Business Planning for a coffee shop

Done By: Noof Mohammed Al-Sada

BH05501678
Section: FA
Subject: SBI301 Seminar in Business Planning & Analysis
Approved By:Mrs. Ilene Valian

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 The Content

Cover page 1
The Content 2-3
Chapter 1- Executive Summary 4
Chapter 2- Terms of Definitions 5-7
Chapter 3- introduction 8
Description of the product & services 9

Chapter 4- Market Analysis 10

Market Target 11
Mission Statements 11
Business Environment 11

Chapter 5- Marketing Plan

Pricing the products for the profit 12-13
What’s Advertising 13
Start-up Advertising 13-14
On-going Advertising 14
Appearance Advertising 14
Expansion plans 14-15

Chapter 6- Competitive Analysis

Bahrain Coffee shop market 16
Related Study 16-17
SWOT Analysis 18-19
Chapter 7- Management plan
Management Structure 20
Hiring Employees 20-21
Who should plan the menu 21
Job Description 21-22
Success Tips 22
Labor Cost 23

Chapter 8- Operating Plan

The project location & premises 24-25
Environment & Décor 25
Facilities and equipment 25-28
Special things to sell 28
Countries ordered from 29

Chapter 9- Financial plan 30

Object & Financial Expectation 30
Sales Goals

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 Break-even analysis 30-31
Income statements 31
Balance sheet 31
Financing proposal 32

Chapter 10- Summary and recommendation 33

Chapter 11- Appendices and Exhibits

Appendix1 (Sales Projection) 34
Appendix2 (Direct Male) 35
Appendix3 (Pictures) 36-37
Appendix4 (Sample of card) 37
Appendix5 ( Flow chart) 38
Appendix6 (Gantt Chart) 39-40
Appendix7 (The menu) 41-42
Appendix8 (Project Financial statement) 43
Appendix9 (Balance sheet) 44-45
Appendix10 (Cash Flow) 46
Appendix11 (Monthly Profit and Loss Statement) 47
Appendix12 (Personnel and staff cost) 48-49
Appendix13 (Survey) 50-64
Appendix14 (References) 65

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 Chapter 1
Executive Summary

Starting a business is one thing, making it work is another. The

success of the business depends on many factors.
We know that the success in self-employment is largely the result of careful
planning and understanding of basic business techniques and formulas.
Based on that the researcher decided to make it’s own business planning
which is about making a study for establishing a coffee shop called Nofiatto in
the new extension in Seef mall. The plan is a frame to issues related to the
business that may effect its operations.
The researcher made the research and the study to acquire relevant ideas to
be implemented in the coffee shop, in addition to provide more products and
services.
This feasibility study covers the financial aspect and other implications of
introducing the afore-mentioned coffee shop in Seef Mall. The market
information has been supplemented by the owner Ms.Noof Mohammed
Alsada. The study is highly reliant on the pertinent data and information
provided by her. We have depended as well on information available from
other independent sources such as the ministry of information’s Tourism
Directorate, In addition to some statistics of other coffee shops and similar
projects operating in Bahrain.
(See Appendix5 PAGE 38 )

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 Chapter 2
Term of Definitions

Annum
Mega-annum,is a unit of time equal to one million years. It commonly used
in geology and paleontology to signify time in the past. For example, 65 Ma
indicates 65 million years ago.
Appraisals
An official document usually provided by an appraiser or jeweler specifying
the quality and replacement value of an item. This document is generally
needed by an insurance firm to assess the value of an item for insurance
purposes.
Archipelago
A sea, such as the Aegean, containing a large number of scattered islands.
Attractions
General all-0inclusive term travel industry marketers use to refer to products
that have visitor appeal, like museums, historic sites, performing arts
institutions, preservation districts, theme parks, entertainment and national
sites.
Avail
To be of use or advantage to; help.
Ceaseless
Without stop or pause; constant.
Collectible
That can be collected.
Conductive
The word "conductive" has a range of meanings within the context of
different standards and should be treated with care.
Courage
Quality of spirit that enables you to face danger or pain without showing
fear.

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Dabble
To splash or spatter with or as if with a liquid.
Decisiveness
The trait of resoluteness as evidenced by firmness of character or purpose;
"a man of unusual decisiveness.
Dedication
Properly the setting apart of anything by solemn proclamation. It is thus in
Latin the term particularly applied to the consecration of altars, temples and
other sacred buildings, and also to the inscription prefixed to a book, etc., and
addressed to some particular person.
Demitasse
A small cup of strong black coffee or espresso
Diligence
The legal process by which a debtor’s lands, personal or moveable property
are attached for the recovery of the debt.
Enthusiastic
Having or demonstrating enthusiasm.
Entrepreneurial
Creating new business.
Glance
To move rapidly from one thing to another. Used of the eyes.
Heritage
Something that is passed down from preceding generations; a tradition.
Impatiently
Unable to endure irritation or opposition; intolerant.
Paradigm
One that serves as a pattern or model.
Patience
Patience is the ability and willingness to wait a long time or to carry out a
task that takes a long time, especially one that is by itself not heavy, but
boring. It also means not easily getting angry or not showing anger in
situations of human communication where the other is unreasonable. It is

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commonly referred to as a virtue, though it is not one of the traditional
theological or cardinal virtues.
Perseverance
The act of persisting or persevering; continuing or repeating behavior; "his
perseveration continued to the point where it was no longer appropriate.
Pertinent
Having precise or logical relevance to the matter at hand; "a list of articles
pertinent to the discussion"; "remarks that were to the point" .
Phenomenon
An occurrence, circumstance, or fact that is perceptible by the senses.
Plethora
A superabundance; an excess.
Proliferation
The continuous development of cells in tissue formation; cell formation.
Residual
Remaining as a residue
Unprecedented
Having no previous example
Tolerance
The capacity for or the practice of recognizing and respecting the beliefs or
practices of others.
Vital
A critical element of the plan.

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 Chapter 3
Introduction

Bahrain coffee shop market draws on the high tourist tide the country
is witnessing. Markets at large are booming with an average of BD 16 million
(USD 42 million) changing hands every single month.
“ Based on information that I got from KPMG the Legal Assistant Advisory on
2006 ”
Investor confidence is as high as never before and the price level is almost at
stability. Tourist movement into the country is showing a healthy growth and
the catering sector is opening up and taking appropriate steps to
accommodate for the boom in tourism. During the last two year more than 10
million people visited the island, making the visitors- to citizen’s ratio hit 100%
per annum. The increasingly growing traffic creates a huge potential of café-
goers base. World class events hosted by Bahrain, On the other hand, add to
the visitor creation process and offer such facilities positioned at vital
commercial spots more seasonal opportunities.
The researcher set and established business goals which is be to achieve
through the coffee shop, such as independence , financial security for
retirement national recognition , making profit and to be successful so as to
expand later on and franchising all over the world.
Likewise, the researcher’s goal is to raise the interest to work with people and
prepare to work of it’s own and to motivate the stuff to work for long term.
The proposed project is planned to derive its revenue from providing a variety
of offering types : light ready snacks, coffee, tea, espresso, soda drinks(), etc.

“Every business starts with an idea. No matter what that idea is ,a well
thought out business plan is what helps turn that idea into reality”

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Description of the product & services
Why should customer pay to buy from Nofiatto Coffee shop when they
can buy ready made ground coffee from the supermarket, so the key question
is why will they pay to buy from Nofiatto Coffee shop? The answer should be
because the shop serves many kind of coffee and tea beside the other
products that will be explain it in details.
(See Appendix6 PAGE 39-40 )

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 Chapter 4
Market Analysis

Market demand for café atmosphere and services is dictated mainly by

the number of Bahrain visitors from GCC countries and the rest of the world.
Local demand is as well a big source of potential customers. Worth noting
here is that building customer base can be easily done with help boost café-
goers numbers and procure ceaseless turnover for the project.
Average demand is a function to several factors , at top pf which comes:
convenience or the place utility. This factor gives each such project a special
advantages or disadvantages – it depends. More specifically, traffic density
depends on the “ Place” , rendering generalization impractical , though the
use of which as a benchmark can prove of avail.
Following is a table presenting the probable causation for café-going along
with frequency and type of trip for average people:

Cause of trip Frequently Spending Remarks

On-Shopping Once/W BD 15 With family

Customary Twice/W BD 10 With Family

Accidental Once/W BD 5 Alone

The source of the table from a questionnaire applied to a sample of different

people .
(See Appendix 13 PAGE 50 )

Café- going is one of life necessities for all adult age classes in such a limited
area country like Bahrain. This phenomenon accompanied with economic
activities such as shopping and buying has created new arenas of life style.In
short, indoor cafes (such as those in commercial complexes) can take a full

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advantages of high traffic location they operate in , regardless of competition
from stand-alone and in-hotel projects.
Mission Statement
Nofaitto Coffee shop seeks to serve high quality food and beverages in
an upscale western atmosphere, conductive to family dining, while observing
the highest standards of services. This is the mission statement of the coffee
shop.
Business environment
Bahrain at a glance, The kingdom of Bahrain is an archipelago with a total
area of 712 sq.k.m. it is situated in the Arabian Gulf off the eastern cost of
Saudi Arabia with which it is connected by a causeway some 25 k.m long.
Bahrain is a member of the Gulf Cooperation Council – an economic
aggregate of more than 32 million people, and is featured by stability and
religious and ethnic tolerance and mutual living. Great deal of capital for
investment is available in no-direct-taxation environment.
Bahrain is passing in a turning point in its development history. The last
few years forged great challenges on the country as a plethora of new
developments and projects has unraveled at unprecedented pace in the
country, leveraging it to an enviable position in the region. New catering
facilities are a logic response, inter alia, to the huge possibilities opened up
before the tourism sector of Bahrain.For the time being, number of
considerable coffee shops throughout the country doesn’t exceed fifty,
scattered along major heavily inhabited and haunted areas. Some of them are
independent. While the others are centered at supermarkets and hotels. Hotel
cafes put aside, number of residual establishments will be a little bit more than
thirty.
(See Appendix3 PAGE 36 )

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 Chapter 5
Marketing plan

Marketing plan is the important process that identify the market , it may
seem to be an extremely complex process. It can be easily be focused in the
five factors used to target the market. Population , Income , Competition ,
Product or service market match , Desire.
Pricing the products for profit
There are several factors must be taken into consideration when setting
prices:
The cost of goods sold.
This amount originally paid for the goods.
The nature of the product or services.
Uniqueness and demand come into play here.. in the case of Nofiatto that
sells goods with stable level of demand, such as the bread for the different
kind of sandwiches raising or lowering prices will have little effect. However
when demand is high for goods that are hard to get, the price can realistically
be set anywhere the business owner wants.
The competition.
It is important to recognize what competition is charging, for often this will
guide in pricing within a certain region. However, if a competitor is charging
what owner feels is an unrealistic price- either more or less- for a product or
service. Then set the prices according to all competitors, consumers will pay
the cost if you offer something special , such as a friendly atmosphere,
convenient hours, follow-up services , or some other benefit not provided by
the competition.
The company policy.
This encompasses a number of things, including the location, position in the
marketplace, and additional services offered. It also takes into account the
personal philosophy about business and the role in it.

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Market strategy.
Should Nofiatto go for large volume at low prices or low volume at high
prices? That is the bottom line in considering market strategy. As a small
business owner will likely opt for low volume and higher prices , since the
alternative involves having the resources, including labor ,display room,
distribution channels, etc. to move or serve large volumes of product or
perform major service tasks.

Customers.
What will the market bear? In other words, what are customers willing to pay for the
products or services? The basic formula for price setting is
Labor + Material + Overhead + Profit Margin = Price
Advertising
More than 150 years ago, Thomas Macaulay, a British historian and
statesman , said : “Advertising is to business what steam is to industry.
The same propelling power”.

What is Advertising in Business?

Advertising informs the public and the customers about who they are, what
kind of business they operate, How they can buy the products and services
and why they should come to the coffee shop.
(See Appendix3 PAGE 37 )
Start-up Advertising
In Nofiatto starting up advertising it includes many steps and process ,it takes
around 2/3 of the capital .
In the first year, interested more in business cards and stationary,
announcement flyers and brochures, and the initial ads in newspapers or
other publications. So at the beginning the main focus was in telling people
where the coffee shop is located and what does it offer? So it includes:
Television.It’s quite expensive for small business, when it can be afford not on
TVs only also in cinema’s screens.

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Local radio. It’s effective way and the cost is based on the amount of time
used.
Buses and CARS transportation. Making very big stickers pasted on CARS
with the coffee shop name and location, The good method in this kind of
advertisements is the public gets the message every time they ride or even
see it in the Roads.
Reviews. Called a food editor and restaurant critic to come in, make an
honest evaluation of coffees and teas, and write an article based on their
impressions.
Direct Mail. It is often the best because a prospective customer can read
the “ Approach” letter at their convenience. There Is a sample of Direct-Mail
letter:
(See Appendix2 PAGE 35 )
Ongoing Advertising
Once the business is up and running it will be vital to success to institute a
regular advertising campaign. And the goal at this point is to attract new
clients, obtain repeat business from existing customers, and enhance the
reputation.
Appearance Advertising
After reaching the point where the business is on steady ground and
showing the increased profits, which can afford to dabble in “institutional
advertising” such as sponsoring prizes donated in Ramadan’s programs, in
return get the name listed on the program or on a banner on TV.

Expansion Plans
Franchising
In future Nofiatto aims to expand through franchising which offers an
entrepreneur new capital and people to expand an operation.
In the most regions of the country, franchising conventions are held several
times a year. Nofiatto’s owner may attend a convention and learn about
franchise opportunities in this fashion, or may contact the specific franchise
that is interested in directly.

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Product branching. In addition to specialty coffees, teas and associated
products, most coffee houses carry a variety of desserts and pastries. To
even out sales throughout the day and to account for seasonal variations.
Nofiatto’s followed this strategy.

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 Chapter 6
Competitive Analysis
Bahrain coffee shop market
There are currently more than fifty coffee shops in the country offering
services ranging from snack and BLD (breakfast, launch and dinner) to
licensed beverages (See the under table for a full perspective about similar
coffee shops in the Kingdom).
Supply

Name Atmosphere & meals served

A piece of cake Casual, Snacks

Al Andalus Lounge Smart Casual, Snacks, Licensed
Al Banco Italian Casual, Snacks, Licensed
Al Layali Smart Casual, Snacks, Licensed
Al Noor lounge Smart Casual, Snacks, Licensed
Al Osra Cafe house Casual, Snacks
Aroma Café Casual, BLD
Bistro Quai Casual, BLD, Licensed
Bouron Street Casual, BLD
Café Lilou Casual, BLD
Café Moda Casual, Snacks
Café Najjar Casual,L, Snacks
Cafe Sayah Casual, BLD
Capuccino Casual, Snacks
Capuccino’s Café Casual, Snacks,Licensed
Casa Blu Casual, Snacks
Chaise Café & Art Gallery Casual, Snacks
Coffee shop Casual, BLD
Coco’s Casual, Snacks
Conservatory Casual, BLD

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Costa Coffee Casual, Snacks
Dar Albareh Café & Galery Casual, BLD
Delifrance Casual, Snacks Casual, Snacks
Elio’s Casual, Snacks
French Corner Café Casual, Snacks
Gallery, Movenpick Smart Casual, Snacks, Licensed
Grand Café, Ramee Casual, Snacks, Licensed
Idea Gallery Casual, LD
Isabella Casual, Snacks
Le Bellevu Casual, Snacks, Licensed
Les Palmes Casual, Snacks, Licensed
Lobby Lounge Casual, BLD
Maison du Café Casual, Snacks
Mrs.Field’s Cookies Casual, Snacks
New York Coffee Casual, Snacks
Overlook Café Casual, Snacks, Licensed
Paint in Space Café Casual, Snacks
Palms Café Casual, Snacks, Licensed
Shades Cafe Casual, Snacks
Siraj Snack Bar Casual, Snacks
Starbucks Casual, BLD
Subway Casual, Snacks
Sultana Café Casual, BLD,Licensed
Ventana Casual, Snacks
Veranda Casual, Snacks

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SWOT Analysis
Strengths
• Past experience in such line of business.
The project operator was in charge of two similar projects in a few tears
ago , but shortage of full time dedication took her away from the business .
Anyway her past experience can be built on for a new, successful launch.

• Place Utility
We touched previously on this subject .once again, the convenience provided
by vicinity to highly-haunted shops in Seef mall will assure the business
ceaseless flow of frequenters.
• New demand created by more degree of Bahrain openness and
favorable business atmosphere. The country’s increasing openness and
positive business conditions is bringing about more numbers of tourists and
visitors. Those numbers can be an important component of coffee shop
clients.

Opportunities
• Expected increase in demand.
Demand on catering services are on high in the country, more traffic for tourism and
shopping is expected every single quarter.
• Bridging the need for more outlets in the location.
Insufficient existing coverage can give the project a new idea in the location.

Weaknesses
• High financial leverage.
This weakness is related to majority of start-ups, with a difference in the
extent. The project will better its financial position through cash inflows
expected to cover loan repayment in due course.

Threats
• Competition at the same site.

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The proliferation of similar business at the site is the main potential threat the
business may face. Existing projects already in operation can be a source of
stiff competition taking into consideration their brand name and image held on
customers’ minds.

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 Chapter 7
Management Plan
The Management Structure

The owner and the Manager

Head
Hostess Waiter Waiter Cleaner
Chef

Cooker
Cooker
Assistant

Hiring employees
In Nofiatto, seven employees hired based on some recruiting Guidelines.
First of all putting an advertisement in Bill boards, newspapers and some
magazines. Then started selection of candidates through personal interview
process, making determination based on poise, appearance, level of interest
in the job, abilities, and future goals. Then set up the interviews in a
comfortable place to put the candidates at ease. After this process finished
arranging to train them on job.To ensure that their standards are instilled from
the Beginning and to get a firsthand idea of the new recruit’s work habits.
On-the Job Training takes five weeks almost , Basically there are some steps
involving this in the training process:
Gain their confidence by putting them at ease, Find out what they already
Knows, Indicate the importance of specific task being taught, Explain for them
each step patiently, Be sure that each step is understood before moving to the
next, Encourage and welcome questions, Nofiatto’s let them to try to do the
task, Correct the mistakes gently, Repeat the steps when it’s not clear,

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Review performance periodically, finally Nofiatto’s offered them support by
letting the employee train others when ready.
If the training done properly in time it will reduce the turnover and accidents,
improve the quality of work performed, lowers the cost of labor, and increase
productivity.
Who should plan the Menu?
The planning of menu should be a cooperative effort between the chef and
the manger or the owner. The chef knows the capabilities of the kitchen staff
and the equipment, as well as the availability of food products and their cost.
The manger, on the other hand , is largely concerned with sales objectives,
profitability and image of the coffee shop, so the researcher tried to cover all
of the main concern of the coffee shop.
(See Appendix7 PAGE 41-41 )
Job Descriptions
The coffee shop will be managed and own by Ms. Noof Mohammed
Al-Sada.
The Head chef is responsible to the owner, overseas the day to day
operations of the back of the coffee shop. Responsible for carrying out
company policies and performing the menu planning, purchasing, supervising
and motivate staff, filling in as needed for cooks, performing cost control
functions and maintaining a high level of quality and service in all aspects of
the operation.
The Hostess should has two years of hostess at least, and responsible that
greets guests as they arrive, takes their name, calls them when their table is
ready, escorts them to table and thanks them on their way out.
The waiters, there are two waiters who have experience for two years, they
are responsible to Check with customers to ensure that they are enjoying their
meals and take action to correct any problems, Escort customers to their
tables, Explain how various menu items are prepared, describing ingredients
and cooking methods, Inform customers of daily specials, Prepare checks that
itemize and total meal costs and sales taxes, Present menus to patrons and
answer questions about menu items, making recommendations upon request.

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Remove dishes and glasses from tables or counters, and take them to kitchen
for cleaning, Serve food and/or beverages to patrons; prepare and serve
specialty dishes at tables as required, Stock service areas with supplies such
as coffee, food, tableware, and linens.
The cooker Assistant. Read work orders, recipes, or formulas in order to
determine cooking times and temperatures, and ingredient specifications.,
Tend or operate and control equipment such as kettles, cookers, vats and
tanks, and boilers, in order to cook ingredients or prepare products for further
processing, Measure or weigh ingredients, using scales or measuring
containers.
The cleaner will helps everyone there. Clean, wash, and sterilize equipment
and cooking area, using water hoses, cleaning or sterilizing solutions, or
rinses, Remove cooked material or products from equipment.
The Cooker , has 3 years of experience. His duties to Prepare orders
according to the customer's preference using established recipes, portions,
and methods established by the coffee shop, Regularly check all food items to
ensure adequacy and quality at all times, Maintain a clean and safe work
environment, Keep all work stations and equipment as clean as possible at
all times. Follow a cleaning schedule for designated equipment and storage
areas, Work together in a team oriented environment to produce foods in a
timely and orderly fashion, Ensure that all orders are presented in a neat and
appetizing manner.
(See Appendix12 PAGE 48-49)

Some Success Tips in managing coffee shops

Take the time to develop new and unique products to offer customer,
Maintain the highest standards in everything they do; it will ensure a solid
reputation, Never sacrifice quality as a means of saving money or time., Plan
ahead, allow yourself time to work efficiently. The bonus is that will enjoy it a
lot more, Be creative., Make customer service the byword, Keep Customer
Coming Back: The true cost of a lost customer is often minimized by
statements, but al lost customer does in fact represent a potential loss a

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regular customer that brings a guest once a week. So Nofiatto’s coffee shop
made special card for the regular customers, so they can stamp it every time
until they finished the empty places, then they have to choose a cake and Hot
drink for free.
(See Appendix4 PAGE 37 )
Labor costs
Labor costs, obviously are the expenses incurred for the actual work done to
manufacture or sell a product. Think of them as wage or salaries.

No. of employees that terminated × 100 = Labor Turnover Rate

No. of Jobs
To calculate a labor turnover rate, divide the number of employees that
terminated employment during a given period of time by the number of jobs in
the restaurant and multiply the result by 100.

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 Chapter 8
Operating Plan
The project location and premises
One of the most important requirements is Location requirement, A good
location is critical to the success of the coffee shop – extreme care must
be taken when selecting a site. Looking for the commercial location the
foremost considerations are:
Type of business which is planning to operate, Retail, wholesale and service
businesses have slightly different requirements as determined by the type of
product or service being offered and the market potential in a specific area.

The demographic of the area. it should find out the number of consumers who
want or need the product or service and & willing to pay the price, the median
income and employment opportunities , the age ranges of the major
population group, and the volume of retail trade and projected expansion
data, which is available from census reports and chamber of commerce
business reports accumulated during the market research project.
Competition. Must determine how many other similar establishments are
serving the market and how the business is going to decide if there is room for
the new venture. the best way by making a list of business near by.
Traffic patterns. Is the proposed location close to freeways, major
intersections, and/or a central business district? Is there sufficient parking?
The ease with which customers can get to the location is a major
consideration in terms of success.
The image. Before go scouting for locations, decide on the image of the
project such as quality products at good prices, superior service, and
convenience.
The product & service. Generally, there are specific areas within a
marketplace that cater to consumers in specific income brackets and/or
occupational groups. i.e. executives, blue-collar workers, students ,etc.

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Consider the product/service and the projected number of potential buyers
within the community.
The amount of rent required. Locations having the highest potential of profit
through consumer traffic such as shopping mall, a corner shop, or a store with
good frontage are more expensive because competition keeps rents up to the
maximum. The trade-off is an increase in sales and lower advertising budget
because of visibility factor.
So the Accessibility to the target market is important. If customers will be
arriving by car, the location must provide adequate space for convenient and
safe parking. The coffee shop should be located near tourist attractions if they
wish to attract tourists. If they intend to cater to business people, it should be
within a few minutes of their workplace or their home .
Based on that The proposed project will be run in the Al-Seef area- a highly
trafficked location- where Seef Mall is at a stone’s throw from the center of
Manama. This location is one of the attractive of Bahrain ensuring continuous
demand from shoppers and passers-by. At Seef Mall the proposed café is
among the first comers.

Environment and décor

Everything a customer sees, feels, smells or hears in the establishment is
a part of it’s décor .Colors , sizes, shapes, weights, and texture are all part of
the décor .
Nofiatto décor simple and at the same time awesome and focusing in many
things such as Building design, style of tables and chairs, tablecloths and
napkins, carpeting and flooring, wall hangings , pictures and drapes , light
fixtures , menus, Floor plan (the space between tables), uniforms for the
employees and plants and other decorator objectives.
(See Appendix3 PAGE 37 )
Facilities and Equipments
Basic Necessities for the coffee shop includes Beverage stirrers,
Coffee, assorted whole beans, Coffee bags , Coffee pots, Condiments, if food
is served, Cream, Filters, Freezer bags, Honey

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Milk, Mugs and cups, Napkins, Plates, if food is served, Salt and pepper, if
appropriate, Sugar , Sugar substitute, Tea , assorted loose-leaf, Teapots
Utensils.
Optional supplies
Books and magazines on coffee and tea, Candies, Cappuccino
makers, Coffee grinders, Coffee makers, Coffee scoops, Espresso makers,
Filters, paper and permanent, Gift baskets, Greeting cards, Herbal teas, Jars,
Mugs and cups, Spices, Tea cozies / strainers, Teapots, Tea towels, Whistling
tea kettles.
General Office Equipment:
There is no reason to pay high prices for office equipment and
supplies, Nofiatto purchased every thing need it for at least 50 percent below
standard retail prices either on sale through the discount period.

The basic equipments

Adding machine.
Many computers include a built in calculator and keypad. The advantage of an
adding machine is that it provides a paper record of all figures, while the
calculator provides only a temporary display. This will be especially important
when its doing the daily cash totals.
Bookcase and inventory shelving system.
The printed matter (brochures, takeout bags and boxes, business card, etc)
will take up quite a bit of space , especially since I want to order enough to
last a while. There will be also sales receipts pads and tapes, purchase
orders, company stationary, promotional material ,etc. A bookcase and
shelving system will accommodate the items and keep them organized.
Computer considerations.
Initially a computer is certainly not necessity , but it makes inventory control
10 times more efficient. In future as my business grows, the administrative
duties will increase and require the preparation of inventory charts, customer
and employee database, and other information.

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Desk and chair.
Spending a significant amount of time either sitting in front of the computer or
sitting at a desk doing paper works and making some telephone calls.
Therefore it’s extremely important that Nofiatto invested in the right desk and
chair Depending on height Nofiatto’s owner need computer keyboard desktop
to be about 26 inches from the ground, even more important the chair should
provide support for the base of spine, a backrest no higher than shoulder
blades.

Filling cabinet.
An absolutely essential item is a filling cabinet to keep all papers in order, it is
not enough to keep a ledger of income and expenses. Also save all invoices,
receipts, canceled checks, purchase orders, equipment warranties, copies of
delivery slips, coffee blends receipts,etc

Telephones.
In a commercial location, getting a business telephone will be one of the first
steps in setting up business. Nofiatto have two lines one as a hotline and the
other for the normal activities.

Special Equipment
Display equipment. Whether choosing display products on high-tech
shelving or in antique armoires, the decorating scheme of the shop is going to
serve an important promotional device, as well as inviting customers to
browse and buy.
Enhanced packaging equipment.
Lighting.
This is the most overlooked any yet most important equipment in retail stores.
Refrigerator.
Perishable products such as milk and cream will need to be kept under
refrigeration. The size of the unit will depend upon what foodstuffs that plan to
offer.

27
Scale.
Nofiatto will be selling coffee and tea by grams, so it will need an accurate
scale for weighing out customer purchases.
Signs.
The type and the size of sign they put outside the coffee shop may be dictated
by the lease.

Special things to sell

For company’s profit and to satisfy the customers taste the coffee shop sell
in some special things to make the shop special too, which includes :Baked
goods and desserts, Books on the history of tea and coffee , Coffee grinders ,
Coffee makers , Collectible china tea cups , Cookies , Demitasse cups
Espresso brewers , Flavored syrups , Loose-leaf tea , Mugs, unusual and
decorative , Prepacked gift assortments of various blends , Sandwiches ,
Spices and flavored sugar , Spoons (demitasse , iced tea, etc) ,Teapots
Tea cozies, strainers.
The coffee shop should be unique & special by some inventors in order to
compete with other coffee shops and keep position for the business
successful. One of the ideas that may see it common but it’s not, which is
customer services by putting phone number for the customer services so
there’re direct relation with the customer for negative or positive issues.
The main common situations that disturb customers and to avoid it are:
When the coffee shop opens late or closes early , When a guest is greeted
impatiently, rather than with a smile , When empty tables, in view of waiting
guests are not bused quickly , When flatware are spotted or coffee cups are
stained , When guests have to wait to place their drink or food order , When
the customer didn’t satisfied with the coffee or food taste.
The mail order business and home delivery One of the other new ideas
Nofaitto established a hotline for the customer to order what ever they want
from the coffee shop. There is special web site to order from.
Website: www.nofiatoo.org
Hotline: +973-176161666

28
 (See Appendix3 PAGE36-37 )

Countries Suggested to Order From

Flavors and aroma are the most important difference between
commercial and specialty coffees. Specially coffees are fragrant and come in
a wide variety of flavors. The orders of Nofiatto’s beans usually from many
countries such as Colombia and Brazil beside other European’s countries.

“Coffee should be black as hell, strong as death, and sweet as love.” Turkish
proverb said.
From time to time the owner try another countries to ordered the coffee beans
from such: Arabian and African Family:Ethiopian Harrar , Kenya, Tanzania ,
Yemen Mocha , Hawaiian Kona , Indian Mysore , Celebes or Sulawesi Kalossi
, China Yunnan , Java Arabica , New Guinea , Sumatran Mandheling or
Ankola , Brazilian Bourbon Santos , Colombian , Costa Rican , Dominican
Republic or Santo Domingo , Ecuador , El Salvador , Guatemalan Antigua ,
Haitian , Jamaican Blue Mountain , Mexican Coatepec , Nicaraguan , Oaxaca
Pulma , Peruvian Chanchamayo , Venezuelan Maracaibo..

29
 Chapter 9
Financial Plan

Objectives and Expectations

The immediate goal of the management is to generate a cash flow
sufficient to meet all obligations of the business and generate a net profit.
It is expected this will accomplished through creative merchandising, intensive
advertising and the utilization of cost controls.
The Long-term goal of the management is to become one of the most famous
coffee shop not only in Bahrain also in the GCC countries and Globally too.
Sales Goals
It’s easy for enthusiastic entrepreneurs to overestimate sales. But it is very
risky in the coffee shop budgets and its cost and expenses through sales
projections, Nofiatto chose the best approach that use a combination of
several methods. As follows:
Annual sales based on the best method investment.
(See Appendix1 PAGE 34 )
Break-even Analysis
The breakeven point is the minimum amount Must charge in order to cover
all expenses incurred for the production and promotion of goods and services
without losing or making money. In other words, any income that is above the
break-even point is considered to be profit and anything below it is a Loss.
To find my break-even point, must first total all of operating costs, including
materials and labor, equipment lease or purchase payments, advertising,
utilities, office supplies, and any incidentals.
This is computed for a particular period of time, such as six months or a year.
However, if the business is still in the early stages of operation, It can use the
estimated figures on the projected expenses statement and guesstimate costs
for material and labor.
Stay informed, knowing the break-even point tells how much must be charged
for products and services and is invaluable in setting prices to realize a profit.

30
Keep in mind, however that the break-even point is a variable figure. Since it
depends on production and overhead costs, plan to reevaluate periodically to
make sure that the prices reflect any changes.

How to calculate the breakeven point for entertainment

Step 1
Determine the total cost of the entertainment

Cost of CD player BD 50
Cost of advertisement 3,000

Total Cost Related to the Entertainment BD3,050

Step 2
Establish your Contribution Margin
100% - pouring Cost Percentage= Contribution Margin
100% - 23% = 77%
Step 3
Calculate the breakeven point
Total Cost ÷Contribution Margin = Breakeven Point
3,050 ÷ .77 = BD 3,961

Income Statement
An income statement contains four types of information. In essence it tells me
how much money came in and from what sources, the cost of the raw
materials that went into products that were sold, the expenses that were
incurred in the course of operating the business and whether a profit or loss
resulted
(See Appendix 8/11 PAGE 43/47 )
Balance Sheet
The basic purpose is to inform me as to what the business owns, what it owes
others, and what its worth is. The statement called balance sheet because
total assets must always equal total liabilities plus the Equity.

31
 (See Appendix9 PAGE 44-45 )
Financing proposal
One of the easiest ways to keep control of the “paper dragon” is set up a 9*12
inch manila envelope or a file folder for each of the following categories:
Paid bills: both personal and business.
Sales Receipts: of very product I have sold or service job I have performed.
Inventory records based on ongoing inventory control and quarterly audits.
Copies of inventory or billing statements that are paid, with a separate file for
those still due .Receipts for miscellaneous cash purchases.
Auto/Entertainment receipts from travel and promotional activities.
(See Appendix10 PAGE 46 )

The cash cost of the project

Actual funds paid by the present project at the start-up-stage

Project revenues
Based upon the results of the breakeven analysis set out , the tables presents
projected revenues over the course of the three coming years:

32
 Chapter 10
Summary and recommendation

Everyone can make a business but not all of business makers can be
successful in their businesses, so owners put this point in their mind and in
their study which concerned and focused on how business can be successful
and famous, at the same time run for very long time.
Based on that the owner’s found that she is interested in the Coffee shops
and decided to enter this field with proper management decisions and future
views.
Depends on immediate goal which was to generate a cash flow sufficient to
meet all obligations of the business and generate a net profit with the most
important objective which was the customer satisfaction, Likewise setting the
mission and vision with some special criteria.
At the end of the study that discussed and gathered the important information
that owner’s need to start up the business from many independent resources
to observe the highest standards of services.

33
 Chapter 11
Appendices and Exhibits
Appendix1

Sales Projection

Number Of Customers Expected Each Day of the Week

SUN MON TUE WED THU FRI SAT TOLTAL

Breakfast 3 5 6 10 10 11 12 57
Lunch 5 6 12 20 19 14 23 99
Dinner 5 8 10 20 30 14 13 100

Total Customer per Week 256

Average Menu Price
Sandwiches BD 2.000
Desserts 2.500
Drinks 1.800

Estimated Average Guest Check Per Person

Breakfast Sandwich plus Drinks BD 3.800
Lunch Sandwich plus 2 Drinks and Desserts 8.100
Dinner Sandwich plus 2 Drinks and Desserts 8.100

Estimated Weekly Sales

57 Breakfast Customers × BD 3.800 = BD 216.600
99 Lunch Customers × BD 8.100 = BD 801.900
100 Dinner Customers × BD 8.100 = BD 810
Total Weekly Sales BD 1,828.500

Estimated Annual Sales

4 weeks × BD 1,828.500 = BD 7,314

34
 Appendix2

Nofiatto Café
Seef Mall II, first floor

Dear Friend:
I can’t function in the morning until I’ve had a cup of steaming hot, custom-blended
Hawaiian Kona coffee with fresh cream. That’s why I don’t open the Coffee shop until
7:30 A.M.
You may be like me- looking forward to that rich flavor of freshly brewed cup of
Java in the morning. If so, I’d like to invite you to become a member of the Coffee
Club. Membership entitles you to incredible benefits that any coffee lover would
appreciate, including 20 percent discount on each gram of whole bean coffee; a 15
percent discount on each gram of ground coffee; a 30 percent discount on grinders,
brewers, and coffee pots; our quarterly newsletter; and an open invitation to join me
and fellow club members every morning between 7 and 7:30 A.M. for special cup to
start the day off right, even if you can’t come by your self just phone us and we will
bring your delivery to your place even your job.
Membership in the clubs is only to have a card and to stamp this card at least 10
times in a month, every time you buy a cup of any kind of coffee they will stamp it for
you, this can save your money on your personal and gift gourmet coffee purchase!
Call me today for further information or to sign up as a charter Coffee club member. I
look forward to adding the pleasure of truly fine coffees and tea from around the world
into your day!

Sincerely,
Noof Al-sada, Owner

35
Appendix3

36
Appendix4

This is a sample of the Card

37
 Select
Select type
Select Decor
of Business
Decide Location
type of Choose Develop
Idea legal Desired Menus Choose
organ- (Approach # 1) Equipment
Approach
ization Select
( #1 or #2) Select type
Location
of Business
Develop Service
System
(Approach # 2)

Final Cleanup
and checkout
Estimate
Dry-Run Submit to Lay Out Cost of
Party and Hire and train Construction
Architect Preliminary project and
Grand Stuff Phase
Contractor floor plan potential
opening Return
Appendix5

Pre-opening
promotional
Activities
Appendix6
 Main menu Nofiatto café
The Sandwiches

Chicken Mayo Sandwich BD 1.800

( Chicken and Mayonnaise in Chabatta Bread, with mushroom and fresh lettuce)
Egg Mayo Sandwich BD 1.700
( Egg and Mayonnaise in Chabatta Bread, with mushroom, cucumber and fresh lettuce)
Tuna Mayo Sandwich BD 1.700
( Tuna and Mayonnaise in Chabatta Bread, with fresh lettuce and cucumber)
Smoked Salmon Sandwich BD 2.000
(Slices of Smoked Salmon in Paniani Bread, with cheese, Mushroom and fresh lettuce)
Roast Beef Sandwich BD 1.800
(Slices of Roast Beef in Paniani Bread, with cheese, dried Tomato, Mushroom and fresh lettuce)
Triple Cheese sandwich BD 1.800
(Three Layers of melted Cheese in Paniani Bread, with mushroom, Cucumber and fresh Lettuce)
Mozzarella Cheese Sandwich BD 1.700
(slices of melted Mozzarella cheese in Paniani Bread, Cucumber , Tomato , Mushroom and fresh lettuce)
Nachos “N’ Dip BD 1.000
(With Your choice of the Dip ask about it)

Diversities

Fresh cakes / Bottled Juices/Muffins/ Water/Chocolate Bars/ Biscuits/ Cookies, Etc..

Appendix6

( Ask for the Price)

Appendix8
Projected Financial Statements

Projected Loss and profit Statement

Y1 % Y2 % Y3 %

Sales 87,768 100.0% 107,120 100.0% 136,327 100.0%

Cost of Sales 30,718.800 35.0% 37,492 35.0% 47,714.450 35.0%

Gross Profit 57,049.200 65.0% 69,628 65.0% 88,612.550 65.0%

Less: Operating Expenses

Advertising and Promotion 900 976 1030
Salaries and Wages 12,600 13,440 13,890
GOSI and Other Staff Cost 1,189.200 1201 1325
Telephone and Fax 840 869 898
Electricity and Water 2,400 2,565 2,742
Property Insurance 300 387 400
Rental Expense 12,000 12,460 13,200
Repairs and Maintenance 360 375 397
Supplies 600 625 678
Petrol Expense 240 255 300
Depreciation Expense 3,504 4,504 5,504
Amortization Expense - Pre Operating 1,764 1,764 1,764
Amortization Expense - Leasehold Improvements 1,000 1,000 1,000
Total Operating Expense 37,697.200 42.9% 40,421 37.7% 43,128 31.6%

Net Profit 19,352 22.05% 29,207 27.3% 45,484.550 33.4%

Appendix9
Projected Balance Sheet
Y1 % Y2 % Y3 %
ASSETS

Current Assets
Cash & Cash In Bank 9,756 38,184 67,353
Supplies 9,899 10,789 11,679
Food Inventory 12,000 12,000 12,000
Total Current Assets 31,655 30.8% 60,973 62.6% 91,032 73.9%

Other Assets
Refundable Deposits 850 850 850
Pre-Operating Expense 5,300 5,300 5,300
Accumulated Amortization (1,764) (3,528) (5,292)
Total Other Assets 4,386 39.5% 2622 15.3% 858 8.3%

Fixed Assets
Equipments & Furnitures 16,715 25,072 33,429
Accumulated Depreciation (3,504) (8,008) (13,512)
Leasehold Improvements 3,000 3,000 3,000
Accumulated Amortization (1,000) (2,000) (3,000)
Total Fixed Assets 15,211 29.7% 18,064 22.1% 19,917 17.8%

TOTAL ASSETS 51,252 100.0% 81,659 100.0% 111,807 100.0%

LIABILITIES AND OWNER'S EQUITY

Current Liabilites
Accounts Payables 1,900 3,100 4,300
Total Current Liabilities 1,900 3,100 4,300
Total Liabilities 1,900 3,100 4,300

OWNER'S EQUITY
Owner's Investment 30,000 30,000 30,000
Retained Earnings, Beg 0 19,352 40,291
Net Profit for the Period 19,352 29,207 37,216
Retained Earnings, End 19,352 48,559 77,507
Total Owner's Equity 49,352 38,293 107,507

TOTAL LIABILITIES AND OWNER'S EQUITY 51,252 100.0% 81,659 100.0% 111,807 100.0%
Appendix10
Projected Cash Flow Statement
Y1 Y2 Y3
Operating Activities
Net Profit for the period 19,352 29,207 45,484
Adjustments for:
Depreciation & Amortization 6,268 7,268 8,268
Operating income before working capital changes 25,620 36,475 37,216

Changes in operating assets and liabilities:

Refundable Deposits (850) 0 0
Supplies (9,899) (890) (890)
Food Inventory (12,000) 0 0
Pre-operating Expense (5,300) 0 0
Accounts payable and accruals 1,900 1,200 1,200
Net cash from operating activities (529) 36,785 37,526

Investing Activities
Purchase equipments (16,715) (8,357) (8,357)
Leasehold Improvements (3,000) 0 0
Net cash used in investing activities (19,715) (8,357) (8,357)

Financing Activities
Share in Capital 30,000 0 0
Net cash (used in) from financing activities 30,000 0 0

INCREASE IN BANK BALANCES AND CASH 9,756 28,428 29,169

Bank balances and cash at the beginning of the year 0 9,756 38,184
BANK BALANCES AND CASH AT THE END OF THE YEAR 9,756 38,184 67,353
 TOTAL CASH AS PER BALANCE SHEET
Appendix11

Monthly Profit and Loss Statement 9,756 38,184 67,353

Jan08 Feb08 Mar08 Apr08 May08 Jun08 Jul08 Aug08 Sep08 Oct08 Nov08 Dec08 TOTAL

Sales 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 7,314 87,768

Cost of Sales 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 2559.9 30718.8

Gross Profit 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 4754.1 57049.2

Operating
Less Expenses
Advertising and
Promotion 0 0 0 300 0 0 0 300 0 0 0 300 900
Salaries and Wages 1050 1050 1050 1050 1050 1050 1050 1050 1050 1050 1050 1050 12600
GOSI and Other
Staff cost 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 99.1 1189.2
Telephone and Fax 70 70 70 70 70 70 70 70 70 70 70 70 840
Electricity and
Water 200 200 200 200 200 200 200 200 200 200 200 200 2400
Property Insurance 25 25 25 25 25 25 25 25 25 25 25 25 300
Rental Expense 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Repairs and
Maintenance 30 30 30 30 30 30 30 30 30 30 30 30 360
Supplies 50 50 50 50 50 50 50 50 50 50 50 50 600
Petrol Expense 20 20 20 20 20 20 20 20 20 20 20 20 240
Depreciation
Expense 292 292 292 292 292 292 292 292 292 292 292 292 3504
Amortization Exp -
Pre Operating 147 147 147 147 147 147 147 147 147 147 147 147 1764
Amortization Exp – 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 83.3 1,000
 Lease improvement
Total Operate Exp. 3066.4 3066.4 3066.4 3366.4 3066.4 3066.4 3066.4 3366.4 3066.4 3066.4 3066.4 3366.4 37,697.2
Net Profit 3066.4 3066.4 3066.4 3366.4 3066.4 3066.4 3066.4 3366.4 3066.4 3066.4 3066.4 3366.4 37,697.2

Appendix12
Personnel And Staff Cost

Personnel Cost
1,670 GOSI 99.100

Position Nationality No Salary TOTAL 7% 3% TOTAL

1 Manager & owner Bahraini 1 700 700 49 21 70
2 Head chef Expat 1 170 170 0 5.1 5.100
3 Cook assistant Expat 1 150 150 0 4.5 4.500
4 Cooker Expat 1 160 160 0 4.8 4.800
5 Waiter Expat 2 130 260 0 7.8 7.800
6 Cleaner Expat 1 110 110 0 3.3 3.300

Capital Expenditure

Equipment

Acquisition Y1 Y2 Y3
Total
Date Item Description Qty Unit Cost Cost
01-Jan-07 Espresso machine 1 2,000 2,000
01-Jan-07 Coffee grinder 1 750 750
01-Jan-07 Sink 1 150 150
 01-Jan-07 Cheese Melter (Salamander) 1 500 500
01-Jan-07 Drainage system 1 200 200
01-Jan-07 Hood-Type Dishwasher 1 1,200 1,200
01-Jan-07 Chopping Block 2 15 30
01-Jan-07 Covered flooring/installation - 2,500 2,500
01-Jan-07 Refrigerator 2 300 600
01-Jan-07 Coffee, coffee makers, teas, teapots
& other stock plus serving supplies
- 2,500 2,500
01-Jan-07 Scale 1 150 150
01-Jan-07 Glassware (Storage and display) 1 1,500 1,500
01-Jan-07 Track lighting 1 560 560
01-Jan-07 Desk, Filling cabinet , calculator - 1,500 1,500
01-Jan-07 Disposer 1 300 300
01-Jan-07 Deep fryer 2 100 200
01-Jan-07 Broiler 2 75 150
01-Jan-07 Waste Bin 2 12.5 25
01-Jan-07 Griddle 2 125 250
01-Jan-07 Convection Oven 1 500 500

TOTALS 16,715 8357.5 8357.5

Appendix13
Please find 5 minutes to answer the following survey regarding your
experience in [Coffee shops]. The results will help us serve you better in
the future.

What is your gender?

Male
Female
What age group are you in?
20 and younger
21-25
26-35
36-45
46-55
56-65
66 and older

What is your annual spending on the coffee shops?

Under BD 5
From BD 5 to BD 1
From BD 5 to BD 10
BD 15 and Above

What is your overall satisfaction with [Coffee shop]?

Very satisfied
Satisfied
Neutral
Dissatisfied
Very dissatisfied

If you are dissatisfied, why?

How often do you visit [Coffee shops]?
Daily
Several times a week
Once a week
Several times a month
 Once a month
Several times a year
Once a year or less often
Visited only once
Do not visit

Based on your experience, will you visit [Coffee shops] more or less
often?

Would you recommend [Coffee shops] to your friend or affiliate?

Definitely
Probably
Probably not
Definitely not
Not sure

What are the Causes of trip?

On-Shopping
You are a Customer
Accidental
Appendix14
References
Web Sites

http://www.zippys.com
http://www.imagechef.com
http://www.google.com.bh/search?hl=ar&q=cooker+Assistant+job+description
http://www.careerdepot.org
http://mahmood.tv/2007/08/24/the-bahraini-economy-excels/
http://www.answers.com/waitressing
www.google.com
www.giraux.com/buyers_guide/glossary.php
www.scotland.gov.uk/cru/documents/eval-debt-13.htm
http://wordnet.princeton.edu/perl/webwn
http://www.royalbank.com/sme/bigidea/index.html
http://www.ehow.com/

Books & Magazines

- The Upstart Guide To Owning & Managing a Restaurant , ROY S. ALONZO
Published By Upstart Publishing Company, Inc.

-Business Marketing ,Crain Communications, Inc.

740 N.Rush Street
Chicago. IL60611 , Published Monthly

- The KPMG’s Company

Mariam Abdulla ( Legal Assistant Advisory)
Chamber of Commerce