ASSIGNMENT NO 02

ENTREPRENUERSHIP

TAIMOOR RAFIQUE

L1F18BBAM0033

SECTION: A
Introduction of My Business Idea
I have planned to open fast casual food restaurant in Pakistan and just applied for a bank loan to
finance my business idea. When I visited bank about the loan application. Bank manager asked
me if you had conducted any research to assess the feasibility of your proposed business idea.
Being an entrepreneur graduate I am conducting a feasibility analysis of my selected business
idea in Pakistan.

What is a Feasibility Study?

A feasibility find out about is an analysis of the practicality of a venture or an idea. Those who
run a feasibility study searching for to evaluate the integral steps to carry an thought to fruition
and decide if those steps and the desired effect are collectively feasible. The study concludes
when all parties worried determine if the undertaking must pass ahead or if it must be
abandoned. Any groups doing a feasibility study may desire to seem to be at how plausible their
monetary projections are and how impactful their advertising and marketing would be. Will my
thought stand out in this market? Will my concept attraction to these in this market? Will my
projected revenue exceed my costs? Will I hit my economic goals? If so, when? If this sounds
similar to your commercial enterprise plan, that’s k – it should. But it’s important to take into
account that a restaurant’s feasibility analysis is now not a alternative for its enterprise plan. The
feasibility find out about is extra of a partner piece to a commercial enterprise sketch to see if the
ideas fleshed out in the business format can moderately and correctly be brought to life.

Restaurant Feasibility Study Outline:

A restaurant’s feasibility find out about have to be the line between short and detailed. There’s
probability to highlight infinite factors in any feasibility study, but withstand the temptation to
complex in areas the place it’s now not necessary. That said, investors and stakeholders will
prefer to understand precisely how you came to the conclusion you reached, so when it comes to
monetary projections, don’t skimp on the details.

Executive Summary
I have completed feasibility find out about have to begin off with an government summary,
though this be the remaining part that I have to write. This is due to the fact my executive precis
must be a few paragraphs or a page worth of content, summarizing the high-level findings of my
lookup and my final suggestion pertaining to the Go or No-Go Decision.

Market Overview and Analysis

This section spotlight how viable my restaurant idea is in the market you intend to serve. Just due
to the fact the restaurant that stimulated my idea does nicely in DHA Lahore doesn’t mean it’s an
automatic success story elsewhere in the world. A compelling Market Overview and Analysis
area will require thorough research into the contemporary state of your meant market – each
industrial and demographic.

How saturated is the restaurant industry where I’m looking to operate?

If your place has an abundance of restaurants already, it can be difficult to make a name for
yourself. Conversely, a drought of restaurants might propose your market isn’t as receptive to
eating places as other areas. No matter the modern country of eating places in your supposed
area, be prepared to shield why your restaurant would make a splash there in spite of the existing
number.

Are there other similar restaurants in the area?

Consider now not simply the kind of food you’re offering, but also the general concept. Let’s say
you’re looking to open a quick informal food restaurant, and you suppose the area’s millennial
white-collar populace that has expressed hobby in ethnic delicacies would simply flock to your
place. You’d be the only spot in town – and that’s great! However, if you open up in an place
with a dozen different speedy casual food restaurants, this may want to make it extra difficult to
snatch a sustainable share of the quickly informal food market.

What is the demographic of my market?

This is where idea meets actuality. If you’re searching to own a bar – and cite the consistent
enterprise growth and annual revenue of 2 billion – you may be capable to make it work.
However, if you’re pitching the thinking in a suburb where 90% of households symbolize
married couples with kids underneath 18, you probably won’t see the identical sales if you
opened that same bar in a city where 70% of the population is aged 22-35. Finding correct
information on your area’s demographics can be tricky, however a properly place to start is the
government.

Business Explanation

This is the place I’ll highlight my restaurant’s concept, its speedy informal food type, and its
aggressive advantages. Speak to how and why it will enchantment to the market I simply
outlined in the previous section. I’ll additionally choose to highlight what I’ll in my opinion be
bringing to the venture.

Financial Projections

This is the section traders will probably flip to immediately – they’ll choose to comprehend their
investments are in all likelihood to be made back, ideally quite a few instances over. This section
is now not one to quick change. It must have supporting charts and documents like a pro forma
profits assertion and a sales forecast – all with clear reason for how you came to the numbers you
reached. I’ll also have to define my predicted expenses, revenue, breakeven point, and capital
requirements.

Expenses

The cost of opening a restaurant can quickly add up – the median total startup costs will set me
back 2 million. I’ll have to seem at instant opening expenses like furniture and equipment, long-
term constant expenses like lease and insurance, and long-term variable costs like food costs.
List all of these prices out (that’s right – all of ‘em), what they will cost, and how I came to the
cost. Consider referencing rates and estimates from websites, realtors, contractors, and
accountants I’ve consulted for added certainty.

Revenue

Offer a complete breakdown of how plenty money I have count on to make in the first year and
where it will come from. I can base these numbers off of projected menu prices, average guests
served per day or week, and common ticket size, which in flip be based totally off of similar
menu fees in the area and estimates from food providers. When it comes to revenue and
economic projections, be hopeful but straightforward with my expectations. My sales forecast
should take into consideration the gradual start restaurant should face earlier than enterprise
becomes hooked up in the eyes of your goal market.

Break Even

Investors will want to understand how rapidly they’ll get their cash back. I’ll be capable to
exhibit them this with a ruin even analysis, which determines how a lot meals you’ll want to sell
and at what point in time your costs to open the enterprise will be offset by way of the revenue
you’ve generated. In the briefest of terms, breakeven factor in a restaurant is calculated by means
of dividing whole constant charges through the distinction between average income per visitor
and average variable price per guest. To see spoil even fleshed out in similarly detail, examine
more about it here.

Capital Requirements

Lastly, my monetary section should make it clear how lots cash is critical to get this thought off
the floor and how massive of an investment I’m in search of from investors. Here is the place
where I may additionally favor to consider asking for working capital. As described with the aid
of Fields in Restaurant Success by way of the Numbers, “Working capital is extra capital, a
reserve fund if I wish, to meet any unforeseen fees and to maintain the commercial enterprise
afloat at some point of the early months until it becomes profitable.”

Conclusion

Alright, it’s time to make a decision. By this point, I’ve covered findings pertaining to market,
my finances, and my leadership capabilities. Provide a Go or No-Go Decision on whether or not
I trust the restaurant thought is viable primarily based off of what I’ve protected in this study. As
an example, my conclusion area may additionally examine as follows. “Based off of our
monetary projections, we conservatively consider we will see [sum] worth of profit at the end of
our first year. This is taking into account the predicted salary of [total revenue], minus our
opening and first year prices of [total expenses]. We reached this conclusion as a result of more
than one factors, such as [list motives for decision]. As a result, it is with full self-belief that we
country [restaurant name] is a possible business task in the restaurant industry.”