Business Plan General Format You can do this project indivi

Business Plan:

General Format – You can do this project individually or up to teams of two – however, if you do this in teams of two, I would expect a 10 page report;.

1.  The paper must be typed

2.  Use headings within the report when appropriate.

3.  A table of contents page is necessary.

4.  The paper should be between 5-7 pages in length.

5.  Plan the paper carefully so as to develop an organized and non-redundant report.

6.  Please cite your sources using MLA or APA Format – (the Writing/> Center/>/> can offer assistance if you do not know how to do this).  Some other helpful sites include - http://owl.english.purdue.edu/owl/resource/560/01/,http://owl.english.purdue.edu/owl/resource/557/01/, http://www.cuyamaca.edu/tpagaard/EnglDept/Resources.htm

Tentative Outline of the Paper:

1. Each student is expected to select an organization (this can be a new(your own business that you own now or hope to run in the future) or preexisting business such as Walmart) and complete the following activities:

2.  Executive Summary. The paper must begin with a one page summary that orients the reader as to the contents as well as to the major sections of the report. The summary, by itself, must provide enough information about the project so that the reader can judge simply by reading this portion if he or she wants to read further.

3.  Introduction. This first segment should present a brief history of the organization and its local operations. Be brief and succinct, but make sure that the reader can obtain a perspective of the organization.

4.  Body. Suggested headings for your business plan include the following, whatever you can find:

1.  FORM OF BUSINESS OWNERSHIP (sole proprietorship, partnership, corporation)

2.  ORGANIZATIONAL STRUCTURE (ownership and management)

3.  LICENSES NEEDED – such as contractors license, etc.

4.  MARKETING PLAN - using the 4 P’s of marketing

5.  PRODUCT/SERVICE PLAN - What products/services being offered the first year.

6.  ADVERTISING – What form of advertising will you use the first year?

7.  OPERATION PLAN – location, will you make or buy your product.

8.  SWOT ANALYSIS – Determine the strengths, weaknesses, opportunities, and threats that pertain to your business.

9.  FINANCIAL PLAN – Make an income statement for the first year (please be realistic). Also include how you will acquire funding.

5.  Conclusion.  In conclusion, please explain why or why not you think your business will be a viable business opportunity. What solutions could you recommend?  What timelines would you offer the company?  Please justify your reasoning.

Solution

Franchisee Business of McDonalds

Executive Summary -

McDonald’s Corporation is an international brand which providing the fast food products like hamburgers, French fries and other items using standard production, heavy expansion and brand promotions as the driving force. McDonald’s currently operates in more than 121 countries and has over 30,000 restaurants worldwide.

McDonald’s use an intense, rapid expansion into different countries through its basic three primary methods of business, franchising, company owned restaurants, and joint ventures. McDonald’s management relied on this method to aid in the acceptance of a new style of eating into unfamiliar markets, with minimum risk and maximum profits, franchising continues to contribute heavy to McDonald’s international success.

With a centrally handling of international structure, It keeps eagle eye on operations, cost and quality. With an Superiority management strategy, McDonald’s heavily relies on local and domestic based logic and attitudes and transfers them to their international outlets and restaurants.  

In order to control its international operation, McDonald’s uses a combination of two approaches i.e Rules Approach and Cultural Approach. The more of control will fall under into rules approach, meaning that control lies with headquarters creates procedures and policies for the other subsidiaries to follow. However, the cultural approach that is shows is being utilized judging by the adaptation that is occurred in some of the international restaurants.

McDonald’s Background -

It operates in over 121 countries and over 30,000 restaurants around the world; McDonald’s Corporation is the largest fast food service in the world. To serve all of the their customers and demonstrate the large size of the company, McDonald’s has more than 1.5 million employees and serves more than 96% of the world’s population at least once a year. McDonald’s operating in the fast food industry and its main product include hamburgers and french fries, chicken, salads, and fish products among others16.

Body -

1.  FORM OF BUSINESS OWNERSHIP – Franchisee      

2.  ORGANIZATIONAL STRUCTURE – Restaurant Level

- General Manager - Restaurant Manager - 1st Assistant Manager - 2nd Assistant Manager -Shift Running Manager - Floor Manager - Staff Training Crew - Crew Members

3.  LICENSES NEEDED – Franchise Disclosure Document (FDD) of McDonald

4.  MARKETING PLAN –

Product Strategies:

These two icons will give customers a mental image of what to look for when they quality food for a low price fast. The firm will focusing on low-priced, quality food and provided an entertaining environment for the children. These things were what is the market wants at the time and the firm answer in spades.

Placement Strategies:

McDonald\'s primary focuses on store placement and always looks for the best locations. This strategy creates some weakness in the last 10 years because it seems that many stores are put in some areas, increase sales from the other McDonald\'s. The company has also made suitable a focus not only how fast it serves customers, but also in the location of its outlets.

Pricing Strategies:

The customer\'s value is an important element of the price charged. Customers withdraw their own mental power of what is a product worth. A product is more than its physical item, the weakness of using low price as a marketing tactics is that the customer may feel that quality is being good. It is more important when deciding on awareness of price of the brand and its integrity.

Promotion Strategies:

McDonald\'s marketing strategies shows different phrase likes, \"Have you had your break today?”, \"You deserve a break today,\" , \"I\'m Lovin\' It!\" mantra. \"I\'m Lovin\' It!\".

5.  PRODUCT/SERVICE PLAN – All products of available in outlay of McDonalds.

6.  ADVERTISING – Hoardings, Online Advertisement, Newspaper etc.

7.  OPERATION PLAN – Mall, Market space area where people can easily walks during days and night hours.

8.  SWOT ANALYSIS –

Strengths        

1) McDonald’s has a strong presence in global market with all its nearest domestic competitor being only half its size, McDonald’s is the market winner in both the international and domestic markets.

2) McDonald’s benefit is from cost reduction through its scale of economics because of its large size and its huge global market presence allows to diversity of risk involved with the performance of economics specific countries.

3) McDonald’s has large real estate portfolio. The company’s outlets are mainly located in areas that are highly traffic volume, high value for visibility ease of access.

Weaknesses

1) The food industry is really saturated has to deal with the prospect of looming market saturation, which will make it difficult to add new outlets.

2) Increase price competition with its to many competitors, which reduces its ability to increase revenue.

3) Lack of product innovation.

Opportunities

1) McDonald’s sell its Donatos Pizzeria back to its founder in 2003 and discontinuation Boston market operations outside of the US.

2) To increase profitability the company has slows its expansion of change the image of current restaurants and McDonald’s restaurants so as to refurbish adding new features such as Internet access.

Threats

1) McDonald’s aggressive international expansion has left it extremely vulnerable to other countries economic slowdown as its exposed to changes in the global economy.

2) Foreign currency fluctuation in internationally market.

3) The Fast food industry is more increasingly competitive sector keeps up with competitors through expensive promotional offers which lead to specific margins to gain market share.

9.  FINANCIAL PLAN –

Name of Fee

Low

High

Initial Franchise Fee

$45,000

$45,000

Real Estate and Building – 3 months’ rent

Base Rent:
$450

Percentage Rent:
0%

Base Rent:
$198,000

Percentage Rent:
40.5%

Signs, Seating, Equipment, and Décor

$691,000

$1,529,000

Opening Inventory

$20,000

$35,000

Miscellaneous Opening Expenses

$44,902

$46,045

Travel and Living Expenses while Training

$3,000

$35,000

Additional Funds – 3 months

$185,000

$329,000

ESTIMATED TOTAL

$989,352

$2,217,045

Total Estimated cost is approx. for Low area is $989,352.

Conclusion -

The “four P’s” of marketing mix (price, product, promotion and place) provide a good starting point for the requirements of strategy implementation in the marketing mix. No particular market strategy is guaranteed to achieve success at all times. Risk attitudes can change by environmental uncertainty and several internal conditions industry volatility also might be involved.

Sources -

Name of Fee	Low	High
Initial Franchise Fee	$45,000	$45,000
Real Estate and Building – 3 months’ rent	Base Rent: $450 Percentage Rent: 0%	Base Rent: $198,000 Percentage Rent: 40.5%
Signs, Seating, Equipment, and Décor	$691,000	$1,529,000
Opening Inventory	$20,000	$35,000
Miscellaneous Opening Expenses	$44,902	$46,045
Travel and Living Expenses while Training	$3,000	$35,000
Additional Funds – 3 months	$185,000	$329,000
ESTIMATED TOTAL	$989,352	$2,217,045