | 1, 625, 000 |
2 | Equipment | 420 646 |
Intangible assets | ||
3 | Food truck branding | 25, 000 |
Current assets | ||
four | Current assets | 0 |
five | Raw material purchase | 30, 000 |
Total: | 2 100 646 ₽ | |
Own funds: | ₽ 1, 200, 000.00 | |
Required borrowed funds: | 900 646 ₽ | |
Rate: | 18.00% | |
Duration, months: | 36 | |
3. DESCRIPTION OF GOODS AND SERVICES
The project provides catering services to the population and guests of St. Petersburg. The basis of the menu is burgers, in addition to them, french fries and drinks are offered. All ingredients used in the preparation of products, natural and fresh, are purchased from local suppliers. Strict quality requirements are imposed on the ingredients, the issuance of certificates and permits by the supplier is mandatory.
The nomenclature and description of the products are given in Table. 3. Sales prices are given in Table. four.
Table 3. Nomenclature and description of the project products
No. | Name | Description |
one | Bald eagle | Classic American rye burger with beef patty, potatoes and vegetables |
2 | Elderly Bald Eagle | 1.5 times enlarged "Bald Eagle" |
3 | Cow in a trap | Burger with beef patty and vegetables under two layers of cheese |
four | Pig on grass | Burger on a wheat bun with bacon, vegetables, mozzarella and herbs |
five | Caucasian arel | Buckwheat burger with grilled lamb cutlet, spicy sauce with Caucasian herbs, vegetables and Adyghe cheese |
6 | Pig on the stove | Burger with grilled pork chop on rye bun with spicy sauce, cheddar cheese |
7 | Mom pig | Burger with pork cutlet on a wheat bun with a classic sauce, with bacon, vegetables, potatoes and cheese |
eight | Scared salmon | Burger on a wheat sesame bun with a fish patty, with vegetables, white sauce and herbs |
9 | French fries “Father’s” | Small french fries |
ten | French fries "His Potato" | Medium french fries |
eleven | French fries “Alexander Bulbrozhdenny” | Large french fries |
12 | Natural coffee | Natural coffee to choose from: cappuccino, americano, Viennese |
13 | Natural tea | Natural tea to choose from: black, green, oolong, puer |
14 | Seasonal drinks | Drinks by season: iced tea and coffee, mojito b / a, grog b / a, mulled wine b / a |
15 | Carbonated drinks | Highly carbonated soft drinks |
Table 4. Variable costs and selling prices
GOODS / SERVICES | COSTS UNITS, rub. | TRADING VALUE, % | UNIT COST, rub . | |
one | Bald eagle | 50 | 200% | 150 |
2 | Elderly Bald Eagle | 65 | 200% | 195 |
3 | Cow in a trap | 60 | 200% | 180 |
four | Pig on grass | 47 | 250% | 165 |
five | Caucasian arel | 68 | 250% | 238 |
6 | Pig on the stove | 65 | 200% | 195 |
7 | Mom pig | 68 | 220% | 218 |
eight | Scared salmon | 70 | 250% | 245 |
9 | French fries "Fatherland" | 12 | 250% | 42 |
ten | French fries "His Potato" | 15 | 300% | 60 |
eleven | French fries "Alexander Bulbrozhdenny" | 18 | 350% | 81 |
12 | Natural coffee | 35 | 220% | 112 |
13 | Natural tea | 25 | 220% | 80 |
14 | Seasonal drinks | 40 | 220% | 128 |
15 | Carbonated drinks | thirty | 125% | 68 |
All burgers are served in cardboard boxes, made to order in accordance with the standards of the brand "Wagon-restaurant." Drinks are served in insulated cardboard glasses.
Drinks are also made exclusively from natural ingredients: natural tea (brewed in a French press), natural coffee (brewed in a professional coffee machine). Seasonal drinks - non-alcoholic, based on tea and coffee.
4. SALES AND MARKETING
The target audience of the project is men and women aged 15 to 40 years with an average income and above; leading an active lifestyle, spending a lot of time outside the home; tourists and students.
Sales points (see Section 2) are selected taking into account the maximum traffic at a certain time of the day. A food truck moves around the city with the goal of reaching its target audience as much as possible.
To promote the brand, social networks are used: vk.com, Twitter and Instagram. SMM is led by the project initiator. Photos of burgers with attractive descriptions, recipes for burgers and snacks for home cooking, photos of satisfied customers with Wagon-Restaurant products (with their consent), city news from the immediate surroundings of the food truck and other information are published. Paid promotion of individual posts is used. Advertising budget - 3, 000 rubles per month.
Planned sales are shown in Table. five.
Table 5. Planned sales
GOODS / SERVICES | AVERAGE PLANNED VOLUME OF SALES, units / month | PRICE FOR UNIT., Rub. | REVENUE, rub. | VARIABLE COSTS, rub. | |
one | Bald eagle | 300 | 150 | 45, 000 | 15, 000 |
2 | Elderly Bald Eagle | 150 | 195 | 29, 250 | 9 750 |
3 | Cow in a trap | 250 | 180 | 45, 000 | 15, 000 |
four | Pig on grass | 200 | 165 | 32, 900 | 9, 400 |
five | Caucasian arel | 150 | 238 | 35, 700 | 10, 200 |
6 | Pig on the stove | 250 | 195 | 48, 750 | 16, 250 |
7 | Mom pig | 200 | 218 | 43, 520 | 13, 600 |
eight | Scared salmon | 100 | 245 | 24, 500 | 7, 000 |
9 | French fries "Fatherland" | 300 | 42 | 12, 600 | 3, 600 |
ten | French fries "His Potato" | 400 | 60 | 24, 000 | 6, 000 |
eleven | French fries "Alexander Bulbrozhdenny" | 250 | 81 | 20, 250 | 4, 500 |
12 | Natural coffee | 700 | 112 | 78, 400 | 24, 500 |
13 | Natural tea | 500 | 80 | 40, 000 | 12 500 |
14 | Seasonal drinks | 350 | 128 | 44, 800 | 14, 000 |
15 | Carbonated drinks | 500 | 68 | 33, 750 | 15, 000 |
Total: | 558, 420 | 176 300 |
5. PRODUCTION PLAN
The main production asset is a food truck - a car van equipped with equipment for making burgers, hot drinks and french fries. The base is a new van brand BAW as the most affordable. Kitchen equipment - European manufacturers of high quality. The food truck, in accordance with the requirements of supervisory authorities, is equipped with running water, sewage, and fire extinguishing means.
The food truck is equipped with a specialized company offering turnkey catering services: the purchase of a car, the development of advertising design, the development of menus, the selection of suppliers, the installation of utility networks and equipment. The total cost of a food truck with a range of equipment services is 2 045 646 rubles. The term of preparation is 45 calendar days. In the same period, the selection and training of personnel.
Warehousing and storage of ingredients is carried out in a refrigerator of a food truck in accordance with the requirements of Rospotrebnadzor. The volume of the cabinet allows you to store a stock of food for two to three days. Ingredients are purchased from three suppliers located in St. Petersburg, by self.
Routes are also provided by the food truck provider. Preparation of products is carried out in strict accordance with them.
Once every three days, liquid production waste is drained and its storage capacity is easily cleaned. Cleaning is carried out by the project staff.
The production plan is given in App. 1 to this business plan.
6. ORGANIZATIONAL PLAN
The project implementation process can be divided into two main phases: the preparation phase and the working phase. In the course of preparation, the acquisition and equipping of a food truck, the selection and training of personnel, the registration of a business and the obtaining of permits are carried out. The preparatory phase lasts 45 calendar days.
During the working phase, operational activities are directly carried out - trade in places agreed with the City Administration, as well as promotion in social networks.
All administrative and managerial functions are performed by the initiator of the project. For this, he has the necessary skills and knowledge in the field of entrepreneurship, has experience in the field of catering. In addition, the project initiator works on a food truck and acts as a marketer (engaged in promotion). Accounting is outsourced.
The following requirements are imposed on employees: work experience in the field of public catering from 1 year, the presence of a medical book. Shift work schedule, 2/2. The staffing and payroll are given in Table. 6.
Table 6. Staffing and payroll
Position | Salary, RUB | Number of people | PHOT, RUB | ||
Administrative | |||||
one | Accountant | 2, 500 | one | 2, 500 | |
Industrial | |||||
6 | Food truck operator (cook) | 20, 000 | 3 | 60, 000 | |
Total: | ₽ 62, 500.00 | ||||
Social Security contributions: | ₽ 18 750, 00 | ||||
Total deductions: | $ 81, 250.00 | ||||
7. FINANCIAL PLAN
The financial plan has been drawn up for a five-year perspective and takes into account all project income and expenses (Appendix 2). Also taken into account the seasonality factor.
Investment costs amount to 2, 100, 646 rubles, of which the bulk is accounted for by the purchase of a food truck (Table 2). Own funds of the entrepreneur - 1.2 million rubles. The lack of funds is planned to be covered with a bank loan for a period of 3 years at a rate of 18% per annum. Repayment of the loan is carried out by annuity payments, credit holidays - 3 months.
Variable costs take into account the cost of ingredients, packaging, fuel and other consumables (Table 4). Fixed costs include rent for the use of points of sale, fuels and lubricants, consumables (not related to revolving funds) and other expenses. The largest item of fixed costs is the depreciation of fixed assets. Depreciation deductions are calculated by the linear method, the useful life of fixed assets is 5 years.
Table 7. Fixed costs
NAME | AMOUNT PER MONTH., Rub. | |
one | Rent | 12, 000 |
2 | Fuels and lubricants | 8, 000 |
3 | Consumables | 7, 000 |
four | Equipment service | 3, 500 |
five | Administrative expenses | 2, 500 |
6 | Depreciation | 34, 500 |
7 | Advertising | 3, 000 |
Total: | 70 500 ₽ |
8. EVALUATION OF EFFICIENCY
The effectiveness and investment attractiveness of the project is evaluated on the basis of a financial plan, as well as simple and integrated indicators.
To account for the value of money over time, cash flow discounting is used. The discount rate is adopted at 2%, since the technology and product are widely known to the market, the level of competition is relatively low. The risk level is also low, all assets are quite liquid.
The simple and discounted payback period of the project is 18 months. Annual revenue - 5.4 million rubles, net profit - 1.4 million rubles. Return on sales - 26%. Expected return on payback from the first month of work. The net present value of the project (NPV) is 2 178 937 rubles, which indicates the effectiveness and prospects of the project. Return on Investment (ARR) - 6.03%. Profitability Index (PI) - 1.04. All this suggests that the effectiveness of the project, although not high, but exists. Considering that the volume of investments is small, the assets are liquid, and the initiator’s self-employment is also assumed, the project is interesting for investment.
Performance indicators are given in Table. one.
9. WARRANTIES AND RISKS
The project takes into account the main risks that may arise during its implementation. The reasons may be both internal and external factors. Risks, their assessment and measures to neutralize them are given in Table. 8. Risk assessment is carried out on a five-point scale, where 1 is the lowest value.
Table 8. Potential risks and measures to neutralize them
Risk | Probability of occurrence | Project criticality | activity |
Decreased quality of supplied ingredients | 3 | five | Constant market monitoring, creating a base of alternative suppliers |
Failure of equipment | 3 | five | Thorough maintenance of equipment; conclusion of a post-warranty contract with a supplier |
Decrease in demand due to worsening economic situation | four | 3 | Creating a more budget menu based on the existing one; search for more affordable ingredients |
ANNEX 1 and ANNEX 2
Denis Miroshnichenko(c) www.clogicsecure.com - a portal to small business business plans and guides
