Licence
All takeaways, cafes, restaurants, tea/coffee stalls and even burger vans are required to hold a licence issued under the The Licensing Act 2003. Any form of trade between 11pm and 5am will require a license, which is in addition to any street trading license you may hold for roadside trading. Your application will have to be accompanied by a copy of a plan of where you intend to trade, an operating schedule, and details of which licensable activities it relates to.
Average Income Levels of Hounslow
- £0 - £10,000 10%
- £10,001 - £15,000 10%
- £15,001 - £20,000 18%
- £20,001 - £25,000 16%
- £25,000+ 46%
This shows me the socio-economic status of my target audience as from this I can see how much money they make and whether they have any disposable income to spend on my Burger Van.
Catering van
I found this van on ebay it costs about 2,500 pounds and its in good condition. This is an ideal van for my business plan because it has everything I need.
Aims of Project
My business is going to be product based due to the fact that by unique selling point is Halal food being sold in my van, therefore when coming up with my marketing aims I would make sure that the it’s a product orientated business.
Marketing Aims
Four P’s
Product- My product is my unique selling point therefore I will concentrate in this area more than any other part of my business in order for it to be successful amongst my customers.
Price- The price of my product will depend on the competition I have, judging by other similar products being sold in other burger shops I will set my own price accordingly. I will also take into consideration my market share.
Place- the place where I sell my product will be very important because it will either boost my sale figures or decrease them because location is vital especially if you are a small business. I will make sure it is a location where my van can be seen from a long distance so I can attract customers who otherwise will not see my van and walk away.
Promotion- this is obviously crucial because my brand is unknown and I have to make it known to the public that I do exist and that I am here. However, this is very costly and I would have to make sure that I have enough money in my budget for promotional purposes.
Example of Promotion
As I am a small business I cannot afford to put an advert on TV, it would cost too much. I will be conducting promotions such as posters, leaflets and newspaper adverts. These methods are arguably not as successful as a TV advert however; they are cheaper which means that it is economically viable for my business.
Production Aims
Loan
I checked out numerous banks and their rates and I found this to be the best rate (see appendices). 6.8% APR typical on loans between £1,000 and £25,000. I would be taking a loan of 15 thousand, which will be paid in 5 years this would cover all my costs for a year.
is used to refer to when a product is produced with the labor of one worker and this is the method I will implement in my business. Job production is scarcely used for bulk and large scale production and mainly used for one off products or prototypes, as it is inefficient; however, quality is greatly enhanced with job production compared to other methods. New, small, firms often use job production, before they get chance to expand. Job Production is usually motivating for workers, because it gives the workers an opportunity to produce the whole product and take pride in it.
Key benefits of job production include:
- work is generally of a high quality
- a high level of customization is possible to meet the customer's exact requirements
-
significant flexibility is possible, especially when compared to
- workers can be easily motivated due to the skilled nature of the work they are performing
Disadvantages include:
- higher cost of production
-
requires the use of specialist labor (compare with the repetitive, low-skilled jobs in
-
slow compared to other methods ( and )
Human Resources
As my business is only a sole trade there will be only one person working in the business and that will be me therefore there would be no need for leadership skills as there is no one that would be working under my guidance. The job description is that I do all the work, ranging from the maintenance of the van to serving the customers. As I am the owner of the van, it is up to me to do all that. I do not think there would be any need of qualifications working in my business however; a good grasp of English and Maths would be useful because the need for communication skills and the need for counting the change you need to give the customer quickly. I will need a driving license for a van because I would be the one that is doing all the driving. The salary for this job is all the profit I make that will go to me.
I would not be doing any recruitment because I do not have the funds and my business does not require another person to be employed by me. As I am a sole trade I have unlimited liability therefore I am accountable for the loss if the business goes bust.
Finance Aims
My marketing strategy for the first few years of my business will be to follow other bigger business and see what they are doing and whether it is effective or not . As I cannot afford to take risks of my own because I have a loan to pay to the bank and I cannot afford to be adventurous.
Start-up costs
Cash Flow Forecast
My start-up cost is 15000, this is the amount of loan I borrowed which paid for all the start-up costs. This shows that by the end of the year I would have 5,132 pounds in the bank that will be used for next year to pay for all the costs of the business. As it can be clearly seen, my business judging from this cash flow is not yet profitable but I would hope to make it profitable by next year. I will be selling my burgers at 2 pounds each.
Break-Even Analysis
Fixed costs (per year) = 21,168
Variable cost (per year) = 7,200
Total revenue (per year) = 18,000 (selling 750 burgers a month)
Total Revenue – Total costs = 18,000 – 28368 = -10368
As I took, a loan out it covered this massive loss
The break-even analyses shows that the business will be making a loss of 10368 pounds which for a small business like mine its huge money and therefore I cannot afford to make this loss.
Findings
- What age group are you in?
18 or under = 40%
19-29 = 35%
30-39 = 10%
40-49 = 3%
50-59 = 9%
60+ = 2%
- Gender?
Male = 67%
Female = 33%
- In terms of your current occupation, how would you characterize yourself?
Retail = 24%
Academic = 13%
Student = 44%
Administrator /Manager = 2%
None of the above = 17%
- How many times a week do you eat fast-food venues?
None = 15%
Once = 5%
Twice = 2%
Three times = 3%
More than three times = 75%
- Do you think it would be a good idea if there was a Halal burger stall in the high street?
Yes = 56%
No = 44%
- Would you be willing to come to this burger stall?
Yes definitely = 41%
Yes = 23%
Maybe = 11%
No = 11%
Definitely not = 14 %
- If yes how much will you be willing to spend on a burger?
1-2.99 pounds = 64%
3-4.99 pounds = 36%
5-6.99 pounds = 0%
- pounds or more = 0%
8. What else do you buy when purchasing fast-food?
Cold / hot drinks = 91%
Desserts = 9%
- What time do you usually eat from fast-food services?
Morning = 12%
Midday = 34%
Afternoon = 54%
10. How far from the high street do you live?
Within a mile = 54%
Within 2 miles = 32%
Within 3 miles = 13%
More than 3 miles = 5%
More than 50% of my participants, for my questionnaires were male therefore I must make sure that my product suits that gender. Men usually like the bigger burger and women tend to go for the burgers that are pleasing to the eye and are not that big.
The majority of the people thought that setting up a burger van would be a good idea therefore I am going forward with it. This also means that people in Hounslow want to .
This shows that people will be willing to come to my burger van because the amount of people that said yes definitely and yes are more than half. This means that I can be very confident about the future customers I will have as in my questionnaire most people said that they will be willing to come.
Analysis of findings
The findings show to me that most of my potential customers are aged 18 or under which means that I have to make sure that my burger suits their tastes as they could potentially make up the bulk of my customers. Most people said that they would be willing to pay for the burger if it cost up to 2.99 pounds so I will have to make sure that my prices reflect that. In short the findings show me that there is a gap in market and that the consumers would love a burger van therefore I reckon it will be a good idea to go forward with.
Evaluation
There are reasons for and against me not taking this idea forward. I will start by first giving the positive of why this is a good idea to take forward. First of all the advantage of this business is that, it is small which means that for a sole trader like myself it is easily managed and it also means that I am very organised as it is a small business. In addition, the business is a tried and tested idea, which has proved successful in the past, which increase my chances of being successful as well. Businesses such as Nandos have proven that this is a great idea if implemented correctly. I also believe that being a Muslim myself will be of great use when running this business because coming from the same background as most of my customers I would have some idea of their tastes and preferences. The problems with it are that there is lots of competition from businesses such as Nandos as I pointed out in my SWOT analyses that I carried out, which mean that it would be a difficult market to establish myself. My unique selling point is also one of my weaknesses because I am selling Halal meat this means that I am only targeting people of a certain religion this means that I would have fewer customers to aim at which I also pointed out in my SWOT Analysis. Another weakness is my inexperience in running a business this would mean that I would have few past experiences to rely upon when a problem arises this will hinder my capability of solving that problem, as I would not know what to do. Another problem that could arise is legislation on health and safety. My food has to be of a particular standard that could mean that my burgers might not be up to that standard. The licensing procedure for obtaining a van is also very hard and time consuming. As it is a question of public health and there is no leniency. If however my business does succeed, a further problem would be if someone else copies my idea; that would increase my competition even more. As my finance section shows that if it were not for the loan I would be in massive debt, this indicates to me that maybe by business proposal is not viable. My costs are huge for such a small business and the revenue is not big enough to cover it. Break even analysis shows that I make a loss of 10368 pounds this year; I cannot afford that. A positive of this business is that it is in a mobile van that means that if my sales were poor, I could move to somewhere else. So this flexibility allows me to move wherever and whenever I want depending, I got the license to park from the council. There is a school nearby where I have parked my van which means that the school children could be targeted as potential customers at their lunchtimes.
Considering all these points, I have concluded that it is best for me to reject this proposal. I severely lack the business experience to take this job and further expand into a business that is self-sufficient. There is also a great amount of competition out there that would further hinder my business as if the customers were to be given a choice between my burgers and the ones they get in Nandos they will chose Nandos all the time as it is an established brand. The business also is Niche market, which means that I only have a small portion of the customers to aim my product at and therefore I do not have enough customers to sell my product to in order to break-even at least. As pointed in my human resources section as I am a sole trade that means I have unlimited liability for the business this means that if the business does go bust I will be liable to pay the money back. That means the bank could sell my house to get the money, therefore it is a risky business to get into and probably not worth the risk.
Bibliography
AQA A2 Business Studies by Gwen Coates and John Wolinski
A2 Business Studies by Andrew Gillespie and Malcolm Surridge
Business Studies A2 Level by Dave Hall, Carlo Raffo, and Rob Jones
A-Z Business Studies Coursework Handbook by Ian Marcouse
http://www.wikipedia.org/
http://www.hounslow.gov.uk/
APPENDICES
Questionnaire
- What age group are you in?
18 or under
19-29
30-39
40-49
50-59
60+
- Gender?
Male
Female
- In terms of your current occupation, how would you characterize yourself?
Retail
Academic
Student
Administrator /Manager
None of the above
- How many times a week do you eat at fast-food venues?
None
Once
Twice
Twice
More than three times
- Do you think it would be a good idea if there was a Halal burger stall in the high street?
Yes
No
- Would you be willing to come to burger stall?
Yes definitely
Yes
Maybe
No
Definitely not
- If yes how much will you be willing to spend?
1-2.99 pounds
3-4.99 pounds
5-6.99 pounds
- pounds or more
- What else do you buy when purchasing fast-food?
Cold / hot drinks
Desserts
- What time do you usually eat from fast-food services?
Morning
Midday
Afternoon
- How far from the high street do you live?
Within a mile
Within 2 miles
Within 3 miles
More than 3 miles
Bank loans
HSBC-8.9% APR typical for Personal loans between £7,000 and £25,000 where the Personal loan purpose is for a car or home improvements.
Lloyds’ TSB-7.9% APR Typical on loans of £7,500 to £25,000 for up to 5 years*.
NatWest-Borrow from £1,000 to £25,000 with our fixed-rate personal loan. and get a low rate of 7.4% APR typical for loans of £15,000 or more.
BUSINESS COURSEWORK