The report contains a proposal of a business plan for Gymmys Kitchen takeaway. The establishment which will be designing healthy meals in addition to provision of meal delivery services to various destinations in Macau. The aim of the business is to deliver delicious food which is natural and has low calories and carbs to homes and workplaces. The location of the business will be at Macau Island, a place that is popular to the visitors. Gymmys Kitchen will have focus on buying quality ingredients from around the world to provide the consumers with a wide range of tastes to choose from. Foods shall be prepared according to the food pyramid resulting in well-balanced nutrients. Nutritious snacks will also be available upon request. The business will be a partnership co-owned by Mina and Sammi. Mina will be the financial manager while Sammi will concentrate on marketing and sales.
This start-up proposal for Gymmys Kitchen has been subdivided into numerous sections which include the company summary, market analysis that explains the micro and macro environment, competition analysis, business model canvas of the restaurant, business strategy, strategic risk management, project execution, financial plan, and the growth strategy.
Company Summary
The business anticipated and explained in this start-up proposal is Gymmys Kitchen that will function not only as a takeaway restaurant but also as a business to raise awareness on healthy eating habits in Macau. The business will share the idea of eating healthy among the residents of Macau. The purpose is in avoiding unhealthy diets for some individuals who use extreme methods such as fasting to lose weight.
Macau is a very small city with the area of 30.5 km², which is approximately 8,700 times smaller than United Kingdom. Gambling is an extremely successful business in Macau which stimulates the economy. It has transformed the territory into one of the world’s largest gaming centres, boosting the economy and improving the infrastructure within the region. Tourism is the main source of money for Macau residents. There are approximately 30 million visitors coming to Macau each year and most of them are form the Mainland China. Due to the irregular shifts of the hospitality and gaming industry, many workers are not eating healthily. Many people in Macau are used to takeaways and irregular diets. Currently, there are only three nutritional food restaurants in Macau and only one provides delivery service.
Business Structure
The form of ownership adopted at Gymmys Kitchen is partnership. The aim of the partners is to provide quality training to employees and hire people with relevant skills and knowledge of operating a restaurant. The reason behind this is to offer the customers the best experience and ensure that the service exceeds satisfaction.
One of the key attributes to running a successful restaurant is selling quality tasting food consisted of balanced meals, obtaining feedback from employees and customers, and maximising the profit through selling via the internet.
Gymmys Kitchen will be co-owned by Mina and Sammi where both will be the general sales manager. Individually, Mina will be the financial manager responsible for accounting in addition to being the executive chef focusing on cooking nutritional meals. On the other hand, Sammi will concentrate on promotions, sales, internet, and e-commerce. Sammi will also be responsible for the logistics in terms of ensuring all the ingredients are available. The plan is to have four employees who will work full time, namely one cleaner, two chefs, and a delivery person. The deliveryman will be required to have a driving license and also have knowledge of riding a bike and motorcycle. The partners will have the duty of ensuring that deliveries are done within time. Moreover, Sammi will manage the flow of orders while Mina will ensure that the inventory records are well-managed.
Partnership is the preferred business structure for Gymmys Kitchen because of a number of reasons. First, partnership is the best approach to use for start-up businesses since it is less expensive in terms of capital (Bock, Opsahl, George, & Gann, 2012). Gymmys Kitchen will combine the expertise and resources of various owners to ensure the success of the business. Moreover, a business that is owned by two partners is easy to manage compared to the one which depends on the decision making of a board of directors. Furthermore, the profits and losses are easily shared between the co-owners in relation to their share, which they agreed upon initially during the partnership agreement (Geddes, 2017). Unlike many organisations and established companies, this form of business structure is not mandated to announce their progress in terms of losses and profits to the public. Therefore, Gymmys Kitchen will be entitled to a unique privacy such that only the workers and partners know the financial state of the business. According to Bock et al. (2012), the best aspect about partnership is that a business can easily be changed into a company if there is a need for this development in the future. Therefore, depending on the growth and success of Gymmys Kitchen, the partners might decide to attract more investment and secure, increased funding from financial institutions by registering the business as a company. Of importance to note is that this upgrade can only be achieved one way. A business registered as a company cannot be downgraded or changed into a partnership as the law requires it to file for liquidation or bankruptcy which results into firm’s dissolution.
Among the reasons individuals start businesses as partnerships rather than corporations or companies is because business partners do not need to undertake legal procedures when forming a partnership unlike starting up an organisation where the owners have to file documents with the government (Glasbergen, 2011). Consequently, filing income taxes is easier since partners are deducted individually, which means that the returns acquired from the partnership are purely information returns. Nevertheless, this information is monitored by the governments’ revenue service to show the expenses and income used by the business. Research shows that partnership is an attractive method to acquire prospective talent or employees. Owners of the business Mina and Sammi have various skills which, when utilised effectively, could contribute positively to the business (Hazudin, Kader, Tarmuji, Ishak & Ali, 2015). Gymmys Kitchen takeaway is set to grow and become successful considering that partners are knowledgeable in different ways.
For Gymmys Kitchen to become successful, the business will need to invest in the following aspects of a good partnership. First, Gymmys Kitchen will need to get at least more than two members who have the same idea to begin the business. The individuals who are being engaged in the partnership have to be legally competent since they have to sign contracts in order to become partners (Selsky & Parker, 2010). In relation to this feature, Gymmys Kitchen qualifies as it is owned by Mina and Sammi operating on different roles of the business. Secondly, Mina and Sammi will need to have unlimited liability, meaning that they will be individually and collectively liable for Gymmys Kitchen obligations and debts. One of the main purposes of having partnerships is to share the profits and losses settled during the initial agreement. However, in case there was no concurrence between by the members, the profits and losses are shared equally among the partners (Hazudin et al., 2015). Other features that make partnership the preferred business structure include voluntary registration, contractual relationship, and mutual agency among others (Selsky & Parker, 2010).
Partnership structure was also the best proposed management structure due to the simplicity in decision making. Consultations between Mina and Sammi will be less complicated compared to when dealing with company. Mina and Sammi, based on the expertise and partnership agreement, each will be liable for the decisions made. Apart from these benefits of a partnership, this formation was selected because of the lack of hardships in interactions between the directors or owners and the employees. The concerns of the workers are addressed immediately often due to the direct access to the managers as they are often available within the business premises.
Style of Leadership
The proposed leadership style to be adopted at the Gymmys Takeaway will be transformational style. Such leaders are individuals who have the ability of stimulating and inspiring supporters for them to accomplish outcomes which are extra-ordinary (Robbins & Coulter, 2007). A transformational leader closely listens to the developmental needs and concerns of individual followers, signifying that they are not self-centred. These types of individuals who adopt this kind of leadership approach change the awareness of the issues of their followers by ensuring they assist them in confronting their past behaviours while giving them an opportunity to shape their destiny through a new beginning. These leaders convince followers that there is hope in doing what is right. Moreover, they encourage supporters into putting additional effort in order to attain both their personal and organisational goals. The ultimate goal of transformational leaders is creating the desired change in terms of how the followers think; considering Gymmys Takeaway is a new business, having a leadership method that acknowledges the difficulty of starting up and motivates employees to give their best irrespective of the work conditions will be critical in achieving long-term goals. Thus, having Mina and Sammi adopt transformational features within the business will ensure employees’ concerns as well as the interests of the business are taken into the account (Warrilow, 2012).
Among the reasons transformational leadership style has been chosen for the leaders at Gymmys Takeaway is that it enhances morale, motivation, and performance of the followers by employing numerous mechanisms. Some of these mechanisms include providing a connection to the followers’ sense of identity, be true to the organisation’s and the collective firm’s identity. In addition to these, others methods include being a role model for the employees, an aspect that makes them not only inspired but also interested, providing a challenge to the employees to take ownership of what they do, and having an understanding of the weaknesses and strengths of all the employees. Finally, this leadership method allows leaders to assign workers’ duties and responsibilities that they are skilled and have high chances of succeeding in. In doing so, performance and productivity are enhanced.
Warrilow (2012) stated that transformational leadership style can be explained through four main components. The first is the idealised influence or charisma which refers to the extent in which a leader acts in a manner that is admirable in addition to convincing others to support an idea and taking stands depicting an individual’s set of values. Being a start-up business, Gymmys Takeaway will require this type of leader who instils discipline and hard work into the workers. Secondly, transformational leaders are identified with inspirational motivation, which refers to the ability of the leader to articulate the vision of a business, in this case Gymmys Takeaway, in a manner that appeals and inspires the employees about the future of the organisation. In this case, the leader offers meaning for the current tasks that the employees might be pursuing. The third aspect of a transformational leader is intellectual stimulation which refers to the ability of the leaders to challenge assumptions and stimulate and encourage creativity in the minds of the employees. Creativity will be highly needed to ensure that new products and services are taken into the account to attract new customers. Thus, having leaders who encourage employees to be creative without having to fear will be vital for the survival of the business and its growth. Transformational leaders will be required to provide a framework for employees that allows them to know how they connect with the organisation, leaders, and to each other for purposes of creatively overcoming obstacles in the course of their mission. Finally, a transformational leadership style at Gymmys Takeaway will allow for personalised and individual attention. It will be important for leaders to provide employees with individual attention by becoming a coach or mentor and, at the same time, show them respect and appreciation for their efforts. The consequences will be enhancing each member of the team’s self-worth and self-fulfilment, which, therefore, will inspire followers for further growth and achievement. Jung & Sosik, (2002) emphasised that transformational leaders are proficient in creating effective teams or groups that work towards achieving the set objectives and goals.
Objectives
This report seeks to develop a start-up plan for Gymmys Kitchen by discovering different factors that could have an influence on a new restaurant business in Macau. During the research, various aspects have been explored including the political environment of Macau, the legal aspect, the technological components, the economic factors, and the nature of the suppliers and customers as well as the cultural aspects. Consequently, an objective of the report is determining the best marketing environment that Gymmys Kitchen could adopt to ensure that its operations are carried out as envisioned by the partners. Another general objective of the new business will be to deliver quality healthy foods at prices which are affordable by the different types of customers in Macau. The mission statement for the business will be Everyone leaves Gymmys Kitchen with a green heart. Gymmys Kitchen will aim at spreading happiness and awareness on the need to eat healthy. To achieve this, the business will have to consistently produce and offer quality foods and services that exceed the expectations while, at the same time, fulfilling the needs of the customers.
The short-term objectives of Gymmys Kitchen will include:
• Establish awareness in Macau and increase it by 20% in every 3 months;
• Attract 10% of customers every month;
• Establish the needs and requirements of the target consumers and consolidate the menu;
• Employ skilled workers who understand the need to provide healthy foods to consumers.
• Establish local reputation as a healthy eating restaurant
The long-term objectives of the business will be:
• Build the reputation through word of mouth and reviews by 15%;
• Improve the services by 10% each month;
• Reduce wastages and unnecessary costs by 10% in every year of operation;
Market Analysis
Micro and Macro Environment
Macro-environmental factors. The macro environment factors consist of issues that affect society as a whole. They are more controllable than the micro environmental factors (Schaltegger, LüdekeFreund, & Hansen, 2016). The following are macro environmental factors that might affect start-up businesses such as the Gymmys Kitchen takeaway. The technological changes enable a business to achieve its main goals and, in other cases, they threaten the existence of the business. Research shows that organisations, which are not able to adapt to various technological changes, may not thrive in the market for a long time. Gymmys Kitchen takeaway will however not be affected by technological aspects considering the size of the Island. Another macroeconomic factor is the economy, which refers to all the trade and industry aspects impacting on the normal functioning of a business. In most cases, many businesses depend on the economic environment for all the sources needed to make the company a success (Fleisher & Bensoussan, 2015). In this case, Gymmys Kitchen Takeaway will depend on the economic environment to ensure that it has found a suitable market for selling their finished goods, in particular food and other services provided. For instance, the prices that the business will set shall be controlled by the economic situation in Macau at any particular time.
The political environment is another macro environment factor that has an enormous impact on business. According to Birnleitner & Student (2013), the political environment has national, regional, and international implications on the business. Macau Island’s political system decides controls and promotes the business activities that go on in the island. Nevertheless, this means that the Gymmys takeaway has to work under the rules and regulations set by the government of Macau (Macau SAR Government Portal, 2018). Efficient, stable, and honest political systems are the primary factors for the growth of start-up businesses (Birnleitner & Student, 2013). Political instability has negative effects on the business policies of an organisation such as in the case of Macau, it discourage tourists arrival and consequently leading to decline in customers. According to Birnleitner & Student (2013), political factors can cause either threats or opportunities to business firms.
The natural environment affects the running of a business in various ways depending on the location and type of business. The natural environments include geographical and ecological factors, which include the weather, endowments, climatic conditions, and topographical factors. Environmental pollution and other disturbances of ecology can be of a great concern for the distribution and delivering of food for Gymmys takeaway hotel (Reid & Bojanic, 2009). Most government policies have the main objective of preserving the purity of the environment and preservation of non-replenish-able resources. Additionally, this adds more responsibilities and negative issues to the business.
Microenvironment factors. Gymmys takeaway will deliver food services to any destination in Macau Island, which means that customers are their main assets. According to research (Storey, 2016), customers are considered to have the biggest microeconomic effect on any business. Simply, Gymmys takeaway cannot successfully gain profits if they do not reach their main consumers. There is a need to know the ideal customers and their types. In this way, the business will be able to develop and generate effective marketing strategies which are integral in generating capital and building an active customer base (Storey, 2016).
The growth of a start-up business depends on its capability to uphold multiple markets which include consumer, business, international, reseller, and government markets (Krause, 2013). Customer markets, according to the Gymmys enterprise, consists of households in which the food is delivered and the individuals who buy these foods. The business markets include producers and the organisations buying goods and services with a view of transferring to the customers who need them most (Thai & Turkina, 2014). The Gymmys enterprise management needs to understand that every customer market dictates its own characteristics, and, therefore, the business has to deliver services that fit into the description of certain consumers (Krause, 2013).
The employees also form part of the microenvironment factors which affect the business. The Gymmys takeaway workers will be responsible for producing foods and selling them in order to expand the business. The hotel will need motivated and qualified employees since these are the vital qualifications for any entity that aims at becoming successful and gaining a market share (Fleisher & Bensoussan, 2015). Gymmys takeaway will thrive if it has the right distribution channels and suppliers. One of the most important factors to consider when setting up a business is knowing the right places to buy raw materials from which will be used for food production and other services which will be issued by the business (Bowen, Morara, & Mureithi, 2009). Moreover, distributing inventories to the customers is significant to the growth of the business. For Gymmys takeaway to operate successfully, there is a need to get the best value on supplies and products, which offer the best value to customers.
Another microenvironment factor which affects the business is the marketing intermediaries. These are the organisations which help a business to sell and promote their goods and services to more customers. The intermediaries include marketing agencies, financial intermediaries, physical distribution organisations, and middlemen (Alfaro, 2017). The intermediaries include retailers and wholesalers who buy products and resell them. However, in this case, the intermediaries can help in providing more customers for Gymmys enterprise. The marketing service agents are important in publicising the business to the public. Furthermore, these agents promote the firms' products to the right markets. According to Bowen, Morara, & Mureithi (2009), Gymmys Kitchen could also utilise the services of financial institutions such as banks, insurance, and credit organisations to have the business insured against various risks such as fire accidents. Taking into consideration Macau is a small place and depends on tourists, the business could collaborate with some of the travel agencies to promote some of the healthy foods offered at Gymmys Kitchen.
Competitors are micro factors, which are significant in the growth of start-up businesses. The level of competition in Macau Island will affect the impact of the hotel’s economic livelihood. In other words, this means that a start-up business will have to share and maybe “steal” some customers from established businesses. Large numbers of competitors in a certain area show that there is a large demand for products and services provided in the area (Yam, 2016). Therefore, a start-up business should establish itself in such areas where they will attract customers easily. A company has to have competition since the lack of it means that they may not find the needed demand to succeed in the future. Moreover, the lack of competition reduces the business's ability to develop and grow (Bloom, Floetotto, Jaimovich, Saporta-Eksten, & Terry, 2018).
Including investors and shareholders in a business depends on the size of the entity. Gymmys takeaway hotel may include investors who help the company grow through funding and finding more customers. Most start-up businesses fail due to the lack of funds. Therefore, in any case, if this situation happens to Gymmys takeaway foods, then they can seek help in creditors who issue loans and are paid back with interest (Fleisher & Bensoussan, 2015). Nevertheless, the best method to raise funds for the business is by getting involved with investors since the business can easily share operating risks and gain the required expertise for running the business. However, the owners of Gymmys takeaway will have to give up the agreed equity with investors for the business.
A business can be affected by various types of public which include internal, financial, media, and internal among others (Pîndiche & Ionita, 2013). The financial public encompasses the factors which affect the start-up business in terms of capital, which include financial institutions such as banks and stakeholders. The financial public influences the organisation's ability to get capital. The media public involves the factors which bring out the editorial opinion from people. Media influences include magazines, radios, and television. The local public consists of the community and neighbourhood. Gymmys business should consider the public’s attitude towards the products it makes and the services it offers. The internal public consists of managers, volunteers, and the board of directors. Gymmys organisation can use newsletters, the media, and other means to motivate and inform the internal public of their state of business (Schaltegger et al., 2016). The local community of Macau Island and the media will affect the image of Gymmys takeaway. In most circumstances, a community supports an organisation which provides jobs, operates within the social environment, and pays taxes. However, if an organisation ignores these requirements, it may risk having a negative backlash within the public (Storey, 2016).
Competition Analysis
Similar to other local or international businesses, Gymmys Kitchen will face stiff competition from some of the firms which are current providing healthy meals to the community at Macau. Due to the presence of local competitors, Gymmys Kitchen will have to improve their services and ensure that the food they offer to the customers is nutritious and affordable. Moreover, cleanliness will be critical to being successful in a restaurant business. One of the competitors that Gymmys Kitchen will have to deal with is Greens Kitchen and Juicery (Macau Lifestyle, 2018). Greens is a restaurant which has been built with an almost similar business model to Gymmys; they serve meat and also introduce vegan options. Greens started its operations in 2014 and it has been promoting a message for health since then as the menu caters for all dietary needs and requirements for the different customers. At the same time, Greens offers take away food items such as fresh baked goods, soups, salads, and the signature line of cold pressed juices (Macau Lifestyle, 2018). In the appendices, a Google Map screenshot for Greens shop at Macau is available for review. The second business which will offer stiff competition to Gymmys Kitchen is Bless Juice Bar that is specialised in serving refreshing juices, herb tea, coffee, and hearty food. The aim of Bless Juice Bar is to provide their customers with a healthy and innovative drinking experience (Macau Lifestyle, 2018). In the appendices there is a Google Map screenshot available, showing the location of the Bless Juice Bar.
Business Model Canvas
Osterwalder et al. (2014) defined a business model canvas as a strategic management template and lean start-up used for the development of business models that might be new or existing. In this case, the canvas will be used in the development of Gymmys Kitchen, and, normally, the canvas model is a visual chart as will be shown below with elements that describe a product’s or firm’s value proposition, infrastructure, customers, and finances. The model is significant in assisting firms to align their activities through illustrations of potential trade-offs. Formal descriptions of businesses are used as building blocks for the main activities. Osterwalder et al. thesis and work (2014, 2010) provided proposals of a single reference model whose basis is in similarities of numerous business model conceptualisations. The infrastructure component refers to the key activities, key resources, and partners. The key activities are the most critical functions involved in execution of the company’s value proposition. In the case of Gymmys Kitchen, the key activity will be the production of simple healthy meals that are nutritious to the customers. The key resources are vital and necessary in creating value for the consumers and sometimes these resources are referred to as the main assets of the organisation that are needed to support and sustain the business (Barquet, Cunha, Oliveira, & Rozenfeld, 2011). These resources could be physical, intellectual, financial, or human. For the purposes of reducing risks and optimising operations of a business model, many firms invest or cultivate the relationship between the suppliers and the buyers with an aim of focusing on the core activities, which for Gymmys Kitchen will be the production of meals that are healthy. In the future, Gymmys Kitchen will require to take into consideration complementary business alliances through strategic coalitions and joint ventures between non-competitors or competitors for the reasons of possible future expansion. The second component in the business model refers to the offering which comprises of value propositions. Value proposition often refers to the services and products which a business such as Gymmys Kitchen has to offer to meet the requirements and needs of the customer (Osterwalder et al., 2014).
Osterwalder et al. (2014) emphasised that an organisation’s value proposition is what makes it distinguishes from others in the market as through it organisations position themselves while, at the same time, offering value via numerous elements such as customisation and price among others (Osterwalder et al., 2014). The third building block comprises of the clients, specifically customer segments, channels, and relationships. For an organisation to have a business model that is effective, firms must identify the customers that it is aiming to serve (Osterwalder, Pigneur, & Smith, 2010). Numerous sets of consumers could be segmented based on different attributes and needs to ensure there is an effective and appropriate implementation of the corporate strategy, which consequently meets the requirements of the clients selected, and among these segments there are mass market and niche, segmented and diversified (De Reuver, Bouwman, & Haaker, 2013).
For Gymmys Kitchen, among the consumer segments to be targeted will be those individuals who want to eat healthy meals. The business will also target male and female customers aged 18-40 with an income of 1000 pounds and above. The business will offer vegetarian meals which means that it will also attract certain types of people with various views on the world. The second aspect on customer is channels that mean that businesses can use different means to deliver the value proposition to the consumers targeted. Businesses can reach consumers using their own channels such as physical stores, partner ones such as major distributors, and online stores (Osterwalder & Pigneur, 2010).
Today, it is possible for a business such as Gymmys Kitchen to utilise technology to increase the sale of different food items. For example, the company can have a website or application from where customers can make various orders and have them delivered to their workplaces or homes.
Ensuring the success and survival of any business means that firms must identify and invest in a form of relationship which they seek to establish with the chosen market segments. Therefore, some of these associations that Gymmys Kitchen can create include dedicated personal assistance, self-service, and personal assistance. The final aspect of the business model canvas refers to finances which include cost structure and revenue streams where the cost structure is a description of the monetary consequences which are most significant when operating and some of the features of cost structure include fixed and variable costs (De Reuver, Bouwman, & Haaker, 2013). Finally, revenue streams are about how an organisation such as Gymmys Kitchen makes income through employing each of the consumer segment. Different ways to earn revenue include usage, brokerage, and transport fees when deliveries are made as well as advertising and licensing. The proposed business model of Gymmys Kitchen has been detailed below.
