overview of cchg, inc

a Creative Hospitality Group company

Business Plan Overview

Concept Creative Hospitality Group, Inc. (CCHG) is a portfolio of companies based in

Tallahassee, Florida with an income strategy of revenue diversification. The standout company

in the portfolio is the Cocktail Experience Lounge, which will cater to the mature working

professional between the ages of 25-54 years old. Concept is a green social and business space

dedicated to sustainable hospitality; the establishment aims to meet the networking needs of the

working professional by providing an atmosphere that is conducive to both social and

professional interaction. The mission of the Group is to serve as the hub of business and social

activity for the North Florida professional community.

The urgent need for Concept is supported by Tallahassee’s risk of losing its creative class to a

city with more appealing amenities. The Knight Foundation designated Tallahassee as a

participant in its Knight Creative Communities Initiative to study the recent interest in the

development of social entrepreneurs to promote community transformation based on Professor

Richard Florida's creative class theory to stimulate economic development. Professor Florida

designates the creative class as the group of thinkers, innovators and decision-makers who

influence cultural phenomenon and impact business.

Survey results for the Soul of the Community (SOTC) Gallup Poll of 26 Knight Foundation

communities identified “the main driver of Tallahassee’s residents’ emotional engagement to be

social offerings (such as entertainment venues for people to meet each other).” In the section that

addressed citizen’s perception of the most important problem facing the community, Tallahassee


led all other communities in its group with “need more entertainment/nothing to do/need more

activities” in its responses. Community aesthetics, that is, physical beauty and green spaces, were

among the aspects that received high ratings for the area and should be leveraged, as they have

an impact on the residents’ emotional connections as well. Concept will be the soul of the

community.

LaTanya White, the entrepreneur who is diligently working on filling the City’s need for such a

venue, visualizes the establishment as a 4-story building that will seek Leadership in Energy and

Environmental Design (LEED) certification to support sustainable hospitality. Concept’s

position on sustainability and green operating is viewed as a grassroots extension of President

Obama’s “New Energy for America” plan, steadfastly holding a position of energy efficiency

and a minimized carbon footprint along with the creation of at least 25 ‘green’ jobs in the

Tallahassee area. This also supports the City’s recent “Gold Certified Green City” award by the

Florida Green Building Council, the first in the State to receive such recognition.

The ideal location has been identified and is located in the Downtown Tallahassee cluster; it is a

15,000 square foot structure that is conveniently situated a half-mile from the State Capitol

Building; the proposed site for the city’s Center for Performing Arts- a 3,000 seat facility and the

designated site for Cascades Park. The facility is located at 115 W. Bloxham Street, Tallahassee,

FL 32301 and is being offered by Commercial Consultants Corporation; it has been on the

market for 5 years.


Revenue diversification is the Group’s primary operating strategy by exploiting all available

options for revenue per square foot. Six revenue streams have been identified in order to

accomplish this strategy- advertising sales, space leased for shared business services, rental

bookings, For Tastemakers Only Membership sales, and food and beverage sales. The retail and

office space being leased along with the membership fees generated will be structured in a way

that absorbs approximately 10% of the business’ overhead expenses. Concept Creative

Hospitality Group, Inc. will be a sustainable hospitality establishment that will support and

maintain green operating. White’s current business venture, 71 Proof, will also fall under the

CCHG, Inc. umbrella and will serve as the launching pad for the Cocktail Experience Lounge by

leveraging the business’ current relationships in the Group’s success.

The Cocktail Experience patron is between the ages of 25-54 years old, holds a professional

career position and has obtained an advanced academic degree(s). They have disposable

discretionary incomes upwards of $15,000 annually and are very technically inclined. Concept

will specifically cater to and court this demographic as many other hospitality establishments

court the more transient population. Anticipated marketing efforts will include focus groups and

various advertising campaigns will be employed to enlist participants. Other marketing and

promotional activities will include the development of a social networking website associated

with the brand and the granting of exclusive, members-only status to loyal patrons.

The lounge area will support social interaction with open, comfortable seating in addition to

booths that allow a slightly more intimate level of social activity. It will be replete with a semi-


exclusive For Tastemakers Only room, 115- where FTO is the social equivalent of VIP status.

Concept is dimly lit with soft seating that includes poufs, banquettes and couches. The interior

design theme is modern-traditionalist with a neutral color scheme highlighted with brightly

colored accents. 115 is decorated with richer colors that evoke an intimate feel without feeling

cramped.

The bill of fare for The Bistro will have organic food and beverages, aiming to meet the needs of

the more health-conscious consumer. As Tallahassee is lacking in its offerings of meeting spaces

and facilities available for rentals, the basement floor of Concept will be designed to support the

inherent flexibility needed for such activities; it will serve as a space dedicated to providing

green meetings for citizens and organizations in the North Florida area. The establishment will

also be fitted with a roof-top garden area that will further support social networking.

Concept is Tallahassee’s only creative hospitality establishment, where creative hospitality is the

development of cocktail and food menus that are unique in style, design and manufacture using

the farm-to-table theory of base ingredients in the creation of signature items. The menu is

seasonal and cyclical, debuting at the beginning of the 3-month period and removed at the start

of a new quarter. Concept will have a limited bill of fare that consists mainly of mezze, tapas,

heavy hors d’ouevres and entree-sized salads along with speciality desserts and signature

cocktails.


Breakfast will be served at The Bistro only on Friday, Saturday and Sunday mornings from 1 am

until 6 am. Sunday brunch will be available on selected special occasions and will operate from

10am to 2pm on specified dates. The breakfast check average is $8 with 2 anticipated turns for

that daypart, where turns are defined as the number of times a new customer is seated in the

restaurant during a specific meal service. The average check for a lunchtime meal at The Bistro

is $12 and will be prepared only during the hours of 11am to 4pm, operating for a total of 312

days per year. The number of turns for the lunch meal is expected to 4; lunch is available

Monday through Saturday at The Bistro. The tapas menu check average is $20 and is only

available in the Cocktail Experience Lounge from 5pm to 2am 7 days per week. The average

beverage check is $10 with six turns projected; the preparation and service of these cocktails is

available 365 days a year from 5pm to 2am, in accordance with Tallahassee City Ordinance.

Concept’s Cocktail Experience Lounge will market itself as Tallahassee’s premier creative

hospitality establishment, one that provides an atmosphere that caters to the mature professional

by offering a level of service that is currently non-existent in the city. This product

differentiation will be easily identified using carefully crafted marketing messages. Concept’s

marketing strategy is to deploy full sensory branding; that is, each of the five senses will be

engaged at the Cocktail Experience Lounge. Sight and touch will be engaged with the décor and

design of the establishment; the food and beverage menu options will be associated with the

guests’ sense of taste. Opportunities to socialize with peers and enjoy live musical performances

are linked to the hearing sense and scent marketing will be employed to fully engage the Concept

customer by creating emotional connections with the brand. ScentAir, a scent marketing


solutions firm based in Charlotte, North Carolina and a leader in the industry, will be retained to

pinpoint which scents will create the strongest emotional tie to the establishment.

Using Kenneth Clow’s direction in the text he authored, The IMC Plan Pro Handbook, to

conduct the competitive analysis for Concept it was determined that while there are over 100

bars and clubs that operate in Tallahassee, less than 20% of these establishments will be viable

competitors for the venue. Tallahassee, with its two major universities and large community

college, has an extremely transient population and most of these hospitality establishments cater

to the students that comprise 30% of the city’s population. SOTC results also found that the 25-

54 year old demographic are the least engaged group in our City- a need Concept further aims to

fill. Venues that consistently target Concept’s customer are listed below:

- 101 Mint Lounge- 2 Chez- Café Cabernet- Paradigm- Top Flight Club- The Winery at Red Bar

Wednesdays begin the weekend for many of these venues, which, unless they also operate as a

dining establishment, are generally not open for operation Sunday through Tuesday nights. In

efforts to establish Concept’s brand of creative hospitality, Sunday, Monday and Tuesday nights

will be marketed as invite-only engagements by local celebrities, including well-connected

political officials, decision-makers and influencers of the area. Concept will also differentiate

itself by being operational 7 days a week, Sunday through Saturday.


As Mondays and Tuesdays are typically the slower days for business, they will be designated as

‘reveal’ nights. The FTO: Cocktail Reveal will be the night that a new specialty cocktail recipe

will debut at the Cocktail Experience Lounge and will be available as cocktail flights, or

samples. It will be marketed as an invitation-only event “for tastemakers only.” In order to begin

to achieve the FTO designation, customers will have to sign up on the Concept social networking

website and create a profile. This profile will capture customer data on demographics, drink

preferences, food preferences and will allow the customer to provide feedback to management.

The customers will be tracked to as much detail as possible, including how often they visit the

establishment, on what specific occasions and the duration of their visit; members with the most

data collected will receive the FTO designation and will become eligible to gain access to the

most exclusive events at the establishment.

White has set a soft opening date of Friday, November 27, 2009 as this date will allow for a 34

days of operations prior to the Grand Opening Event to be held on Thursday, December 31,

2009. The Grand Opening event will be marketed as Tallahassee’s Best New Year’s Eve Party

and will include a special performance by one of the music industry’s most popular artists. The

ceremony will be held in the Cocktail Experience Lounge at 6 o’clock in the evening and will be

attended by local celebrities, loyal supporters and industry experts who have been selectively

invited to attend.

The National Restaurant Association (NRA) generates financial assumptions based on empirical

evidence and industry averages. These assumptions have been used in the development of the


financial plan for Concept Creative Hospitality Group, which includes the Start-Up Cost

Analysis, Statement of Cash Flows, Income Statements, Balance Sheet and Fund Usage

Analysis. The financial statements that have been prepared are properly aligned with the

marketing and operating strategies set forth by Ms. White. They reflect data from the months of

July 2009 through December 2009 (Year 0), as expenses will be incurred for those months since

the first day of operation is November 27, 2009. The year 2010 marks the first full calendar and

fiscal year of operation.

The NRA estimates that, on average, a hospitality venue will only operate at about 67% of its

seating capacity; this factor helps generate the estimates for food and beverage sales based on the

number of seats, average meal price, number of turns per meal segment and number of days the

establishment operates. Startup costs are a function of the total sales figures and are impacted by

various costs based on square footage. The $750,000 construction costs, $450,000 in décor costs

and mortgage deposits of $275,000 are each dependent upon the total square footage of the

establishment. Square footage is calculated by determining the number of seats needed per

seating style. Office inventory, professional fees, pre-opening advertising costs, printing costs,

uniform and miscellaneous costs were figures based on empirical data; the figures were given

and add to the total startup costs of $2.69 million.

The months of July through December 2009 reflects the near non-existing operating activities for

the establishment. Financing activities for that same period show the most impact as the loan

amount was awarded in the early part of the year. These finances went towards the investment


activities used to secure the building, land and equipment for Concept. Upon achieving positive

income gain in December 2009, the net income amount is categorized into short-term investment

activities, working capital and retained earnings. The net cash flow for 2009 is $689,486.87.

Figures of Years 2 and 3 reflect the decrease in financing activities as any further capital needed

for growth will come from retained earnings and working capital for Concept.

The balance sheet for Concept Creative Hospitality Group, Inc. demonstrates that the

establishment’s major liquidity lies in the food and beverage inventory kept on hand. In 2010,

the $674,521.09 of inventory accounts for over 60% of Concept’s current assets. This is

important to note in the daily operations of the establishment in order to ensure that the proper

number of inventory turns are conducted for the most efficient revenue generators. Of the total

assets, the fixed building and land assets account for just under half of the total fixed assets

contribution. Long-term notes payable account for all of the establishment’s long term liabilities

reflecting the loan amount granted by private investors.

Maintaining a 30% food cost and a 20% beverage cost brings the total cost of sales to

$901,541.93, generating $2.12 million gross profit on these sales with a margin of 70.36% in

Year 1. Total operating expenses, including payroll at 25%, employee benefits at 5% and credit

card fees at 2.5%- where each is determined as a function of total sales- amounted to

$1,917,836.09. Income taxes payable, at 4% of the Earned Income Before Taxes (EIBT) of

$507,566.51, totaled $145,216.16 leaving a net income amount of $362,350.36 for the first full

operating year. The full business plan, including the complete marketing and promotional


strategy along with all financial projections is available upon request. White is currently actively

seeking investors to participate in the project.

LaTanya White, MBA1700 N. Monroe St, 11-171Tallahassee, Fl [email protected]

mailto:[email protected]

http://www.71ProofLLC.com/


References

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Clow, K., Baack, D., (2007). The IMC Plan Pro Handbook. New Jersey: Prentice Hall

Gallup Inc., Survey Results- Soul of the Community: Tallahassee, FL, 2008

Kawaski, G., (2004).The Art of the Start. New York: Penguin Group

Miller, J., Dopson, L., Hayes, D., (2005). Food and Beverage Cost Control, New Jersey: John Wiley and Sons, Inc.

Sullivan, R., The Small Business Start-Up Guide, 3rd Edition, Information International

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