Table of Contents

Introduction: .................................................................................................................................... 3 Formulation of the Topic: ........................................................................................................... 3 Structure of Part II (TIS) ............................................................................................................. 3 Environmental Scan ........................................................................................................................ 3 SWOT Analysis for Holliday Villa Hotels & Suites Subang ..................................................... 4 Strength .................................................................................................................................... 4 Weakness ................................................................................................................................. 4 Opportunity.............................................................................................................................. 4 Threat ....................................................................................................................................... 5 Business Concept ............................................................................................................................ 5 Product and service description................................................................................................... 6 Various Beverages on offer ......................................................................................................... 7 Packaging .................................................................................................................................... 7 Service ......................................................................................................................................... 7 Value for Money ......................................................................................................................... 7 Understanding TMS ........................................................................................................................ 8 The target market and size .......................................................................................................... 8 Industry analysis and forecast ..................................................................................................... 8 The Profile of target customers ................................................................................................... 9 Business Potential ........................................................................................................................... 9 Why is this great idea? ................................................................................................................ 9 Competitor Analysis ..................................................................................................................... 11

Competitive advantage and competition analysis ..................................................................... 11 Barriers to entry......................................................................................................................... 11 Operation Strategy ........................................................................................................................ 12 Company description and business model ................................................................................ 12 Marketing Strategy........................................................................................................................ 13 Marketing Plan .......................................................................................................................... 13 Financial Model and business viability......................................................................................... 14 Exit strategies ................................................................................................................................ 18 Teams Strengths ............................................................................................................................ 19 Business Strategy .......................................................................................................................... 20 Long Term strategy ................................................................................................................... 20 Short Term Strategy .................................................................................................................. 20 Logo for the Holliday Villa Hotels & Suites QSR ....................................................................... 21 TIS Conclusion ............................................................................................................................. 21

Introduction:
After completing my training at Holliday Villa Hotels & Suites Subang, I have realized that they can very well expand them self into a separate fast food snacks center chain across the Malaysia. As the hotel is a reputed brand but in off season their business is not so attractive at this is a strong opportunity to expand into this sector and target the bottom of pyramid with a different name and keeping the brand name intact, just extending your brand name to your new venture.

Formulation of the Topic:

Our new venture opportunity for the Holiday Villa Hotels & Suites Subang is of the most beloved snack in Asia Samosa. The venture is to be a snack food chain centered on Samosa and having the brand name of the Holliday Villa Hotels & Suites.

Structure of Part II (TIS)

In this report we have covered the following topics for starting a new venture or better to say expanding into a new business line by the Holliday Villa Hotels & Suites Subang. a. Business Concept and its Uniqueness b. Understanding TMS c. Business Potential d. Competitor Analysis e. Operation Strategy f. Marketing Strategy g. Financial Model and business viability h. Exit strategies i. Teams Strengths j. Long and Short Term Strategy

Environmental Scan
At present the Holliday Villa Hotels & Suites Subang is already well reputed and well placed hotel in its own market. But their target is mainly the tourists and top level people of the pyramid

of the Malaysian society. Many of the renowned hotels in the same industry are already diversifying as their business are not active in off season and after the recession the hotel and hospitality business have had a big blow to their business in the whole world. Diversification into other similar industry and targeting the middle class population to access the bigger mass has become the demand for the hour. After working at the Holliday Villa Hotels & Suites Subang I have felt that because of various reasons the hotel have the capacity to diversify into the Snacks chain build around samosa. As this will add a uniqueness in their product which will be liked by a bigger mass and the brand value attached with the Holliday Villa Hotels & Suites Subang will also pass on to the new venture.

SWOT Analysis for Holliday Villa Hotels & Suites Subang

Strength

The Holliday Villa Hotels & Suites Subang have a strong and renowned brand value Cost of raising capital will not be much difficult for the Holliday Villa Hotels & Suites Subang Preparation of the menu items will be easier for the Holliday Villa Hotels & Suites Subang as they already have experienced cook for their own menus. Governance and management will be easier for the hotel for the new venture Operational benefits as the Holliday Villa Hotels & Suites already have presence in different cities the provision of central kitchen for preparation of the semi cooked materials will be easier to handle

Weakness

No experience of diversification till date

Opportunity

20 million population to target Unique way and product for the Malaysian market Low cost and availability at prime locations Target market segment is of mass so exposure to that market

Diversified products and business ensures better risk adverseness in future from recessions

Threat

Treat of dissolving the brand value Low cost entry for new players may increase the competition in future Other already available snacks in local market

Business Concept
The idea centers on samosas, Asias most famous snack, which is enjoyed by millions around the world every day. We aim to use the great advantages of a samosa and use it to fulfill an emerging and unfulfilled need of our Target Market Segment. The samosa today is a self contained unit of food, with various shapes and sizes, prepared in different ways, and filled with an unlimited number of mixtures. This makes it not only easily adaptable by various parts of our country but also makes it a base for innovative variants. We aim to utilize not only the immediate connect that a samosa has with the masses but also the enormous possibilities that it offers. A samosa though ubiquitious in our country, is hardly prepared or made in the same manner as is popularly thought. Being an extremely versatile snack a Samosa has the following advantages when it comes to the Quick food & Service format: 1. Versatile One may put as many different types of filling as one can think and cook it in many different ways. 2. Physical form Samosas can be triangular, dumplings or pyramidal and these options give different samosas a different identity. 3. Packaging A samosa is a snack which is easy to pack and is in itself a well packaged self contained meal. 4. Color Depending on the kind of dough one uses colors can also be added to differentiate a samosa. 5. Emotional Connect All Indians share an emotional and mental connection with samosas due to its ubiquity. 6. Flexibility It can either be treated / consumed as a snack or as a meal.

The concept is to sell innovative and established regional variants of samosas as well as beverages, in the form of a filling snack, packaged and marketed as a complete meal. This meal will be designed specifically for a customers on-the-go food requirements. It looks to fulfill the targeted segments need for hygiene, quick service, value for money and convenience in the form of a quick bite at any time of the day. The aim is to use this iconic snack of our country, a samosa, and fuse it with tastes from all around the world as well as offer regional samosa variants, so as to give a contemporary experience to the customer. The choice of variants will be a mix of various famous regional samosas, a few international flavours and signature samosas. These samosas will be offered to our TMS with an option of salads, chatnis, curds, daals, pickles, breads etc. Also combo meals of beverages, dessert, salad and the chosen samosa will be offered at discounted rates. All these options will be designed, made, serviced and packaged keeping in mind the needs of our TMS of quick service, tasty food, hygiene etc. The entire model will work on a hub and spoke model with a central kitchen supplying preprepared semi-cooked food to the different outlets situated in Mumbai (please see map on page )

Product and service description

Some of the few types of samosas which can be put on the menu are 1. Jumbo aloo Samosa 2. Chicken and Cheese Samosa 3. Keema malai Samosa 4. Grilled English Vegetable Samosa 5. Four cheese Samosa 6. Mango Pulp Sweet Samosa 7. Baked Alaska Samosa (Fried Samosa with cold ice cream in center) 8. Manchurian Samosa

Various Beverages on offer

1. Chocolate Shakes 2. Cutting Chai 3. Fruit milk shakes 4. Carbonated Soft Drinks 5. Sweet/Salt Lassi

Packaging
Trendy and cool with various catchy colors, the packaging will be designed to be very easy to carry and which can hold the samosa in a compact and efficient manner. Packaging will be designed to advertise the outlets to those who see the package with someone else. The organization will also implement as many green measures as possible for its packaging, like using paper bags, no or minimal plastic etc. The packaging will also be designed so that it will take minimal time for the staff to pack an order and serve it.

Service
All Service times will be between 1 to 8 minutes for all orders. Many fast moving orders will be kept pre-prepared in heavy customer traffic hours so that they can be served within a minute if required. A McDonalds model of product preparation will be used in this case. With a food warmer kept in the middle, the order taker will be able to call for orders and have them packaged and ready to t/away within a few minutes and at times within seconds.

Value for Money

All items will be priced between 20 100 RM. Also many economy packages, in the form of combo meals, special offers, happy hours and discounts on bulk orders will be offered. This price band has been chosen as there are very few organized players who operate in this band, especially in the take away format. It also allows increased frequency in purchase for our TMS. These attractive prices will also spur a lot of word of mouth activity since college and school

going students as well as many working professionals has always been attracted to such value in the food sector.

Understanding TMS
The target market and size
The Malaysian food market is valued at approximately $87 Billion. Retail food industry in (2008) was pegged at $15 Billion. Branded players forms about 5% of about $20 Billion Quick Service Restaurant (QSR) market in Malaysia. We actively compare ourselves to the QSR market players in Malaysia, not to mention taking them as an input for our model since this is one of the fastest growing and volume oriented markets.

Industry analysis and forecast

The market for the QSR industry segment is set to grow at 4 to 5% every year with organized players contributing 10% of that. Every year, however, organized players are eating into the market share of un-organized players. This means a growth percentage which is far higher for the organized players than for the un-organized ones. QSR is expected to become a $35 billion Industry in a less than a decade. There are 20 million middle class Malaysian. They all have at least 3 meals a day. That means a total of 300 million meals a day. Samosas looks at this great potential with enthusiasm since it means that even if one could successfully target a miniscule percentage of these numbers, it could lead to great volumes and revenues. This seems an even better indicator in the light of the fact that the average urban Indian meal time has been decreasing at an increasing rate, to almost half the time it was 2 decades back for lunch. This is due the urbanization of many smaller cities and towns which are now on the same trajectory as what the European and American populations were a few decades back in terms of total time given to meals by the middle class and the number of meals had by all families had together.

The Profile of target customers

Geographic Tier 1, 2 and 3 (to be targeted on a case by case basis) cities Demographic age 14 to 35, urban, students, graduates, working professionals and young families, single working women. Socio economic Middle class especially those who do not have the resources to treat other QSR brands as a regular meal option. Psychographic inspirational, customers looking for an affordable snack / meal, with convenience of quick service, which offers value for money, hygiene, variety of tastes and association with an urban, cool and contemporary brand yet with the Indian feel and connection.

Business Potential
Why is this great idea?
Samosa is an iconic Asian snack that is loved by the masses of all regions and communities of our country, yet it is not explored as an innovative central idea by any organized player. We have seen that traditionally Malaysians love to eat their meals slowly. However the present urban life demands more time out of all of us and hence we find ourselves cutting down on the time we give to our meals. There is millions of urban middle class Malaysian commuting for hours every day who needs to grab a quick bite. There is a great opportunity in fulfilling this need which is, as of right now, being fulfilled by various established QSR players by default and not by design. Along with this is the fact that Malaysian average meal times are reducing the same way the European and American meal times did for their middle class a few decades back when their economies saw the kind of growth that Malaysia is seeing right now. The culture of all family members having meals together is also changing not only in urban India but also Urbanizing Malaysia which represents a great opportunity for QSR outlets, especially the ones in the t/away format. The more we see the break from the family meal culture, the higher the income levels with greater individual independence, the more we expect people to have meal regularly at QSRs.

The customer today wants variation in their favorite Malaysian snack with the use of different fillings, packaging and different ways of it being cooked. He is also growing very health conscious and seeks tasty variations along with his need for health oriented snacks. All these needs have been identified and we are providing solutions to these with our innovative products. So far staple food from all around the world has been experimented with and tested in different countries in the form of fast food and later introduced in Malaysia pizzas, pastas, tacos, etc. No one has done that for an Malaysian snack, and that too the most loved Malaysian snack. With Malaysians eating out much more than before such a product can create a niche for itself in a market, like QSR, which is set to become a $20 billion Industry in a few years. To give you an idea, people in Bangkok eat out 45 times a month whereas the average middle class Malaysian eats out only 8 times a month. This represents great potential for the QSR market. Now with the help of the above scenarios and statistics we find that a Samosa is the one of the best placed products to offer a solution to the needs of urban middle class Malaysians. In fact, thanks to the versatility of the samosa and present technology we can now make health conscious samosas which can be baked or steamed instead of being fried. They can have olive oil for the crispiness instead of the normal vegetable oil, while those who still prefer the original taste can have our deep-fried samosas. They can be filled with vegetables to not only give the customer a feeling of fullness but also wellness. A similar space has been exploited by Momos in this country but not in a focused or organized way towards the concept of health or wellness. So in a sense we have the following factors which make this idea feasible 1. Reduced meal timings 2. Change in food consumption patterns and culture 3. High Disposable income 4. Snack being treated as substitutes to meals 5. Need for a small, well packaged, hygienic, quick service meal and snack 6. Increase in the average calorie consumption of Malaysian

7. Demand for new innovative tastes while still with an Malaysia feel 8. Demand for health oriented food choices and variety of tastes 9. Increase in prevalence of eating out culture 10. Demand for food convenience

Competitor Analysis
Competitive advantage and competition analysis
1. No branded/organized players which offer samosas as snacks, packages and marketed specifically to our Target Market Segment. 2. No branded/organized players which offer a variety of samosas at the same location. 3. Very few branded or established players which offer such convenience to a customer for on-the-go meals at such low prices (20 100 RM) 4. No national or Urban player selling veg and non-veg samosas in an organized fashion/with a focus on samosa as their USP/main product. 5. No player which has used samosas to fulfill the quick service meal requirements of their customers as a strategy. 6. There are quite a few players who are offering snack and quick meals at the same price as us, even though they may be offering different foods. However at our pricing strategy we have to differentiate our brand, products, service in such a way that even though we will be in a similar price band our offered value will seem higher to our TMS

Barriers to entry
1. A crowded QSR market where most established players have outlets in almost every commercially viable place. 2. QSR brands need heavy advertising, marketing and need to create many outlets before they can become national/regional brands and hence bring in higher revenues with more brand recognition.

3. High rentals in the commercially important spots which either eat deep into profitability or make many areas unviable for a new entrant. 4. For a product like Samosas, there will be a lot of competition from the local players who may be able to give lower prices to the Target Market segment but only without many of the other requirements being catered to. 5. Also research shows that once brands become famous customers are willing to pay more for the same value than for other not-so well known brands. Also the ability to draw in crowds with an established brand increases exponentially than for new entrants especially with limited financial muscle.

Operation Strategy
Company description and business model
Samosas will work on a Hub & Spoke business model where a centralized kitchen will be sourcing the semi-cooked raw material needs of the Samosas outlets/kiosks in the form of semiprepared samosas. For this the centralized kitchen will be preparing various mixtures and the samosa flour sheets which will be transported to outlets twice a day to maintain freshness and reduce wastage as well as make better use of manpower. These will then be used by the outlets which will be constructed as takeaway kiosks, ideally 120 sq feet in area, at strategic locations, next to commercial areas, close proximity to offices and colleges, BPOs, malls. We will be placing these outlets (as shown in the map on page no) so that they may service areas with high mobile volumes and moderate residential volumes. We will be looking at this model to help us gain volumes for lunches, post lunches, evening snack and dinner timings. The final preparation of the food items will take place at the outlet itself with the help of required stock of semi prepared materials. These outlets will, prepare the required type of samosas and beverages as per the order of a customer. The order will be on cash basis unless orders exceed a particular level in terms of value. A kot (kitchen order ticket) system based on automated ticketing will be used and this will be an inherent part of the overall accounting and billing system which will also run on the same software for better accounting and sales measurement.

For food production various end stage cooking equipment will be placed in these outlets like deep fat fryers, stoves, chest freezers, food warmers etc. With the help of these, the fast order taking process and the food stocking process (similar to the one with Mcdonalds) one can prepare a samosa within 3 5 minutes of the order while maintaining freshness. For desserts this time can be as low as a minute. Hence, all order taking, final preparation, packaging and sale of all products on the menu will be done at these outlets while the kitchen will pre-prepare the mixtures and flour sheets for these samosas. We aim to open the first such outlet and the central kitchen at the same time, in the vicinity of each other though at separate locations. The next 4 outlets will be made in the following year. We first aim to target Kuala Lumpur making 11 outlets within the city after which we plan to move to other cities using the similar hub and spoke model. Our aim is to target cities around Kuala Lumpur and in Malaysia in the first 5 year and gradually keep on expanding.

Marketing Strategy
Marketing Plan
1. A company website will be made which gives the pertinent information regarding the stores and the company. 2. Small hoardings and posters at various locations, especially coffee shops and other such joints with high volumes, in the vicinity of the outlet. 3. Radio and local channels can be used but only after year 2 due to constraints in the budget. 4. Sponsorship, stalls at various food related events in schools, colleges and offices. 5. Word of mouth is our primary channel of marketing. 6. Twitter can be used aggressively to market our brand as well as various social networking websites. 7. Newspaper pamphlets in the neighborhood houses. 8. SMS campaigns can be used for the introduction of new outlets. 9. Competitions and special offers aimed at our TMS to keep them connected and involved.

10. Loyalty programs will be introduced to build a loyal customer base.

Financial Model and business viability

Total number of customers expected on stabilization of unit in 8-10 months 300 per day Profitability target per unit per month on stabilization 30% to 35% Profitability of the company at the end of 3 years 34.35% Built up area per unit 120 sq feet Built up area of centralized kitchen 400 sq feet Food and Beverage cost 25% Revenue target per customer RM. 40 Estimated time of breakeven per outlet/unit 11 months per outlet Estimated time of breakeven profitability for company 3 years approx (Due to expansion plans that are funded by company profits and loans) Seed Capital Requirement RM. 90 Lakhs No of months after which cash flows are used for expansion: 19 months Total number of outlets opened for 3 years: 11 3 year end results for outlet 1
284175 11367000 4015325 35.32 Total Customers Total Revenues Total Operating Profits Profitability %

Number of employees with the salaries 2 apprentices 4000 2 drivers 10000

3 junior chefs 6000

1 main chef 15000

1 sup chef 8000

1 accountant 10000

Total 3 years major expenses

11225500 1500000 9739400 1500000 44964500 Total Samosa Spoke/Outlet Capital Cost Marketing Expenses Total Samosa Hub Costs Total Expansion Costs + Miscellaneous Total Outlet Var+Rec costs

Capital Cost Heads Unit 1/ outlet/spoke

Rent Advance 120 Sq feet Construction 120 Deep fat fryer 1 Chest Freezer 1 Blender 1 Steel Tables 3 LCD television 1 Baking Oven 1 Exhaust Hood 1 Sink Unit 1 Microwave 1 Counter units 1 Computer 1 Software 1 KOT machines 1 HR consultant 1 Menus, Stationary and Printing, Menu Hoardings Legal & Liscence Costs Music System 1 Carbonated Drinks Machine 1 Cooking Utensils Uniforms 14 Installation Costs 1 Food warmers and steel rack 1 Steel racks Vertical 1 Generator 1 2 Burner Cooking Stove 1 Training DTH service 1 300 RM sq feet 800 36000 10 360000 96000 34000 30000 11500 15000 25000 100000 25000 12000 8000 4000 20000 4000 8000 20000 20000 100000 4000 10000 3000 8000 35,000 40,000 3000 15,000 5,000 3,000 2000

5000

7 employees

600

Total

1020500

Capital Cost Heads of the Samosa centralized kitchen

Rent Advance Construction Installation Utensils Steel Working tables Uniforms Computer Delivery Van 6 range stove Fridge Legal and Lisence Cost Deep Freeze Software Dough Mixer Exhaust Tandoors Sinks Storage 400 Sq feet 1000000 200000 100000 30000 30000 40000 20000 200000 60000 15000 200000 60000 10000 60000 150000 3000 12000 25000

11

Total

2215000

NET PROFIT
40.00 30.00 20.00 10.00 0.00 -10.00 -20.00 -30.00 -40.00 NET PROFIT 2010-2011 -29.84 2011-2012 19.52 2012-2013 23.59 2013-2014 27.60

7,000,000

6,000,000

5,000,000

4,000,000
MONTHLY SALES

3,000,000

MONTHLY TOTAL COSTS

2,000,000

1,000,000

0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35

Breakeven for one samosa outlet

PARTICULARS

2010-2011 (8 Months)

2011-2012 (12 Months)

2012-2013 (12 Months)

2013-2014 (4 Months)

INCOME
REVENUE

31,71,000

1,78,29,000

3,21,22,000

1,33,90,000

Less: EXPENDITURES
Food & Beverage Packaging material Rent Maintenance Materials Printing and Stationary Cleaning Supplies Fuel Electricity Water Salary Phone and internet Insurance TOTAL 7,92,750 2,37,825 13,04,000 66,000 16,000 66,000 26,400 1,52,000 1,98,000 82,000 11,12,000 26,400 38,000 44,57,250 13,37,175 33,24,000 2,13,000 24,000 2,13,000 85,200 3,80,000 7,10,000 2,37,000 31,88,000 85,200 95,000 85,20,000 25,56,000 50,52,000 3,57,000 24,000 3,57,000 1,42,800 5,72,000 11,90,000 3,81,000 51,08,000 1,42,800 1,43,000 33,47,500 10,04,250 19,84,000 1,44,000 8,000 1,44,000 57,600 2,24,000 4,80,000 1,52,000 20,36,000 57,600 56,000

41,17,375

1,43,48,825

2,45,45,600

96,94,950

PBT

-9,46,375

34,80,175

75,76,400

36,95,050

Exit strategies
The Exit strategy of the firm will be based on the following steps:1. Recovery of all the security deposits of the outlets rentals 2. Individual agreements will be entered into with people who wish to take over individual outlets in case they require setups for their own food startups. This will help us also reemploy all the staff which will be trained and have a substantial experience in food service.

3. In case these outlets do not find takers for such agreements we shall then concentrate on selling off all assets as soon as possible. 4. The hub kitchen can then be converted into a take away kitchen which can prepare Malaysian food which can cater to various localities in the vicinity. 5. The hub kitchen may also go through the same process as the outlets, in case we feel that it is not feasible to start the t/away kitchen at that time, where we can try and locate people who are interested in taking over the hub kitchen for their own food operations. 6. In case that does not happen we can then sell of all our assets in the central kitchen as well. 7. The vehicles will be sold off and the cash will be used to purchase bikes in case we convert the hub kitchen into a take/away kitchen. 8. The final goal is to sell off the business after it has been established as a quality t/away business to anyone who wishes to run it so. 9. Since we would not invested in immovable assets hence assets liquidation will not be such a big issue. 10. We will actively look at re-employing all employees with the owners of the outlets if and incase people are interested in the proposition of taking over these outlets.

Teams Strengths
The team that shall be heading this venture will be having expertise in business analysis, hands on experience on hospitality and food industry. The Holliday Villa Hotels & Suites will be actively participating and helping the two experts in formulating the extended business plan and will be constantly assisting and supporting them to succeed in their venture. I will be also involved in the business implementation and will be handling the operation of the business and especially the food items to be served will be tested by me. The team looks at hiring a head chef who will look after quality control and kitchen operations. He will also be required to start an R&D kitchen in the future for constant product development

and innovation. Since the plan would require an fairly experienced and well versed kitchen professional and he can be a partnership in the venture depending on his profile.

Business Strategy
Long Term strategy
The long term strategy includes the following: 1. To expand across Kuala Lumpur to over 35 outlets in 5 years from 11 in 3 years 2. To be able to build a brand as an innovative food t/away brand while still delivering value to the TMS 3. To develop an R&D kitchen so as to offer continuous innovation to customers in terms of offerings 4. To breakeven at year 3 5. To be able to start a franchisee model in various cities after the success of this model in Kuala Lumpur. 6. To be able to foray into tier 3 cities after year 6 once those cities have developed an urban culture to create the need for such a product. 7. To build a national brand by year 7 of start of operation 8. To have presence in all metropolitan cities in India by year 8

Short Term Strategy

1. To start 11 units for year 3 2. To reach budgeted profits and volumes and revenues for all units 3. To introduce new and innovative products at regular intervals for the outlets 4. To have innovative promotional strategies in the first 3 years 5. To create a strong regional brand by year 2 6. To create enough public awareness through PR activities and promotions

Logo for the Holliday Villa Hotels & Suites QSR

TIS Conclusion
This is a very lucrative project for the Holliday Villa Hotels & Suites Subang as it is not only giving them an opportunity to earn huge profits but also giving them an opportunity to expand into an unexplored new venture and also diversifying their business. The Holliday Villa Hotels & Suites will not face any competition in the new venture as it is a totally unexplored area. Their operations and other amenities will not cost them much as they are already in a similar business. One of the very crucial and important part of the supplier for a particular business where Holliday Villa Hotels & Suites will have an advantage of already existing supplier for their hotels. Arranging for finance form the banks or financial institutions will be eaiser for the existing good running business into a new similar expansion with such high expected returns in a small period of three years only.