Académique Documents
Professionnel Documents
Culture Documents
Page 1
THE CENTRAL PERK
COFFEE HOUSE
DECLARATION
Page 2
I, PREETI SINGH GAUTAM hereby declare that the project entitled “THE
CENTRAL PERK” is my original work, done by me except the material and
information gathered from the various coffee cafe. This has not been
previously submitted for any other degree or diploma.
Page 3
ACKNOWLEDGEMENT
The study was conducted by the assistance of several individuals. Their co-
operation and guidance has resulted in the completion of the entire
comprehensive project, without which this task was almost impossible. I
really appreciate their help and hereby thank them.
Firstly, I would like to thank coordinator Dr. Ashish Sonkar and Dr. Aastha
Sharma for providing me the opportunity to take up this project and for his
valuable guidance, academic and moral support which made this report a
reality.
Page 4
TABLE OF CONTENTS
Page 5
Executive Summary
The Central Perk is determined to become a daily necessity for local coffee
addicts, a place to dream of as you try to escape the daily stresses of life
and just a comfortable place to meet your friends or to read a book, all in one.
With the growing demand for high-quality gourmet coffee and great service,
THE CENTRAL PERK will capitalize on its proximity to the Kanpur
university Campus to build a core group of repeat customers. The Cafe will
offer its customers the best prepared coffee in the area that will be
complimented with pastries and snacks.
The company will operate a 500 square foot coffee bar within a walking
distance from the Kanpur University campus. The owner has secured this
location on a lease contract with an option to extend up to three years. The
owner have also provided Rs. of the required Rs.539,900 start-up funds.
Page 6
1.1 Objectives
The central perk Cafe's objectives for the first year of operations are:
Become selected as the "Best New Coffee Bar in the area" by the local
restaurant guide.
1.3 Mission
Page 7
The Central Perkwill 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 coffee or espresso and pastries 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.
The Central Perkwill invest its profits to increase the employee satisfaction .
2 Company Summary
Mid Town Coffee Cafe, limited liability Company, sells coffee, other
beverages and snacks in its 500 square feet premium coffee bar located near
the Kanpur University campus.
The Central perk is a sole proprietorship firm, and the owner contributes the
entire capital. This gives increased profit margins from the start and as the
company grows, the debt-free philosophy will be maintained. However,
Page 8
recognizing that in reality not all variables are controllable. The founder owns
a shop and has enough funds to start the business.
Legal expenses for obtaining licenses and permits as well as the accounting
services totaling Rs. 2,000.
Marketing promotion expenses for the grand opening of THE CENTRAL PERK in
the amount of Rs.60,000 in the start .
Pre-paid rent expenses for three month at Rs.20 per square feet in the total amount
of Rs.30,000.
Other start-up expenses including stationery (Rs.500) and phone and utility
deposits (Rs.24, 000).
Espresso Machine of Rs. 11,000. Coffee Grinder & maker of Rs. 600 and 1500
Respectively.
Computer, Air conditioner and Billing Machine of the total amount of Rs.89,500.
Page 9
The following table summarizes the start-up assumptions.
Start Up Expenses
Start Up Assets
Page 10
#Cash Reserve (in Rs.)
Utilizes 8000 3 24000
salaries* 26600 3 79800
Rent 10000 3 30000
supply cost 20000 3 60000
Emergencies 10000 - 10000
Total 203800
The lease contract has an option of renewal for three years at a fixed rate that
THE CENTRAL PERK will execute depending on the financial strength of its
business.
The floor plan will include a 200 square feet back office and a 300 square feet
coffee bar, which will include a seating area with 15 tables, a kitchen, storage
area and two bathrooms. The space in the coffee bar will be approximately
distributed the following way--275 square feet (i.e., 55% of the total) for the
seating area, 130 square feet (26%) for the production area, and the remaining
95 square feet (19%) for the customer service area.
Page 12
Products
THE CENTRAL PERK will offer its customers the best tasting coffee
beverages 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 higher
margin espresso drinks. Along with the espresso drinks, brewed coffee and
teas, as well as some refreshment beverages, will be sold in the coffee bar.
THE CENTRAL PERK will also offer its clients cakes and cookie. For the
gourmet clientele that prefers to prepare its coffee at home, THE CENTRAL
PERK will also be selling coffee powder.
The menu of the THE CENTRAL PERK, coffee bar will be built around
espresso-based coffee drinks such as lattes, mochas, cappuccinos, etc. Each of
the espresso-based drinks will be offered with whole, skimmed, or soy milk.
Each of these coffee beverages is based on a 'shot' of espresso, which is
prepared in the espresso machine by forcing heated water through ground
coffee at high pressure. Such espresso shots are combined with steamed milk
and/or other additives like cocoa, caramel, etc., to prepare the espresso-based
beverages. Proper preparation techniques are of paramount importance for
such drinks. A minor deviation from the amount of coffee in the shot, the size
Page 13
of the coffee particles, the temperature of milk, etc., can negatively affect the
quality of the prepared drink.
Coffee consumption has shown steady growth, with gourmet coffee having the
strongest growth. Coffee drinkers in that area are among the most demanding
Page 14
ones. They favor well-brewed gourmet coffee drinks and demand great
service. THE CENTRAL PERK will strive to build a loyal customer base by
offering a great tasting coffee in a relaxing environment of its coffee bar
located close to the Kanpur University campus.
THE CENTRAL PERK will focus its marketing activities on reaching the
University students and faculty, people working in offices located close to the
coffee bar and on sophisticated teenagers. Our market research shows that
these are the customer groups that are most likely to buy gourmet coffee
products. Since gourmet coffee consumption is universal across different
income categories and mostly depends on the level of higher education,
proximity to the Kanpur University campus will provide access to the
targeted customer audience.
The chart and table below outline the total market potential (in number of
customers) of gourmet coffee drinkers in Kanpur.
Page 15
4.2 Target Market Segment Strategy
THE CENTRAL PERK will cater to people who want to get their daily cup of
great-tasting coffee in a relaxing atmosphere. Such customers vary in age,
although our location close to the University campus means that most of our
clientele will be college students and faculty. Our market research shows that
these are discerning customers that gravitate towards better tasting coffee.
Furthermore, a lot of college students consider coffee bars to be a convenient
studying or meeting location, where they can read or meet with peers without
the necessity to pay cover charges. For us, this will provide a unique
possibility for building a loyal client base.
Page 16
4.2.1 Market Needs
Strong management
Weaknesses:
Small Staff
Online Presence
Weak Brand
Opportunities:
Page 17
Coffee cafe industry is one of the fastest growing industry in India.
More people like to visit coffee cafe for informal meetings.
Threats:
Competition
THE CENTRAL PERK's direct competitors will be other coffee bars located
near the Kanpur university campus and cafeteria of university. THE
CENTRAL PERK will position itself as a unique coffee bar that not only
offers the best tasting coffee, cakes and cookie but also provides home-like,
cozy and comfortable environment, which established corporate
establishments lack. We will cater to customers' bodies and minds, which will
help us grow our market share in this competitive market.
Buying Patterns
Page 18
The major reason for the customers to return to a specific coffee bar is a great
tasting coffee, quick service and pleasant atmosphere. Although, as stated
before, coffee consumption is uniform across different income segments, THE
CENTRAL PERK will price its product offerings competitively. We strongly
believe that selling coffee with a great service in a nice setting will help us
build a strong base of loyal clientele.
Page 19
THE CENTRAL PERK will position itself as unique coffee bar where its
patrons can not only enjoy a cup of perfectly brewed coffee 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 THE CENTRAL PERK from incumbent
competitors.
THE CENTRAL PERK baristas will handle the sales transactions. To speed
up the customer service, at least five employees will be servicing clients--
while two employee will be preparing the customer's order, two waiters and
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, THE CENTRAL PERK 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 coffee bar.
Page 20
Food costs are assumed at 25% for coffee beverages and for retail cookie and
cakes. Proximity to the University campus will dictate certain sales
seasonality with revenues slightly decreasing during the school vacation
periods.
The chart and table below outline our projected sales forecast for the
First years.
FORECASTED SALES
Days in month 25 25 25 25 25 25 25 25 25
Total sale p/m 18750 30000 25000 20000 18750 20000 7500 9375 10000
No. of months 12 12 12 12 12 12 12 12 12
Total sales for 12 225000 360000 300000 240000 225000 240000 90000 112500 120000
months
SALE (in 1912500
Rs.)
Page 21
COST OF FORCASTED SALES
Days in month 25 25 25 25 25 25 25 25 25
Total Cost p/m 10000 16500 17000 13000 12750 12000 4500 6875 7000
No. of months 12 12 12 12 12 12 12 12 12
Total Cost for 12 120000 198000 204000 156000 153000 144000 54000 82500 84000
months
COST (in Rs.) 1195500
Management Summary
However, because of various activities and functions there will be need to hire
some employee who can perform these activities. An Accountant
(Rs.60,000/yr) will be hired who will oversee all the coffee bar operations.
Four other employees (Rs.54,000/yr each) will be in charge of coffee
preparation and serving. These four employees will be hired to fulfill the
staffing needs on part time basis. In the second and third year of operation,
salary will increase by 10% .
Page 22
6.1 Management Team
Page 23
Human resource management (HRM) is the strategic and coherent approach to the
management of an organization’s most valued assets - the people working there who
individually and collectively contributes to the achievement of the objectives of the
business. The terms "human resource management" and "human resources" (HR) have
largely replaced the term "personnel management" as a description of the processes
involved in managing people in organizations. Human Resource management is evolving
ra. As such, HRM techniques, when properly practiced, are expressive of the goals and
operating practices of the enterprise overall. HRM is also seen by many to have a key
role in risk reduction .
Synonyms such as personnel management are often used in a more restricted sense to
describe activities that are necessary in the recruiting of a workforce, providing its
members with payroll and benefits, and administrating their work-life needs. So if we
move to actual definitions, Torrington and Hall (1987) define personnel management as
being rapidly “a series of activities which: first enable working people and their
employing organizations to agree about the objectives and nature of their working
relationship and, secondly, ensures that the agreement is fulfilled".
".......those decisions and actions which concern the management of employees at all
levels in the business and which are related to the implementation of strategies directed
towards creating and sustaining competitive advantage"
. Human resources management comprises several processes. Together they are supposed
to achieve the above mentioned goal. These processes can be performed in an HR
department, but some tasks can also be outsourced or performed by line-managers or
other departments.
Page 24
• Human Resources Planning (HRP)
• Design of Organization and Job
• Selection and Staffing
• Training and Development
• Organization Development (OD)
• Compensation and Benefits
• Employee Assistance
Nature of HRM
Simply put, Human Resource Management (HRM) is a management function that helps
managers to recruit, select, train and develop members for an organization. Obviously,
HRM is concerned with the people's dimension in organizations. Following are few
definitions of HRM:
1. HRM is a series of integrated decisions that form the employment relationship; their
quality contributes to the ability of the organizations and the employees to achieve their
objective.
2. HRM is concerned with the people dimension in management. Since every organization
is made up of people, acquiring their services, developing their skills, motivating them
to higher levels of performance and ensuring that they continue to maintain their
commitment to the organization are essential to achieving organizational objectives. This is
true, regardless of the type of organization- government, business, education, health,
recreation, or social action.
Page 25
3. HRM is the planning, organizing, directing and controlling of the procurement,
development, compensation, integration, maintenance and separation of human resources
to the end that individual, organizational, and social objectives are accomplished.
HR ACTIVITES
1. RECRUITMENT/SELECTION
3. PERFORMANCE APPRAISAL
4. RECLOCATION
5. INDUCTION
7. SEPARATION
8. EXIT INTERVIEWS
9. ATTENDENCE/AWARD/REWARD
Page 26
In Human resource management is a process of bringing people and
organizations together so that the goals of each are met. It is that part of the
management process which is concerned with the management of human
resources in an organization. It tries to secure the best from people by winning
their whole hearted cooperation. In short, it may be defined, as the art of
procuring, developing and maintaining competent workforce to achieve the
goals of an organization in an efficient and effective manner.
Performance Appraisal.
Recruitment
Page 27
Recruitment at OPEN AIR RESTAURENT is carried out in close co-ordination with the
department requiring the personnel. It is a process where the qualification and other skills
needed for the job are taken into account & based on this the incumbent is selected after
proper screening & interviewing. He is then inducted & provided training if needed.
Page 28
6.2 Personnel Plan
The table below outlines the personnel needs of THE CENTRAL PERK
coffee bar.
Financial Plan
THE CENTRAL PERK will capitalize on the strong demand for high-quality
gourmet coffee. The owners have provided the company with sufficient start-
up capital. With successful management aimed at establishing and growing a
loyal customer base, the company will see its net worth doubling in two years.
THE CENTRAL PERK will maintain a healthy 40% gross margin average,
which combined with reasonable operating expenses, will provide enough
cash to finance further growth.
Page 29
7.1 Projected Cash Flow
As the table below present, the company will maintain a healthy cash flow
position, which will allow for timely debt servicing and funds available for
future development.
Page 30
7.2 Break-even Analysis
With average monthly fixed costs of Rs.262,700 in FY2012 and an average margin of
37.5%, THE CENTRAL PERK's break-even sales volume is around 35027 units. As
shown further, the company is expected to generate such sales volume from the out start.
Page 31
7.3 Projected Profit and Loss
Page 32
7.4 Projected Balance Sheet
Balance Sheet (in Rs.)
Particulars FY2012-13 FY2013-14 FY2014-15
Bibliography
Page 33
1. Business Policy and Strategic Management by Azhar Kazmi
2. Financial Management by I M Pandey
3. Marketing Management, by Philip Kotler
4. http://www.incometaxindia.gov.in/
5. http://www.environmentportal.in/category/thesaurus/industry/food-
policy/food-process- industry/fruit-juice-industry
6. http://www.reportbuyer.com/food_drink/country_overviews_food/indian_fr
uit_juice_market.html
Page 34