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Acknowledgment
Several people played an important role in the accomplishing of this Report.
And we would like to acknowledge them here. First, we would like to thank Ms.
Fakhr-e-Alam, our course teacher for the assistance and encouragement to
pursue to this study. We thank him to give us an opportunity to explore our
learning of business activities and molding them in form of a business plan.
We thank Almighty Allah for reasons too numerous to mention. Thanks to
Allah who gave us an opportunity to complete this report and submit on time.
We also thank Him for supporting us on each and every stage of the Business
Plan.
We also wish to thank our families who cooperated with us and allowed us to
spend time on preparation of this report. We also thank them for believing that
we can finished this Report before due date of submission.
In the end thanks to all the group members who worked on their assigned parts
effectively and efficiently and utilized their time and energy in the preparation
of this report.
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Table of Contents
S. No. Contents Page No.
1 Executive Summary 3
2 Business Description 5
3 Marketing Plan 7
4 Strategy and implementation 12
5 Operations 14
6 Legal Environment 18
7 Organic Certification 23
8 Management Team 26
9 Startup Expenses and capitalization 28
10 Financial Statements 30
11 Critical Risk Analysis 3312 Timing and Objectives 36
13 Deadlines 37
14 References 38
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Executive Summary
We will be in the business of organic food; farming and using the farm produce to make
salads and juices. Our restaurant Green Addiction! will provide delicious confectionary
items and a variety of delicious salads and juices with a salad bar stretched in the middle of
the restaurant. This will not only look attractive but will also pull public to itself, who are
stressed out from a hectic day and desire health, taste and a quick and handy service to get the
best.
Green Addiction is based on a partnership business. There are four partners of the business,
each contributing equal amount of capital. The profit and loss is decided to be shared equally
among all the members.
Our mission is to make people enjoy the feeling of eating healthy food; food which is free of
dangerous amount of chemicals and is not genetically modified. Natural food which is
healthy and delicious is offered by Green Addiction.
The world market for organic food is predicted to exceed $88,000 million by 2015, according
to Market Line, a near 50% increase in five years. Fruit and vegetables represent the leading
segment, representing over 30% of the overall market. Karachi represent close to 55% of theorganic food market in Pakistan.
Consumers are not only increasingly aware of the potential health risks from poor diets but
are also taking more responsibility in optimizing their own health. Bad publicity given to the
use of pesticides and fertilizers is spurring consumers to look for organic alternatives. Greater
care is given to ensure organic food labels are not misused, with a possible Rs. 10,000 fine
for food producers and retailers who mislabel or sell organic products that do not meet the
standards imposed by the DAoP.
The target market for Green Addiction is broadly the upper class and upper middle class.
Zamzama is an elite area and shopping hub for residents of Defense Housing Authority and
neighboring areas. Residents of these areas have high income and they have high purchasing
power. They spend a huge portion of their income on snacks and food. People are becoming
more conscious of their health and thus Green Addiction has an opportunity to target this
market.
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Business Description
We will be in the business of organic food; farming and using the farm produce to make
salads and juices. Our restaurant Green Addiction! will provide delicious confectionary
items and a variety of delicious salads and juices with a salad bar stretched in the middle of
the restaurant. This will not only look attractive but will also pull public to itself, who are
stressed out from a hectic day and desire health, taste and a quick and handy service to get the
best.
Product and services
Green Addiction will produce organic fruits and vegetables. These will be produced by
acquiring a farm land near superhighway, Karachi. Farmers will be hired who will then be
trained under organic standards so that they are well aware of the organic procedures. These
produces will then be used by the chefs to prepare some delicious and full of nutrition salads.
Green Addiction will also offer fresh healthy juices.
Mission Statement:
Our mission is to make people enjoy the feeling of eating healthy food; food which is free of
dangerous amount of chemicals and is not genetically modified. Natural food which is
healthy and delicious is offered by Green Addiction.
Vision Statement:
Our vision is to be the best organic restaurant in Pakistan. Providing healthy food and
increasing awareness regarding organic food. We see ourselves as the market leader in
organic food restaurants in next five years.
Goals and Objectives:
Our principle goal is to produce healthy food which is free of harmful chemicals and which
has its nutritional value preserved. To ensure this we have also planned to acquire
international organic certifications. Healthy food provides opportunity for consumers to
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consume more nutrition and live a healthy life. Our goal is also to increase awareness in the
market for consuming healthy food and growing vegetables and fruits at their homes; kitchen
garden, for their daily consumptions.
We believe that our commitment to healthy organic food help us create loyal customer base
and increase profitability by increasing sales revenue. It may also give us an opportunity to
expand our business and explore other cities as well. We also aim to market our salads in
shopping malls and restaurants who wish to have a salad bar.
Target Market
The target market for Green Addiction is broadly the upper class and upper middle class.
Zamzama is an elite area and shopping hub for residents of Defense Housing Authority and
neighboring areas. Residents of these areas have high income and they have high purchasing
power. They spend a huge portion of their income on snacks and food. People are becoming
more conscious of their health and thus Green Addiction has an opportunity to target this
market.
Legal Form of Ownership
Green Addiction is a result of partnership between four members; Anum Nasir, Dajana
Khalid, Saniya Siddiqui and Shiza Aslam. All the partners have invested equal amount of
capital and will share profits and loss equally. The partnership will be registered in order to
avoid any future problem though registering the partnership is not compulsory. The ideas and
resources are all mutually decided by the partners and all the conflicts are resolved with
mutual consideration.
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Research Analysis
The world market for organic food is predicted to exceed $88,000 million by 2015, according
to Market Line, a near 50% increase in five years. Fruit and vegetables represent the leading
segment, representing over 30% of the overall market. Karachi represent close to 55% of the
organic food market in Pakistan.
Like many other food industry sectors, the organic food market was hit by the global
financial crisis as consumers prioritized budgets over other concerns. Yearly growth more
than halved in 2009, falling as low as 4.5%, according to Dion Research. With revenues setto pick up again to exceed $60 billion by the close of 2011, the global organic food market
will continue to rebound.
Organic food is processed differently to similar products in the same categories, such as fruit
and vegetables. Organic produce is grown in soil farmed without the use of pesticides and
fertilizers. Organic foods are also produced without other potentially harmful practices such
as irradiation and genetic engineering. Organic products adhere to National Organic Program
standards in Pakistan. Regulations seek to maintain a balance between farming methods and
the ecological system, and to cut down on residue due to water, soil and air pollution.
Market Trend
Consumers are not only increasingly aware of the potential health risks from poor diets but
are also taking more responsibility in optimizing their own health. Bad publicity given to the
use of pesticides and fertilizers is spurring consumers to look for organic alternatives. Greater
care is given to ensure organic food labels are not misused, with a possible Rs. 10,000 fine
for food producers and retailers who mislabel or sell organic products that do not meet the
standards imposed by the DAoP.
Consumer products producers and food retailers alike are according greater importance to
organic and natural foods and beverages to meet growing demand. Moving forward,
awareness surrounding health issues and eating habits will continue to fuel consumer demand
and companies will diversify their product ranges in response. Non-food organic products are
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also seeing growth, with products including organic clothing, household cleaning products
and pet food.
Because of our connections within the very trendy area of Zamzama, we have an excellent
feel for the area and its core group of customers. They will all share something alike, which is
a feeling of being in the "in crowd" and having "gotten it" in life. Although the crew will be
different and not connect with each other in each segment, each segment is complementary to
the others. We do plan to raise menu rates as the restaurant gets more and more crowded, and
to make sure we are charging a premium for the feeling of being in the "in crowd."
Market Segmentation
The Lonely Rich
Most of the lonely rich are technology workers these days, and most of those technology
workers are Internet workers. Their life has become their website servers and code they write,
and the people who help them to make the decisions in that world. They hang out with each
other, but desperately want to get away from it and use the money they are racking up.
Because this wealth has come fairly easily for them, it is particularly easy to separate them
from their money again - they spend the most on juices, appetizers and salads. This segment
of market is mainly males and generates high monthly income but has fewer opportunities to
take care of their health.
Young Happy Couples
The restaurant will have an atmosphere that encourages couples to visit it. It won't be
awkward for others, and Green Addiction does want to be a social place where people meet
each other and develop a network. These young couples are generally very successful and
would like to spend quality time with each other while having light foods and snacks and
juices. They are more likely to spend for quality food and consume their large portion of
income on hangouts and restaurant visits.
The Rich Hippies
The rich hippies in Defense and Clifton are a massive group with tremendous influence over
the city's government and private enterprise. They wear tie-die but drive BMWs and crave thefeeling of being in a social circle that is changing the world - even if in different ways than in
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their glory days. We will cater to their ecological ideology and contribute to charities to help
them part with more of their money. This segment is mostly male youngsters. They have their
pockets full of money and they visit different cafes and restaurants with their friends.
Women on diet
The organic food menu will always have a line of extremely delicious very low-fat meals.
Green Addiction will have tables of women meeting to discuss all types of matters while
feeling good about the food they eat. The trends have increased in women for going out and
spend time with their friends and colleagues. Women coming for shopping to Zamzama are
likely to choose Green Addiction for resting and having an energy boost meal.
Other
Shopaholics at Zamzama Street will be our attractive customers who would like to get rid of
their thirst by consuming fresh juices and healthy salads.
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Competitors
Our competitors will be juice spots like aghas juice and salad bars of pizza hut, nandos ,
roasters, subway in general and with respect to location that is Zamzama Street our
competitors will be butlers chocolate caf, tutti frutti, roasters etc.
Green Addiction will not have a major competitor as there is no other company in the
business or organic food restaurant. We believe that Green Addiction is a trend setter and our
quality products will help us gain market share.
Competitive Analysis
Factor Me Strength Weakness Tutti
Frutti
Butlers
Chocolate
Cafe
Importance
to Customer
Products Healthy Yes Healthy Limited, sweet
mainly
Very
important
Price Moderate-
High
Yes Moderate High Very
important
Quality Excellent Yes Very good Very good Important
Service Good Yes Good Good Very
important
Reliability Reliable Yes Reliable Reliable Important
Expertise Expert chefs Yes Expert in
frozen
yogurt
Expert in
chocolate
products
Important
Company
reputation
Not well
known in
market
Yes Well-
known
brand
name
Well-known
brand name
Important
Location Zamzama Yes Zamzama Zamzama Important
Appearance Lively, fresh Yes Simple,
trendy
Dark, dim
lights
Important
Sales Self service Yes Self Ale carte Very
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Method service Important
Credit
Policies
Credit and
debit cards
accepted
Yes Credit and
debit
cardsaccepted
Credit and
debit cards
accepted
Very
Important
Advertising Newspapers,
hoardings,
internet
Yes Word of
mouth
Newspaper
advertisement
Important
Image Not well
built up
Yes Good
image
Good Important
The competitive analysis suggests that Green Addiction has two main indirect competitors,
Tutti Frutti and Butlers Chocolate Caf. Tutti Frutti is a frozen yogurt parlor which offers
self service to its customers. It offers different range of flavors and toppings within an
affordable and reasonable price. Customers can take yogurt quantity according to them. It
offers credit opportunities as well by accepting credit cards. On the other hand, buttlers
chocolate caf offers sweets, mainly desserts. They offer Ale Carte and also accept credit
cards.
As compare to our competitors, we offer healthy food. Tutti Frutti is giving major
competition as people prefer frozen yogurt rather than salads. Green Addiction has an edge as
it produces its raw material itself and has planned to obtain international organic standards.
The image of Green Addiction is not well established but with the passage of time the
company will be able to position itself in the market as the leading salad bar and organic
healthy food provider.
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Strategy and Implementation
Our strategy is simple; we intend to succeed by giving people a combination of great,
healthy, interesting food, and an environment that attracts "trendy" people like a magnet.Strategies regarding different sections are discussed below.
Promotion
The promotional strategies of Green Addiction will start a month prior to inauguration. The
inauguration is planned on the Chand Raat, 9th August 2013. There will be distribution of
catalogs and pamphlets in the malls near the shop and Zamzama market. There will also be
banners and posters in the nearby target market areas so that people can get aware. It is also
planned that the sales staff will guide the people and tell them about the health benefits of
organic food and salads. (Haberberg, A. and Rieple, A. 2008)
The electronic media is not ideal to use as Green Addiction is located in Karachi only and
electronic media spreads the word nationwide. It is also expensive medium. Using print
media is cheaper and suitable to reach the target market. Through our promotional activities
we want the customers to know that we are offering organic food products. Organic foods are
free of harmful chemicals and genetic modification. They are more nutritious and healthy.
In the long run we wish to develop awareness and desire in people to have and maintain
kitchen garden at home. This would help people to improve their diet and grow organic and
chemical free fruits and vegetables.
Pricing
The prices of the products of Green Addiction will be high-moderate. The pricing will
depend on the quantity bought by the customer. As we are offering organic food, it would not
be suitable to charge low prices and give a negative impression about our product. Most of
the customers have a perception that low quality is associated with low prices. For this
reason, green Addiction aims to charge a reasonable price which covers our costs and
generate reasonable profits. (Grewal, 2008)
Once we are able to capture market and build loyal customer base, we wish to increase our
prices slightly. The prices also depend on the raw material used in preparation of salads and
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prices of seeds and fertilizers. Some of the fruits and vegetables will be purchased from other
suppliers as weather of Karachi does not support each fruit. The prices of the salads and
juices will rise with an increase in the prices by the suppliers and due to inflation.
Proposed Location
The Location for the farm land is chosen to be near superhighway, Karachi. It is prime
location for farming as there is already some small scale farms located in the nearby area.
Transport is also easy to access as the farm connects to the superhighway which connects to
the city. There is availability of water for irrigation throughout the day. The farm is located
away from the city so that noise pollution caused by the farming activities and farming
activities may not disturb the residents of the area. The requirement of land was not of a bigland, so the land for farm is 11.62 kanal in size. (Haberberg, A. and Rieple, A. 2008)
For the retail outlet, we have chosen Zamzama. It is a commercial area where loads of shops
and offices are located. Zamzama street is home to Karachi's most elite designer shops for
clothes, shoes and accessories. It also has a number of high end restaurants and coffee shops
which are popular hangout spots for the rich and the fashionable residing in the posh
neighborhood of DHA.
Distribution Channel
The distribution will be through the salad bar, restaurant located at Zamzama. The customers
will be given the opportunity to visit and take a look at the salad bar and serve themselves.
The restaurant will have dining facility as well as take away. In the long run we also plan to
start delivery service for free. We also aim to distribute our products in the shopping malls
and other restaurants in the long run. For the initial start, we have only one outlet at
Zamzama. (Grewal, 2008)
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Operations
Production
Green Addiction is aimed to produce organic vegetables and fruits and produce salads and
juices using this organic farm produce. The farm will is decided to be located near
superhighway, Karachi. The farming will be done on a small scale in order to meet the daily
requirement of the business and cut storage costs. It is decided that all extra produce of the
day will be sold in the market so that it is not wasted and the business does not face storage
problems.
To make sure that the farm produce is organic, Green Addiction will be acquiring organic
standards, certification from SGS. SGS is the worlds leading inspection, verification, testing
and certification company. The land for farming will be acquired in January after inspecting
different locations and choosing the best land. After acquisition of land, farmers will be hired
and they will be trained under the SGS organic standards so that it can be ensured that our
staff is well trained and is aware of the business vision and mission. (Haberberg, A. and
Rieple, A. 2008)
The company will then hire two chefs for producing fresh salads and juices from the farm
produce. First produce will be harvested in the beginning of august. The chefs will decide the
menu with mutual discussion and expertise. For selling juices and salads, Green Addiction
will have its shop opened in Zamzama Commercial area. The shop will be decorated by an
interior designer who with the concern of the partners will decorate the shop. Chefs will also
help in setting up the kitchen and buying all necessary kitchen machinery, tools and
equipment.
There will be other supplies needed to make salads, for example eggs, olive oil, olives,
spices, sauces etc. These supplies will be purchased on a regular basis as per the demand.
Keeping the stock of these supplies would deteriorate the quality. On the other hand, salads
and juices will need to be stored in a cool place. For this reason, refrigerators and deep
freezers will be bought.
It is also aimed that Green Addiction will acquire quality standard certification for its shop
produce as well. ISO certification and HACCP certification are aimed to be acquired. This
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would help to improve food quality, service quality and hygienic environment of the shop
and kitchen.
Location:
Farm Location: The farm is decided to be near superhighway, Karachi. The farm
land is 11.62 kanal in size. This location of the farm is selected because it is a non-
residential area, it is easy to acquire agricultural land here and there is availability of
all necessary facilities.
Choosing the location for the farm was an important decision to make. It was to be
taken in to account that the farm is away from the residential area as the farming
activities might disturb the residents of neighboring houses. Farming activities may
produce noise pollution that would not please the residents. It is also difficult to find a
land for agricultural purpose inside the city. For these reasons the land for farming is
acquired near the superhighway.
As the farm is located near the superhighway, transport of farm produce and raw
material is very easy. The Super Highway begins north of Karachi at the end of
Mohammad Ali Jinnah Road, near junction of Karachi Northern Bypass (also known
as M10). It is connected with the Karachi Northern Bypass with a trumpet
interchange. Then it continues out of the city. Transport of fresh organic produce to
the shop is very easy and fast through superhighway and Karachi northern bypass.
The farm land is also near the airport. It would be easy for to transport imported seeds
and fertilizer to the farm. The prime location of farm will save transportation cost and
time.
The availability of water is also an important factor in choosing the farm land. There
is availability of water through-out the day on the land that is acquired. Heavy farm
machinery, e.g. tractor, can easily be used on the farm without the difficulty of storage
and disturbing neighbors. There are other small scale farms also located near the land
acquired. It has increased the opportunity to take benefit from the location. Instead of
buying the heavy farm machinery, it is decided to rent machinery from other farms for
beginning.
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Shop: The shop is located at Phase 5, Zamzama Commercial. The shop is acquired on
rent. Zamzama is a commercial road that is connected with Khayaban-e-Shaheen on
one side and ends at 'Two Talwar' on the other side. Zamzama It runs in Phase V of
Defence Housing Authority (DHA). Zamzama street is home to Karachi's most elite
designer shops for clothes, shoes and accessories. It also has a number of high end
restaurants and coffee shops which are popular hangout spots for the rich and the
fashionable residing in the posh neighborhood of DHA.
As Zamzama is a commercial area, there is always crowd for shopping. During
shopping people prefer to have light snacks instead of heavy meals. For this reason it
is a prime location for opening our salad bar which offers fresh organic salads and
juices. It would provide an attraction to the people coming for shopping. People are
becoming health conscious day by day, and the targeted market for our product is
upper and upper middle class of the society who are health conscious and have high
purchasing power. (Haberberg, A. and Rieple, A. 2008)
There are restaurants and cafes already present in Zamzama but our product is
differentiated and offers fresh organic produces. There is competition in the area but
the differentiated product provides a competitive edge. During shopping when people
are tired and hungry, they tend to choose snacks and we offer healthy organic salads
and juices for them.
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Taxation
According to Income Tax Ordinance, 2001, the agricultural land and produce is exempted
from tax. It is mentioned in the Tax ordinance 2001 that where a person uses his own farm
agriculture produce in the manufacturing that article whose income is treated as
business income. Only the market value of the agricultural produce is deducted. No full
deduction shall be made in respect of any expenditure incurred by the taxpayer as cultivator
or as a receiver of rent-in-kind. The market value of such produce used as raw material is
allowed as deduction against income from business is calculated as follows:
Total income from business XXX
Less: Market value of the agricultural produce
Utilized in the business as raw material (XXX)
Taxable income from business XXX
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Legal Environment
Partnership
Green Addiction is based on a partnership business. There are four partners of the business,
each contributing equal amount of capital. The profit and loss is decided to be shared equally
among all the members.
Registration of Partnership
Procedure and Requirements
The registration of Partnership firm is not required by law and there is nopenalty for non-
registration. Nevertheless registration can give many advantages to the firm. The Partnership
Deed is prepared on the Stamp Paper of worth Rs. 500. Registration fee of Rs. 500 also
needs to be deposited in National Bank of Pakistan through Challan Form. It is mandatory for
the firm to be located in commercial area. Copy of Lease Agreement or Ownership
proof needs to be provided as well. The next requirement is the attachment
of computerized National Identity Cards of Partners and Witnesses.
It is mandatory that all papers should be attested from Notary Public. And the partners should
contact the office after three days of submission of papers. All partners are required to appear
before Registrar of Firm during 9:00am to 11:00am with their original National Identity
Cards. Lastly an affidavit regarding accuracy of papers and existence of office needs to be
submitted on stamp paper worth Rs. 5.
Partnership Deed
PartnershipDeedis a document that tells about the mutual rights andobligations of all
partners. This needs to be signed by all the partners and subsequent copies held by each
partner. At the time of registration, a copy of the deed has to be submitted with an application
to the Registrar of Firms in the concerned area. This document may also be referred to as an
Article ofpartnership. A partnership deed usually containsthe following format:
1. The name of the firm
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2. The nature of business that is to be carried out by the firm
3. The address at which the firm intends to conduct its business
4. The amount of capital that each partner contributes. The form ofcapitalwhether that be cash or property needs to be documented. If the capital is
property, a full description of the property and the valued amount should be given
also.
5. The names and addresses of each partner should be given
6. The duration of the partnership if any
7. The ratio of sharing profits and losses
8. The amount or percentage of interest, if any, which is to be allowed on capital
9. The amount of salary each partner is to receive
10.The manner in which a partnership is to be dissolved and thesubsequent distribution
of property among the partners.
11.In the case of insolvency the valuation and treatment of goodwill
12.Provisions regarding the accounting system and the fiscal year to be used
13.Rules to be followed in the case of retirement, death and admission of a partner
14.The method of settling disputes if any among partners. I.e. whether or not an
arbitrator is to be appointed
15.Method of calculating amount issued to a deceased partner, and
whether this is to be paid in full or in installments to his legal representative.
16.In the case of breach of duty by one partner, powers of other partners to expel him
from the firm
17.The keeping of proper books of accounts and periodical preparation
of accounts.18.Any provisions to prevent any future misunderstanding and ill will.
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Application
The procedure of registration is comparatively simple. An application in the Form No. 1 ofPartnership Act 1932, along with the fee has to be submitted to
the Registrar of Firms. All the partners must sign the application. The application or
statement must contain the following particulars:
1. The name of the firm
2. The place or principal place of business of the firm
3. The names and addresses of other places where the firm may conduct business
4. The partners date of joining thefirm
5. The duration of the firm
6. The name and address of the partners. Once the registrar is satisfied with the
application, a certificate of registration is issued to the partners. As mentioned
previously this is not required to commence business. If at any time there are changes
to the firm in relations to the partners, place of business, insolvency etc. the registrar
must be notified.
Costs for Non-Registered Firm
In case of dispute between the partners or ex-partners, the unregistered firm
cannot enforce any right arising from the contract or granted by the Partnership Act of
1932. No law suit can be filed against the third party
the partner of the firm to enforce the rights from a contract and the partnership cannot claim
any dues in the court which may be outstanding. If one denies the existence of the partnership
nothing much can be done legally as there are no formal documents as a proof, thus
registering the firm is very important.
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Rights Duties and Liabilities of Partners
Rights of Partners
The different rights of the partners are as follows.
1. Right to take part in business.
2. Right to express opinion
3. Right to inspect books.
4. Right to share the profits.
5. Right to interest on capital.
6. Right to interest on advances.
7. Right to be indemnified.
8. Right to act in emergency.
9. Right to give Consent.
10.Right to retire.
11.Right not to be expelled.
12.Right to carry on competing business.
13.Right to enforce.
14.Right to share in profits or interest.
15.Right to bind other partners.
Duties of Partners (General/ Fundamental /Absolute)
The following are the duties of the partners:
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1. Duty of good faith.
2. Duty to carry on business.
3. Duty to share losses.
4. Duty to use firms property forthe firm.
5. Duty to account for personal profits.
6. Duty to be liable individually and jointly.
7. Duty to work for the greatest common advantage.
8. Duty to render accounts.
9. Duty of disclosure.
10.Duty to indemnify for frauds.
11.Duty to act within authority.
12.Duty in emergency.
13.Duty not to transfer interest.
Liabilities of Partners
The liabilities of the partners are given below.
1. Liability of partner for acts of the firms.
2. Liability of the firm for the wrongful acts.
3. Liability of firm for misapplication.
4. Liability of retiring partner for all the liabilities of the firm prior to his retirement
Process for the dissolution of a Partnership firm
The process requires a Rs. 250 stamp paper called the dissolution deed which is submitted in
National bank through a challan form. After this, the partnership is required to inform the
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general public through best possible means so an ad is placed in a newspaper. The copies of
N.I.C. of all partners are attached to all the attested documents. Later, when all the documents
are submitted, the partners are required to report to the office with their original N.I.C. from 9
am to 11 am.
Organic Certification
SGSs organic food certification services ensure regulatory compliance and enhance brand
value, while safeguarding the environment and satisfying consumer demand for organically
produced foods. SGS is the worlds leading inspection, verification, testing and certification
company. They are recognized as the global benchmark for quality and integrity. With more
than 70,000 employees, they operate a network of more than 1,350 offices and laboratoriesaround the world.
SGSs core services can be divided into four categories:
Inspection: The comprehensive range of world-leading inspection and verification
services, such as checking the condition and weight of traded goods at transshipment,
help to control quantity and quality, and meet all relevant regulatory requirements
across different regions and markets
Testing:Their global network of testing facilities, staffed by knowledgeable and
experienced personnel, enables to reduce risks, shorten time to market and test the
quality, safety and performance of products against relevant health, safety and
regulatory standards.
Certification:They enable business to demonstrate that its products, processes,
systems or services are compliant with either national or international standards andregulations or customer defined standards, through certification.
Verification:It ensures that products and services comply with global standards and
local regulations. Combining global coverage with local knowledge, unrivalled
experience and expertise in virtually every industry, SGS covers the entire supply
chain from raw materials to final consumption.
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How does the certification process work?
PROPOSAL: SGS provides with a proposal based on the nature and size of operation.
If we accept the proposal the process continues.
PRE-ASSESSMENT: Optional pre audit review of business operations to give an
indication of the readiness of organization for the audit. It is often found useful for
identifying any weaknesses in operational activities.
DOCUMENT Review: Business production and handling system is evaluated prior
the on-site audit to check the feasibility of operation to become organically certified.
It further helps to understand your activities and to plan the on-site audit as effectively
as possible.
CONTRACT: After a review of the certification agreement between the business and
SGS, the contract is signed.
ON-SITE AUDIT. The on-site visit on business operation includes interviews with
the partners and staff and examination of working practices. In addition, records and
documentation are evaluated. The on-site visit is essential to check compliance with
the respective organic standard. At the end of this stage, all findings of the audit are
presented to the partners. If any nonconformities are observed Partners will receive a
Corrective Action Report so can address the non-conformities before a technical
review is conducted.
CERTIFICATION: Once business comply with all relevant organic productionrequirements a technical review is conducted by a qualified and authorized SGS
Certification Manager, who will then decide the issuance of an organic certificate.
ANNUAL RECERTIFICATION: The document review, on-site audit and
certification are annually repeated to maintain your organic certification. During the
on-site visits, SGS review the implementation of the corrective actions taken to
address the past non-compliances.
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Benefits of being certified by SGS:
Cost-effective and customer oriented set of solutions
Independence and confidentiality
Highly qualified and experienced staff
fast and efficient execution of your requests
Effective entry-to-market tool to the most important global organic markets
Use of the organic standard and SGS logos distinguishes your product in the
marketplace and adds brand value
If different certification schemes or organic standards are requested they can be
combined in a single cost effective audit
HACCP Certification through SGS:
HACCP certification is an international standard defining the requirements for effective
control of food safety. It is built around seven principles:
Conduct Hazard Analysis of biological, chemical or physical food hazards
Determine critical control points
Establish critical control limits, for example, minimum cooking temperature and time
Establish a system to monitor control of Critical Control Points
Establish corrective actions
Establish procedure for verification to confirm that the HACCP system is working
effectively
Establish documentation and record keeping
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Management Team
Partners:
1. Anum Nasir
2. Dajana Khalid
3. Saniya Siddiqui
4. Shiza Aslam
Quality Control Manager:
1. Jane Aster
Job Description of each Partner
Anum Nasir
(Partner)
Dajana Khalid
(Partner)
Saniya Siddiqui
(Partner)
Shiza Aslam
(Partner)
Finance
Huma Hashmi-accounts officer
Record keeping
Cash
management
Annual
statements
payments
Shop Operations
Jane Aster-Quality control
officer
Chefs(2)
Shop floor
employees(2)-
daily sales and
service
Inventory control
and storage
Farm Operations
Farmers Suppliers of
seeds and
fertilizer
Transport to
shop
Marketing
Advertising Promotional
campaigns
Expansion
strategies
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Business Advisor
Mr. Khalid Eijaz Qureshi
He has 30 years background in farming and exporting farm fresh vegetables and fruits. He
has visited several countries and has acquired quality certifications, international and
national. He is one of the leading exporters of fresh fruits and vegetables in Pakistan and has
been working for organic production. He guided us towards organic standards and other
business activities.
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Start Up Expenses and Capitalization
Sources o f Capita l
Rs.
Partners' Investment
Anum Nasir 1,250,000
Dajana Khalid 1,250,000
Saniya Siddiqui 1,250,000
Shiza Aslam 1,250,000
Total Investment 5,000,000
Startup Expenses
Farm Land
Purchase 1,100,000
Construction of shelter and store 100,000
Total Buildings/Real Estate 1,200,000
Shop
Security Deposit 150,000
Total Leasehold Improvements 150,000
Capital Equipment List
Furniture (Shop) 200,000Equipment (Shop, Kitchen) 100,000
Fixtures 160,000
Machinery (Kitchen) 300,000
Cold Storage (Kitchen, Shop) 300,000
Agricultural Tools 100,000
Total Capital Equipment 1,160,000
Location and Admin Expenses
Rent (Shop) 300,000
Rent (Farm Machiner) 30,000Ownership Transfer (Farm land) 50,000
Organic Certification Cost 100,000
Legal Consultant 40,000
Pre-opening salaries 300,000
Transportation 50,000
Total Location and Admin Expenses 870,000
Opening Inventory
Kitchen Supplies 60,000
Seeds 30,000
Fertilizers 80,000Imported Fruits and Vegetables 75,000
Rs.
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Total Inventory 245,000
Advertising and PromotionalExpenses
Advertising 100,000
Signage -Printing 70,000
Travel (For promotion to malls) 30,000
Website development 100,000
Total Advertising/PromotionalExpenses 300,000
Other Expenses
Electricity Bill (Pre-opening) 60,000
Interior Designer (Shop) 100,000
Preparation for inauguration 80,000
Hiring Cost 20,000
Total Other Expenses 260,000
Reserve for Contingencies 815,000
Summ ary Statement
Sources of Capital
Owners' and other investments 5,000,000
Total Source of Funds 5,000,000
Startup Expenses
Buildings/real estate 1,200,000
Leasehold improvements 150,000
Capital equipment 1,160,000
Location/administration expenses 870,000
Opening inventory 245,000
Advertising/promotional expenses 300,000
Other expenses 260,000
Contingency fund 815,000
Working capital -
Total Startup Expenses 5,000,000
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Financial Plan
The financial plan consists of a 12month profit and loss projection, a cashflow projection, a
projected balance sheet, and a Break
even calculation. Together they constitute a reasonableestimate of our companys financial future. More important, the process of thinking through
the financial plan has improved our insight into the inner financial workings of our company.
(Randall, H. 2006)
Opening Day Balance SheetGreen Addiction
Assets
Current Assets
Cash in Bank 815,000$
Inventory 245,000
Total Current Assets 1,060,000$
Fixed Assets
Machinery & Equipment 400,000$
Furniture & Fixtures 360,000Cold Storage 300,000
Farm Land 1,100,000
Agricultural Tools 100,000
Total Fixed Assets 2,260,000$
Total Assets 3,320,000$
Total Liabilities -$
Owners' Equity (Net Worth) 3,320,000$
Total Liabilities & Net Worth 3,320,000$
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Critical Risk Analysis
SWOT Analysis
The following SWOT analysis captures the key strengths and weaknesses within our
restaurant and describes the opportunities and threats facing it. (Bohm, A. 2008)
Strength:
Healthy food
Protection of biodiversity
Monopoly
Product and Service innovation
Provision of hygienic environment
Weakness:
High rent
High prices charged
Variation in demand and supply from natural disasters
Lack of customer awareness and brand equity
Opportunity:
Creative idea
Room for growth and expansion
Trend setters
Exploring new market
Threats:
Threat of new entrant
Brand equity of other dining areas
Critical situation of the city
Economic recessionSupplier frauds
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Porter Five Forces Model
IndustryRivalry
Intensity ofcompetiton isalways high in
food industry as
other food chainare always in the
run to getcustomers
attention withnew offers.
Supplier Power
Supplier power willbe moderate to high
as there are numberof seed andequipment suppliers
available in themarket.
Potential Entrants
Moderate threat ofnew entrants because
of high costassociated.
Buyer Power
Initially there is verylow threat of buyer
power as its a foodindustry and wehave differentiated
product.
Substitute Threat
There is moderateto high threat ofsubstitute as its a
food industry andother food outletsare also available.
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Continuity of Business Structure
If we are able to meet our objectives that include sales and market share we have set for the
year than we have plans of expanding our business. We have plans of opening up small cafes
in big malls around the city like in Saima mall food court and Dolmen mall food court and
also one in Food Street this way more people will get easy access to our caf and it will help
us in achieving our future goals.
Successor
Its going to be a joint venture with equal power residing with each partner so if any one
partner dies others will take over after settling the compensation and other policies with the
deceased family and so on and if all die than according to the polices their children will take
over the business.
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Timing and Objectives
1-December-2012 concept building (concept testing/vision statement/mission statement)
15-December-2012-industry analysis/competitor analysis
-identify target market/customers/suppliers
25-December-2012-deciding name for business (Green Addiction!)
1-January -2013-applying for partnership
15-January-2013-registration of partnership confirmed by the registrar
18-January-2013-surveying locations for developing organic farm and shop
20-January-2013- acquisition of land for organic farm and shop
23-January-2013-hiring farmers for growing the crops and interior designer for the shop
15-February-2013-acquiring machinery for use on the farm
25-february-2013-getting updates from interior designer regarding progress of the shop
1-March-2013-surveying markets for acquisition of manure and seeds for farming
20-March-2013-acquisition of manure/seeds for production
26-March-2013-sowing of seeds commence
10-April-2013-interior of the shop completed
11-April-2013-purchasing equipment and furniture for the shop
13-April-2013-recruiting activities for the shop commence
16-April-2013-listing the menu
-marketing activities for the shop commence
16-May-2013-generating market response analysis
20-May-2013-Testing of the menu card
26-May-2013-Finalizing the menu card
29-May-2013-negotiations with the suppliers
1-June-2013-getting updates from farmers regarding growth of crops
15-June-2013-signing contract with suppliers
20-June-2013-increased marketing and promotional campaigns for the shop
8-July-2013-preparations for the launch show commence
20-july-2013-further marketing and promotional campaigns/online promotions
25-July-2013-sending invitations for the launch show
26-July-2013-reviewing program design of launch show
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29-July-2013-coordinating with guests
1-August-2013-harvesting first produce of crops
3-August-2013-coordinating and getting updates from guests/photographer/media etc.
8-August-2013-launch of Green Addiction! on chaand raat9-August-2013-outlet open officially
Deadlines
19-January-2013-signing the partnership deed
24-January-2013-acquiring land for shop and farm
14-April-2013-interior of the shop completed
30-March-2013-sowing of seeds
16-April-2013-recruiting activities for the shop
20-April-2013-marketing activities for the shop
12-July-2013-preparations for the launch show
8-August-2013-launch of Green Addiction! on chaand raat
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References
Bohm, A. 2008, the SWOT Analysis, Germany, Grin Verlag
European Commission, 2007, Food consumer science, Belgium, European Communities
Grewal, 2008, Marketing, Special Indian Edition, India, Tata McGraw-Hill Publishing
Company Limited
Haberberg, A. and Rieple, A. 2008, Strategic Management: theory and application, United
States, Oxford University Press
Hall,D., Jones,R., Raffo, C., 2004, Business Studies, 3rdedition, causeway press limited
Helfert, A. E. 2004, Techniques of Financial Analysis, 9 thedition, India, McGraw Hill
MICHAEL BLUEJAY, n.d., Whole Foods Market: What's wrong with Whole Foods? From
http://michaelbluejay.com/misc/wholefoods.html
Randall, H. 2006, Accounting, 3rdedition, Dubai, Oriental Press
http://michaelbluejay.com/misc/wholefoods.htmlhttp://michaelbluejay.com/misc/wholefoods.htmlhttp://michaelbluejay.com/misc/wholefoods.html