UNIVERSITY OF GONDAR

INSTITUTE OF TECHNOLOGY

DEPARTMENT OF BIOMEDICAL ENGINEERING

Entrepreneurship

Business plan for Atse café, restaurant and recreational center

BY:

EDEN HAILU GUR/00653/10

HAMID OUMER GUR/00980/10
SAMRAWIT BELAY GUR/00823/10
SELAM MARU GUR/01077/10
YEABNAT KIFLU GUR/00421/10

Submitted to: Birhanu Aderajew

Submission date: August, 2022

Gondar, Ethiopia
Atse café, restaurant and
recreation center

Business Plan of Atse

Café and restaurant

August, 2022

Email: Atsecafeandrestaurant@gmail.com

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Contents
1. Introductory page.....................................................................................................................1
1.1. Mission statement.............................................................................................................1
1.2. Vision statement about business growth...........................................................................2
1.3. Business goals and objectives...........................................................................................2
2. Executive summary..................................................................................................................4
3. Industry analysis.......................................................................................................................6
3.1. SWOT analysis of the venture..........................................................................................6
3.1.1. Strength.........................................................................................................................6
3.1.2. Weakness.......................................................................................................................6
3.1.3. Opportunities.................................................................................................................6
3.1.4. Trait...............................................................................................................................6
4. Operational plan.......................................................................................................................7
4.1. Building.............................................................................................................................7
4.2. Equipment.........................................................................................................................7
4.3. Suppliers............................................................................................................................7
4.4. Human resource requirements..........................................................................................7
4.5. Staff cost...........................................................................................................................8
4.6. Overhead expenses............................................................................................................8
5. Market plan...............................................................................................................................9
5.1. Description of the market..................................................................................................9
5.2. Product and service...........................................................................................................9
5.3. Positioning........................................................................................................................9
5.4. Promotion..........................................................................................................................9
5.5. Distribution channels......................................................................................................10
5.6. Marketing plan price.......................................................................................................10
6. Organizational Plan................................................................................................................11
6.1. Entrepreneurial team or Management/Owners...............................................................12
6.2. The personnel plan..........................................................................................................12
7. Risk analysis...........................................................................................................................14
7.1. Low demand....................................................................................................................14

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 7.2. Perishable habit of product.............................................................................................14
7.3. Failure of supplier...........................................................................................................14
7.4. In efficiency in distribution channel...............................................................................14
7.5. Inflation...........................................................................................................................14
8. Financial plan.........................................................................................................................15
8.1. Assumptions....................................................................................................................15
8.3. Pricing system.................................................................................................................18
8.4. Breakeven point analysis................................................................................................19
8.5. Equity and credit Financing............................................................................................19

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 1. Introductory page
Name of the company: Atse café, restaurant and recreational center

Address of the company: Gondar, University of Gondar/UOG in institute of technology/IOT

campus.

Nature of the business: Service provider

Address of the partners: Ethiopia, Gondar

Statement of financing needed: 25% equity financing and 75% credit financing

Name of Partners:

 Eden Hailu
 Hamid Oumer
 Samrawit Belay
 Selam Maru
 Yeabnat Kiflu

1.1. Mission statement

The business is become very necessary and important in the campus:-

Because of the following visible problems;

1. High number of student at present and increase per year.

2. Need of quality supply.
3. Increasing non-café student.
4. Low in quality and in quantity of the present cafeteria.
5. No place for refreshment

Due the above problem the startup of this business is a great opportunity for the university
society especially for the students which cover higher number of the society and also higher
number of costumer.

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In general the purposes of business are listed below:-

 Supply food and beverage for the society in good quality and in sufficient quantity.
 Reducing the contaminated disease due to low quality of the existing cafeteria.
 Supply and service its product 24 hours per a day.
 Best site of business place.

1.2. Vision statement about business growth

The main products or services to be sold or services provided are:

 Food preparation and packed food (fasting food, meat etc.)

 Beverages (Coca-Cola, mineral water, milk, juice etc.)
 Refreshment Service

The key to our success that will help establish a successful plan in UOG
 Product quality - Food, coffee, tea and other beverages with a comfortable environment.
 Service - Our patrons are paying for high quality food, delivered in a short time frame in
a comfortable environmental each member of the staff will be courteous, efficient, and
attentive.
 Marketing - We will need to target our audience early and often. While the business is
located in a central and accessible location, many people will have to be re-introduced to
the café/restaurant.
 Management - We maintain a firm grasps on costs, such as food, beverage and labor
costs. Stock is maintained by a dedicated stock system by employ management, and
quality control is critical.

1.3. Business goals and objectives

The objective of this group business is to provide good quality of service and adequate quantity
of products and satisfy the need for quality food and satisfy the need of refreshment in the
campus.

The goal of this business is to provide good quality food with a minimum Price for students.

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The main business goal of the business plan is to provide adequate profit for the owner of
business.

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 2. Executive summary
Name of Business: Atse café, restaurant and recreational center

Description of the business:

The restaurant\ Café is owned and operated by Café Ltd and is 100% group share of the group
member. The business is assumed to be started up to the year month and it has no working and
customer experiences before hence, the idea of opening this business is not based success and
reputation of the business but due to high shortage because the existing cafeterias have low
quality and leads the students to the food contaminated diseases.
This Terminal is open for business seven days a week and 24 hours a day.
The average spend split between beverages and food is:
 Beverages- 16%
 soft drinks
 Water
 Milk
 Coffee/tea and
 Others
 Food – 80%
 Refreshment Service
 Pool house
 Tennis table
 Other games
The legal form of the business is: Partnership
The reason for choosing this legal form:
We know that there are various forms of legal structure of organization, to organize small
business. We evaluate each of these available forms of legal structure by considering the merit
and demerit of each structure. Then we select the one, which is optimal for the establishments of
the enterprise. That is called partnership. As definition, partnership is the association of two or
more people to carry as co- owner of business where the relation is based on agreement.
Establishment of our enterprise is due the association of five (our group), where the relationship
is based on an agreement. The partner decides to use the available asset of the enterprise to cover

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the debt. The following are advantage of partnership forms of legal structure, which are critical
for the enterprise:

 Easy of start up
 Increased source of capital
 Personal supervision
 Reduced risk

Contact Address: Atsecafeandrestaurant@gmail.com

Type of business: Service provider

Project’s contribution to the economy:

The business is located inside University of Gondar. The building we’re planning to rent is
property of the University therefore this can be a major income for the University. And also the
business will pay tax regularly for the government. It also creates a job opportunity for many
people.

Owners’ profile

No Name Address Qualification Function in the Relevant

business experience
1 Eden Hailu Gondar 5th year student Investor 0
2 Hamid Oumer Gondar 5th year student Investor 0
3 Samrawit Belay Gondar 5th year student Investor 0
4 Selam Maru Gondar 5th year student Investor 0
5 Yeabnat Kiflu Gondar 5th year student Investor 0

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 3. Industry analysis
In fact, it is difficult to clearly put the industry of the venture. However, it belongs to service
industry as a venture provides service in all of its three units although to some extent production
is involved in all future units.

We need to examine the conflictions of the industries separately. For example, the cafeteria
service is almost expanding every time because this industry is always essential and necessarily
where peoples living together like the students of Gondar University exists. So we can sure about
the expanding nature of the cafeteria and quality food service. When we come to the recreational
division it is obvious that the industry will expand with an increasing rate because the customers
of the business or the target market of the business are although teenagers which are the very
sensitive to pleasant recreational centers like the one which is going to be managed by our
business.

3.1. SWOT analysis of the venture

The venture will have some strength, weakness, opportunity and trait:-

3.1.1. Strength
 Solve its problem through discussion

 Serve its customer as their demand and preference

 Tries to avail product and service as customers need

3.1.2. Weakness
 Shortage of wide place

3.1.3. Opportunities
 Accessibility of untapped market

 Favorable working environment

3.1.4. Trait
 Fluctuation of price for the purchase of raw material

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 4. Operational plan

4.1. Building

The location of the business is in UOG/IOT inside a building formerly known as teacher’s
lounge. The building covers a total of 200Km 2 area and has 10,000birr monthly fee. The main
infrastructures needed for this business are water and Electricity. As the building is located in a
University it has an adequate electricity and water service.

4.2. Equipment
Since we are starting a business, we have to list equipments and any other assets we need or have
acquired to establish our business and we have to List items individually, or by type. The table
below shows to present this information as follow.

Equipments price in birr

Furniture 50,000
Kitchen objects 100,000
Pool table 30,000
Table tennis 10,000
Kerembula 20,000
Total 210,000

4.3. Suppliers

The materials required to produce our products and services are supplied from suppliers and
farmers who lives around the campus.

4.4. Human resource requirements

Atse café and restaurant and recreation center is owned by Business group which has five
members with equal share. It is staffed by;

- Two Shift Managers

- Two Deputy Shift Managers

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 - One Head Chef
- Three Assistant Chefs
- Six Waiting staff
- Two cashiers

4.5. Staff cost

Position NO. salary /birr Total salary
Shift Managers 2 5000 10000
Deputy Shift Managers 2 5000 10000
Head Chef 1 3000 3000
Assistant Chefs 3 2000 6000
Waiting staff 8 1500 12000
Cashiers
Total = 41,000

4.6. Overhead expenses

no Overhead expenses cost per month in birr
1 Indirect labor 3000
2 Electricity 5000
3 Water 1000
4 Depreciation of fixed capital 10000
total 19000

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 5. Market plan

5.1. Description of the market

The restaurant\ Café is owned and operated by Café Ltd and is 100% group share of the group
member. The business is assumed to be started up to the year month and it has no working and
customer experiences before hence, the idea of opening this business is not based success and
reputation of the business but due to high shortage because the existing cafeterias have low
quality and leads the students to the food contaminated diseases.
This Terminal is open for business seven days a week and 24 hours a day.
The average spend split between beverages and food is:
 Beverages- 16%
 soft drinks
 Water
 Milk
 Coffee/tea and
 Others
 Food – 80%
 Refreshment Service
 Pool house
 Tennis table
 Other games

5.2. Product and service

Our products are mainly Ethiopian foods like enjera and wott, bread and some are foreign foods
like pasta, macaroni, and rice e.tc. Our foods have high qualities and fair price.

5.3. Positioning
Our café is located at UOG in IOT campus in a building formerly known as teachers’ lounge

5.4. Promotion
As much as possible we tried to create a good environment with the public by participating in
different charity activities and also by sponsoring some ceremonies in the campus. Our
advertising is mainly focused on distributions posters’ ion different area of the campus.

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 5.5. Distribution channels
Our products are totally distributed in our café. We have no repair services

5.6. Marketing plan price

 How much are customers willing to pay?
Highest: 150 birr
Average: 85 birr
Lowest: 20 birr
 competitors’ price
Highest: 150 birr
Average: 87.50 birr
Lowest: 25 birr
 Our price
Highest: 100 birr
Average: 52.50 birr
Lowest: 5 birr

We chose this pricing because it is low when compared with the competitors and can also make
profit to the business. Our pricing system is totally by cash because products individual price is
very small (between 5-100ETB).

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 6. Organizational Plan
The kitchen is the responsibility of the Chef who will manage kitchen operations including
keeping it clean. The critical task of maintaining the food inventory and assisting in menu
development will be performed by the head chef and the two members who are responsible for
doing all the purchasing and inventory control. The Deputy Shift Managers will assist in all areas
and will be in charge when the shifts Managers are absent. The cleaning and waiting services
will be performed by the waiters.

Figure: organizational structure

List our available current staff

Job title Name Skills or strengths

Purchase and inventory Tsfaye Three year experience

control

Purchase and inventory Mulusew Three year experience

control

Shift manager Mulugeta.D Three year experience

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Shift manager Tewodros Three year experience

Deputy Shift manager Sileshi Three year experience

Deputy Shift manager Mulugeta.b Three year experience

Cashier Tigabu,Mulugeta.h,E Three year experience
phrem
Cashier Mulugeta.F,Muslim Three year experience

List our required staff

Job title Quantity Skills necessary

Waiter 6 1 year experience

Head chef 1 3 year experience

Assistance chef 3 2 year experience

6.1. Entrepreneurial team or Management/Owners

Atse Café and restaurant is owned by the five UOG students which all have equal share. The
group of owner had no job experience on this type of job and also not trained as a chief, but they
are a students in which they have a desire and prosperity of work that are supported by five years
academic performance.

6.2. The personnel plan

The personnel plan for the Atse café, restaurant and recreation center are:

- Two Shift Managers

- Two Deputy Shift Managers
- One Head Chef
- Three Assistant Chefs
- Six Waiting staff
- Two cashiers

Employee salaries are as follows:

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Position NO. salary /birr Total salary
Shift Managers 2 5000 10000
Deputy Shift Managers 2 5000 10000
Head Chef 1 3000 3000
Assistant Chefs 3 2000 6000
Waiting staff 8 1500 12000
Cashiers
Total = 41,000

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 7. Risk analysis
Just like any firms Atse café, restaurant and recreation center faces major business risks though it
is class member some to clearly state the risk that the venture might fact analysis of industry and
market as well as observation of ventures characters enable us to forecast the follow of potential
risk to the business.

7.1. Low demand

The low demand of customer for ventures service mainly determine the amount of service sale as
well as profitability of the business an adverse variation in demand means an ultimate decline in
ventures ability to provide customized service if demand of customer is not as forecasted by
ventures official then there will be lost to the venture.

There is a great possibility that some services of the venture such as business plan development
will not be completely demand by our customers.

7.2. Perishable habit of product

As most foods provided in café & restaurant perishable by their nature there might be the
possibility of loss of the demand for product fluctuates.

7.3. Failure of supplier

If there is failure in supplier to provide raw material on time there will be the possibility of
customer dissatisfaction ultimately losing the potential customers to but direct competitor.

7.4. In efficiency in distribution channel

As the firm depends on external distribution agents to market its service there will be failure of
distribution channel which might result decrease in sales and large inventory holding if sales
volume affected as result of failure in distribution channel students might develop negative
perception that their products one not demand in local market.

7.5. Inflation
A continues increase in price might affect ventures sales through Increased price of raw material
forces the firm to increase its price which might be in contraction with our business.

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 8. Financial plan

8.1. Assumptions
The financial plan depends on important assumptions, most of which are shown in the following.
The key underlying assumptions are: We assume a constant growth in the economy, without
major recession. We assume of course that there are no unforeseen changes in technology to
make equipment immediately obsolete. We assume access to equity capital and financing
sufficient to maintain our financial plan as shown in the tables.
8.2. Total Capital Requirement
Total Capital Requirement It is the overall requirements to start the project, this capital
requirements includes all assets like:

 Fixed cost
 Variable cost
 Working Capital
A. Fixed capital

Equipment cost

Equipments price in birr

Furniture 50,000
Kitchen objects 100,000
Pool table 30,000
Table tennis 10,000
Kerembula 20,000
Total 210,000

Building rental=30,000(per 3 months)

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Labor cost

Position NO. salary /birr Total salary

Shift Managers 2 5000 10000
Deputy Shift Managers 2 5000 10000
Head Chef 1 3000 3000
Assistant Chefs 3 2000 6000
Waiting staff 8 1500 12000
Cashiers
Total = 41,000

Total fixed cost=281,000birr

B. Variable cost

Raw materials

Position Amount per Cost in birr Total cost in

month birr
Egg 50 piece 11 550
Injera 750 piece 10 7500
Vegetables - - 5000
Meat 90 kg 400 36000
Milk 150 litre 40 6000

Sugar 25 kg 70 1750

Coffee 20 kg 300 6000

Oil 25 litre 200 5000

Butter 3 kg 800 2400

Spices 10 kg 400 4000

Others 5000

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Total 79,200

Total variable cost = 79,200 birr

C. Working capital (per month)

Utility expenses

Number Working capital items price in birr

1 Utility cost such as electricity 10,000

2 The amount of ready cash needed to pay workers and overheads 300,000
Total working capital requirement 310,000
Total working capital requirement=310,000 birr

Total investment

i. Fixed capital (F.C) = 281,000 birr

ii. Variable cost(V.C)= 79,200 birr
iii. Working capital (F.C) = 310,000 birr
iv. Total capital = F.C + W.C + V.C = 281,000 +79,200 + 310,000 =670,000 birr

Total cost per month

Fixed cost = 281,000 birr/month

Variable cost = 79,200 birr/month

Total Cost=VC+FC

= 360,200 birr/month

Total cost per year= 360,200 *12=4,322,400 birr

8.3. Pricing system

Our market place is found in UOG in IOT campus. It is very strategic place for café and
restaurant. Our pricing system is totally by cash because products individual price is very small
(between 5-100ETB).

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Desired profit percentage from a single service/product = 30%

Average price of each product/service sold per month = total cost per month + 30% of total cost

=360,200 + 108,060 = 468,260 birr

Desired profit percentage from a single service/product = 30%

Revenue

Revenue = Average selling price * service given per month

=360,200 * 70 =25,214,000 birr/month

NOTE: we estimated amount of service given per month to be70.

Gross profit

Income tax (20%) = 0.2 *revenue = 0.2 * 25,214,000=5,042,800 birr

Gross profit per month = revenue – tax=25,214,000–5,042,800 = 20,171,200 birr

Net profit

Net profit per month = gross profit per month – total cost

=20,171,200 birr –360,200 birr

Net profit = 19,811,000 birr

8.4. Breakeven point analysis

Breakeven point occurs when the cost of producing commodity is equal to the total revenue of
the commodity. The level of operation utilized percentage of material capacity is computed when

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relatively simple model of revenue & costs are equated. To analyze or estimate profit or loss, it is
often necessary to determine the quantity of service at which revenue & costs will be equal.

Breakeven point B. E.P = Fixed cost/ (selling price – unit variable cost)

Therefore B.E.P =281,000/ (468,260 – 79,200) = 0.72

8.5. Equity and credit Financing

To meet the capital requirements there are the following options of financing or source of funds.

 Equity financing

 Credit/Debt financing

The business to be financed by equity and credit financing system in the ratio of 1 to 3, that
means 25 % equity and 75 % credit(liability).
Equity financing: The project capital requirement of about 25 % of the seed capital full filled by
equity finance.

Debt finance: A method of obtaining finance which involves an interest on the amount of
money borrowed. It requires pay back the amount of money borrowed with its interest rate of
12%.

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