Daily Fife & Coffee

January 2012[THE LITTLE TEA SHOP]

The Little Tea Shop

Tea and Snack Food

The Little Tea ShopBusiness Plan

Course Name: Principles of Management

Code: MGT3371

Term: Fall 2011Instructor: Nguyen Phuong MaiStudents: Dinh Quoc Bao

Nguyen Van Ha

Nguyen Minh Tuan

Nguyen Tuyet Mai

Tran Dinh Phu

The Little Tea ShopThe Little Tea Shop is a small tea shop which service Hanoi snack food and Vietnam tea in an alley of a street in Hanoi. The Little Tea Shop is a locally owned Hanoi snack food and tea outlet that will be positioned as a famous restaurant through our creative approach to the company's image and detail presentation. The Little Tea Shop will provide a combination of excellent food and drink at value pricing, with fun packaging and atmosphere. The Little Tea Shop is the answer to a nice and good place of demand for snack-type fast food and tea. The Little Tea Shop is a place to dream of as you try to escape the daily stresses of life andjust acomfortable place to meet your friends, chatting, or want to share your feeling to others, all in one. With the growing demand for high-quality snack food, tea and great service, The Little Tea Shop will capitalize on its proximity to the middle class including White-color labor, younger and student in Hanoi first and other big city after to build a core group of repeat customers. The Little Tea Shop will offer its customers the best snack food and other drinks in the area, as well as music about Hanoi that its patrons can heard to enjoy their visit.Its a nice place for ones who come to talk with friends, family; or just to enjoy hours of quiet and peace. And especially if you indulge in tea and Hanoi snack food, The Little Tea Shop is really an idea place with many famous kinds of tea such as: Pink tea, Dragon eye, Palace tea, Queen tea, Honey tea, Jasmine tea, Pomelo tea, Chrysanthemum tea... all from high quality tea and some Hanoi snack food such as: bnh gi, bnh rn (salty and sweet), nem chua (fried and grill), bnh bao (steam and fried) Customer will be satisfied with its fresh air, antique style and courteous service.Besides The Little Tea Shop also has a kiosk of fast tea and food. Its for ones who are busy and dont have much time. And you dont have to wait too long for your order.The company will operate a 50 m2 with 3 floor restaurant in HoanKiem district. The shop is expected to grow sales revenue from 1.2 billion VND in first year and growing to about 2.6 billion in the second year and continuing to more than 7.5 billion in the year after that. As The Little Tea Shop will strive to maintain a more than a half gross profit margin and reasonable operating expenses,investing return on the shop to expand market share.EXECUTIVE SUMMARY

THE LITTLE TEA SHOPS OBJECTIVE The Little Tea Shop wants to establish a large regular customer base, and will therefore concentrate its business and marketing on local residents, which will be the dominant target market.

To establish a presence asa successful local snack food and tea outlets and gain a market share in Hanoi's food industry

To expand into a number of outlets by year three, and sell the franchise to neighboring metropolitan cities, such as Hai Phong, Vinh, Da Nang, Hue, Nha Trang, HCM City, Can Tho

The Little Tea Shop might become one of the best chain snack food and tea shop in Vietnam with highest quality and services. MISSION Product mission: Provide customers finest quality drinks and food, make suit all customer, down to smallest details.

Community mission: Provide customers really relax and happy time beside friends and family also give customers knowledge of culinary culture.

Economic mission: Operate and grow at a profitable rate. KEYS TO SUCCESS Location: in center of culture and tourist, convenient accessing.

Products: variety of quality drinks and food suit everyone, clean equipment.

Servers: cheerful, skilled, professional, articulate.

GROWTH PROGRAM AND RISK ANALYSIS

Expansion

With the mission to provide for customer a new way to drink tea and eat snack food, The Little Tea Shop want to become one of the best snack food and tea restaurant chain in Vietnam.

After one to two years, The Little Tea Shop shop might expand its business with other shop in Hanoi and Hai Phong, Vinh, Da Nang, Hue, Nha Trang, HCM City, Can Tho

.

After 7 years, The Little Tea Shop hope that we will become one of the most favorite restaurant brand name in Vietnam, having more than 10 campuses in Vietnam.

Risk analysis

Because we open food and tea restaurant in Hanoi, where is surrounded by many tea and snack food kiosk. Thus we must give many policies to competitive with other. However, with the better management process and policies, we believe that we can gain the customers form market. In this part we will focus on analyzing on macro elements that can affect to our business.

Firstly, The Little Tea Shop can be influence by the economic crisis in Vietnam. Because our segment will be middle class including white color worker, younger, with the job related to office, so they can be affected by crisis, declining their income, and they do not have enough financial to buy food and drinks in our restaurant. In our perspective, Vietnams economic system has business cycle rage from 1.5 to two years; it is easy for a recession period appear again. Because of that reason, the board of manager always predicts what happen in the future and giving the best policy.

Secondly, it is the financial problem. The mission of The Little Tea Shop will be a chain of snack food and tea restaurant in the 5 years; therefore, we must collect the financial from other sources, financial intermediaries like banks, investor, and funds. As a result, if something happened to our sources, the restaurant will not have enough money to increase business activities and open new shops.COMPANY SUMMARY THE LITTLE TEA SHOP SUMMARYThe Little Tea Shop, a small business, sells snack food and tea, other beverages, in 50 square metre in Hoankiem district. The Little Tea Shops major investors are Dinh Quoc Bao, Nguyen Van Ha, Nguyen Minh Tuan, who cumulatively over 80% share of the shop. The start-up loss of shop is assumed in the amount of 148 million VND.

COMPANY OWNERSHIPThe Little Tea Shop is registered as business of household in Hanoi and will be Limited Liability Corporation after two years. Dinh Quoc Bao owns 33%, his friends, Nguyen Van Ha and Nguyen Minh Tuan hold approximately 22% each as well as Nguyen Tuyet Mai, Tran Dinh Phu account for nearly 10% in The Little Tea Shop.

START-UP SUMMARYStart-up Requirements

Start-up Expenses

Kitchen and Fixtures10,000,000

Furniture and Interior15,000,000

Legal3,000,000

Rent60,000,000

Marketing expenses10,000,000

Contingencies5,000,000

Total Start-up Expense103,000,000

Start-up Assets

Cash Required35,000,000

Start-up Inventory10,000,000

Other Current Assets-

Long-term Assets-

Total Assets45,000,000

Total Requirement148,000,000

Start up expense is 103 million which includes:

Legal expenses for obtaining licenses: 3 million

Rent expense: 10 million per months (Rent prepaid expense: 60 million/6months)

Decoration expense: 25 million

Marketing expense: 10 million

Contingencies fees: 5 million

The required start up assets:

Operating capital in the total amount of 35 million which includes employees and managers salaries (wages in 2 first months).

Start up inventory 10 mil for the first month including: Tea, sugar, flour, tea filters, oil, meat, vegetable, vinegar, beverages, etc: 7 million Retail supplies (napkins, tea bags, cleaning, etc.) 1million Office supplies: 2 million

Funding for the restaurant comes from two major sources Owners investment and banks loans. Three major owners, Dinh Quoc Bao, Nguyen Van Ha and Nguyen Minh Tuan have contributed 50 million, 35 million and 30 million respectively. All others contribute 13 million, which brings the total investments to 128 million. The remaining 20 million needed to cover the start up expenses and assets came from bank loan: one-year loan in the amount of 20 million. Loan was secured through BIDV Bank. COMPANY LOCATION AND FACILITIESThe Little Tea Shop locations will range in size from 50 meter square and will seat from 15 25 guests each floor. Our first location will be on the larger end of this range. The location will feature its own originality in merchandise display and other brand building attributes. We will equip the outlet with modern furniture and aim for cleanliness and an open feeling.

The space selection be chosen based upon the following criteria:

Community size: minimum of 800,000 people within a radius of 8 kilometers.

Tourist destination.

Easy access.

Large percentage of teenagers in the community.

All of these qualities are consistent with The Little Tea Shops' goal of providing a top quality fast food experience. We want "word-of-mouth" to be our best form of marketing, where our customers value our brand as something exciting and cannot wait to tell their friends and neighbors.

PRODUCTS The Little Tea Shop will offer its customer the best tasting tea and snack food in the area. This will be achieved by using high quality ingredients and strictly following preparation guidelines. The store layout, menu listings and marketing activities will be focused on maximizing the sales of the higher margin food and drinks. PRODUCT DESCRIPTION

Pink tea

Dragon eye

Palace tea

Queen tea

Honey tea

Jasmine tea

Pomelo tea

Chrysanthemum tea

bnh gi

bnh rn (salty and sweet)

nem chua (fried and grill)

bnh bao (steam and fried)

COMPETITIVE COMPARISONThe Little Tea Shop has several advantages over its leading competitors:

Unique "fusion" concept of dipping sauce.

We expect a high degree of enthusiasm and offer a fun store with friendly staff, that reflects the company's youthful and energetic culture.

Supporting merchandise items that support the company's brand building.

Food is made 100% fresh, compared to most food outlets that use frozen.

Our dipping sauce is also made fresh without preservatives.

Our innovative packaging will be more entertaining than our competitors; a single cone with a cup reserved for dipping sauce. SALE LITERATURE

The Little Tea Shop will use advertising and sales programs to get the word out to customers.

2,000 color brochures to be distributed throughout destination shopping mall and facilities: in-store, cinemas, area eateries, information during the grand opening in January 2012.

Half page magazine reviews in Hanoi's lifestyle magazines that advertise the presence of the outlet. SOURCING

The Little Tea Shop has a legal contract with the best supplies. That will be warranted the quality and quantity of goods which will be used to serve customers. We use the tea from a company in Hong Kong, which was exported in many countries in the world with the excellent quality. We also use the foods, fruits which are provide by Metro Cash and Carry Vietnam, and beverages as well. Thus, with many big suppliers, the customer can believe that they will be served with the best product and services. That also ensure the stable for the shop, we will not pay more attention about the quality and the stable of supply. SALE PROGRAMSEach opening of The Little Tea Shop will have, more or less, the same marketing mix as the others. Below are the programs that we will develop to open each location.

Grand Opening

Each new outlet will have outdoor signage as soon as possible. We want the signage to be supported by banners before the opening.

Point of Purchase

We will sell gift certificates, announce future job openings, and possibly mention franchise opportunities.

Direct Mail Piece

A stand-alone piece, folded, will be produced in full color on heavy weight paper. Inside will be all the important details of The Little Tea Shop, explanation of our menu, prices, house of operation and a locator map.MARKET ANALYSIS SUMMARY MARKET SEGMENTSWith our products and services, we will focus our marketing activities on reaching people in middle class or who working in offices located close to the restaurant and on busy man who have not enough time to go out and have a meal by delivery. Our market research shows that these are the customer groups that are most likely to buy restaurant products which can be easily take on the way. We will cater to people who want to get their daily cup of great-tasting tea in a relaxing atmosphere. It shows that these are discerning customers that gravitate towards better tasting tea and food. Furthermore, a lot of officer considers tea shop to be a convenient meeting location, where they can have conversation or meet with peers and partners without the necessity to pay cover charges. For us, this will provide a unique possibility for building a loyal client base.

General trend toward quality among Vietnam consumers definitely plays an important role in the recent growth in gourmet food and tea. Additionally, such factors as desire for small indulgencies, for something more exotic and unique, provide a good selling opportunity for restaurant.

TARGET MARKET SEGMENT STRATEGYThe Little Tea Shop intends to cater to the bulk of teenagers and youngsters in Hanoi. We have chosen this group for several important reasons. It is our goal to be "the extraordinary snack food place" and we believe that the age group from 15 to 25 is the primary age where brand building efforts could take place. They are on limited or fixed incomes and seek a value/price relationship that will not stretch their budgets.

Our secondary target is between the ages of 25 and 37, which are a heavy lounge/restaurant user group. They are more flexible in budgets and seek more than a value/price relationship. MARKET NEEDS

General trend toward quality among Vietnam consumers definitely plays an important role in the recent growth in gourmet tea and snack food. Additionally, such factors as desire for small indulgencies, for something more exotic and unique, provide a good selling opportunity for restaurant.A recent Consumer Trend and Analysis by Euromonitor identified the following needs among our target markets. Our core group:

Wants variety and flavor in its food, preferably something fried

Looks for speed of service

Wants an entertaining and fun experience

Insists upon a clean, friendly, and attractive environment

Adopts a global lifestyle

Is computer literate

Enjoys eating out

Has an active lifestyle

Comes from various ethnic backgrounds

INDUSTRY ANALYSISIn the World, Vietnam tend to be one of the biggest exporter tea and which the special taste of Vietnams tea, we are going to account for a high segment in the markets tea share. In Vietnam, tea is the most popular of drinks of Vietnamese and this tendency continues to develop more significantly. Hot drinks in Vietnam saw strong growth in total volume terms in 2009. Of all the hot drinks products, tea continues to be the most popular in Vietnam in terms of total volume sales. Tea is a traditional drink among northern residents in Vietnam. Other hot drinks enjoy the strongest total volume growth in 2009 due to increasingly health conscious consumers in Vietnam. According to some survey, there are 37 percent of adults in the age from 18 to 24 drink tea, up from 31 percent the prior year. In the future tea continues grow with high speed in tea market. Vietnam tea consumption has shown steady growth, with gourmet tea and snack food having the strongest growth. Tea drinkers in the Hanoi are among the most demanding ones. They favor well-brewed gourmet tea drinks and demand great service. We will strive to build a loyal customer base by offering a great tasting tea in a relaxing environment of its restaurant. COMPETITONWe direct competitors will be other tea shop located in Hanoi. These include "Tr o" tea shop and other tea shop. "Tr o" will definitely be one of the major competitors because of its strong financial position and established marketing and operational practices. However, despite of "Tr o"'s entrenched market position, many customers favor smaller, independent establishments that offer cozy atmosphere and good tea at affordable prices. We estimate that "Tr o" holds approximately fifty-five percent market share in that neighborhood with the remaining market share split among other establishments. Let know more about them: "Tr o" is all about great tea. Whether that's in their tea shops throughout Vietnam, a pack you've bought at the supermarket or a cup you've had in a leading hotel or restaurant. They strive to serve the perfect cup, every cup. Their difference is a lifestyle brand they believe in serving people rich experiences, based around tea. Those rich experiences come from doing everything really well. As a proudly Vietnamese brand, the "Tr o" philosophy is about combining the best of the fast paced international world with the traditional charm and traditions of Vietnam.How I plan to take advantages of competitor weak points?We can serve snack food include tea for customers who not have enough time to enjoy in our shop. More than that, we are sure that the price of our products will always lower than other with high quality and best service. Beside that we will offer its customers the best prepared tea in the area that will be complimented with snack food, as well as free books that its patrons can read to enjoy their visit. We will make its best effort to create a unique place where customers can socialize with each other in a comfortable and relaxing environment while enjoying the best brewed tea and snack food in town. We will be in the business of helping our customers to relieve their daily stresses by providing piece of mind through great ambience, convenient location, friendly customer service, and products of consistently high quality.Our marketing strategy will be focused at getting new customers, retaining the existing customers, getting customers to spend more and come back more often. Establishing a loyal customer base is of a paramount importance since such customer core will not only generate most of the sales but also will provide favorable referrals.

We will cater to customers' bodies and minds, which will help us grow our market share in this competitive market.STRATEGY SUMMARY COMPETITIVE EDGE

Store design that will connect nature with customers, and designed for fast and efficient operations.

Employee training to insure the best tea preparation techniques.

Marketing strategies aimed to build a solid base of loyal customers, as well as maximizing the sales of products.

Same price with competitor but higher quality.

Profession services.

Friendly space

Many different and special way to make a fantastic taste for the foot and drink

Fresh food daily

We will position itself as unique tea shop where its patrons can not only enjoy a cup of perfectly brewed tea but also spend their time in an ambient environment. Comfortable sofas and chairs, dimmed light and quiet relaxing music will help the customers to relax from the daily stresses and will differentiate our bar from incumbent competitors. The major reason for the customers to return to a specific tea shop is a great tasting tea and food, quick service and pleasant atmosphere. Although, as stated before, tea consumption is uniform across different income segments, we will price its product offerings competitively. We strongly believe that selling tea with a great service in a nice setting will help us build a strong base of loyal clientele.We will handle the sales transactions. To speed up the customer service, at least two employees will be servicing clients while one employee will be preparing the customer's order, the other one will be taking care of the sales transaction. All sales data logged on the computerized point-of-sale terminal will be later analyzed for marketing purposes.In order to build up its client base, we will use banners and fliers; utilize customer referrals and cross-promotions with other businesses in the community. At the same time, customer retention programs will be used to make sure the customers are coming back and spending more at the tea shop MARKETING STRATEGY

We will have professional marketing strategy to account for the customer share in the market. In our marketing, we will focus on three marketing campaigns together.

I. Online Marketing

II. Viral MarketingIII. Traditional Marketing Online Marketing

Websites and Forum

We will create and support for our websites and forum, ensuring that they often provide useful information for our customers. The content of web covers the information of tea, the tea market, specially tea and food, steps to have a cup of excellent food and tea. That also will be a channel for everyone to update news about daily life: work and entertainments And specially, our websites can communicate with customer as social networks. In that, other people can update their view, events in your daily life. Its is called My tea diary function.

http://littleteashop.com.vn http://littleteashop.com.vn/forum http://quantranho.com.vn Moreover, marketing department attacks on social network as a channel to promotion The Little Tea Shop. Which are Facebook, Yahoo Plus!, Twittler!, Year1! Yobanbe! .We want to create communications customers of our shop on the internet.

Viral marketingAnother marketing campaign that will be used is the viral marketing and viral advertising. At the previous part, we has said about a communication of the Tea shop, so with the viral marketing our manager apply marketing techniques that use shops pre-existing social networks customer on the internet to produce increases in brand awareness or to achieve other marketing objectives through self-replicating viral processes, analogous to the spread of pathological and computer viruses. It can be word-of-mouth delivered or enhanced by the network effects of the Internet. With this campaign maketers may take the form of video clips, interactive Flash games, advergames, ebooks, brandable software, images to update to shops websites, blog, forum and even text messenger though email. Traditional marketing We continue advertise on other channel to increase our share in the market. Those are newspaper and magazines. That marketing campaign cannot gain success without promotion strategy. With promotion strategy, promotion girl team in buildings in the city, creating events for clubs in Hanoi, Fan club

1. Discount and presents to customers on special days (Valentines Day, Womens Day, Birthday)

2. Loyalty Customer Card

3. Golden hour discount

4. Dish of the Day

5. Free delivery

With the Loyalty Customer Card, the customer will be serve with higher value, and they will received discount daily with 5% for each bills and 50% for his or her birthday.

Moreover, we also bring for customer better services by having golden hour discount. Because the mission of Little Tea shop is the best product for all customers, so the cakes and food will be only used in just one day. In the end of the day, although the quality of cakes and food still are very good, but we will not buy in tomorrow, so they will be sales off from 15 17 oclock and after 21oclock. This action will release the inventory in one day.

Dish of the Day- Although Little Tea Shop has many dish, cakes But each day, we will serve customer with one special dish, it will be make better, selling with lower price any easy to take away. With one dish for one day, one moths we serve 30 dish each day, the customer Little Tea shop focusing is students, pupils, they are the potential customer in the future for Little Tea shop. MANAGEMENT SUMMARYCustomer Relationship Management

In order to having winning marketing strategy, Little Tea Shop has a Customer relationship management system (CRMs) and Information System to support for CRMs. With CRMs, manager can manage the information of customer, we will collect the information about email, telephone, age, sex, birthday, hobby Using that system, Director can interact with customer, serve more additional value. We can present my love with loyal customer by sending a postcard for those in their birthday. Besides, we can also plan events which base on the hobby of customers Our CRMs will be provided by corporation having reputation in the market. ManagementLittle Tea Shop is majority- owned by board of management, who are studying Business Administration from Troy State University. Dinh Quoc Bao is worked for several years as an sales manager. Nguyen Van Ha has many experiences in running a restaurant, previously, she opened and manage a small restaurant with high profit in several years. Nguyen Minh Tuan has work for two years as an independent consultant, after that, she has done a job for her family corporation. Tran Dinh Phu is working for his corporation as a manager and he has experience in tourist and hotel area. Tran Dinh Phu, for the last three years he has worked as a manager of restaurant, a successful restaurant in CauGiay district. Under the management of Phu, the restaurant has consistently increased sales while maintaining a lower than average level of operating expense.

However, because of investors other commitments they will not be involved into daily management decisions at Little Tea Shop. Thus a professional manager will be hired who will oversee all the tea operating. One full time baristas will be in charge on tea preparation and one chef as well. Five peoples will be hired to fulfill the staffing needs. In the second and third when the shop begins to open more spaces, more employee will be hired to handle the increased sales volume. Management Director

A full-time manager will be hired to oversee the daily operations at Little Tea Shop. The candidate has had at least one year in managerial in management. This management directors responsibilities will include managing the staff, ordering inventory, dealing with suppliers, developing a marketing strategy and perform other daily managerial duties. We believe that our candidate has the right experience for this role. A profit-sharing arrangement for the manager may be considered based on the first year operational results.

Management Consultant

Despite the owners and managements experience in the restaurant and tea industry, the Little Tea Shop will retain the consulting services from a company in this field. The consultants will help developing the business idea, business development and handle problem. Consultants will be primarily used for market research, customer satisfaction survey and to provide additional input the evaluation of the business opportunities. Management System After 3 years

After 3 years, with about 4 shops, we divided management system into local management departments.

Financial

Little Tea Shop will be provided fulfill financial start up in the first year with an small ad from Bank. In the year after that, the board of manger hopes that it will increase significantly in revenues and opening other shop in places in Vietnam. At that time, the owner would continue to invest more money in the Shop, and making more loans on others banks to capture the developing of the shop. After 3 years, Little Tea Shop will be registered as a corporation with stronger financial power. The following tables show the financial situation from the first year when shop was opened to the third year.

Principle of Managements18

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0.35

0.22

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Sales

Young35%

Officer22%

Tourist12%

Other31%

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