Opening a sandwich shop in huddersfield

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1.0        Terms of Reference

This coursework is required by AQA A level business course.  I have to set up a business researching all the key stakeholders in my business idea such as suppliers, customers etc. I have to study the feasibility of a new business. This coursework was started in June 2005 and is submitted in Febuary 2006.

1.1        Primary Objective

To the test the feasibility of opening up a sandwich shop in Huddersfield town centre. This will be the careful planning of the opening of a sandwich shop in the Huddersfield area. I will carefully think of all the necessary procedures I need to go through in order test the feasibility of a sandwich shop in Huddersfield. My USP will be making large orders of sandwiches for business’ in and around the surrounding area.

1.2        Secondary Objectives

- Find a suitable location for a sandwich shop.

- Find background information that will allow me to put my work into context.

- I need to analyse the competition and what threats they pose as well as opportunities that may arise.

- I will produce a questionnaire to find out about the consumers and what they will pay, what they like and also locations.

- I need to find all if any of the operational aspects that will affect my business.

- Undertake a thorough financial analysis linking budgets to a cash flow forecast. I will produce one budget for the whole of my business and from this use it to produce a profit and loss account and a balance sheet.

-Undertake financial appraisal to asses my idea of a sandwich shop.

-Identify different sources of finance. This will be how will I get the funds to start up my business idea.

-Make a decision on the ownership of the business.

-Undertake SWOT and PEST analysis of internal and external factors affecting my business.

-Assess every element of my business plan from financial aspects to also what sandwich fillings I will sell.

This will allow me to test the feasibility of my business and how successful it is. For me to test the feasibility of my business I will carry out primary and secondary research on other small business' to find out how feasible they are. I will find out about customers, competitors and the market I want to open a business in. I want to research from potential customers about asking them what they think about other sandwich shops. I do this indirectly by drawing up a table in my questionnaire and asking them about a selection of sandwich shops. I will then ask direct questions to the potential customers about what price they are willing to pay, what they think is the best location, what sandwiches they like and also if their employment/business buys large orders of sandwiches.

2.0        Procedure / Methodology

Market research is collecting data that will be relevant to my business. This will be things such as the competitors, the market, price potential customers are prepared to pay and also what sandwich fillings are likely to be the most popular. Research is essential as it will help me understand potential customers and what they are looking for from a sandwich shop. This will be the expectations they have and also what they need as customers. It will help me when deciding on certain decisions such as what sandwich fillings to use and also what price customers are prepared to pay.

2.1        Primary Research

Primary research describes information gathered through interaction with other people. Primary research can be gathered through meetings, one-on-one interview, focus groups, and surveys.

Information collected designed for a specific need. This is first hand research such as questionnaires, interviews and foot counts etc. I have used questionnaires and asked 50 random people in the centre of Huddersfield. I will fill in the questionnaires myself and write down the answers from what the people say. I think doing it this way will help me to understand it when it comes to analysing the data. It saves me the job of trying to understand 50 peoples different hand writing. This will help me analyse and tally up the data faster and be more efficient. I need to stand near a sandwich shop so that I can interview people who come out of the sandwich shop. These are likely to be potential customers. The people have to be totally random of all ages above 13. this is because these are likely to be my target audience.

 I have worked out that as so many people shop and visit Huddersfield regularly then I am going to locate my sandwich shop in the town centre of Huddersfield.  I have used my data to work out what customers are prepared to pay and also if they are interested in Snappy sandwiches.  I have also researched competitors and what customers think about them.

 I could also undertake interviews with different people as another form of primary research. This would be a good idea as its more relaxed than a questionnaire as many people do not want to spend time talking to me to help fill in a questionnaire. Undertaking primary research this way can be hard as it hard to convince people to sit down and allow me to interview them.

  1. Secondary Research

Secondary research describes information gathered through literature, publications, broadcast media, and other non-human sources. Secondary research is in general easier to gather than primary.

This is research undertaken by another person or organisation. Published or recorded data that has already been collected for some purpose other than the current study. This involves books, business plans, account etc. This will be readily available for me and so getting hold of this information should be fairly easy. Using the internet made it easy and quick for me to find potential locations rather than having to physically visit every estate agents.

2.3        An evaluation of your research

I have filled in 50 questionnaires so that I can produce statistical results in the form of graphs and charts. I got 50 random people of all ages in the town centre of Huddersfield during the day to fill in my questionnaires that ask relevant questions to the topic of my sandwich shop coursework. I have asked questions such as price people are prepared to pay and also given people a choice of sandwich fillings etc. My results show that ham is the most popular sandwich filling. 86% of the people I asked people who shop regularly in Huddersfield town centre which confirms my expectations of the high amount of people who buy sandwiches in Huddersfield. They were 68% of people who buy sandwiches from sandwich shops in Huddersfield. This shows that there is a niche market for quality sandwiches at a reasonable price. 38% of people were prepared to pay £2+ for a sandwich and 60% prepared to pay £1-£2.

I have made some conclusions to the first sections of my report. I have clearly identified my primary and secondary objectives. These are the objectives of my coursework are what I have set out to achieve for my coursework report to be accurate and for the sandwich shop to be feasible. In my objectives I have tried to include everything that I need to research and work out.

In my procedure I have talked  about the kind of data I will collect and also how I will collect this information. From this collection of data I will be able to look at factors internally and externally that affect my business. This will be things such as competitors, prices and customers etc. the primary research I have gone into detail about  how I will undertake primary research, through questionnaires. I have then described how the data will be processed.

I found that research can be hard. Finding what you need is not always so easy to find. information on competitors, location and consumers was difficult. I had to research to find the information I needed such as the location I will use. For this I had to find several locations that are in the right area and also that are not that expensive. I used  which is and estate agents in Huddersfield to help me find several possible locations that I can analyse and then choose which is most suitable. It was finding possible locations in the HD1 post code that was a problem as there was not many for rent.

Researching competitors and finding information about them was a bigger task than I thought. for this I found all the sandwich shops in HD1 using  and then identified my key competitors. I then picked several and put them in a comparison table. For this I had to then analyse the different competitors. To find the information about competitors is not always so easy. As I had several local business’ then they didn’t have websites like subway who is also one of my competitors. I had to undertake some qualitative interviews with customers of my competitors to find out information. this was me undertaking primary research in order to get the information I needed.

the questionnaires was the way I found out about my consumers. this required me to ask random people questions about where they buy sandwiches and if they would be interested in using my sandwich shop. standing in the middle of Huddersfield asking random people if they will help fill in your questionnaires is not the easiest way to get information. People are unwilling to help. This was frustrating at times as you are trying to ask people to fill in a questionnaire for you and yet no one wants to participate.  

When it come to tallying up the questionnaire results this was a boring job and became repetitive. I found the best way to tally up was to do a question at a time other wise it become too boring.

2.4        Copy of blank questionnaires or interview questions and tally charts.

Snappy Sandwiches Questionnaire

We are currently in the development process of opening the first sandwich shop in Huddersfield, please take a few moments to fill in this questionnaire.

1. Age?

………………..                                                

2. Do you often buy sandwiches from sandwich shops in Huddersfield?

Yes                         No                          Maybe                

3. Gender?

Male                        Female

4. Would you be interested in buying from snappy sandwiches?

Yes                         No

5. What kind of sandwiches do you like?

Egg mayonnaise                Prawn        mayo                        

Cheese + ham                   Tuna mayo

Cheese                                Chicken

Ham                                Chicken tikka

Beef                                Spam

Corned beef                        Pork

BLT                                Egg

Bacon                                Sausage

6. Do you shop often in Huddersfield?

Yes                         No

7. Frequency of visit to sandwich shops in Huddersfield?

Daily                        2-3 times per week                Monthly

8. Does your business, employment buy large orders of sandwiches, if so where?

Yes                         No                       …………………………………………

9. How much are you willing to pay for a sandwich?

£0-1                        £1-2                        £2+

10. What other things interest you when it comes to purchasing a sandwich or choosing a shop to buy a sandwich?

……………………………………………………………………………………………………………………………………………………………………………………

11.How would you rate these?  1-5      1=poor                5=excellent

12. Are you tempted by sales and promotion etc?

Yes                        No                Maybe                

13. Where is the ideal location for a sandwich shop in your opinion?

Huddersfield town centre        

Almondbury

Lindley

3.0        Background

3.1        A background to your idea

My idea is to open a sandwich shop in Huddersfield town centre or near to the town centre. I am aware of the competition and think that if I can get into this market that has many customers my business could be successful. I am going to take advantage of economies of scale and have already made contact with food suppliers. This would be very beneficial as the savings could help the business. I thought doing a sandwich shop is simple and so would help me as there are not many complications to base my coursework on. I work in a restaurant and have a good idea of food and how its ordered and lead and delivery times etc. I need to find out about competitors, demand and the market etc. the good points about my business is that it is easy to set up, low start ups and running costs and in a mass market. I also have a USP where my shop will specialise is making large orders for companies, organisations etc.

3.2        Why people set up in business

People set up in business for many reasons, the main one is to make a profit. People also set up in business to achieve life ambition, redundant, be own boss or to make more money for themselves. People also have ideas or inventions which they think will be a very good idea to sell or offer to people.

The reason I am setting up my business is to make a profit and establish a successful business that will make steady profits. I want to enter the sandwich market as it has huge potential and I think my idea of a sandwich shop is feasible in Huddersfield town centre. I am opening a sandwich shop in Huddersfield town centre which already has an estabilished market. I will try to force my way into this existing market by having a USP of producing quality sandwiches for both business’ in the surrounding area and the general public. This will be business’ telephoning orders and also the general public passing by and stopping to buy a sandwich.

3.3        The business plan

This is targets within a business such as sales and financial targets. It is also the aims and objectives of a business as to which the business aims to achieve. The targets need to be met for the business to be a success and for all areas to be working efficiently. This will help in the future as the planning will help avoid mistakes which can be very costly for a business. A plan is very important as trying to get finance and the financial lenders would be keen to see this plan before borrowing money. I was keen to have a realistic business proposal and accounts that are realistic.

4.0        Findings

   The finds section of my report is where I outline the results of my research. When I set out to research this sandwich shop I expected some people to say yeas and maybe to using the business. I was also shocked at the responses I received from the questionnaires. I thought that not as many people would use the shop or be interested in using the shop. This was good news as I then knew I was entering a market with a lot of customers and for the possibility to expand.

4.1        The Market

This is the world of commercial activity where goods and services are bought and sold. Without any competition there would be no markets.

A niche market is small business’ providing specialist or rare products to customers. Business’ in niche markets are usually business that become mass market once they have grown and become popular.

A mass market is where there are big businesses that produce mass amounts of goods and services. They produce the same good or service in huge quantities.

I am entering a niche market in Huddersfield town centre. It is the sandwich shop market I want to open a business in. I expect competition to be high as there are several sandwich shops in this area. I expect annual sales of sandwiches to be over 15,000 as a minimum target to exceed. In this market are mainly small sole traders which have only the one store open and there are national companies such as subway who has stores all over the country. I have identified subway as a competitor as I think it will be one of the main key business’ in my market. The market is run by many small business with the exception of a few national business’. This is a monopoligistic as there are some national businesses but they don’t have much power in the sandwich shop market. My product is a luxury product. It is not something that is needed by customers they will only purchase a sandwich if they feel like it. A sandwich is only wanted if a person is hungry, compared to a bus ride to work then a person has to take up this service.

4.1.1        Consumers

Consumers are individuals or households that purchase and use goods and services generated within the economy.

My target market is people aged between 16 and 60 both male and female. I Think these are the main people who will be in The Huddersfield town area. I believe that these people will be my main target audience. This is the right age group for my sandwich shop to appeal to. This is the age of people from their last year in school to the retirement age. I will have sandwiches that appeal to this age group. E.g. spicy chicken is more for people in the lower end of my age group.

 I think that yearly if the sandwich has promotions etc and we have regular visitors to the shop then these people could visit the sandwich shop 3-4 times per week. I think the main reason for these people to visit the shop regularly is to have choice and to aim at a wide audience.

I can tell from my graphs that there are 43 people out of my 50 random people asked about if they often shop in Huddersfield said yes. This is very positive for me as this means well over half the people shop in Huddersfield so I just need to tempt these people to buy sandwiches. I will try tempt people to buy sandwiches with promotion and other sales. Of the 50 people 30 people either visited Huddersfield town centre daily or at least 2-3 times per week. This gives me an incentive to locate in Huddersfield town centre so that I can have a sandwich shop that is close to where these people regularly shop.

Join now!

I already know that Saturday will be the busiest day of the week in terms of trading for my sandwich shop. I now need to plan around this for things such as stock deliveries, amount of people working and also have a later closing times than in the middle of the week. I will need a later closing time as I need to maximise sales and by opening longer on a Saturday I can achieve this. I have spotted that there are 30 who either visit Huddersfield town centre daily or 2-3 time per week

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