See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/359669225

FLAVORED CHURRO Pakistan, A Business plan for New business idea Crafted By
Sohail Khan..

Chapter in Entrepreneurship · December 2021

DOI: 10.13140/RG.2.2.16008.90886

CITATIONS READS
0 791

1 author:

M Sohail Khan
COMSATS University Islamabad
4 PUBLICATIONS 0 CITATIONS

SEE PROFILE

All content following this page was uploaded by M Sohail Khan on 01 April 2022.

The user has requested enhancement of the downloaded file.

Business plan submitted in partial fulfilment of the
requirements of the Productions and Operations
Management
Management sciences Department

Group leader
Mohammad Sohail

1
1. Executive Summary 3
2. Objectives 4
3. Company Summary 4

3.1 Start-up Summary 4

3.2 Products and Services
5
4 Marketing plan 6

4.1 Market Segmentation 6

4.2 SWOT Analysis 7
4.3 Competitive edge 8
4.4 Marketing Strategy 8
4.5 Sales Forecast 8
4.6 Pricing Strategy 9

5. HR Plan 9
6. Management Plan 10
7. Financial Plan 10

7.1 Estimated Sales Budget 10

7.2 Estimated production Budget 10
7.3 Proforma Income Statement 11
7.4 Proforma Balance Sheet 12

Table of contents

2
EXECUTIVE SUMMARY:
FLAVORED CHURRO is dessert specialty stores that will provide you the sweetness of life and
cherish your day with the tastiest Churros you have ever taste. Experience the taste of delicious
Churros with extraordinary shape of Churros made with full of love and joy; combined with
refreshing ice cream and various topping that you can choose by your own. Flavored Churro is a
brand of dessert specialty store that brings an innovation of Churros in Pakistan. As we know,
Churros is a traditional doughnut from Spain that has already gaining its popularity in Pakistan.
This is a great opportunity for Eat Churros to open and enter the market because of the chance to
compete in this market is quite good. Flavored Churro is a new and fresh idea which makes our
product stands out from another product. As stated before, this extraordinary shape of Churros is
going to be one of the trendsetters in the dessert industry, especially in Pakistan.

We will open our shop at the Cantonment Board Clifton (CBC) is in Karachi which was created
for all the teams from entrepreneurship to try entering and testing their products to the market. It
will be a great experience for Flavored Churro because of the warm welcome from the customers
toward our product is expected.

We will promote our churros through social media, eWOM, and influencers. also, endorsement to
attract more customers and tell that our churros are different. In result, many customers will buy
our churros because they will be curious and want to taste our unique churros. Therefore, we served
our churros in limited stock and people will buy our churros as soon as possible.

This indicates that Flavored Churro has a good opportunity in the market, because of our product
is one-of-a-kind and combined with the good quality and services provided by our team members.

3
Objectives

There are several objectives that Flavored Churro want to achieve as startup company in dessert
specialty industry.

▪ To be the leading and reputable dessert specialty store especially

▪ To be competitive in the market of dessert industries.
▪ To increase the numbers of our stores and expand our business into
▪ new markets in the big cities of Pakistan.
▪ Sales growth and increased profitability.
▪ To optimize our customer satisfaction.
▪ To always bring a fresh idea and keep being innovative toward the product of Flavored
Churro.

KEYS TO SUCCESS

To achieve the objectives of our company, we made several keys to success for Flavored Churro
itself.

▪ Providing and maintaining a good quality with extraordinary taste in every product that we
made to the customers.
▪ Develop customer incentive and loyalty programs to leverage customer relationships and
create positive word of mouth.
▪ Offers product that are priced appropriately for each segment of our market.
▪ Provide a well-designed store and located in strategic area.
▪ Create a great marketing and financial strategy to support our company growth and
competitiveness to compete in the market with the same industry.

COMPANY SUMMARY:

1. START-UP SUMMARY:

After spending about two months searching and trying the churros recipe, make the churros
into flat shape, then change it into bowl shape; our group decide to ask for guidance from a
pastry chef to make the churros, considering the quality and the taste will be better if pastry
chef is the one who make the churros.
4
 The start-up capital will be used for legal expenses, kitchen inventory and equipment, packing
and other materials, rent, promotion and business sign, and inventory on hand at start-up, as
shown in the list below.

● Rent

Because the place of the Karachi is at Cantonment Board Clifton (CBC), we have to pay the
rent about 400,000. Also, we need freezer to store the churros dough and the ice creams, we
decide to rent the freezer with 4 ice cream box 8 liter inside for Rs 1000.

● Kitchen Inventory

▪ This will include specific tools and accessories that are typically needed for churros
bowl production and service facility and includes:
▪ Food preparation: aprons, aluminum bowl, blender, gloves, storage containers, trays,
worktables, mixers, baking pan, cleaning supplies and equipment, pots and strainer, oil
paper, plastic packaging, etc.
▪ Churros tools: cooking brush, baking pan, muffin molt, piping bag, and other specific
items.
▪ Utensils: cooking utensils, wheel cutters, cutting guide, rocker knives, etc.

● Kitchen Equipment

Includes mainly oven, churros dough equipment (digital scale, mixer, oil paper, muffin molt,
piping bag set, baking pan), freezers, and cooler box. Rs,5000- worth of equipment (long-term
assets). Our group decided is to purchase only new equipment, except oven, freezer, and cooler
box; use high quality product and equipment to maintain product quality.

2. PRODUCTS AND SERVICES

Flavored Churro offers the customers bowl-shaped churros with delicious ice cream and toppings
coupled with exceptional customer service in a welcoming atmosphere. Customers can watch the
chef preparing their freshly fried bowl-shaped churros along with their choice of ice cream and
topping. Furthermore, we also provide delivery service to customers that order a large amount of
our churros.

5
The uniqueness of our churros lies in the fact that churros normally is either thin (or sometimes
knotted) or long and thick. Flavored Churro is the first company in Pakistan that offers churros in
a cup shape. Therefore, it can be stated that the cup shape of our churros distinguishes Flavored
Churro from the competitors.

Our unique bowl-shaped churros are daily made by our chef and baked in the oven. After this
baking process the bowl-shaped churros are being distributed to the sales locations. At those sales
locations the bowl- shaped churros will be stored in a freezer. When a customer orders a churros-
bowl, the churros-bowl will then be taken out of the freezer, freshly fried and sprinkled with
cinnamon powder.

As mentioned before our customers have the possibility to add ice cream into their churros cup.
Therefore, Flavored Churro offer various kinds of ice cream flavors to the customer which consist
out of the following 4 flavors: chocolate, strawberry, vanilla and cookies and cream. Besides that,
Flavored Churro also offers the customers with various kinds of toppings, which consist out of the
following 5 choices: chocolate syrup, strawberry syrup, Choco chips, Oreo, and peanuts.

MARKETING PLAN

In this section we would like to discuss and analyze the market of Flavored Churro itself. The first
thing we would like to discuss is about our market segmentation. The next one is about the service
business analysis which is mainly analyze the competition and buying patterns of the market.

MARKET SEGMENTATION

Market segmentation is the process of dividing an entire market into different customer segments.
After we divide the market, then we make the targeting which entails deciding which potential
customer segments the company will focus on.

We divide our market into some segments based on the demographic segmentation which are kids
(age 7 – 15), teenagers (age 16 – 19), and young adults (age 20 – 25). Three of them are the most
promising customers if we look on their behavior toward consuming dessert especially churros
which contains sweet, and they tend to like it.

6
During the occasion in Karachi, we only target our market into college-aged customers which is
in between teenagers and young adult’s segment. Due to our Karachi location is on campus area,
we try to reach and targeting this market as our priority.

SWOT ANALYSIS
Business analysis is a research discipline of identifying business needs and determining solutions
to business problems. There are several generic business techniques that usually used when
facilitating business analysis. In this paper, we will try to analyze the business using SWOT
analysis which stands for Strengths, Weaknesses, Opportunities, and Threats.

STRENGTHS

The strengths of Flavored Churro itself is the uniqueness of our churros lies in the fact that churros
normally are either thin (or sometimes knotted) or long and thick, but we make some innovation
by changing the shape of churros itself into bowl- shaped. With this fresh idea, it becomes clear
that this is one of our strengths. Beside of our uniqueness, we also provide a great quality product,
because we are using good tools and equipment in the process of making our product. The
combination from churros and ice cream, which is hot and cold, makes our product stands out and
invites the curiosity of our customers to try our product.

WEAKNESSES

We could not deny that our product’s idea is easily imitates by other competitors. Once we enter
the market and gaining popularity, there will be many competitors which can imitate the idea of
our bowl-shaped churros.

OPPORTUNITIES

This is a growing business which involves the great idea and innovation. Because of Flavored
Churro is the pioneer of bowl-shaped churros ice cream in Yogyakarta, it will be a good
opportunity for us to gain the customer’s trust and their loyalty. Also, we will create a lot of
different creations and innovations toward our product to make our customers feel satisfy and
happy with our product.

7
THREATS

The growing number of competitors which runs their business in the same industry might be our
biggest threat, especially the competitors which also serves churros as their main product.

MARKETING AND SALES STRATEGY

COMPETITIVE EDGE

Competitive edge or competitive advantage is an advantage that a firm has over its competitors,
allowing it to generate greater sales or margins and/or retain more customers than its competition.
There can be many types of competitive advantages including the firm’s cost structure, product
offerings, distribution network and customer support.

Our competitive edge is the unique shape of churros that served with various flavor of ice cream
and topping that customer can choose. Usually, churros shape is like a stick, but our churros’ shape
is bowl, as a result we can add ice cream on the top of it. Using the people’s curiosity, we promote
our churros through social media, eWOM, and endorsement to attract more customer and tell that
our churros is different. In result, many customers buy our churros because they are curious and
want to taste our unique churros. Therefore, before we also said that our churros are limited, people
buy our churros as soon as possible, so they still can have it. And we all sold out our churros in
each day during the occasion.

Marketing Strategy

Marketing strategy is an organization's strategy that combines all of its marketing goals into one
comprehensive plan. A good marketing strategy is a way for company to get more profit, attract
customers, and sustain the business by focusing on market research and the right product mix.

There are 3 marketing strategies of Flavored Churro group that applied to market Flavored Churro
product during the occasion, those are:

a. Social media marketing

b. Traditional Word-of-Mouth and eWOM
c. Influencer Marketing

8
Sales Forecast:

Sales forecasting is the process of a company predicting what its future sales will be. This forecast
is done for a particular period soon, usually the next fiscal year. Accurate sales forecasting enables
a company to make informed business decisions.

Sales Forecasting gives insight on whether a company should expand, information about cash flow,
and the ability to effectively manage its resources. Without forecasting, a company would be
unsure of what inventory level to maintain, unsure on how it should allocate resources across the
company, and it would have a hard time predicting future success. Forecasting sales is a crucial
business practice, because in addition to helping a company allocate its internal resources
effectively, having this data is important for acquiring investment capital. Often, investors want to
know what a company’s future expected sales are before making an investment.

The sales strategy is to build and open new locations to increase revenue. However, this plan will
be implemented when the one "market tester" outlet showed potential growth. As each individual
location will continue to build its local customer base over the first three years of operation, the
goal of each store is Rs 1,000,000 in annual sales, with the original flagship store expected to earn
almost Rs 2,000,000 per year. We anticipate the highest peak on the months of June and July in
our sales forecast, due to the holiday seasons.

PRICING STRATEGY

Our pricing strategy is positioned as "generic", meaning that Rs 100 is the average consumer
spending for a snack or light lunch in Karachi. Leveraging the volume of chicken, fries, Soda, and
signature style sauces to be sold, we are serving the majority of Karachiites.

HR PLAN

Our company consisted of ten people in the beginning Because starting and managing a company
is not a simple task, all ten people had to work together to achieve the goal. Think about aspects
as thinking about a product, a name, and a unique concept. The organizational structure was
hierarchal, because all ten people did tasks on their own level, and everyone had as much influence
in making decisions as every other fellow student. Concluded at the end of the project, the group
could make the decisions fast and everyone agreed with each other very easily. It was decided that

9
the 2 people would do the bookkeeping, because they have better knowledge about how much
money was needed for the total project.

MANAGEMENT PLAN

Shafi Ullah (CEO)

Saud Ahmad (marketing manager)

Sameed Alam (operational manager)

FINANCIAL PLAN:

Estimated Sales budget:

Product Karachi Sales Price Amount

Churro’s chocolate syrup 5,00 units Rs. 600 per unit 300,000
Churro’s strawberry syrup 7,00 units Rs. 550 per unit 385,000
Churro’s peanuts 1,000 units Rs. 500 per unit 500,000
Total Amount of estimated sales 1,185,000

Estimated production budget:

Churro’s Churro’s Churro’s

Description chocolate syrup chocolate syrup chocolate syrup

Budgeted Sales 21,000 37,500 54,300

Expected Ending Inventory 6,200 10,500 12,200

Total Units Requirements 27,200 48,000 66,500

Beginning Inventory (5,800) (10,600) (13,000)

Production Budget (in Units) 21,400 37,400 53,500

10
Proforma Income Statement:

Description Amount

Revenue 1,185,000

Less Expenses:

Salaries 250,000

Rent 70,000

Depreciation of Equipment 20,000

Electricity 50,000

Advertising and marketing expense 215,000

Transportation and delivery expenses 100,000

Gas & fittings 40,000

Utilities 5,000

Other Expenses 10,000

Interest Expenses 8,500

Total Expenses (768,500)

Income Before Tax 416,500

Income Tax (416,500* 10%) (41,650)

Net Income 374,850

11
 Proforma Balance Sheet:

Description Amount Amount

Assets
Current Assets:
Cash 75,000
Cash at Bank 5,000
Account Receivable (800,000 * 10%) 80,000
Inventory 95,000
Total Current Assets 255,000
Non-Current Assets:
Equipment 400,000
Accumulated Depreciation (20,000) 380,000
Long Term Assets 124,850
Total Non-Current Assets 504,850
Total Assets 759,850

Equities
Current Liabilities:
Account Payable (95000 * 20%) 19,000
Accrued Income Tax 21,000
Outstanding Salaries 5,000
Total Current Liabilities 45,000
Non-Current Liabilities:
Long Term Loan 55,000
Bonds Liability 15,000
Total Long-Term Liabilities 70,000
Shareholder Equity:
Common Stock 270,000

Net Profit 374,850

Total Shareholder Equity 658,350
Total Equities 759,850

12

View publication stats