Description
Develop a Strategic Business Plan for a New Venture
Start-up companies are more important in bringing products and services to market. In response to new technology, new and innovative businesses are taking over the markets of those older companies too slow to move with changing customer demands. Following this line of thought, for this task you are an administrative officer at the corporate level of an offshore organization and, you are assigned to develop a strategic business plan for a new venture in a sector of your choice. This Strategic Management Process should contain whatever is necessary to start-up a company from scratch, including the new company’s philosophy, mission, objectives, strategies and tactics, CSR, an analysis of the firm’s internal and external environment, organizational structure, leadership and, an one-page financial report justifying the firm’s survival for at least a year. You should justify your choices in terms of the chosen industry/sector on the grounds of innovation, competitive advantage and, company’s sustained growth and survival. Your budged is £150,000 (BP).
DIRECTIONS AND HELP FOR YOUR ASSIGNMENT
You are expected to discuss a number of components that appear in the ‘Strategic Management Process’ in relation to an innovative idea/ new venture. However, in the same way that businesses vary in the processes they use to formulate and direct their strategic management activities, you may include different components in your strategic process. In other words, although the basic components of the models used to analyze strategic management operations are very similar, you may develop an eclectic strategic analysis. Despite the differences, nevertheless, your strategic analysis should be representative of the foremost thought in the strategic management area. Your strategic management process may include all, or most of the following key components (source: Pearce and Robinson, 2010):
Company Mission
Form a company mission for your new venture. The mission of a company is the unique purpose that sets it apart from other companies of its type and identifies the scope of its operations. In short, the company mission describes the company’s product, market, and technological areas of emphasis in a way that reflects the values and priorities of the strategic decision makers.
Internal Analysis
The company analyzes the quantity and quality of the company’s financial, human, and physical resources. It also assesses the strengths and weaknesses of the company’s management and organizational structure. You are expected to proceed to a similar analysis, using appropriate tools such as SWOT analysis.
External Environment
A firm’s external environment consists of all the conditions and forces that affect its strategic options and define its competitive situation. The strategic management model shows the external environment as three interactive segments: the remote, industry, and operating environments. You should present and discuss a similar analysis about the external environment of their new venture.
Strategic Analysis and Choice
3
Simultaneous assessment of the external environment and the company profile enables a firm to identify a range of possibly attractive opportunities. These opportunities are possible avenues for investment. However, you must be screened through the criterion of the company mission to generate a set of possible and desired opportunities. This screening process results in the selection of options from which a strategic choice is made. The process is meant to provide the combination of long- term objectives and generic and grand strategies that optimally position the firm in its external environment to achieve the company mission.
Long-Term Objectives
In your analysis, you are expected to emphasize the importance of long-term objectives. The results that an organization seeks over a multiyear period are its long- term objectives. Such objectives typically involve some or all of the following areas: profitability, return on investment, competitive position, technological leadership, productivity, employee relations, public responsibility, and employee management.
Generic and Grand Strategies
Many businesses explicitly and all implicitly adopt one or more generic strategies characterizing their competitive orientation in the marketplace. Low cost, differentiation, or focus strategies define the three fundamental options. Although every grand strategy is a unique package of long-term strategies, 15 basic approaches can be identified. You are expected to present and discuss the generic and grand strategy/ies that are suitable for their new venture, how are to be achieved, and their roles towards achieving the organization’s long-term objectives.
Short-term objectives
Short-term objectives are the desired results that a company seeks over a period of one year or less. They are logically consistent with the firm’s long-term objectives. Companies typically have many short-term objectives to provide guidance for their functional and operational activities. Thus there are, among others, short-term marketing activity, raw material usage, employee turnover, and sales objectives. You should discuss their short-term objectives, and their role in supporting generic and grand strategies.
Functional tactics
You are expected to suggest a number of functional tactics and how these short-term activities are used to achieve short-term objectives and establish competitive advantage. Within the general framework created by the business’s generic and grand strategies, each business function needs to undertake activities that help build a sustainable competitive advantage. These short term, limited scope plans are called tactics. A radio ad campaign, an inventory reduction, and an introductory loan rate ar examples of tactics. Functional tactics are detailed statements of the ‘means’ or activities that will be used to achieve short-term objectives.
Policies that empower action
Speed is a critical necessity for success is today’s competitive, global marketplace. One way to enhance speed and responsiveness is to force/allow decisions to be made whenever possible at the lower level in organizations. Policies are broad, precedent- setting decisions that guide or substitute for repetitive or time-sensitive managerial decision-making. Creating policies that guide and ‘preauthorize’ the thinking, decisions and actions of operating managers and their subordinates in implementing the business’s strategy is essential for establishing and controlling the ongoing operating process of the firm in a manner consistent with the firm’s strategic objective.
Strategic Control and Continuous Improvement
Strategic control is concerned with tracking a strategy as it is being implemented, detecting problems or changes it its underlying premises, and making necessary adjustments. In contrast to post-action control, strategic control seeks to guide action on behalf of the generic and grand strategies as they are taking place and when the end results are still several years away. The rapid, accelerating change of the global marketplace of the last 10 years has made continuous improvement another aspect of strategic control.
Conclusion
As it has been mentioned earlier, you are expected to use all or a number of components towards synthesizing a Strategic Management Process for their new venture. Each component is a central theme in different chapters of their core textbook. At the same time, students are expected to present a one-page analysis of their financial highlights, illustrating expected money inflow/outflow for a year.

Explanation & Answer

please find the attached files. i look forward to working with you again. good bye
Running head: STRATEGIC BUSINESS PLAN
Strategic Business Plan
Name
Tutor
Institution
Course
Date
1
STRATEGIC BUSINESS PLAN
2
Introduction
Jaz café will be a small but modern and cozy coffee shop targeting upper-middle class
coffee enthusiasts who are willing to pay a little more for Gourmet coffee which is more
expensive compared to regular coffee. The business will target coffee enthusiasts who wish to
grab a cup of coffee with their friends and family, or would want to relax as they read a book.
In addition, Jaz will offer its customers a pleasant outdoor patio and high quality gourmet
flavored coffee accompanied by a wide range of snacks such as sandwiches. The coffee
house will only focus on Gourmet because coffee consumption trend has changed in the last
five years, with current preferences leaning more towards Gourmet flavor over regular coffee.
Company Mission
Jaz cafe’s mission is to be the number one gourmet coffeehouse of choice due to the
ability to embrace innovation which will help customers save time and money. The coffee
shop will aim at providing a friendly and comfortable atmosphere where customers can
access high quality gourmet coffee at a reasonable price. The company will ensure that a
unique environment is provided for customers so that they can relax and socialize with others
in comfort as they enjoy Gourmet flavored coffees. We will be focusing on relieving
customers of daily stresses through our quality products and friendly customer service. The
experienced barristers will be able to provide outstanding services by recommending
beverages for customers and when necessary, customizing. This will ensure increase in
employee satisfaction, increase in sales, and increased shareholder returns.
STRATEGIC BUSINESS PLAN
3
Internal Analysis
SWOT Analysis
Strengths
•
Jaz cafe will adopt a franchise business model which attracts less risks compared to
small sized coffee shops.
•
The Gourmet coffee segment has a defined target market of the Upper-middle class,
hence its highly profitable due to the ability to charge relatively higher prices.
•
Availability of resources, hence the company will run on minimal debt.
Weaknesses
•
A franchise is more complex to operate compared to other simple coffee shops.
•
Jaz coffee is a small company which may not be able to withstand the strong
competition from large and established coffee giants such as Starbucks (Lundy,
2014).
Opportunities.
•
Currently there is an increasing demand for Gourmet coffee hence there are
opportunities to expand the business into various cities.
•
The company can expand globally since Gourmet coffee has a growing international
market demand.
•
Tap into wider market. The company can sell several other drinks such as Tea, regular
coffee, and milkshake.
STRATEGIC BUSINESS PLAN
4
Threats.
•
New products are always coming up, hence there is a high threat of better and more
preferred drinks being introduced to the market.
•
High competition. Jaz café will face competition from several large companies and
small businesses. People can also choose to make coffee at home.
External Environment
The Coffee shops industry is driven by economic and social factors, especially current
trends and one’s disposable income. In the recent years, there have been increasing trends of
coffee consumption, hence an increasing demand for the beverage compared to other
beverages. Disposable income has also increased over the years, hence people are willing to
spend more. Today, coffee top sellers such as Starbucks have established highly profitable
coffee beverage segment. However, most have not achieved much success with gourmet
coffee as this beverage tends to be a little bit costly compared to traditional coffees. Even
though it is possible to make profits from gourmet coffee, most of the companies have not
mastered strategies for targeting the right audience for the beverage. Due to cultural factors,
most of the customers want to buy the experience as well as the scent of freshly brewed beans
(Tom Matzen, 2011). Most of these consumers also tend to be coffee enthusiast, hence it is
possible to have a high level of customer loyalty.
Gourmet coffee demand is especially high in upper-middle class neighborhoods,
hence the Jaz cafe will specifically target this demographic. The company will take advantage
of the fact that this segment of the beverages industry is not yet saturated, hence there is room
to establish a profitable franchise.
STRATEGIC BUSINESS PLAN
5
Strategic Analysis and Choice
Rather than adopting the current industry trend of focusing on low pricing as a
competitive advantage, Jaz café will focus on quality of the coffee provided, offering
convenience, and in customer service. The company will also focus of franchising the
business in order to diversify risks and minimize operating costs so as to realize high profits.
Long-Term Objectives
Within the first year, Jaz café hopes to breakeven and have presence in five cities
where five coffee shops will be established. Much focus will also be on building customer
loyalty and in creating brand awareness.Unlike most modern cafes, Jaz cafe will seek to be
known as an outstanding smaller but cozier cafe which will be offering premium coffees,
which will especially be served by highly qualified Baristas, with the ultimate target market
beingglobal coffee enthusiasts.
Generic and Grand Strategies
Jaz café will adopt a differentiation strategy which will lead to enhancement of
competitive advantage. The café will be small but cozier than its competitors, will mostly
focus on Gourmet coffee, will target coffee enthusiasts, and will offer outstanding quality of
products. Therefore, the key focus will be; great products which will ensure that customers
return again and again, high quality Baristas who will ensure quality of beverages, and focus
on meeting customer needs and specifications.
Short-term objectives
Jaz cafe will focus on ensuring that at least 100 customers visit the coffee shop during
the first week. This number will be expected to triple by end of the first month, and by the
STRATEGIC BUSINESS PLAN
6
third month, atleast 500 customers should be visiting the café each day. This will lead to a
significant increase in sales and revenues.
Functional tactics
The functional tactics adopted by Jaz cafe will mostly include social media marketing
and enhancing customer loyalty through promotions and free snacks. Social media
advertising will help establish presence of the café at the least possible cost.
Policies that empower action
A highly skilled team will be responsible of running the business, and power will be
decentralized to ensure that there is less bureaucracy, and that junior managers as well as
employees are able to make decisions which are within their job description(nhsbdc, 2011).
However, the most sensitive decisions such as changing the menu or introducing new
products will be made by the management team.
Strategic Control and Continuous Improvement
Monitoring of performance of the café will be tracked using various set metrics of
sales, profitability, and customer loyalty. An increase in sales will be an indicator that the
employed marketing strategies have been successful. On the other hand, the ability to break
even within the first year of operations will indicate that expenses have been maintained at
acceptable levels and that sales have been high and consistent. High customer loyalty will
indicate customer satisfaction since customers will be willing to visit the café time and time
again.
STRATEGIC BUSINESS PLAN
7
Financial Report
Budget: 150, 000 in BP
Expenses
1. Retail space lease: 20,000
2. Labor: 40,000
3. Inventory (Raw materials) 10,000
4. Equipment.
The below equipment will be purchased within the first year:
•
Espresso Machine 20,000
•
Espresso grinder 1,000
•
Fridge (3,000)
•
Dishwasher, Microwave, storage bins 3,000
5. Snacks(Muffins, cookies, scones) 20,000
6. Utilities (internet, water, electricity, gas, phone) 11,000
7. Legal Fees 300
8. Permit 1,000
9. Accounting fees 5,000
10. Promotions and Advertising 10,000
STRATEGIC BUSINESS PLAN
8
References
Lundy, M. (2014). Business models for quality coffee. Researchgate, 226. Retrieved from
https://www.researchgate.net/profile/Mark_Lundy2/publication/258437648_Business
_models_for_quality_coffee/links/02e7e528391f20ee83000000/Business-models-forquality-coffee.pdf
nhsbdc. (2011). SAMPLE BUSINESS PLAN: Moose Mountain Café. nhsbdc, 28. Retrieved
from https://www.nhsbdc.org/sites/nhsbdc.org/files/media/moose_mountain.pdf
Tom Matzen, M. H. (2011). START & RUN A COFFEE BAR. Entrepreneur Coach Inc., 27.
Retrieved from https://www.self-counsel.com/docs/SR_coffee_bar.pdf
Running head: OUTLINE
1
Outline
Name
Institution
Course
Tutor
OUTLINE
2
Outline
Introduction
•
Jaz café will be a small but modern and cozy coffee shop targeting upper-middle class
coffee enthusiasts who are willing to pay a little more for Gourmet coffee which is more
expensive compared to regular coffee.
Company Mission
•
Jaz cafe’s mission is to be the number one gourmet coffeehouse of choice due to the
ability to embrace innovation which will help customers save time and money.
Internal Analysis
SWOT Analysis
Strengths
•
Jaz cafe will adopt a franchise...
