Table of Contents

Table of Contents 1 1 Research Methodology 2 2 Restaurant Industry Analysis 2 Market Segmentation 4 3 Need Gap Analysis 5 3.1 Changing Lifestyles and Preferences 5 3.2 Increasing number of working female population 6 3.3 Growing tourism industry 8 3.4 Health conscious consumer segment 8 3.5 Increasing Nuclear Families 8 4 Innovativeness 9 4.1 Uniqueness 9 5 Advantages over Competitors 9 6 Implementation Strategy 10 6.1 Marketing Strategy 10 6.1.1 Web-based Marketing Strategy 10 6.2 Sales Strategy 11 6.2.1 Scalability and Sales Forecast 11 7 Personnel Plan 12 8 Financial Planning 13 8.1 Projected Cash Flow 13 8.2 Break-even Analysis 13 8.3 Projected Profit and Loss 14 8.4 Projected Balance Sheet 15 8.5 Business Ratios 16

1 Research Methodology

“Exploratory” research has been conducted in order to study the Indian Restaurant sector and gather data necessary for chalking out a business plan for opening a QSR. Major portion of the findings and analysis are based on: * Literature review from multiple sources * Exhaustive Secondary research
The workflow for the study/research has been outlined in the figure given below.

2 Restaurant Industry Analysis

Restaurant market in India is growing fast due to the increasing number of people eating out.

* Restaurant/Food service market in India has witnessed tremendous growth in recent years

* With increasing number of people eating out the industry offers major opportunities to the players to capture a larger consumer base

* Changing demographics, rising income levels and increasing urbanization has also fuelled market growth

* The growing segment comprises of formats like fast food chains, cafes and fine dining restaurants

* There is an increasing trend of Indian players exploring the foreign market

* Target consumer group lies in Tier I & II cities

* Constant innovations with the product varieties and their reach to the consumers has proved to be a strong growing aspect for the players
Market Segmentation

* Food service market in India is growing with fine dining restaurants, fast food and Cafes emerging as attractive investment options for the organized players * Growing trend of eating out with increasing disposable incomes has increased the number of consumers

3 Need Gap Analysis
3.1 Changing Lifestyles and Preferences

Changing lifestyles and positive views of consumers towards fast food is creating a gap in the supply and demand in the food services industry.
The lifestyle of the urban consumers is changing rapidly. The common traits are: * Growing trend of eating out at fast food joints and restaurants * Consumers who eat out for fun and spending time with family, tend to experiment with different varieties of cuisines * Close to 70% of teenagers find it right to eat fast food * Increased liking for specialized international cuisines like Chinese, Mexican, Italian due to increase in tourism * Majority of them prefer eating fast food whenever they feel like

Factors promoting QSR Industry

3.2 Increasing number of working female population

With increase in number of working women, frequency of eating out is rising and driving the market. * The increasing involvement of women in workforce has been favourable for the growth of food services industry in India. * The participation of urban Indian woman in the workforce has increased from 14% to 17% between 2000 and 2005.

* 51% of the population which eats out constitutes of woman

* This growing number of working women is beneficial for the food service sector as this result in lack of time available for household activities like cooking. * With the number of women who are joining the work force is on the rise, households are expected to increase the frequency of eating out.

Source: Census of India, 2001 and Technopak analysis

3.3 Growing tourism industry

As per the Ministry of Tourism the foreign tourist arrivals were 606,000 in November 2010 as opposed to 528,000 in November 2009 and 532,000 in November 2008. Apart from this, the domestic tourist segment is rapidly growing owing to more affordable air travel and higher disposable incomes. The growth of the tourism sector and food service industry is inter-dependent.

3.4 Health conscious consumer segment

Consumers today want more for their money and now actively seek quality. Apart from demanding time saving and easy to handle goods, they are interested in low calorie, environment friendly and wellness foods and are willing to pay a premium for these products. Being assured healthy and wholesome food options and quality outlets is a significant crowd puller.

3.5 Increasing Nuclear Families

According to the Technopak Report 2009, approximately 1.52% of joint families give rise to nuclear families every year. Going out and ordering in - are more prevalent food habits among the nuclear families than the joint families in India.
4 The Concept
4.1 Mission & Objectives

The name of our hypothetical restaurant would be Lazeej and its mission is to become the premier fast-casual dining place. This will be accomplished by offering an unprecedented experience coupled with great food at reasonable price.
The objectives of this restaurant business plan are: * To become the premier fast-casual dining restaurant * To open a new store every 12 months * To offer high-quality food and a wonderful experience at reasonable prices
The various parameters which will play a pivotal role in the success of this business plan are: * Offer simple, delicious menu items * Treat every customer as if they are the only customer * Design and employ strict financial controls
4.2 Initial Investment/Funding

The business plan for Lazeej has been prepared aiming aggressive growth. The intervals for opening a new store will be approximately one every 12 months. * Each location will be 1,000 square feet, on average, able to serve approximately 50,000 people per month. * For restaurants to succeed, the key factor is location. Hence, proper research would be conducted before finalizing a location * Traffic counts per month are to be 20,000 or greater. The decision to open a new store is not strictly every 12 months but when a new ideal location opens up. * For the opening of a new location, Lazeej will incur the following expenses: * $75K in build out expenses * $10K in equipment
Assumption: 50 INR = 1 US $
The required fund will be arranged from banks or angel investors.
4.3 Target Market Analysis and Segmentation Strategy

Lazeej will be operating within the fast-casual segment of the restaurant industry. This market can be divided into two segments for our restaurant concept: 1. Families: They will comprise the majority of dinner time business. As more households become two income families, the adults have less time to prepare meals. Going out to dinner eliminates the need to prepare a meal and offers time to catch up with each other.

2. Individuals: They make up the majority of lunch time business. Many go out to lunch to get out of the work setting. Others have business meetings at lunch.
Our restaurant will be competing against other segments within the industry such as fast food as well as more traditional sit down restaurants.

4 Innovativeness
4.1 Uniqueness

* Quality at every step, at every process (Raw Material, suppliers, Cooking, Time Management) * Careful choice of the location depending on surrounding, parking area, accessibility, visibility * Hygiene (Staff, material handling, storage area, Cleanliness, pest control, waste management) * Taste – On par with the Best and consistency * Aesthetic of outlet – Pleasant ambience * Uniform identity across all stores/branches (Unique theme, look and colour codes- likes of Café Coffee Day, Domino, Barista) * HR Support - Skilled and highly trained staff at the outlet * Quick turnaround time for home deliveries * Affordable pricing * Availability in all the important corners of the city * Total quality control * Complete control on materials management * Trustworthy team dedicated at Kitchen and outlets * Associated with some of the best chefs and cooks
5 Advantages over Competitors

* Excellent food quality, identity and novelty * High employee motivation and service option * The restaurant will be double layered – the upper portion will be exclusively for the couples and special orders & services will be provided to them. * There will be the theme-based menu for 3 days in a week * Different India cuisine themes will be tried by having a special menu * Customers with high and frequent purchase will be given a special discount * Quality product and hygiene would be maintained across all the outlets
Two major competitive advantages of this restaurant concept are: * Ensuring customer experience: With so many restaurants and prepared food being offered at grocery markets, the customer experience becomes extremely important. When a customer has a good experience at a restaurant, there is a significant chance that they will become a repeat customer. It is this experience that remains in the customer's mind well after they have consumed all of their food. This memory is what is communicated to their friends and colleagues. * Fast, healthy food alternative: There is a huge market demand for fast, convenient food that can be consumed without dietary concerns. Our restaurant will offer exactly this, vegetables and non-vegetarian items that are grilled with or without healthy marinades and sauces that add flavor not fat. White or brown rice will be offered as the starch of the meal. In addition to the plentiful amount of vegetables offered, green salads are also available.
6 Implementation Strategy

Marketing effort will focus on communicating the message that the restaurant offers a convenient, healthy dining experience. This will be accomplished through a variety of ways to be detailed in the Marketing Strategy section. Its sales strategy will be an effort to convert potential and first-time customers into long-term customers.
6.1 Marketing Strategy

The goal of the marketing strategy will be to raise awareness levels regarding the restaurant and the offerings and value. The message will be that Lazeej is a convenient, healthy fast-casual alternative restaurant. Lazeej will employ several marketing outlets: * Advertisement – Through leaflets, posters and hoardings * Sales Promotion – Discount coupons, issuing privilege card and contests * PR – Press release and stories in local media

6.1.1 Web-based Marketing Strategy

This restaurant will have a web presence with a simple, user-friendly website. The website will be used for menu information, contact and location information, as well as background for the story of the restaurant.
The website will rely on two methods of marketing as a means for developing awareness of the site and increasing the number of visitors. * Search engine submission: The website will be submitted to various search engines.

* Printed material: It will reference the website address on all printed material that is passed out including menus, business cards, and advertising media.

6.2 Sales Strategy

The sales strategy will be accomplished using several techniques. * Free Meal Coupons: After 10 meals purchased, the 11th will be free. Free meal coupons are an effective way of increasing sales from a specific customer. They are effective because they provide the customer with a sense of additional value. People love getting something beyond what they pay for. * Concentrating on the customer's experience: Customers will not come back if they are not happy with their dining experience. All employees go through a comprehensive training process that includes training on how to offer the customer the finest experience. The employees are empowered to resolve issues and are encouraged to seek assistance from the manager for a conflict that they are unable to resolve.

6.2.1 Scalability and Sales Forecast

Sales will be modest during the first few months but will grow incrementally. The second store is forecasted to open in 2nd year; subsequent new stores will open at the earlier indicated 12 month intervals.

7 Personnel Plan

For the first unit there will be a team of 10, out of which the job of Chef, Manager and Service person’s jobs will be performed by core team itself. For the subsequent units we will just replicate this plan.

8 Financial Planning

In this section we will illustrate all the financial planning related to Cash Flow, Profit & Loss and Balance sheet. The projections will be also provided to get a better idea of the future plan.
8.1 Projected Cash Flow

8.2 Break-even Analysis

The Break-even Analysis indicates that $10,099 will be needed in monthly revenue to reach the break-even point.

8.3 Projected Profit and Loss

The following table indicates Projected Profit and Loss.

8.4 Projected Balance Sheet

The following table will indicate the Projected Balance Sheet.

8.5 Business Ratios

The following table indicates common Business Ratios specific to Lazeej as well as industry ratios.