MUSEÓ TEA & COFFEE BUSINESS PLAN

1.0 EXECUTIVE SUMMARY

The Museó Tea & Coffee is a small café with a full tea and coffee shop. This is
where customers can indulge in quality tea and coffee including light sandwiches,
and a range of pastries at a considerable price. Our friendly service and welcoming
ambience will undoubtedly captivate customers to satisfaction. The Museó Tea &
Coffee offers more than just good quality and reasonably-priced products, we
provide a remarkable experience to every customer from the moment they enter our
place.

The Museó Tea & Coffee will be located along Calanipawan Road, across
Savers Depot, Barangay 96, Calanipawan, Tacloban City. Our target and expected
customers are the students that is why the location of our business is ideal because of
the schools present around the area; there is also a lack of cafés and coffee shops
that offer products with a considerable price.

Eunice Aparis, Lucil Belleza, Eric Bonife, Janeen Escalona and Denielle Juan will
form a partnership as owners of the Museó Tea & Coffee wherein they would run the
business and get it started. They are all graduates with a degree of business
management, so they will have the skills and knowledge necessary to run the
business. The partnership is founded from friendship, composed of people who enjoy
quality and excellent tea and coffee that are at the same reasonably priced. These
people also have a talent for the arts, namely painting and wood carving, which is
why various colorful paintings and wood sculptures would be seen on display in our
tea and coffee shop.

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 The coffee market is growing at a rate of seven percent annually, which makes
our business a good one to go into. There is a steady increase in number of coffee
and tea lovers in our locale who desire low priced coffee whilst still being of quality,
this embodies the entirety of the Museó Tea & Coffee.

1.1 Vision, Mission, & Objectives

Museó Tea & Coffee will offer a fresh point of view on Calanipawan, Tacloban
City. We want to be the coffee destination of choice in Tacloban City and to be
known for our ethically sourced, good quality tea and coffee, and excellent customer
service.

There are influential key success factors and activities that will contribute to
the accomplishment of the objectives of Museó Tea & Coffee. These factors include
our ability to select the best location, keeping variable and overhead expenses as low
as possible, building high market visibility through brand building and advertising.
With respect to the business transaction, Museó Tea & Coffee will deliberately choose
to be distinctive and unique in its customer experience and will also present an image
of wholesome, quality tea and coffee products in an attractive and clean atmosphere.

The structure was chosen because of its operational simplicity, this business
will be an independent, start-up venture. The initial fund required by the Museó Tea
& Coffee will be capitalized through the savings of the owners. Museó Tea & Coffee
expects to be making business by the middle of its first year.

1.2 Venture Concept

Museó Tea & Coffee’s goal is to solve the problem of the lack of inexpensive
coffee places in our specified location. We will focus on the students in school and on

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a budget who still want a satisfying food and drink experience. Customers should
expect to be satisfied with quality food, tea and coffee.

1.3 Description

The Museó Tea & Coffee will offer a full service tea and coffee shop. This will
include serving brewed tea and coffee, specialty lattes, espresso, smoothies, and
other such drinks. We also offer light sandwiches and a variety of desserts and
pastries such as cookies, cakes, etc. Museó Tea & Coffee also features a collection of
different artworks, namely paintings and wood sculptures made by local artists. There
will also be coffeehouse music playing through our speakers, this will contribute to
the feel and mood of drinking tea or coffee, and the overall experience of the
customers.

2.0 ENVIRONMENTAL ANALYSIS

2.1 Trends & Growth Rate

Business Insider reports that 54 percent of coffee drinkers began drinking

coffee between ages 13 and 19. This is a good statistic for our target market. Coffee is
also the second most in demand commodity in the world and approximately more
than a quarter of Filipinos over age 18 drink coffee every day. This makes coffee a
very popular drink for Filipinos, which is good for our business. Also, according to
Business Insider, coffee shops are growing at an annual rate of seven percent.

2.2 Barriers for Business

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 There are not many barriers to opening a coffee shop. The only requirements
are a place to build your business, money to remodel and buy equipment, and
getting licensing to serve food. However, it is difficult for new coffee shops and food
places to gain momentum in the market because of competition with bigger brands.
Business Insider reported that 70 percent of coffee shop sales are made by only the
top 50 coffee shop owners. While this makes opening a successful tea and coffee
shop more difficult, it does not make it impossible.

2.3 Key Success Factors

In order to be successful in the current market, it is important to have a unique

and distinguishable product that will set us apart from other coffee shops and
teahouses. We also need to figure out who we are trying to sell to and appeal to
them in the smartest way possible. Our tea and coffee shop will need friendly
employees who know what they are doing and are competent enough to do things
on their own without being micromanaged. Finally, our marketing has to be smart
and beneficial to our customers. A way to do this is to make loyalty cards and
advertise in highly populated areas.

2.4 Stage of Growth

Currently the coffee shop industry is growing, it has reached its peak in 2015
and will slowly be entering the maturity stage. This means there is still a market for
growth in the industry, but it is important to enter quickly. It also means that we
should not solely rely on coffee products for our income, which is why we added a
tea shop and a simple café where we offer to sell light sandwiches and various

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pastries that are of a low price as possible but still of good quality, to set us apart
from other local coffee shops.

2.5 Competitor Analysis

Museó Tea & Coffee’s prices are lower compared to coffee shops in the area
of our location such as Café Lucia, Serenitea or any coffee shops found in Robinson’s
Place Tacloban. Café Lucia is pretty expensive averaging to about 160 pesos worth of
product. Figaro Coffee in Robinson’s Tacloban offers high quality products but are
not much student-friendly because of their higher prices; their sandwiches cost about
an average of 210 pesos, and their beverages with a price average of 150 pesos.

3.0 ORGANIZATION

The key to the success of this venture, which is as important as the location,
equipment, and the ambiance, is our people. Well trained and enthusiastic
employees are vital to providing a great service and creating a desirable atmosphere.

3.1 Organizational Chart

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(see next page for a full view of the chart)

Management Team

Eric Bonife Lucil Belleza Denielle Juan

Café Owner; Café Owner; Café Owner;

General Manager Finance Manager Marketing Manager

Eunice Aparis
Janeen Escalona

Café Owner;
Café Owner;
Manager of Human
Product Manager
Resources

Crew

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Fernando Amorsolo Leonardo da Vinci Vincent Gogh Pablo Picasso

Barista Barista Maintenance Security

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3.2 Roles, Responsibilities, Salary

3.2.1 Management

 General Manager – is in charge of the overall operations of the business.

 Manager of Human Resources – takes charge of the employees of the café
and supervises the hiring, training and disciplining of employees.
 Marketing Manager – develops, implements, and executes strategic
marketing plans for the entire organization.
 Finance Manager – is in charge of the financial reports of the business
including other financial aspects like budgeting, inventory, and payroll. Use
one’s accounting expertise to understand how and when to order supplies.
 Product Manager – develops products by identifying potential products,
conducting market research, generating product requirements, and
determining specifications, production timetables, pricing, and time-
integrated plans for product introduction.

3.2.2 Crew

 Barista – (works behind the counter) prepares the ingredients and makes
coffee and other beverages. Performs other café duties like being the
acting cashier or server. The pay is 30 pesos /hr.
 Security – Secures premises and personnel; permitting entry. Their work
pay is 23/hour

 Maintenance – duties consist of installing, repairing, and maintaining the café

grounds and equipment. The work pay is 23/hr.
an estimated work hour in a day is 14 hours*

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4.0 OPERATION

4.1 Raw Materials

Raw Material Estimated Cost (in pesos)

Coffee Drinks
Coffee beans 100.00/ kg
Milk 80.00/ L
Water 35.00/ 5 gallons
Cocoa powder 600.00/ 225 g
Sugar 55.00/kg
Creamer/syrup 45.00/100g
Pre-made mixes 2500.00/ 4320 g
Tea Drinks
Tea leaves 190.00/ box
Milk 190.00/250 ml
Water 35.00/ 5 gallons
Powdered mixes 2395.00/4320 g
Sweetener (sugar, honey) 320.00/ 250 ml
Fruit & Chocolate Beverage
Fruits 200.00/ kg
Cocoa (powdered, bar) 600.00/226 g
Milk & Cream 43.00/250 ml
Water 35.00/ 5 gallons
Pre-made mixes 2500.00/4320 g
Sweeteners (sugar, syrup) 320.00/ 250 ml
Toppings (sprinkles, etc.) 140.00/ 1 kg
Sandwiches
Bread 60.00/ loaf
Oil 100.00/ 1 l
Vegetables 110.00/ kg
Fruits 200.00/kg
Egg 170.00/ 2 dozens
Pork 230.00/kg
Beef 270.00/kg
Seafood (tuna) 250.00/kg
Condiments 1000.00
Herbs & Spices 1200.00s
Estimated Total: 13,975.00

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4.2 Equipment

Equipment Estimated Cost (in pesos)

Hot Beverage Equipment 700,000.00
Cold Beverage Equipment 500,000.00
To-Go Supplies 15,000.00
Countertop Organization 50,000.00
Coffee & Tea Serving
80,000.00
Supplies
Beverage Dispensers 100,000.00
Coffee House Essentials 50,000.00
Beverage Equipment Parts &
200,000.00
Accessories

Estimated Total: 1,695,000.00

4.3 Utilities & Others

Description Projected Cost (in peso)

Establishment
Construction 4,000,000.00
Detailed Engineering 2,000,000.00
Basic Designs 1,500,000.00
Building Equipment 3,000,000.00
Furniture 1,000,000.00
Utilities
Electrical 250,000.00
Water 50,000.00
Plumbing 80,700.00
Ventilation 100,000.00
Air Conditioning 60,000.00
Building Safety Regulations 30,000.00

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 Direct Labor 1,000,000.00
Projected Total: 13,070,700

4.4 Sourcing

Museó Tea & Coffee will buy from a select group of suppliers when it comes
to the coffee beans and tea leaves used. Direct sales relationship will also be
established with fresh produce, meat, and seafood distributors based in Tacloban
City. We will also buy the equipment, silverware, and other essentials needed for the
production and operation from local shops as well as shops based in the National
Capitol Region. We will ensure proper evaluation of our suppliers.

4.5 Quality Control

Museó Tea & Coffee will offer a satisfaction guarantee for the products. If a
customer is not satisfied with their order, either a replacement will be made or a
refund will be given. Museó Tea & Coffee also guarantees it will stay up to health and
safety code for its food.

4.6 Storage & Inventory Control

Overseeing and proper control of ordering inventory, storage of inventory,

controlling the amount of products for sale will be practiced in our shop. Museó Tea
& Coffee guarantees to effectively maintain internal controls over inventory, including
safeguarding the inventory from damage or theft, use purchase orders to track
inventory movement, maintaining an inventory ledger, and frequently comparing
physical inventory counts with recorded amount.

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4.7 Technology

The Museó Tea & Coffee logo is protected by trademark laws. All our menu
creations will not necessarily have the same protections, however, when possible,
popular “trade-names” will be protected. The business of Museó Tea & Coffee is not
dependent upon process technology or patentable inventions.

4.8 Future Products

The Museó Tea & Coffee will initially focus upon the dining, tea and
coffeehouse, and overall experience of the customers, future expansion efforts will
focus upon providing live entertainment. We are hoping to invite local musicians to
perform in our place every Sunday nights. This will help set the mood and
atmosphere of the coffee shop, and thus improving the full experience of the
customers.

5.0 MARKETING STRATEGY

5.1 Customer Demographic

We are looking to target customers who live or are located within Barangay
Calanipawan and the surrounding area. We are mostly targeting the 15 to 24 age
range, because of their desire for low-priced and fast quality food and beverage, and
service. For this reason, we will be looking to put our coffee shop near school
campuses. We are primarily targeting both genders of students, and also medical
staff, and part-time workers.

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 Some customer needs we are looking to fulfill are dietary needs, health needs,
caffeine needs, and the desire for desserts. Museó Tea & Coffee will be able to
accommodate some dietary needs by offering dairy-free coffee for customers who
are lactose intolerant. Museó Tea & Coffee can satisfy customers’ desire to eat
healthy as well because of the variety of herbal and non-herbal teas for customers to
pick. There will also be sweeter fillings for those who want to fulfill their sweet tooth.
Finally, we will fulfill a need for caffeine and quality coffee with our coffee products.

5.2 Location

The location we found is perfect for our target market. We are located along
Calanipawan Road, Barangay Calanipawan, near RTRMF-DVOREF campus, Sagkahan
National High School, and Asian Development Foundation College. This means it will
be extremely convenient for students to come to Museó Tea & Coffee. Along the
Picas - San Jose DZR Airport Road, Monday through Friday, this highway does get a
little crowded during the rush hours of the day, around noon and 5 p.m., but other
than that traffic is usually low. However, this intersection allows more people to
notice our shop and would likely come pay a visit.

5.3 Product & Pricing

Museó Tea & Coffee will offer its customers quality tea and coffee beverages.
This will be achieved by using quality guaranteed ingredients and strictly following
preparation guidelines. The store layout, menu listings and marketing activities will be
focused on maximizing the sales of higher margin espresso drinks. Along with
espresso drinks, brewed coffee, frappe coffee and teas, as well as some refreshment
beverages will be sold.

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 Museó Tea & Coffee will also offer its customers pastries, and sandwiches. For
customers that prefer to prepare their coffee at home Museó Tea & Coffee will also
be selling coffee beans. We also cater to customers who order to-go beverages and
food, these will be sold with our own to-go supplies packaging with our business
name and logo.

Museó Tea & Coffee’s prices will be lower compared to nearby coffee shops.
We ensure reasonable product prices for our target customers which are the
students. Our beverages will range from 50 pesos to 180 pesos, and our pastries and
sandwiches will not exceed 200 pesos.

5.4 Advertising & Promotion

Museó Tea & Coffee’s plan is to spend as little as advertising as possible while
still getting the word out about our tea and coffee shop. Our plan is to advertise
mainly through social media and flyers put up around high traffic areas and in college
or school campuses, like within the vicinity of RTRMF-DVOREF. These flyers will have
the necessary information—name of the restaurant, who we are, where we are—but
they will also include coupons for the coffee shop, such as 10 percent student
discount on Sundays. This will help make sure that customers not only read the flyer,
but also come to our place and purchase something. The goal is that the customer
will like what they try and come back again and again. There is the possibility that
someone will take advantage of our flyers and take all the coupons, but we figure
that will be a small minority of people.

Our plan is to go around where we set up flyers about once a week to make
sure the flyers are either still there or that there are still coupons attached. Spending
only about 300 pesos a week is a very cost effective way to generate publicity. We

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might also tell some people to spread the word about Museó Tea & Coffee through
word-of-mouth. Students are more likely to believe one of their peers’ opinions
about a place than other reviews, so we will act on this as much as possible.

6.0 FINANCIAL PLAN

We want to finance growth mainly through cash flow. We recognize that this
means we will have to grow more slowly than we might like. The most important
indicator in our case is inventory turnover. We have to make sure that food inventory
turnover stays at approximately four turns per month, or we risk loss through
spoilage. We do not want to let our average collection days get above 45 under any
circumstances. We must target a net profit of 14% at the least, and hold marketing
costs to no more than one to three percent of gross sales.

The following sections will outline the important financial information

regarding the overall net income, expenses and profit of our business.

6.1 Financial Assumption

The financial plan depends on important assumptions, most of which are

shown in the following table. The key underlying assumptions are:

 We assume a slow-growth economy, without major recession.

 We assume of course that there are no unforeseen changes in
technology to make equipment immediately obsolete.

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  We assume access to equity capital and financing sufficient to maintain
our financial plan.

6.2 Projected Cash Flow

We expect to manage cash flow over the span of one year with minimal new
investment required over the first two quarters. It is our expectation that revenue
beyond projected sales will be invested in retiring long-term debt early.

Net Cash Flows

8
7 7
6
5
4.5
4
3 3
2
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0
Quarter 1 Quarter 2 Quarter 3 Quarter

Net Cash Flows

6.2 Projected Income & Profit

Projected Income and Profit for the Following Years

4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
Year 1 Year 2 Year 3

Profit Income Margin

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6.3 Key Financial Indicators

The most important indicators in our case are daily seating "counts" and
weekly sales numbers. We must also make sure that we are turning our inventory
rapidly so as to avoid food spoilage.

We must target net profit/sales figures toward the 14 percent level with gross
margins never dipping below 38 percent. Marketing costs should never exceed three
percent of sales.

Benchmarks
2
1.8
1.6
1.4
1.2
1
0.8
0.6
0.4
0.2
0
Sales Gross Margin % Operating Expenses Inventory Turnover

Year 1 Year 2 Year 3

7.0 APPENDIX

ASSETS 2017 2018 2019

Current Assets P 4 Billion 4.5 Billion 5 Billion
Accounts Receivable -
Inventory P2 Million P 2.3 Million P 2.4 Million
Prepaid Expenses P 1 Million P 800, 000 P 500,000
Other Initial Costs -
Total Current Assets 4.3 Billion P 4.5 Billion P 5.2 Billion

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Fixed Assets
Leasehold Improvements -
Equipment P 3.5 P 3.5 Million P 3.5 Million
Million
Furniture and Fixtures P 1 Million P 1.5 Million P 1.8 Million
Others
Total Fixed Assets P 4.3 P 9.5 Million P 10.5 Million
Billion
Total Assets P 4.3 P 9.5 Million P 10.5 Million
Billion

Liabilities and Equity

Liabilities -
Accounts Payable -
Commercial Loan Balance -
Commercial Mortgage Balance -
Total Liabilities -

Equity
Common Stock P 3 Million P 3.5 Million P 3.5 Million
Retained Earnings P 27 P 28 Million P 30 Million
Million
Dividends Dispersed/ Owners Draw -
Total Equity P 30 P 31.5 Million P 33.5 Million
Million
Total Liabilities and Equity P 30 P 31.5 Million P 33.5 Million
Million

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