luxembourg caffe vergnano 1882 report
TRANSCRIPT
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Project Report
On
Café Vergnano in Luxembourg
Submitted by
Mohammed Naseer Khan
(1226114117)
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1. Country Profile:-
Luxembourg is a tiny European country, bordered by Belgium, France and
Germany. It’s mostly rural, with dense Ardennes forest and nature parks in the
north, and the Moselle river valley in the southeast. The rocky gorges of the
eastern Mullerthal region earned it the nickname “Little Switzerland.” Its
capital, Luxembourg City, is famed for its fortified medieval old town perched
on sheer cliffs.
Full name: Grand Duchy of Luxembourg
Population: 516,000 (UN, 2011)
Capital: Luxembourg
Area: 2,586 sq km (999 sq miles)
Major languages: French, German, Luxembourgish
Major religion: Christianity
Life expectancy: 78 years (men), 83 years (women) (UN)
Monetary unit: 1 Euro = 100 cents
Main exports: Steel products, chemicals, rubber products
GNI per capita: US $77,160 (World Bank, 2010)
Internet domain: .lu
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International dialling code: +352
2. Luxemburg economic profile:-
This small, stable, high-income economy - benefiting from its proximity to
France, Belgium, and Germany - has historically featured solid growth, low
inflation, and low unemployment. The industrial sector, initially dominated
by steel, has become increasingly diversified to include chemicals, rubber,
automobile components, and other products. Growth in the financial sector,
which now accounts for about 36% of GDP, has more than compensated for
the decline in steel. Most banks are foreign-owned and have extensive
foreign dealings, but Luxembourg has lost some of its advantages as a
favourable tax location because of OECD and EU pressure. The economy
depends on foreign and cross-border workers for about 40% of its labour
force. Luxembourg, like all EU members, suffered from the global economic
crisis that began in late 2008, but unemployment has trended below the EU
average. Following strong expansion from 2004 to 2007, Luxembourg's
economy contracted 3.6% in 2009, but rebounded in 2010-11 before slowing
again in 2012.
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The country continues to enjoy an extraordinarily high standard of living - GDP
per capita ranks among the highest in the world, and is the highest in the euro
zone. Turmoil in the world financial markets and lower global demand during
2008-09 prompted the government to inject capital into the banking sector and
implement stimulus measures to boost the economy. Government stimulus
measures and support for the banking sector, however, led to a 5% government
budget deficit in 2009. Nevertheless, the deficit was cut to 1.1% in 2011 and
0.9% in 2012. Even during the financial crisis and recovery, Luxembourg
retained the highest current account surplus as a share of GDP in the euro zone,
owing largely to their strength in financial services. Public debt remains among
the lowest of the region although it has more than doubled since 2007 as
percentage of GDP. Luxembourg's economy, while stabile, grew slowly in 2012
due to ongoing weak growth in the euro area. Authorities have strengthened
supervision of domestic banks because of their exposure to the activities of
foreign banks.
3. Culture of Luxemburg:-
Facts and Statistics:-
Location: Western Europe, bordering Belgium 148 km, France 73 km, Germany
138 km
Capital: Luxembourg
Population: 462,690 (July 2004 est.)
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Ethnic Make-up: Celtic base (with French and German blend), Portuguese,
Italian, Slavs (from Montenegro, Albania, and Kosovo) and European (guest
and resident workers)
Religions: 87% Roman Catholic, 13% Protestants, Jews, and Muslims (2000)
Language in Luxembourg:-
French and German are the official languages of Luxembourg. The spoken
language of the majority of the 400,000 population is Luxembourgish. The 1984
Language Act determines that French is the only language of legislation, and
that French, German as well as Luxembourgish can be used for administrative
or judicial purposes. Official documents are usually not available in
Luxembourgish.
Luxembourg Society & Culture:-
The Family
Luxembourg is a small country and many people remain in the same town in
which they were raised, therefore creating close extended families.
. Obligation to one's family is a person's first priority.
. Parents are intimately involved in the education and career choices of their
children.
. The family is the social adhesive of the country and each member has
certain duties and responsibilities.
Religion:-
. The majority of the people are Roman Catholic, although Article 19 of the
constitution guarantees freedom of religion.
. The church's strong influence on the culture is reflected in the national
holidays, many of which are religious observances.
. It is also seen in the respect for hierarchical relationships, the formal and
ritualized behaviour, and the way that the family is seen as the basis of the
social structure.
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Privacy:-
. Although friendly and informal with close friends and family, Luxembourgers
are often reserved and formal when dealing with outsiders. . They are private
people and do not put their possessions or emotions on display.
. Luxembourgers do not ask personal questions and will refuse to answer
should you intrude on their privacy.
. Personal life is kept separate from business.
. If a friendship develops at work and is carried into the personal arena, this
camaraderie will not be brought into the office.
. Personal matters are not discussed with friends, no matter how close.
Etiquette and Customs in Luxembourg:-
. Greetings are reserved and formal until a relationship has been established.
. The most common greeting is a brief handshake.
. Very close friends greet each other by lightly kissing on the cheeks three
times, starting with the left cheek and alternating.
. This can be between women or a man and a woman.
. Men never kiss other men; they always shake hands.
. Surnames with the honorific titles Monsieur or Madame are used in most
social situations.
. Wait to be invited before using someone's first name and always use the
formal pronoun for you, "vous" rather than the informal "tu".
4. Political system of Luxemburg:-
The Grand Duchy of Luxembourg is a representative democracy in the form of
a constitutional monarchy, with hereditary succession in the Nassau family.
The Grand Duchy of Luxembourg has been an independent sovereign state
since the Treaty of London was signed on 19 April 1839. This parliamentary
democracy has one particularity: it is currently the only Grand Duchy in the
world.
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The organisation of the Luxembourg State is based on the principle that the
functions of the different powers have to be spread between different organs. As
in many other parliamentary democracies, the separation of powers is flexible in
Luxembourg. Indeed, there are many relationships between the executive and
legislative powers although the judiciary remains completely independent.
The legislative power rests on the joint action of the Parliament,
the government and the Council of State.
Together with the government and its responsible members, the Grand
Duke forms the decision-making body of the executive power.
According to the Constitution, the courts and tribunals are responsible for
exercising the judicial power. They carry out their duties independently.
A constitutional monarchy regime is the perfect framework for a country in
which social consensus and dialogue are catch-words.
The country’s stability is incidentally reflected in the fact that changes in
governments occur smoothly: in the past, two of the three main political
parties (the Christian-Social People's Party, the Luxembourg Socialist Workers’
Party and the Democratic Party) have generally formed coalition
governments following legislative elections that take place every five years.
Business profile of Luxemburg:-
1. Due to its largely service-oriented economy, Luxembourg has a lower R&D spending target than the EU2020 strategy. R&D spending in the area of 3% by
2020 is not a realistic target in large parts of the Greater Region. 2. Additional to its service-orientation, Luxembourg is also characterised by a
strong research sector. This sector relies on a high share of human resources working in knowledge-intense activities and on their ability to participate in
research networks.
3. In terms of innovation, Luxembourg is strong with respect to marketing and organisational innovation, but less in terms of product and process innovation.
4. Whether considering the knowledge economy or innovation, entities of the
Greater
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Region show heterogeneous patterns. If one agrees that “one size does not fit all”, each entity should have its own strategy.
5. The impact of R&D investment on regional growth is unequal; it depends on
an existing critical mass of R&D and on the extent to which each region is capable to transfer its knowledge into its economy (innovation profile).
What does it take to start a business in Luxembourg?
According to data collected by Doing Business, starting a business there
requires 6.00 procedures, takes 18.50 days, costs 2.00% of income per capita
and requires paid-in minimum capital of 22.60% of income per capita Most
indicator sets refer to a case scenario in the largest business city of an economy,
except for 11 economies for which the data are a population-weighted average
of the 2 largest business cities. See the chapter on distance to frontier and ease
of doing business ranking at the end of this profile for more details.
5. Coffee culture in Luxembourg:-
Drinking Coffee in Luxembourg with Knopes Brothers
For Fabien and Francois Knopes coffee is a family affair. These young and
passionate guys are the fourth generation of Knopes Artisan Torréfacteur
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business. They carry the heritage of their great grandfather, Albert Knopes,
who opened a grocery store with colonial goods in 1936. Soon after that he
specialized in coffee.
Coming from Belgium, they moved their business to Luxembourg in 2014 to
establish a coffee scene in the country previously untouched by the Speciality
Coffee. Join us for a coffee with Knopes brothers in their two cafés in the city
of Luxembourg.
Knopes Roastery
What used to be a garage in the suburbs of Luxembourg is now a culinary
centre with restaurants, shops and also a roastery/café. It is called Am’Garage
and it was our first stop in Luxembourg. Parking marks are still evident on the
ground as a reminder of the original purpose of the building.
In the morning the café was of a rather calm and relaxed ambience. Volume
came later in the afternoon when people gathered from the surrounding
offices. We ordered our coffees, a cappuccino using a seasonal coffee branded
“1936” regarding to the company’s history. This time it was Brasil Fazenda
Irmas Pereira and, to our surprise, a single origin filter coffee was brewed
with beans from Vietnam (Da Lat). Fabien Knopes had just a few minutes
between roasting so he sat down with us and talked us through the history of
their coffee obsession.
“I always liked coffee to some degree but it was only in 2009 when I cupped
speciality grade coffees for the first time. Then I knew I was in love. Now I
know I will spend the rest of my life working with it,” describes his story
Fabien. Their father took a bold decision to move from commodity coffee to
Speciality at the time few people in Europe had a clue about Speciality coffee.
The brothers took over the company when their dad died and worked closely
together, Francois more focused on the café and Fabien on the finance.
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Knopes Café
We found our way to the city centre to talk to the other half of Knopes duo.
Just a bit hidden from the Avenue de la Porte-Neuve is located Knopes Café
where we met Francois Knopes. He got hooked on coffee at the World Barista
Championship in 2006 in Bern. Eventually Francois started to compete
himself and became Belgium Latte Art Champion of 2012. Talking about the
family affair, his competitor in the World round in Seul, South Korea, was his
girlfriend Anaïs. She is French Latte Art Champion of 2012 and she works for
the Knopes brothers in Luxembourg now too.
“The only thing that is worse than no coffee is bad coffee” says the sign next
to the café’s entrance. Well, that is the reason to carry our coffee kit with us
anytime we hit the road. We tried an experimental batch of cold brew from
Kenya Marimira AB instead of espresso or cappuccino. Mikaël Portannier,
French barista working in Luxembourg, brought a Toddy cold brewer with
him from Paris and started experimenting.
Knopes Café is a cosy small café with dozen of seats inside and outside,
usually filled with Luxembourg’s international expats. These are regular
customers at Knopes. They feel comfortable here due to the multicultural feel
of the place that reminds them of cafes back home. On top of that they
appreciate tasty coffee and good service. Although it is not a standard in
Luxembourg yet, both brothers believe in the bright future of their business
and speciality coffee in this small country. We wish them good luck! Thus
people of Luxemburg use more milk in the coffee.
6. Price preferences:-
1. Dosette E.S.E. 100% Arabica x 150 par Caffé Vergnano-35.09euros
2. Dosette ESE Vergnano Decaffeinato x18- 5,30 euros
3. Capsule Espresso Dec Caffè Vergnano x10 pour Nespresso-2,90euros
4. Capsule Espresso Bio Caffè Vergnano x10 pour Nespresso-3,90euros 5. Café moulu Vergnano Antica Bottega 100% Arabica 250gr-5,20euros
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7. Business plan and entry strategies:-
• Short-term goal: Use the quality of our service and advertising to soon
become well-known throughout Connersville.
• Long-term goal: Expand the business to other locations and include
catering.
• Strategy: Work hard to have the best-tasting coffee, treats, and service in
town and surrounding areas.
Project at glance:-
• Shop name : café vergnano
• Product : Coffee
• Location : Luxembourg
• Capacity : 4800 cups/month
• Raw material : Coffee bean, Milk, Sugar, Cream, Ice-
cream, Chocolate
• Land : 1000 sq.ft
• Labor : 10
• Cost of Project : 2815000
Swot analysis:-
• Strengths: Reasonable prices, wide variety of coffee and drinks, a lot of
home-made treats
• Weaknesses: Turn down in the economy, start-up costs, new business, no
reputation
• Opportunities: Job opportunities for the many unemployed in
Connersville, catering
• Threats: Gas stations, McDonalds, Brian’s Bookstore, and other local
restaurants
Legal structure:-
• My business will be run as a sole proprietorship.
• All debts and liabilities of this business will be my responsibility.
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• I will pay personal income taxes on the profits made. This will make
accounting much simpler.
• With having a sole proprietorship, I can also deduct my business losses to
the extent of my total income that I may have from all sources.
Market analysis:-
• Target Market: My target market will be to anyone who enjoys coffee,
but I will mainly target people age 18 and older, both male and female,
and who are of the working class. The total population of Connersville is
15,411, and the number of males and females are about the same. There
are 11,813 residents over the age of 18.
• Competition: My major competitors would be Brian’s Bookstore which is
located on Central Avenue in Connersville. One of the strengths of
Brian’s Bookstore would be that they serve coffee along with selling
books. They have also been in Connersville since 1998 and they are well-
known. People may also be brand loyal to their coffee.
• Market Trends: Coffee is the drink of choice for many people across the
world. Every morning millions of people rely on their morning fix to get
going for the day.
– The US Department of Agriculture’s estimate of the 2006/07 world
coffee production has increased to 128.6 million bags, up 4.9
million bags from its June 2006 estimate.
– 17% of the adult population consumed a gourmet beverage on a
daily basis in 2008 compared with 14% in 2007.
Marketing mix:-
Pricing:
Our pricing scheme will be based on a competitive pricing model
with other similar product providers
Distribution:
Our products will be dispended from our one and only shop. we
provide home delivery.
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Promotion :
Our shop is located in traffic area so it will significantly increase
visibilities.
Customer services :
We provide products base on customer’s taste and preferences.
Positioning:-
The competitive edge is based on customer taste and preferences. There is
exestitiing competitors in the market so its difficult to survive in market so we
more focus on youngsters and students and for those we provide entertainment
source like customer play musical instruments in our shop.
Marketing strategy:-
I will do as much as I can to get my business name known throughout
Connersville. I plan to make flyers to put on cars that have my business name,
logo, and address on them. It will also list the day of opening and will state that
if you bring the flyer in through the first week of opening you can get 20% off
any drink of any size. I will also have two coupons in the local newspaper for
1.00 euro off any purchase. I will have reasonable prices, but they will not be
too high or too low.
Start up costs:-
• Incorporating 176.72
• Licenses and Permits 239.88
• Insurance 700.00
• Legal 500.00
• Bean Grinder 795.00
• Food supplies 900.00
» 3,311.60
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Break even analysis:-
3,311.60/ (1.45-.50)
– =3,485.89
I need to sell 3,485 cups of coffee to break even.
Competitor Analysis:-
DIRECT COMPETITOR
Starbucks Coffee
INDIRECT COMPETITOR
Mc Donald's Local cafes
Target market:-
1. College students
2. Young professionals
3. Tourists
4. Shoppers
8. Punch line for coffee:-
“Fall in love with coffee all over again.”
In French - Tomber en amour avec le café tout recommencer.
In German - Verlieben Sie sich in Kaffee alle immer wieder.
9. Branding and promotion through advertisements:-
PROMOTION
We would adopt the following promotion strategies:
Print advertisements:
• University campus
• Outside MRT Stations
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• Television advertisements in local cabs and buses
• Local FM radio advertisements
• Discount coupons on frequent visits
Poster of my business plan for café vergnano in Luxembourg in the
official languages:-
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10. Bibliography:-
1. http://www.worldmapper.org/posters/worldmapper_1038_coffee_consum
ption_ver2.pdf
2. https://en.wikipedia.org/wiki/Luxembourg
3. http://www.everyculture.com/Ja-Ma/Luxembourg.html
4. http://citysavvyluxembourg.com/category/lifestyle/food-and-drink/cafe-
culture/
5. http://theculturetrip.com/europe/luxembourg/articles/the-top-10-cafes-in-
luxembourg-city/
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