Business Plan

AGSC 229

Mr. Pierre Madani

Tarek Amro 201202108

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3 Meal Box

Business Owners:

Tarek Amro, Ibrahim Amro, Desiree Amro

Beirut, Lebanon

+ 961 3823429

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Table of Contents

ContentsExecutive Summary..............................................................................................................3

General Company Description:..................................................................................... 5Mission Statement....................................................................................................................5Goals and Objectives................................................................................................................5Philosophy................................................................................................................................6

Value Proposition.............................................................................................................. 8

Marketing Plan................................................................................................................... 8Market research.......................................................................................................................8Economics.................................................................................................................................9Product...................................................................................................................................11Customers..............................................................................................................................12Competition............................................................................................................................12Niche......................................................................................................................................13Promotion...............................................................................................................................14Promotional Budget................................................................................................................15Pricing.....................................................................................................................................15Proposed Location..................................................................................................................16Distribution Channels.............................................................................................................16

Operational Plan............................................................................................................. 16Production..............................................................................................................................16Location..................................................................................................................................17Legal Environment.................................................................................................................17

Management and Organization.................................................................................. 19

Personal Financial Statement..................................................................................... 21

Startup Expenses and Capitalization........................................................................23

12-Month Profit and Loss Projection.......................................................................26

Income Statement........................................................................................................... 28Resources...............................................................................................................................29Annex.....................................................................................................................................32

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Executive Summary

When we sat down, myself and the two other business partners (my father, and

my mother) to brainstorm about an idea of a new business, we wanted to come up

with something the people wanted, and is accessible for all. We thought what is better

than creating a diet box with an affordable price, because nowadays everyone is

looking after eating less or cleaner.

Having a diet is sort of a woman thing to practice nowadays. But we wanted

an idea that will bring men and women to eat healthier and in fewer quantities, and

this is why we are creating this diet box that will be stored in supermarkets at

affordable prices. This idea stroke us, because my mother as well as my sister are

always on a diet, constantly visiting dieticians and buying special food from at high

prices as well as going to the supermarkets and spending big on ingredients that they

won’t totally consume.

3 Meal Box is a diet box as stated before that will have a private kitchen in

Ain el Mrayse, where the cooking will be held and then delivering the boxes to all of

TSC and Spinneys branches in Beirut. We are targeting mostly adults, women who

constantly seek a diet and men that are aiming to change their eating habits. We are

offering diet food, but we are not a diet clinic. We are simply a specialized kitchen

that offers the best quality of food in a box that will have a 3 day expiry date, with

healthy ingredients and a lot of care.

Our boxes will contain breakfast, lunch, dinner, a salad and a small desert or a

fruit. Everyday we offer two types of menus, so that the consumer can have a choice

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of buying what he prefers, and everyday a new menu is in stores. People have the

misconception that healthy food is expensive, but not inside our box. As for our

customers, average to rich, everyone that is shopping in Beirut’s Supermarkets is a

target to us.

With the hard work and the extensive marketing and word of mouth, our

business is set to expand by visible rates, and expand more into the food industry and

the market in supermarkets.

As for the funding, we have savings in the bank, but we are not going to invest

in it. Because our funding will not be enough to carry on with the needed operations.

That is why we are asking and reaching for a loan from the bank that will take into

consideration of our business proposal. With the needed funds in our hands, our

business will carry more operations; more sell out, and eventually higher return on

investments rates.

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General Company Description:

Mission Statement

“Eat right, Live tight”

The purpose of our mission statement is to give the targeted consumers an

overview of us, without even saying. Our mission statement is brief, straight to the

point and describes our business directly. Our own reason for existence in this market

is to provide the proper type of nutrition and food supply to the consumer. Lots of

people complain about their weight problem, and how diet food is more expensive

than the normal food. Nowadays, everybody is busy, women and men are always at

work, and cooking time have decreased, so people tend to deliver fast food to their

homes because it’s a cheap meal. But we aim to provide the real taste, with the supply

of the best nutritional requirements.

Goals and Objectives

Our goals are not tied down; rather they are wide and ever lasting until they

reach the destination we have in mind. Goals of our company are bound by our

growing aspiration and potential.

Many of our goals would be having a solid market share in the diet business

by the end of our 3rd year in business. In addition to that, our business has goal for

expanding and supplying in many other supermarkets like Le Charcutier Aoun,

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Goodies, Shoppers, and reaching areas outside Beirut and maybe for the nearby

countries. But also to have our own loyal customers who can take programs with us

and we can deliver to their houses later on. Other than that, one of the main goals is to

provide a better quality of food and healthy way of eating, and creating market

recognition.

Objectives are progress markers to goal achievement. Objectives help the

business planner to guide down the road for goals. Many of our objectives in this

business are to introduce a new product in the supermarket, providing more options to

consumers.

Philosophy

Our business delivers what matters of care and wellbeing. We initiated this

business to provide the healthy way of living for people, by eating in a healthy way.

This is the most important core idea that we will try to preserve and implement.

Our products can be consumed by everyone who is in TSC or Spinneys

branches in Beirut. We will start by targeting gym members, we will be contacting

several gyms in Beirut, where we will be hanging an advertisement poster about our

product, as well as creating a Facebook page, and other social media intermediaries

for 3 Meal Box, and definitely we will be concentrating on the word of mouth news

spreading from public relations, as well as having some television, radio, magazines

and internet advertising.

The food industry is an ever growing industry for a simple reason which is

people always have to eat in order to survive. That is why we have great potential to

grow, in this sector.

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The industry is always changing and evolving in a better way. On the short

term, the changes might be simple and effective, but on the long run, they will either

make the company grow bigger or demolish it to ruins. For example, a simple

marketing strategy may not be effective and attract customers on the short term, so the

company will be forced to close down. Being a smart business operator means making

use and taking advantage of every opportunity given by the market and the

competitors. This means to use any defeat of competitors in order to benefit and grow

bigger.

Every company needs a set of competencies in order to stand out and have a

strong base structure. We believe that a business cannot succeed if it does not have the

proper management and an efficient hierarchy. Although as a startup business the

number of employees is small, yet it is important to act as a functional system to

enhance efficiency. This, we consider as our main strength. Our own competitive

strengths will be that we are putting 3 diet meals inside a box and that is accessible to

everybody. We are going to put detailed calorie distribution inside each box.

We will not hire unprofessional and inexperienced people. In order to move

forward in the market, our business must have a special kind of expertise in which we

can utilize to our benefit.

One of the aspects of building up a business is choosing which legal form of

ownership to apply. After looking and differentiating between different types of legal

forms, we found out that the limited liability corporation is the best type of legal form.

LCC has an unrestricted purpose for operations, with a minimum capital of LBP

5,000,000. In addition to that, transfers to third parties require the approval of partners

representing 75% of the LLC's capital. This means in case of disassembling the

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company, it can be done in an easy way. LCC requires members from 3 to 20

partners, and it is suitable for small businesses and start-ups.

Value Proposition

We offer a variety of homemade and calorie counted food in our meals, from

traditional Lebanese stews, to international cuisines, and in addition to salads and

desserts. We are basically modern nutritionists with a twist that attracts those few

extra kilograms that need to go away.

Our boxes are highly affordable taking into account that the customer is

receiving 3 meals, a salad and a dessert at a price of 18,750LBP.

Marketing Plan

Market research

In order to have a successful business, it is important to know what the

consumer wants, create it, and make it a need. This will create an enormous demand if

we knew that preferences of costumers. This is where the market research comes, in

order to guide us through our business. Market research happens through two

channels, primary and secondary.

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Secondary data is everything that has been collected before by other

researches, which we can use in our own studies. And the primary data is the data we

collect through statistical studies and surveys.

To know more about the market, we conducted an online survey of 63 people

to ask them more about what they know about healthy food. 95.08% of the surveyed

people have at least tried healthy food before. 53.97 % of them perceived healthy as

expensive. 69.84% of the people surveyed eat outside their homes more than three

times per week. In addition, 57.14% of the people surveyed more than once in a

typical day bring food from the outside to eat at home. The information we gathered

will guide us in order to perform the best work

Economics

When we will open our business, we will not have a big consumers share. We

want at first to start producing 250 meals per day and distribute them to TSC

Hamra, Ashrafie, Jnah, Beirut Sook and Verdun and in Spinneys Jnah, Hazmieh,

Ashrafieh and Dbayeh.

This is around 27-28 boxes a day in each supermarket. We can estimate that the

niche constitutes around 70 % of this market, and then the rest is 30 % of the

market share.

Our business is not a large business, with a huge budget. Rather it is almost a

small business with an adequate budget. This implies that we will grow, but not

high rates in the first few months. In addition to that, there will be some bumps

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along the way. These bumps will be obstacles and barriers that will make it hard

for us to reach our objectives and goals.

As a new food type of product, consumers might be hesitant to try something

new they are not familiar with. We may not be accepted directly, nor will the

people recognize the product we are offering. That is why we should really

implement a powerful marketing campaign. In other words, market penetration

will not be that easy at first, although we are a new concept in the Supermarkets.

Another obstacle would be the wide and various competitors. Today in

Lebanon there is a lot of diet centers and dieticians who have their loyal

customers. And the Supermarket itself is competitors where the ingredients we use

in creating our formula are sold out there. So it would be hard for a large portion

of the consumers to change accept this new idea.

The only way to overcome these bumps and later ones in the future is at first

to have a solid management and doing the right things at the right time.

Our business may get affected when the industry changes. That is because our

business is in the heart of the industry. Any change in the industry will either

break us down, or make us grow bigger. That’s why it is very important to

breakeven in the first year of operation.

In addition, any change in the economy will directly affect our business. For

example, in a case of economic recession, people will tend to consume less and

keep their money safe. That will directly affect the food industry, directly or

indirectly.

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Product

Our product is something new in the market. This is why we have to be very

prudent and intelligent in how we’re going to market it. Along the years, many

food innovations have been created and succeeded, as well as failed and

diminished.

We are hoping that our product can become a durable business, because we are

strong believers in our motto and business idea.

The products we have are healthy, tasty, affordable for everyone, satisfies

every kind of taste. Our products are packed freshly, and packed in special way to

be re-heated at home. In addition, the box package we use is biodegradable and

ecofriendly. Our food will be stored inside plastic cases and stored inside a carton

box.

Now, that you have bought our 3 Meal Box. What is next? How can our

product be good and beneficial? Why to have a boring eating routine, full of fatty

burgers and junk food? It is the same to try something new that will change your

habits and lifestyle upside down. Eating healthy is the new thing, where everyone

can have that amazing body he/she dreamt of having. We offer Low-Cal full taste

food, with even lower prices than most of the market. We are giving our

customers 3 meals a salad and a desert all for 18,750LBP.

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Customers

In order to sell a product, and have amazing big profits from it, we have to know

well our customers. That is why we should to know the demographic profile of our

customers. Most of the Supermarket customers are Moms and Dads in another way

Adults.

Age, Gender: 30+ years old, females and males

Location: TSC and Spinneys Beirut and its Suburbs.

Income level: Average working salary and more

Social class: Medium to Rich

Competition

Everyone that sells food is technically a competitor, whether being direct or

indirect. Different shops sell different kinds of food, and they attract different kinds of

people, depending on tastes and preferences of theirs, but mostly diet center are our

competitors

Our main products that we are going to be serving inside the box are ready to

eat or heat and eat meals. Some of the Diet centers do that as well, but do not sell in

supermarkets per meal; they do a monthly program with their customers.

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Many of the major competitors might be Carla’s Good Food, Centimeal, Diet

Delights, Diet Secrets, Le Gabarit, Health Box and Kcateries.

We consider our products to be one of a kind in the market. No diet center

offers 3 meals a salad and a dessert for this small amount of money, they either sell

one meal for a similar amount or 3 meals for a much higher amount, and as stated

before they do not put their products in supermarket for the consumer to have the

choice to pick from 2 kind of daily different menus. This added value differentiates us

from the rest of the dieticians in the market. Competition will be based on the cheap

box that we are offering in parallel to the other diet centers. In addition to the type of

customers, not all people that come across Spinneys and TSC will be familiar or ready

to try something new such as our products. That is why it will be harder to compete

for customers, and attract them to our product and try the food.

The indirect competitors in addition to the ones mentioned before, might be

the normal restaurants that serves diet food such as La Fitness, Roadster, Fiber and

more. They are considered as indirect competitors because they offer an addition

value different than ours which is sitting inside and having a meal with friends, but

still these restaurants are mostly targeted by students and young adults, and which are

not our market.

Our pros are that we offer fresh, healthy, tasty food that satisfies the needs of the

customers. In addition, it is hard to make enormous profits in the first year. We aim to

sustain an increasing sales margin on the long run.

Niche

Nowadays, people have become busier in their lives, the woman is working as

hard as the man, she still manage to cook and raise the kids too, but sometimes she

just can’t, that’s why we are bringing a product that is ready and you can consume it

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any day you want no need to follow a certain program like the in other diet centers,

we want the customers to drift away from eating fast food when there is no food at

home, and try our healthy Low-Cal 3 Meal Box.

Then we come, and help change this reality. We at our business aim for the

wellbeing of our customers before we think of anything else. Certainly everyone is a

regular visitor to his nearby supermarket, so sooner or later they will notice our

product and would like to try it, because we will be having some marketing

advertisement and it will impact their lives in a way or another. We are here to create

a change from the beginning, if we can, to stay with this niche for years.

Promotion

There are many and various ways that we can get the word out to customers.

Our first method is to put in a commercial on Nostalgie Radio Station, because it’s a

highly listened station by adults, in addition we will appear on Mtv Channel for free

to promote our product on the show Men el Ekhir which is a huge watched show that

talks about new ideas going on in Lebanon, and because we have a connection with

one of its hosts, as well as broadcasting on Whatsapp and on Facebook which are for

free, we will be putting posters in some gyms in Beirut, and finally the word of mouth

of customers. We will not aim to advertise on television due to the high costs.

As any other company, we ought to have a logo design, business cards for the

top managers, and in addition to our day to day menus that we will be posting on our

Facebook page.

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Promotional Budget

We will be spending first of all 3000$ for Nostalgie Radio Station that will

play our 15 seconds commercial 20 times a day for 15 days, and then there are the

flyers and posters that we will be hanging in gyms that have agreed to let us put in

(Avalon, Panacea and Fitness Zone have accepted to let us put a poster inside because

myself and some of my family members are registered in these gym and we are old

and loyal customers), as well as some flyers on peoples doors. Before the startup, the

flyers and posters will cost around 1000 $ as a maximum. After starting the business

and starting with the operations, these costs will be less because we will not need

brochures as before.

Pricing

What differentiates us from other healthy food shops and diet centers is that

we are not as expensive as they are. When we conducted our survey, most people

have the perception that healthy food is expensive. But we are going to erase this

misconception, in a way that our prices are affordable to the quality we offer. Our

prices are fixed at 18,750 LL per diet box.

This pricing strategy is not more expensive than our competitors, as our

competitive analysis shows. We are mid-range priced in a way to a normal meal, but

if we combine what we offer we are way below the market pricing, and this creates

our competitive advantage.

Our personal pricing is 14,750 LL but the supermarkets we have contacted

will take 4,000LL per each box sold so that they can generate profit thus making our

product available on shelves for 18,750 LL.

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Proposed Location

We are going to rent a 170 meter square place in Ain el Mrayse where we will

be having the kitchen and offices to operate our production. And delivering from there

daily the 250 meals, that are proper to increase if the demand increases to the

supermarkets in Beirut.

Distribution Channels

We will need two Renault Kangoo LCV cars that will be responsible for the

daily delivery between our kitchen and the Supermarket, which will cost us around

18,000$.

Operational Plan

Production

Our production techniques happen in our kitchen; we chop, cook, prepare, and

pack our meals. Our kitchen is our theatre.

One of our characteristics is our high-end quality and cleanliness. That is why

we are careful about our quality control. We will coordinate with Boecker and ISO for

the quality control and keeping up the high standards of cleanliness.

In addition to that, we care about the wellbeing of our image between the

customers; we care about the customer service and the feedback that we get back

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from the customers. We will have discussions on our Facebook page making

everyone able to see others comments and feedback and participate in the

discussion.

Inventory count is essential for the knowing what we will produce on the next

day. We have to count our food quantities and the needed materials. We will

neither over stock, nor under stock our inventory because it will reduce cost and

efficiency, but we will be having a constant inventory because we will be

producing the same exact amount of meals every day.

Location

The 170 square meter space we are renting in Ain el Mrayse will cost us

18000$ a year. And storing our products in Supermarkets as listed before.

Legal Environment

Our company is going to be registered as a LLC, thus not listed in the Beirut

Stock Exchange. We need to contact a lawyer which he will facilitate this work.

We already have a lawyer who will start with the papers and permits and register

them in the specialized ministries. These permits and regulations are such as the

NSSF, the TVA, health permit, trade permit, and so on.

Personnel

We do not need a lot of employees to carry out our operations because we are

a rather small to medium enterprise. We will be having 16 employees, including the

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top 3 managers which one of them is an accountant, the two drivers, the chef and his

cooks, 2 cleaners, and a nutrion expert.

Our type of business requires a certain expertise and professionalism because

there is a certain mode of work that must be taken. We have almost every kind of

labor at our business.

We will have part time jobs and full time jobs, based on the type of labor.

High end and experienced employees will have higher salary than the unskilled

and the inexperienced employees. For example, the drivers will have a lower pay

than the nutritionist and the chef that are the backbone of the business.

Inventory

The inventory that we will keep in our store is the raw material that we are

going to use in our everyday processes. They are basically the food, fruits,

vegetables and everything else in between. In addition to the finished goods such

as pastes, salts, oils and so on.

Suppliers

Many of the suppliers that we are going to deal with are Fattal Holding placed at Jisr

el Wati, which are going to supply us with everything canned, frozen foods, and

everything in between. We will be paying in cash, and have an account payable on

credit. In addition, we will get out fruits and vegetables from the Wholesale market

from Sin el Fil. We will be paying by cash. We will be getting our bread from

Wooden Bakery, and we will be paying with cash also, unless we have a credit policy

with them. As for the fresh meat and chicken, we know a very reputable and clean

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butchery in Caracole el Druze called Louhoum Market. For this butchery, we will be

having a credit policy.

Management and Organization

Our business has a low number of employees and it is small relatively. That is

why we do not need a complicated and difficult hierarchy. Most of the tasks will be

divided among the managers and specified employees. The business owners will

direct the whole management, in order to reduce costs and increase efficiency.

Myself, and the top business partners will do our day-to-day basis

management directly, without any need to require any other external management

sources. Since we are opening a business, we have a strong business background. I am

almost a graduate in Agribusiness from AUB, my dad already owns his business, and

my mother is an accountant and head of a department in a company, so we have an

experience in running a business.

Top Managers (3)

Personel (2)

Nutritionist

Chef

Inventory and Supplies Division

Fattal and Wooden Bakery

sales

Butchery and Wholesale market

for fruits and vegetables

Logistics Division (4)

2 Drivers

2 Cleaners

Operational Division

(6)

2 Cooks

4 Assistant Cooks

Miscellaneous Divison

Tech Supplies

Taxes and VAT

Media and Prints

Legal AspectsFigure 1 - Organizational Hierarchy by Function

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The top managers themselves will do the miscellaneous activities. Therefore

in total, our personnel will include 16 employees, including the 3 managers

themselves. This is of course the initial number of employees at first. We might need

extra employees depending on the expansion of our business and operations. In

addition to that, we will contact an external insurance company to take care of the

insurance expenses. The insurance company that we will work with is Libano-Swiss

Insurance. This will cost us around 2,500 $ per year. The insurance is against fire,

theft, work accident, cars tout risque and other miscellaneous events.

As for the tasks of the personnel, the top 3 managers we will take care of

technological supply and usage, such as the accounting system and any related

software. This is because one of the top managers has a wide experience in

programming. For this issue, we do not need to contact any other external

programming company. In addition, we as top managers will be our own accounting

managers, taking care of the taxes and TVA in the ministry of Finance.

Other than that, we will take care of the media and all digital prints. As for the

kitchen operations, we need 7 employees in the startup: the chef, which is the head of

this operational division, 2 cooks under his command, and 4 assistant cooks. The 2

cooks each one of them will prepare one of the 2 menus that will be stored every day

in the supermarkets. Their salaries will be ranging from 700$ to 900$, as for the 4

assistant cooks, they will be mainly part timers who can apply for the job and get a

salary of 350$ per month. We will need 2 drivers to deliver the boxes to the

supermarkets. Their salaries will range from 400 $ to 500$.

As for the cleaners, we have contacted Jalloul Office for cleaning purposes.

This service will cost us around 800$ per month. As for the inventory and the supplies

division, the top managers will be in direct contact with the suppliers and order the

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needed goods and products. In addition, the goods will be delivered to us for free, so

we are free of the transportation costs. As for the personnel division, we need a As for

the personnel division, we need a chef with a good food expertise that can help us

with our demands, his services will cost us around 2000$, and an experienced

nutritionist that will help us prepare the healthy food recipes and indicating us the

amount of calories in each meal, her salary will constitute of 3000$ every 6 months,

she will change coordinate with the chef to change or adjust the menu twice a year.

Personal Financial Statement

The main entrepreneurs of this business are 3 people. It was a family idea and

all the partners are related to each other. These 3 people are Ibrahim Amro, Tarek

Amro and Desiree Amro. We are a father, a son and a mother. In addition to our own

contribution to the business, it won’t be enough to carry out the business. That is why

we need an external source of money.

We are going to contact Bank Audi in order to get a loan. But any loan

requires a certain procedure, which requires the presence of a personal financial

statement for the major owners of the business. This includes the personal assets,

which are available.

In the personal financial statement of the 3 owners, we have included the total

liabilities and the total assets of the owners combined. This is important to let the

bank loaners know that we are worth this funding.

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PERSONAL FINANCIAL STATEMENT

Top Three Managers

Assets Amount in Dollars

Cash - checking accounts n/a

Cash - savings accounts 220,000

Certificates of deposit n/a

Securities - stocks / bonds / mutual funds n/a

Notes & contracts receivable n/a

Life insurance (cash surrender value) 500,000

Personal property (autos, jewelry, etc.) 300,000

Retirement Funds (eg. IRAs, 401k) 100,000

Real estate (market value) 2,000,000

Total Assets 3,120,000$

Liabilities Amount in Dollars

Current Debt (Credit cards, Accounts) 60,000

Notes payable (Loans) 70,000

Taxes payable 30,000

Real estate mortgages (describe) 14,000

Total Liabilities $174,000

Net Worth $2,946,000

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Startup Expenses and Capitalization

Setting up a financial scheme for any business is essential in order to predict

any losses or profits. Before opening up the business for the customers, the

entrepreneurs must keep track of the expenses and costs of operations.

The food industry is very strong in Lebanon, and especially in the Beirut area.

There is many and different food and equipment suppliers, giving us a lot of choices

to choose from. But still, we should be careful when selecting our suppliers, resources

and machinery. In addition to these expenses, we need also to add a separate line item,

called the contingencies to account for everything unexpected that will come in the

way of our operations.

We will need a lot of machinery and supplies to start our business. After an

extensive research in the market and asking other business owners about the prices

and costs, we came up with the perfect prices and expenses combination for our

operations.

The first expense we have is the space. We have found a place in Ain el

Mrayse that will allocate our needs to construct the kitchen and offices. This 170m²

space will cost us around 18,000$ per year. We will pay this value in advance.

As for the fixed expenses or costs, we have several points. Our fixed costs are

indifferent of the production level, and do not depend on the operations. These

include of rent services, cars purchase, the registration expenses at the beginning, the

salaries of the employees, the insurance fee, and the cleaning and delivery services.

These add up to 109,850$ the first year. (The coming year will not include the

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registration fees again, nor the car purchase). So the fixed cost per month will be

7,509 $ (90,100$ per year).

The variable costs are the expenses that we pay to get supplies and raw

material, the electricity, the water, the taxes, the maintenance, and any expected future

expense. These add up to 291,100 $.

As a forecast, we will sell 250 meals per day.

SOURCES OF CAPITAL

Owners' Investment: We won’t be

investing from our personal savings; we

will directly get a loan from the bank.

Tarek Amro 0

Ibrahim Amro 0

Desiree Amro 0

Total Investment $0

Bank Loans

Bank Audi $200,000

Total Bank Loans $200,000

STARTUP EXPENSES

Buildings/Real Estate

Purchase $-

Construction -

Remodeling 5,000

Generator 10,000

Total Buildings/Real Estate $15,000

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Capital Equipment List

Furniture $1,000

Equipment 25,000

Fixtures 2,000

Machinery 10,000

Total Capital Equipment $38,000

Location and Admin Expenses

Rental $18,000

Legal and accounting fees 6,000

Prepaid insurance 2,500

Pre-opening salaries 0

Cleaning servies 9,600

Total Location and Admin Expenses $36,100

Opening Inventory

Fattal $500

Butchery 1,000

Fruits and Vegetables 800

Wooden Bakery 300

Total Inventory $2,600

Advertising and Promotional Expenses

Advertising $3,000

Signage -

Printing 1000

Travel/entertainment -

Other/additional categories -

Total Advertising/Promotional Expenses $4,000

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SUMMARY STATEMENT

Sources of Capital

Owners' and other investments -

Bank loans 200,000

Other loans -

Total Source of Funds $200,000

Startup Expenses

Buildings/real estate 15,000

Capital equipment  36,100

Location/administration expenses  38,000

Opening inventory 2,600

Advertising/promotional expenses 4,000

Other expenses 1,000

Contingency fund -

Working capital -

Total Startup Expenses 96,700$

12-Month Profit and Loss ProjectionThe 12-month profit and loss projection will be our wild guess of the sales and

profits and expenses we are going to have. It is based on the costs, and the market

prices including our markup value.

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Our expenses are mostly going to be paid at the first, before the startup, so in

the coming next month’s our expenses and costs will not be as high as the beginning.

We have a lot of expenses, such as the materials and supplies and marketing

strategies. We will over stock our inventory that is why we will make day-by-day

orders from the suppliers. The bread will cost us around 25,000 LL per 2 days, the

meat, chicken and fish combined around 625,000 LL per day, fruits and vegetables

around 300,000 LL every 2 days, and finally the other products such as cheese, oils,

peppers etc.., around 300,000 LL every 3 days.

In addition, the equipment and shop supplies from the kitchenware to the desk,

toilet and other stuff, will cost us around 38,000$. These supplies will be bought from

China to reduce costs, yet they are of excellent quality.

As for the marketing and advertising campaign, we will do a big buzz in the

first few weeks in order to ensure that all the comers to the supermarkets hear about

our product.

At the end of the fiscal year, we have to pay the income tax, which is 10 % of

the total sales. For this purpose, we will pay 94,500 $ in the first year as an extra

expense not included in the 12 month projection sheet.

28

Income Statement

Revenue from the 250 meal per day over 1 year: 250 x 14,750 x 30 x 12 =

1,327,500,000/1500 = 885,000$

Expenses:Bread: 3,000$Meat: 150,000$Fruits and Vegetables: 36,000$Other Goods: 2,400$Loss on goods and perishing: 5,000$ Taxes: 88,500$Rent: 18,000$Supplies: 38,000$ over 5 years making it per year 7,600$ Legal and accounting fees: 6,000$Insurance: 2,500$Interest: 66,667$Cleaning Services: 9,600$Advertisement: 4,000$Chef: 24,000$Cooks: 19,200$Assitant Cooks: 16,800$Delivery Boys: 10,800$Nutrionsit: 6,000$Cars: 18,000$Generator: 10,000$Remodeling: 5,000$Utilities: 5,000$Total Expenses: 520,067$

So our net profit is 885,000 – 520,067$ = 364,933$

We have told the bank that the 200,000$ that we are going to get from them will be paid in 3 years with an interest of 12% per year so this makes it 66,666.67$ a year + 24,000$ the first year, + 16,000 the second year and finally + 8,000$ the final year.

As we can see our net profit the first year is of 364,933$ which will be divided into three parts for the shareholders to get their revenues and profits as well to re-invest or sell their shares in the future.

29

Resources

The logo design and name of the company is created by me – Tarek Amro

The Sultan Center TSC

Achrafieh, Tilal Beirut, Baydoun Street Tel: + 961 1 339299

Jnah Boulevard, Adnan Al HakimTel: + 961 1 858590

Verdun, Concorde GalleriaTel : + 961 1 746990

Hamra, Sadat StreetTel: + 961 1 746989 

CityMall, 14 Dora Highway Tel: + 961 1 905520 

Beirut Souk, Downtown Tel: + 961 1 986444

Hotline: + 961 1 905805Email: customerservice@tsclebanon.com 

Spinneys Head Office

Lebanon Dbayeh Highway Standard Chartered Bank Bldg. P.O.Box: 90-1532 Jdeidet El Metn, Lebanon

Phone: +961 4 541441Fax: +961 4 542409 e-mail: info@spinneys-lebanon.comCustomer Service: customer.service@spinneys-lebanon.com

Khalil Fattal et Fils

Fattal Building, Dany Chamoun Street, Jisr El Wati (Sin El Fil) Beirut - Lebanon

Telephone: +961-1-485 250

Afif Ayad

30

Trade Marketing Executive

Telephone: 03086365

www.kff.com.lb

Wooden Bakery - Jdeideh, Lebanon

Tel: +961 4 410 666

www.woodenbakery.com

Louhoum Market Butchery

Caracole el Druze, Beirut

Liban Fruits

Beirut, Sin el Fil

Fruits and Vegetables Market

Tel: 01 483454

Boecker - Boecker Bldg., Furn El Chebbak, Beirut

Tel: + 961 1 285111

Assad Daoui, Furnitures and Ofiice Supplies

Clemenceau, Beirut

http://www.adaoui.com/

Liabno-Swiss Insurance

Kantary, Beirut

Commerce and Finance Building, 2nd floor

P.O. Box 11-3821 Beirut 1107-2150

Lebanon

Jalloul Office for Manpower

Rawche, Australia Street,

Rawche Center Bldg. Second Floor

31

Survery Monkey www.surveymonkey.com

Lebanese Ministry of Economy and Trade http://www.economy.gov.lb

Ministry of Financewww.finance.gov.lb

Jubaili Bros for Electric Diesel Generatorshttp://www.jubailibros.com

Bank Audihttp://www.banqueaudi.com/Pages/Default.aspx

Original Kitchenshttp://www.originalkitchensqld.com/page/1467083

Food NetworkHttp://www.foodnetwork.com

Eating Healthyhttp://www.helpguide.org/life/healthy_eating_diet.htm

32

Anex A

Low Potential  (-1)

Moderate Potential (0)

High Potential  (+1)

1.

Extent to which the idea:

o Takes advantage of an environmental trend

o Solves a problem

o Addresses an unfilled gap in the marketplace

Weak Moderate

0

Strong

+1

+1

2.

Timeliness of entry to market

Not timely Moderately timely

0

Very timely

3.

Extent to which the idea “adds value” for its buyer or end user

Low Medium High

+1

4.

Extent to which the customer is satisfied by competing products that are already available

Very satisfied Moderately satisfied

0

Not very satisfied or ambivalent

5 Degree to which Substantial Moderate changes Small to no

33

. the idea requires customers to change their basic practices or behaviors

changes required

required

0

changes required

 

 

 

 

Part 2: Industry-Related Issues

Low Potential  (-1)

Moderate Potential (0)

High Potential  (+1)

1.

Number of competitors

Many

-1

Few None

2.

Stage of industry life cycle

Maturity phase or decline phase

Growth phase

0

Emergence phase

3.

Growth rate of industry

Little or no growth

Moderate growth Strong growth

+1

4.

Importance of industry’s products and/or services to customers

“Ambivalent” “Would like to have”

0

“Must have”

5.

Industry operating margins

Low Moderate

0

High

34

 

 

Part 3: Target Market and Customer-Related Issues

Low Potential  (-1)

Moderate Potential (0)

High Potential  (+1)

1.

Identification of target market for the proposed new venture

Difficult to identify

May be able to identify

0

Identified

2.

Ability to create “barriers to entry” for potential competitors

Unable to create

-1

May or may not be able to create

Can create

3.

Purchasing power of customers

Low Moderate High

+1

4.

Ease of making customers aware of the new product or service

Low Moderate

0

High

5.

Growth potential of target market

Low Moderate High

+1

 

 

 

 

35

 

 

 

 

 

Part 4: Founder- (or Founders-) Related Issues

Low Potential  (-1)

Moderate Potential (0)

High Potential  (+1)

1.

Founder or founders experience in the industry

No experience

-1

Moderate experience

Experienced

2.

Founder or founders skills as they relate to the proposed new venture’s product or service

No skills Moderate skills

0

Skilled

3.

Extent of the founder or founders professional and social networks in the relevant industry

None Moderate

0

Extensive

4.

Extent to which the proposed new venture meets the founder or founders

Weak Moderate Strong

+1

36

personal goals and aspirations

5.

Likelihood that a team can be put together to launch and grow the new venture

Unlikely Moderately likely Very likely

+1

 

Part 5: Financial Issues

Low Potential  (-1)

Moderate Potential (0)

High Potential  (+1)

1.

Initial capital investment

High Moderate

0

Low

2.

Number of revenue drivers (ways in which the company makes money)

One

-1

Two to three More than three

3.

Time to break even

More than two years

One to two years Less than one year

+1

4.

Financial performance of similar businesses

Weak Modest Strong

+1

5.

Ability to fund initial product (or service) development

Low Moderate High

37

and/or initial startup expenses from personal funds or via bootstrapping

-1

 

Overall Potential 

Score

(-5 to +1)

Overall Potential of the Business Idea Based on Each Part

Suggestions for Improving the Potential

Part 1:

Strength of Business Idea

+3

High potential

x

Moderate potential

Low potential

Part 2:

Industry-Related Issues

0

High potential

Moderate potential

x

Low potential

38

Part 3:

Target Market and Customer-Related Issues

+1

High potential

x

Moderate potential

Low potential

Part 4:

Founder- (or Founders-) Related Issues

+1

High potential

Moderate potential

x

Low potential

Part 5:

Financial Issues

0

High potential

Moderate potential

x

Low potential

Overall Assessment

 5

High potential

x

Moderate potential

Low potential

 

39

Summary:The overall assessment of this product got a +5, making it a successful business to create and invest in.

Annex B

40