New retail store Concept, tea store chain By Manpreet singh Digital

m

U n i v e r s a l B u s i n e s s S c h o o l , K a r j a t

Heena Jain MBA3/1325

Shiveen Jindal MBA3/13xx

Chayya Singh MBA3/13xx

Manpreet MBA3/1329

2014

Retail Management New Low-Budget retail store

Group 9

T-PoG

Retail Management 2014


Page 1

Table of Contents Sr No.

Content Page No.

1 Executive Summary 2

2 Store Concept 2

3 Retail strategy statement 4

4 Why this Business? 4

5 Industry Dynamics 5

6 Store Design & Layout 8

7 Operational Plan 10

7a Sourcing 11

7b Stocking 12

7c Order Preparation 14

7d Maintenance 15

8 Human Resource Planning 17

9 Business model Canvas 19

10 Marketing Strategy – (Segmentation, Targeting, Positioning) 21,22,23

11 Retail Mix 24

11a Merchandise Mix 24

11b Pricing & profitability 26

11c Location planning, trading area 26-27

11d Promotion Mix 29

12 Finances 30-33



Page 2

Executive Summary

T-PoG is the first of its kind, innovative Tea shop which targets the youth & tea lovers

with over 100 kinds of tea, Classical Indian ambience, safe and cool place to hang out, a cool

book store & everything what Indian youth can think off. It will offer different kinds of teas

& various tea time snacks. It will provide a new kind of experience of having tea. Indian

youth love tea and leaving those road side small tea shops, there is no place to enjoy tea.

T-PoG will fill that gap & will provide an overall experience of having Tea with its

differentiated offerings. Karaoke, Books, games to name a few. Most importantly it will be a

24*7 open, low budget shop.

The report contains the business plan for starting and operating the shop. It’s Segmentation,

Target market, positioning, Marketing & retail mix.

The report also explains the store layout, Consumer journey, and various promotional

events for the retail shop. It finally concludes with an estimated 6 months Finances for the

operation of the store.

The store with an average order of Rs.50/person, is estimated to achieve its breakeven in ….

Years, after which it is profitable with a 50% Gross profit margin on a minimum of the above

order size.

Store Concept

India is the second largest producer of tea and one of the largest consumers too. Indians,

Particularly Indian youth love tea. Tea is one thing that refreshes them. There are more than

5 million small tea shops across India. There are high end coffee shops like café coffee day,

Star bucks on one hand and the local tea shops on the other. But no shops to serve the

middle class. Middle class form a majority of Indian population. Our T-PoG is a 24*7 Tea

shop which will serve the Indian middle class. College students don’t feel good to have tea

at local stalls, also they offer low variety. They even cannot afford to visit high end cafes. At

T-PoG menu ranges from Rs. 5 to Rs.50. Store will provide an Indian ambience, on demand

karaoke, book store and table games like snake & ladders, ludo etc. the core product of our

shop is the experience of having tea. It will have a self-service mode of serving. Each table

will be equipped with ordering kiosk from which customer can place the order. Order will be

received by the counter person who then forwards it to the kitchen. Before 5 minutes of the

completion of order, customer will receive notification on the table kiosk that their order is



Page 3

Ready and they can collect the order from counter and pay the bill. Table games and books

to read will be available free of cost, while customers have to pay if they want to buy the

books. In case the book demanded by customer is unavailable, we will make it available

within 4 days. Some of the critical success factor for this kind of food tea store is the Inner

environment of store and behavior of staff with the customer. All the necessary training will

be given to staff time to time to take care of the same. To increase the pocket size of the

customer in this type of low budget tea shop, it is required that customer spend more and

more time at the shop, That is the reason to provide Books , table games and on demand

karaoke. Also there will be special state wise tables (more explained in store layout) to

enhance the experience of the customers and engage them more and more. Customer walls

etc. will add value too.

How it Works

Customers enters the

Shop & occupies their

Table

Order Placed through on

Table I-Pads with in built

Menu

Order Received at counter

Forwarded to kitchen

1 Order

Received

Order ready!!

Notification received

On table

While the order is processed,

Customers can read books

From the large library, enjoy

Free WiFi at iPads on table, &

Can also request songs to play

Collect Order

& Pay the Bill

Order ready!!

Notification received

On table



Page 4

Retail Strategy

Why T-PoG?

India is one of the largest consumers of tea. Annual consumption of tea in 2013 in India was

close to 900 million Kgs. On an average every Indian has tea 2 cups a day. When we talk of

population between 15 to 40 years, average consumption is 4 cups a day. India has 190.7

million households which fall under Medium Income group. 46% of Indian population falls

between 15 to 45 years.

There are high end coffee bars like Café coffee day, Starbucks etc. on one hand, while low

end local Tea stalls on the other hand. There are no Tea/Coffee stores which are targeted to

especially to middle class, which in fact is the biggest by population. Indians love tea.

Professionals during office breaks, Students while doing the college works, late night works

often search for this kind of places. Girls don’t feel good having Tea on local tea stalls. They

cannot afford to go to high end coffee shops daily. So there is a huge gap which T-PoG has

aimed to fill.

Anand Nagar, Khandwa, The place where T-PoG is expect open has more than 30 colleges

(with hostels) and offices with an average population of 200. There are no Good Tea/coffee

shops or restaurants in the 10 km radius except some local tea stalls. People have high

disposable income and consumption capability in the area. So T-PoG will be the ideal shop

for the people of that area.

T-PoG aims to provide all the facilities provided by high end coffee shops, at low prices to

serve the masses. Below is the explanation of how T-PoG will provide value to its target

Market.

The Main aim of T-PoGis to serve the tea lovers with lots of different varieties of tea

at a place which is safe and comfortable yet has the classic Indian ambience. A place

where they can pass their free time, do there official work out of the office and at the

same time enjoy their favorite songs. Where they can have real Darjeeling/Assam tea

very near to them



Page 5

Industry Dynamics

With the increasing disposable income and growing middle class across India, People now

are more outgoing when compare to anytime in the history. Indians love to eat and drink

out. With the largest demographic in the world, among the total population of 1.25 billion in

Indian, 46% falls in the age group 18-44. And the result of this, the restaurant industry in

India, which is mainly driven by the young population aged 15 to 44 years has registered

revenues of INR 75,000 crores in FY'2013. The industry has witnessed a sound growth which

has been fueled by the advent of large number of national as well as international chains in

the organized market. Many international chains such as the Mc Donald's, KFC, Dominos

and Pizza Hut largely have dominated the organized restaurant market in the country over

the years.

Free

WiFi

Books

Table

Games

Karaoke Rich

Menu

IPads

Value

Proposition



Page 6

The overall restaurant market has grown at a CAGR of 6.6% from FY'2008 to FY'2013 and

has witnessed an increase in revenues to INR 75,000 crores in FY'2013 from INR 50,000

crores in FY'2007.

The changing lifestyles with the increasing nuclear families and a rise in the urbanization in

India over the past years have also supported the growth of the restaurant market in India.

Additionally, the change in customer taste has also played a major role. Due to the growing

exposure to the international cultures and lifestyles, the Indian population has started

developing their tastes and is reaching out to restaurants trying new dishes. This change in

the taste preference of the people in India has motivated many international and Indian

players to expand their reach in the Indian restaurant market.

The Indian organized restaurant chain market has witnessed an upward trend and has

grown at a CAGR of 19.1% from FY'2008 to FY'2013 where it has witnessed revenues of INR

20,000 crores in FY'2013 growing from INR 7,000 crores in FY'2007. The organized chain

market in India includes a large number of players in the QSR, full service, PBCL and the food

court segments. The market has significantly expanded primarily owing to the high demand

among the large Indian population over the years.

The Quick Service Restaurants (QSR) and the casual dining restaurants account for a major

share of the revenues of the organized chain market in India. The QSR's and the casual

dining restaurants together contributed a market share of 80.6% in FY'2013 to the organized

restaurant chain market.

20

55

Restaurant Industry

Organised

Unorganised

Amounts in '000 Crores

81%

19%

Organised Restaurants

QSR & CD

Others

Trends Of the year 2013



Page 7

Growth of Restaurant industry in India

The key drivers for Tea shop can therefore be summarized as follows:

Increased spending ability and rising aspirations

Upward trends in Tea consumption

More % of young population among the total population

Changing taste preferences leading to restaurants

Ease of Availability/Reach

0 10 20 30 4050

6070

80

2007

2010

2013

43

48.75

55

7

11.81

20

Overall

Organised

Cagr 6.6%

CAGR 19.1%



Page 8

The key challenges for the Tea shop are:

Constantly changing laws

Bringing fresh tea leaves from Darjeeling on regular intervals

Threat of the entrance of competitor in the same area

Availability of labor

As many of the challenges can be controlled, Tea Shop in the particular area provides a

great opportunity. There is a huge untapped market and most importantly people are in

immediate need of such kind of shop. Also our business provides an opportunity to develop

a private label tea to be introduced in the later phase once the brand is established. The

availability of farm in Darjeeling presents great backend support for the forward integration.

T-pog is a two floor Tea shop. Ground floor will be with air conditioner and First floor will be

open to air, so that customer can enjoy sunrise and sunset while having their tea.

Store Design Layout



Page 9

On Ground floor

A. Entrance

B. Normal serving tables

C. Special tables dedicated to states.

I. These will be separate compartments, with the interiors representing

the culture of the particular state. It is so, that the customer can have

an experience of the particular state.

D. There will be a book shelf besides counter.

I. This book shelf will contain all latest love, Fantasy, and related novels.

NEWS papers and other books

II. From the counter customer can either issue a book or can purchase it.

III. If the customer issues the book he is allowed to read the book in

store only.

IV. This activity is for engaging customer for long time.

E. Kitchen will be on the ground floor to prepare all the orders.

F. The stairs will be on the left side of the entrance, so the customers willing to

go on the first floor can co directly

On the first floor-

A. First floor is with the view of sunrise , sunset and with the moonlight as it is open

floor. (Open to air , will still have a shade, but no side walls)

B. Tables for groups

C. Smoking zone

D. And a karaoke where people can enjoy their tea with guitar and music. This is an

another activity for engaging customer.

E. And most importantly a customer wall- where they can show their talent, views and

anything what they want to share.



Page 10

Operational Plan

Our Operations Primarily is divided in 4 major Parts

Daily procurement of Milk and dairy products

and vegetables

Twice a week procurement of spices and

other general food items

Special Darjeeling tea will be sourced from

Darjeeling via railways in the second phase

Sourcing

Most the dairy products & needs to be stored in

Refrigerator and Deep Freezer

A wooden wardrobe will be required for proper

Placement of Crockery items

Stocking

Order Preparation Orders received at counter will be forwarded to

kitchen by Counter person

Orders are made by using IPads on all tables

Modern cooking equipment for efficient

cooking

Maintenance This includes all types of normal operations of

Restaurant apart from specific operations mentioned

above. Regular Crockery updating, IT systems, Library,

Kitchen Maintenance



Page 11

Sourcing

Sourcing of Milk

Milk will be delivered directly to the restaurant twice a day by

the milkman of the local area. Usually Sanchi milk is the best

quality of milk available in the region. It is supplied by Sanchi

distributors having their outlets at all the major areas. Milk will

be available a wholesale rates through these Sanchi distributors

which will deliver milk directly to the restaurant.

Sourcing of Bakery products & Vegetables

All the bakery products like cheese, butter, eggs etc. which

have low shelf life and needs to be served fresh will be

procured daily from the local wholesale vendor. Fresh

green vegetables too need to be procured daily in the

morning from the local vendors. So the an estimated

quantity of these things will be procured every morning on

daily basis

Sourcing of Kirana items

Sugar, salt, Spices etc. kirana items have a long

shelf life. So these things will be bought weekly

or fort nightly from the local wholesalers in

bulk quantity. So as to facilitate the operations

of next 7-15 days. Also for Gas cylinders, we

initially will buy 3 cylinders although we need

only two for daily operations. 3rd cylinder will

act as a backup in case of any emergency. Cylinders are delivered directly to restaurants by

the local gas agencies, within 7 days of the order. We will procure it in the same manner. As

gas pipeline connection is not available presently in the area, we have to buy cylinders.



Page 12

As we are a low budget restaurant, procuring the entire items at least possible price will be

the key for long term Profitability. But at the same time we have to ensure that the best

quality of all these things are bought. For the examination of this, regular quality checks

needs to be run (explained in detail, in the maintenance part)

Sourcing of crockery and Utensils

As the main aim of T-PoG is to provide an overall

experience of having tea, crockery plays an important

role. Crockery needs to be updated every 6 to 8 months.

Similarly Kitchen utensils too will be updated as & when

needed. There is no fix place for the procurement of these

things, as they are impulse buying items.

Books & Games

Books, A very important part of T-PoG, will be

updated when required. Books will be sourced

mainly from amazon.com , Also some of the will

be procured from local book dealers.

Stocking

Stocking the inventory in a efficient manner is one of the most important part for any type

of business. It directly affects the overall profitability of the business. We have a special

attention for the storage of our inventory.

Deep Freezer & Refrigerator All the Dairy products like

butter, milk, Paneer, Cheese etc. and the fresh green

vegetables will be stored in deep freezer for continued

freshness. A full size refrigerator too will be available the

store for the same purpose. As the dairy products and

vegetables get spoiled quickly, deep freezer is essential to

avoid the spoilage probabilities. Both the refrigerator & the

deep freezer are to be kept inside the kitchen only so as to

have quick access an reduce the overall delivery time.



Page 13

Storeroom

Besides the kitchen, there will be a 225sq ft storeroom which

will act as a warehouse for all the other items. As we are not

keeping large stock, so this room will be enough to house our

entire inventory safely and also will give us a quick access for

the same. It will have shelves for storage of Kirana items, two

wardrobes for crockeries. So that entire inventory is kept safely

and is quickly accessible.

The entire storage place needs to have proper ventilation. All the stocks need to be

updated constantly. For this our IT team has developed software which will keep us

updated about the quantity of each item present in the store room. All the incoming stock

needs to feed in the software. It will calculate the consumption on the basis of orders

received.



Page 14

Order preparation

One of the key factors behind the success of any restaurant is the time between point of

receiving order and the point of delivering the food. This time needs to be minimized. Chunk

of this time depend on your ability to prepare the ordered food.

Cooking the food

Our kitchen will be equipped with one Microwave oven,

2 No.s Toasters, 1 No. 4-Burner Gas stoves, 1 No. Mixer

grinder and 2 No.s Induction plates.

All the basic ingredients will present in kitchen in limited

quantity required for daily operations. Also the

ingredients stored, are very near to the kitchen. Basic

Sauces, Chutneys etc. ingredients which are required for

most of the dishes will be prepared at the start of the

day. Now, once the order is received at the counter, it

will be transferred to the chef. Chef then will prepare

the order. Just when the food is cooked (not served), chef will inform the counter person,

who will transmit the signal to the IPad on the table of the respective customer.

Serving the Food

Just when the food is cooked completely, customer

will receive notification on the IPad screen of their

table (Image showing the notification). So while the

food is being served, customer can go to the

counter. While he reaches the counter, his order will

be served to him by then. Customer then, can pay

for the order and collect his order.



Page 15

Cleaning of the dishes

Once the customer leaves the table, serviceman of the particular table will collect all the

dishes from the table, clean the table and take the dishes to the washing area near the

kitchen and handover the dishes to the serviceman of the washing area. Cleaned dishes

then will be transferred again to the kitchen.

Maintenance

This part basically talks about our backend processes. Besides the normal operations

mentioned above, all other miscellaneous operational activities forms the part of

maintenance. Periodical maintenance of each and every thing is very important to make the

business more efficient & thus more profitable. This is the only reason to include

maintenance part as a separate head. Further, maintenance is subdivided into following

heads:

Software Connectivity



Page 16

IT Systems & Accounts

This will insure the proper working of Computer systems, Our software for ordering from

the table directly, Wifi system, Karaoke which is one of our differentiated offerings.

Maintenance of the books of accounts and other financials is one of the very important

aspects for any business to work efficiently. Proper reporting of revenue, Profitability,

Developing strategies based on the financials.

Kitchen Maintenance

For restaurant business, proper maintenance of kitchen is must. The quality of food you

serve to the customer directly depends on the degree of hygiene you maintain in the

kitchen. Head chef will be trained to achieve the best hygiene standard in and around the

kitchen.

Training

For any business to run efficiently it is very important that all the employees are expert in

their respective domains. For T-Pog, as we want provide an overall experience to our

customers, it is necessary that not only the waiters but all the members of the staff present

in the restaurant thrive to do this. Regular training sessions will be conducted for all, initially

with the help of training institutes & then staff to staff training in the future.



Page 17

Human Resource Planning

Human resources are the most expensive and most important of all the resources. Proper

planning is to extract most out & make the business profitable. Below are the different

departments and their responsibilities and the number of person required in each

department.

Responsibilities & size of Departments

Housekeeping:

Housekeeping personnel will be responsible for the cleanliness in all areas of the restaurant.

Cleaning tables once the customer left the restaurant, cleaning of toilets, smoking area,

cleaning of dishes, utensils etc. They will also assist logistics person for daily logistics. And

other functions like serving & assisting customers.

Housekeeping Department will be led by Restaurant manager and will consist of 7 helpers. 2

helpers for each floor 1 for kitchen for the Day shift and 1 helper on ground floor and 1 in

the kitchen for the Night shift.

Most (3) of the helpers of housekeeping department will serve also assist other

departments as all of them will be required only during peak hours & for the rest of the time

they can assist other departments.

Restaurant Manager

Tech.

Dept. Kitchen Logistics House keeping



Page 18

Technical Department:

Technical department is further divided into two sub departments Marketing & IT

department.

IT department will consist of only 1 IT person who will be responsible for the proper working

of IPads on the tables, Computer systems, Karaoke, Wi-Fi and other IT systems in the store.

Marketing will consist of One marketing manager who will be responsible for designing

different campaigns, publishing ads in the NEWS papers & on radio, Organizing time to time

events for engaging audiences, Managing instore customer wall, and most importantly he

will be responsible for Customer relationship Management.

IT and Marketing together will also be responsible for managing online presence of T-PoG.

i.e. managing all the social media pages of T-PoG, writing blogs and managing Website of

T-PoG!

Logistics

There will be 1 person in this department who will be responsible for bringing stock for all

the departments. He will be assisted by one of the helpers of housekeeping dept. he will be

responsible for the shopping of fruits, vegetables, bakery, grocery and other needs of the

restaurant. He will be responsible for all the work outside the restaurant & report directly to

the Restaurant Manager.

Kitchen

Kitchen will consist of a Head chef, two assistant chefs & 2 assistant helpers specific to

kitchen only. Head chef, One assistant chef & One assistant helper will work in day shift &

the other assistant chef & Helper will work at night sift.

Head Chefs will be responsible for training of all helpers and assistant chefs. Processing

orders, preparing dishes, keeping the manager updated above the requirements of all the

raw materials (bakery, Milk, Vegetables, spices etc.)

Assistant chefs will be responsible for preparing all the dishes and assisting the head chef.

They will be responsible for maintaining the inventory of raw materials in the kitchen and

store room. They will report to Head chef.

Assistant helpers as the name suggests will assist chefs in their work. Cutting vegetables,

preparing dishes etc.

In all there will be 15 employees including the manager in the restaurant.



Page 19

Business Model Canvas



Page 20



Page 21

Marketing Strategy

T-PoG is a youthful brand, and so all marketing should be focused on our target markets.

Below is the explanation of all the marketing tactics & strategies to be followed for T-PoG!

We should have clearly defined segments and the targeted audiences

Segmentation

ALL TEA LOVERS

Students Working professionals Teens Youth Cools Matures

Age 15-18 18-24 24-40 40+

Sex M/F M/F M/F M/F

Income Low Low/Med Med/High High

Education Low Low/Med Low/Med/high Low/Med/high

Lifestyle

Study Oriented/

Highly outgoing

Study Oriented/

Highly outgoing

Heavy Work loaded, Medium outgoing

Medium workload, Less

Outgoing

Urban Tier ii Tier ii Tier ii Tier ii

Avg no. of TEA cups/DAY

2-3 3-4 3-4 4+

Segment Attractiveness

Med High High Low

Segment Awareness

High High Med Med

Price sensitivity High High Low Med

TARGET MARKET



Page 22

Students

a. Teens : These are young school going students. There lifestyle is oriented highly

towards studies, have low income and they like to go out and enjoy with friends. Highly price sensitive. They actually look for the places which costs them less and can serve most to them.

b. Youth : These are young college going students. A major part of this segment stays

in hostels. Higlhly studies oriented. Like to party & hangout as couples and groups. Have low to medium income. They are active 24*7. So they are ideal targes for T-PoG. Their sensitivity towards price is Not very high But also not very low.

Working Professionals

a. Cools : They are heavily work oriented individuals. Have a high disposable income.

Like to enjoy most and are readily outgoing. Very less sensitive towards price. As T-Pog is located in area with more than 20 offices in a 3 K.M. radius, T-PoG is highly accessible to them. They can come to T-PoG before the office hours, During breaks and after office hours. They are one of the major target market for t-Pog.

b. Matures: They are working professionals of more than 40yrs of age. Mostly

married and have many responsibilities. Are less out going and like to enjoy time with family.

Targeting:

As clearly indicated in our segmentation table, Working professionals cools & Young college students will be our major target segments. Also young students will be targeted.

Positioning:

T-PoG is a low budget highly involving, restaurant. It is positioned as a cool and safe place to hangout which have a lots of varieties. We provide not just Tea but an overall experience for enjoying tea.



Page 23

Positioning on Map

High price

Low price

Low Indulgence

High Indulgence 3 star Hotels

Local Tea Gumthis

Restaurants

Sweet Shops

High Indulgence



Page 24

Retail Mix

Merchandise mix

T-PoG will have more than 50 different varieties of Tea divided broadly into two catagories.

Besides tea, we will also have Sandwiches, toasts, Rolls and the traditional indian dry snacks

like Mathri, Pinni, Laddus, Biscuits, Sev, Chakli, Naan khatai, khakra, thepla & other regional

tea time snacks.

Tea

Desi Tea Videsi tea

Plain tea

Clove Tea

Cardomom Tea

Ginger tea

Masala tea

Tulsi tea

Pepper tea

Customized tea

Coal special tea

Strong/Light tea

Etc

Chinese tea

American tea

British tea

Malaysian tea

Scientific tea

Green Tea

Black tea

Lemon tea

Ice tea

Tea Latte

Etc.

Toasts, S/Ws

Butter Toasts

Cheese Toasts

Veg cheese Sandwich

Egg sandwich

Oregano sandwich

Masala rolls

Egg rolls

Paneer tadka roll

Chinese roll

Malai Roll

Kachori/Samosa

Mathri/Pinni

Khakra/thepla

Nan khattai

Bhel/ Garlic buns

Rolls Desi snacks



Page 25

Total Product Concept

Potential Product:

Female drivers

and Speed

Control Alerts

Augmented Product:

Safety, Comfort, karaoke and free reading novels

Expected product:

On Time Service, Quality ,ambience and Trust

Actual Product:

Tea and snacks

Core Service:

Experience



Page 26

Pricing & Profitability

Pricing the merchandise is a very critical factor. It cannot be priced high as we are a low

budget segment player. We cannot price it low as we are providing so many facilities which

bears high cost.

When we see our competitors, their price ranges From INR 10/cup (200ml) at local gumtees

to INR 150 in nearby 3 star hotels. Similar price range for other categories, ranging for INR

25 to INR 500.

We will provide a mix of both, but slightly towards the lower side. Our tea prices will range

from INR 10/ Cup to INR 50/ Cup (220ml) . Below is the broad pricing for different categories

& also the gross profit from each category (Gross Profit = Selling price – Cost of sales, this

includes all raw materials but no other expenses)

Category Price range Gross profit Margin

Tea 10 to 50 50-70%

Toasts & Sandwiches 15 to 50 40-65%

Rolls 15 to 40 30-50%

Dry Indian Snacks 10 to 30 50%

Other Snacks Upto 50 Variable

Wi-Fi Free upto 1hr, 5/mb beyond. 100%

Books Demand Based 15-20%

Location Planning

Location planned for Our first Restaurant is Anand Nagar Khandwa, Madhya Pradesh. It is a

big commercial area with almost 35 colleges & offices with an average strength of 200

persons, within the radius of 3 K.M. Apart from local tea shops (gumtees) there are hardly

any good shop for having snacks. In the area. Though there are some bakeries but no

restaurants around.

T-PoG is planned to be located on the main street with two main roads passing near by.

Prices in INR/serving



Page 27

Traffic

Signal

Parkin

g

Parking En

trance

To St. Pius

To Alliance College

To G

.D.C

To

Raj

Un

iv.

3 K.M.

5.5 K.M.

8 K.M.

Trading Area



Page 28

Primary Trading Area

Our primary trading area extends from Alliance college in the west to St. Pius school in the

east, and from G.D.C. in the north to Raj Univ. in the south. The area surrounds almost 30

colleges, Offices & schools with an average of 200 individuals working or studying. Primary

trading area has a population of more than 10,000. From any location in our primary trading

area, T-PoG can be reached within 25 Mins.

Geographic Boundaries St.pius (E), Alliance college(W), G.D.C (N), Raj Univ. (S)

Population 10000(Residential) + 5000(Daily Commuters)

Radius 3 K.M.

Max time to reach T-PoG from any point 25 Mins

Trading Areas on Map



Page 29

Secondary Trading Area

Geographic Boundaries Kishore nagar (E), Clock Tower(W), Padam Nagar(N), Civil Lines(S)

Population 1,50,000(Residential) + 20000(Daily Commuters)

Radius 5.5 K.M.

Max time to reach T-PoG from any point 45-60 Mins

Tertiary Trading Area

Geographic Boundaries Hotel Aangan(E), Doodh talai(W), Hotel Zayka(N), Indira Square (S)

Population 4,50,000(Residential) + 30000(Daily Commuters)

Radius 8 K.M.

Max time to reach T-PoG from any point 70-80 Mins

Promotion Mix

As we have a specific target audiences, all our promotional activities should be targed to

them.

Sales promotion: During the initial few days a lot of sales promotion would be done to

attract the customers. Combo offers, 50% off , Buy 1 get 1 free etc. offers will be given for

initial few days.

Direct Marketing: Direct marketing by going in different colleges and offices in the near

by area. Sponsoring events of colleges & schools etc would be done. As colleges and offices

are our specific TG, direct marketing in the colleges would be done on a large scale.

Media Advertising: Advertisements in the local News Papers & radio channels would

give a reach to huge number of audiences as these are two most common channels among

the youth



Page 30

Internet Advertising: This is an era of internet. Each and every individual have

smartphone now a days. Advertising through is fast and extremely targetable. A lot of SEO

would be done for our restaurant. We will offer free discount coupons through websites like

freecharge, Mobikwik etc. Publish ads on all the websites our target audiences visit through

Google Adwords.

Social media marketing: Social media is expanding at a very high rate; specially young

population is attracted towards it. We will have our company’s page on all the major

websites like Facebook, twitter etc. We have a dedicated marketing manager to manage

social media. We will organize contests for best new style tea on Facebook & twitter. Where

people will submit their styles of making & having tea. Best idea would be awarded with a

free meal at T-PoG.

InStore Promotions: Our store will be decorated regularly on different festivals and

occasions. Theme of all the promotion activities goingon on different channels will be in

contrast of the decorations in the store. Time to time we will organize different events to

engage audiences.

Loyalty program: Customers can signup for special T-PoG Chai card. They will get extra

benefits through these cards. Extra 10% off for card holders. Also they will get express

service where they will be preferred over customers for processing of orders. They will get

free tickets for events organized by T-PoG.

Finances

Private label Tea

Revenue Streams

Food sales

Private label Tea

Advertising income

Cost Centers

Salaries

Maintenance

Promotions

Fixed

Variable Raw Materials

Logistics



Page 31

Fix Costs

a. Salaries

b. S,G and A expenses

S.G and A expenses

Particulars Monthly Cost Yearly Cost

Electricity, Water , Petrol 15000 180000

Internet 2000 24000

Housekeeping 1500 18000

Miscellaneous 5000 60000

Marketing 5000 60000

Total 28500 342000

S,G & A Salaries Total Fixed monthly Expense

28500 148000 176500

Payroll

Department Role No. of personnel

required Salary per

person Total/ year Total / month

Kitchen

Head chef 1 300000 300000 25000

Assistant chef 2 180000 360000 30000

Helper 2 60000 120000 10000

Housekeeping Helper 7 48000 336000 28000

Marketing Jnr. Manager 1 120000 120000 10000

IT Manager 1 120000 120000 10000

Logistics Jnr. Manager 1 120000 120000 10000

Admin Manager 1 300000 300000 25000

Total 16 1776000 148000

All amounts in INR



Page 32

c. Setup cost

Setup Cost (one time) Fixed Category Particulars Units Cost/unit Total

Furniture Table set 20 8000 160000

Decoration Various Various 500000

Kitchen Equips

Gas burners 2 8000 16000

Microwave 1 15000 15000

Deep freezer 1 90000 90000

Refrigerator 1 50000 50000

Induction cooker 2 3000 6000

Utensils Various Various 10000

Crockery Various Various 20000

It system

IPADs 20 10000 200000

Computer 1 15000 15000

Software Various Various 15000

Miscellaneous 200000

Total 1297000

Market Sizing & Opportunity

Market sizing and Contribution margin Calculation Population of Khandwa 1390000

Population in the age group 15-40 yrs 667200

Target segment size in Primary trade area 6000

Estimated Numbers of orders per day 100

Estimated avg. Order size 185

Revenue / month 555000

Gross profit / Month (40%) 277500

Operating cost (In the above table) Fixed/ Month 176500

Contribution Margin/ month 101000



Page 33

Breakeven Analysis

Breakeven analysis

Breakeven period(Months) is (Total Fixed cost)/Contribution towards Fixed cost each month

(1297000)/45500

13

Total months for Breakeven is 13 Months

Profit & Loss Statement

Profit & Loss Statement For next 3 Years

Assumption: Annual growth rate= 10% Tax 30%

Particulars Year 1 Year 2 Year 3

Revenue 6660000 7326000 8058600

COGS 3330000 3663000 4029300

S,G & A Expenses 2118000 2329800 2562780

Operating Profit 1212000 1333200 1466520

Tax @ 30% 363600 399960 439956

PAT 848400 933240 1026564

The End!

New retail store Concept, tea store chain By Manpreet singh Digital

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