$pagename = “Free Essays”;
= “Food Franchise In Malaysisa| Business”;
$description =”Business Essay – Regard the economic pressure and the uncertainty due to some economical aspect. Facing the difficulties of enterprising”;
$subject = “Business”;
Food Franchise in Malaysia
On the 27th of February, I was given an opportunity by my investor (Ms. Janice) to present a business development plan regarding franchise. In this report, it consist the purpose of choosing the right franchise, studies and some statistic in order to come up with ideas which are relevant.
Regard the economic pressure and the uncertainty due to some economical aspect. Facing the difficulties of enterprising, it is essential to analyze the profitability of franchising in Malaysia. However, for a multiracial country like Malaysia, there is a guarantee of success in franchise especially in the F&B industry; I have decided to apply ideas of reducing cost assisted by a new concept which could be a new trend of fast food.
To be in this field, for choosing the right franchise, there is a certain level of difficulties, many factors have to be considered, which also includes the limitation of a mere individual, the lag of budget and other management skill. First, we have to analyze the potential development if we choose a particular brand. Second, we have to determine the period of executing the purchasing of this franchise. Apart from these standard protocol. It is also vital to explore new expansion and future plans out of this brand. Therefore, choosing something too big would only burden the cost. Further more, something that is already so well known doesn’t have much dimension of improving(freedom), nevertheless, for big brands, it would never lets solely one or two franchisee to change or jeopardize the establishment they have.
Despite the fact of lacking in different type of fast food. After a variety of franchise, the franchiser that I have chosen is Jester pie. It occurred to me that, something new would be the ideal choice of franchising in Malaysia. The term New refers to a brand that has never heard by Malaysian.
Along this report, there will be introduction of the brand, the history, the external and internal factor, as well as method of reducing cost and new innovations.
8.0: Short term execution plan (recommendations)
The short term execution plans will commerce as soon as the investors start investing. The period of this operation is approximately 10 months. The first step is to consult a accountant to calculate the cost and profit margin then consult a lawyer to deal with patent right of lily café, mean while settle applications of halal and sirim to expand a bigger scope of consumers.
For worst case scenario, we can pull back development plan and divert into asset liquidization for more capital or atleast assure the minimum lost. As an alternative, lily’s patent can be used for venturing in new business purpose or involve in property industry.
8.1: Long term development plan (recommendations)
Short term wise, Jester pie in Malaysia will only be a mere franchisee. However, for the coming years after the first set up, A&D co will invest more on buying the franchise-ship of Malaysia to become Malaysia’s sole Jester franchiser, combined with strategic support of ingredients supply to minimize other franchisee’s cost.
Apart from that, all Malaysia franchisee will have to go through A&D to commerce their Jester store. From that point, prioritize good marketing and advertising tactics to gain public’s attention and loyalty. The same offer to franchisee will also be available locally.
As a guideline for management plan, within the execution period (1-2 years). A&D co must be able to cover the investor’s capital equity.
5.0: Public respond
After research on the brand due to my surveys. Most people haven’t heard of JESTER yet, it occurs to me that this could be an opportunity to start something Malaysia doesn’t have.
Thus, being part of this F&B industry. It is still quite typical and conservative. In other words, this is an opportunity to redefine a whole new trend of fast food chain
5.1: Price range
As the aspect of economy, price definitely influences consumer’s behavior towards a business. Regarding my studies, this is the result of 50 correspondent’s respond towards the price of pies.
7.0: Stakeholder
For every business, stakeholders hold a very influential impact on the business. Among these stakeholders, it is vital to analyze the limitation and solution to overcome these obstacles.
7.1: Investor
It is undeniable that source of finance is everything to a business therefore, assuring investor profit and trust must be executed in the most efficient and effective way. However the periodic execution must be within the scope of one year to prevent better ideas.
7.2: supplies
In term of supplies, JESTER is originated from Australia; the problem of importing all these ingredients from overseas would dramatically increase the shipping cost. As an alternative to reduce cost, is to find sources to these ingredients locally without affecting the quality. After tracking alternative sources, lily café also helps to reduce logistic and inventory cost by check-pointing suppliers location to assure sufficient inventory for minimum rate of two weeks. Despite the supplies are entirely durable.
2.0: CHOOSE THE MOST ELIGIBLE FRANCHISE
Among all the brands, I have chosen JESTERS PIE to franchise. The reason of doing so is because JESTERS has never been franchised in Malaysia before, aren’t like brands for instance (Starbucks, Dunkin Donuts). JESTERS fully fulfill the term NEW in my introduction. New as in the proposal and trust of potential expansion of JESTERS and with a wider market in a new country. It’s definitely a winning scenario for both franchisee and franchisor. Later in this assignment, I will sell the business plan and future direction of developing JESTERS in Malaysia. Further more, it has a low start up cost compare to other fast food business. In a way, we get to save up the franchising cost to allocate in other process of managing.
2.1: ABOUT JESTERS:
JESTERS is a genuine Australian business, which have had more than ten years of experience in gourmet food manufacturing, retailing, marketing and small business management. According to info found online, Jesters pies are based on chef-inspired recipes that are hand-made daily using premium, all-natural ingredients. Jesters’ pies contain no added preservatives, MSG, artificial flavors or colors. Jesters has served five Tick approved pies since 2004 and are the only national pie franchise to have a range of pies to have earned the Tick.
JESTERS were formerly known as Shakespeare Pies back in 1994. However, after the first jesters store opened on 1997, the business was spitted into two names which made them partner. In 2005 due to business strategy, all Shakespeare Sydney stores were officially re-branded to Jesters, resulting it to be Australia’s single biggest branded franchise pie company with over 70 outlets across NSW, Victoria, Western Australia and New Zealand.
2.2: What does JESTERS offers to its franchisee? :
For a brand like Jester, they cannot ignore the harsh competition of others, therefore, to stay the fittest. It provides franchisee support, training, marketing, merchandising, research and product
Developments which will help ensure the success of every Jesters store.
The bellows are the supports jesters provide:
I. TRAINING
Every new franchisee is given thorough training. If you have little or no experience, we’ll
Support you 100% of the way. Before commencing in your store, you’ll gain hands-on experience in one of our existing training stores for a nominated period.
A Business Consultant will be assigned to you throughout your training program.
They will follow up and ensure you are getting the most effective training possible.
II. FRANCHISE SUPPORT
Whilst you will be running your own business you will not be alone.
Each Franchisee is assigned a business consultant who provides on-going support.
A network of existing Franchisees and support from the Company are only a phone call away.
http://www.jesters.com.au/pdf/franchise_info.pdf
III. STORE LAYOUT & EQUIPMENT
Store designs are developed based on the layout of the premises you select and our experience gained in other stores.
The ideal layout has been developed after constant refinement and research.
We select the best available equipment to fit our specifications and requirements.
This ensures a professional base on which to make the best products.
Qualified and experienced shop fitters will be used to construct and refurbish all stores.
IV. STORE OPERATIONS
Our staffs are happy and friendly and our products are easy to sell.
Inventory holding requirements are minimal and there are no debtors to chase and wastage is minimal compared with other businesses.
You are not required to commence operating your store at an unreasonably early hour because it takes no more than an hour to open a store.
http://www.jesters.com.au/pdf/franchise_info.pdf
3.0: SETTING UP THE BUSINESS
Prior to start any business, anyone would know that the source of finance is the most vital issue, without money we have no bargain power to neither obtain nor achieve the purpose or aim of this whole franchising idea. Therefore the first thing is to find out how much would it takes to buy jesters franchise. This is shown below:
WHAT IS THE COST OF A FRANCHISE?
The outlay required to establish a Jesters store ranges from $230,000 to $280,000
(EXC GST, including all Franchise Fees)
*The amount quoted may exceed $280,000 only when a larger than average premise is sought by the Franchisee.
This investment covers such items as:
- Franchise Fee = $35,000
- Training Fee = $7,000
- Fit-out of premises = $120,000* approx
- Equipment package = $80,000 approx
- Promotional opening funds = $5,000 approx
- Legal costs = $3,500 approx
- Depending on size of premises
http://www.jesters.com.au/pdf/franchise_info.pdf
WHAT IS THE ROYALTY PAYMENT AND MARKETING LEVY?
Presently Jesters charges a franchise royalty of 6% of net sales and a marketing levy of 5% of net sales which is payable weekly. This fee is applied to support various areas of the business from field support and management, through to Research and Development, and recipe development, as well as the ongoing use of the naming rights.
http://www.jesters.com.au/pdf/franchise_info.pdf
4.0: HOW TO ACQUIRE THIS FRANCHISE?
Money is everything for start up, a question always occur to an entrepreneur, how to use the most effective solution to get the financial source? Despite for every business plan there is an execution period, if the plan doesn’t commerce within that period, the risk from competitors will increase. For instance a better business plan would have already been executed, before commencing a particular business. Nevertheless, individual would normally result in a loan. Regard its flexibility in liquidizing or transaction purpose.
A loan comes in various types, like mortgage loan, housing loan, individual loan and business loan. Yet, there is always a similarity among these loans, which is the banks confirmation of a creditor’s capability to return that sum of money.
To assure the loan goes smoothly, a guarantor is no doubt an important point of this loan.
4.1: Business Loan Application Checklist
New Business:
- A completed member business loan application
- Your business plan, including the following:
- A brief description of your business
- A summary of the company’s management structure
- Detailed one (1) year projection of Income & Expenses (please attach written explanation as to how you expect to achieve same).
- The purpose of the credit, how much is needed, and the term desired
- Your business experience, credit references and collateral available
- A personal financial statement from each owner, dated within 90 days of the request
- Complete personal tax returns (from each owner) for the past two years, including all schedules
- By-laws/Articles of Incorporation/ Partnership Agreements/ DBA(Doing Business As)
Certificate
Other items based on loan purpose and/or collateral pledged:
- Working capital line of credit
- Accounts receivable/payable aging reports as of most recent period end
- Inventory listing or summary as of most recent period end
- Equipment and vehicle financing
- Invoice/purchase order
- Loans secured by existing equipment
- Equipment listing as of most recent period end
- Loans funding the purchase of real estate
- Accepted purchase agreement (real estate purchase)
- Loans secured by non-owner occupied real estate
- Rent rolls and copies of leases, operating income and expenses
6.0: External factors
Before venturing into any business, there are factors we have to take into account. The source of income as well as customers evaluation is influence by these factors.
6.1: Demography
Demography refers to the targeted consumers in term of age, spending power and the density of population.
Regarding age, any category can accept JESTER PIE because of its reputation in Australia for having a range of pies to have earned the Tick and the variety of pie to suit the taste of different age range.
Secondly, due to which is at subang, most consumers can afford to buy pie at the range of (RM5-RM15). Combine with good managing tactics and the flexibility of changing locations; I am able to track down customers which have that kind of spending power and willing to try something different. As we all know F&B mostly based on crowd and location. With my concept of lily café, it enables me to move from location A to B. directly, I am able to locate my market.
6.1.1: Heart Foundation Tick
Since 2004, Jesters has offered a range of pies that have earned the Heart Foundation Tick. Our Tick approved pies meet strict standards for serve size, saturated fat, salt and vegetable / fibre content and they have been independently tested so you can be sure they’re a healthier choice.
6.2: Economy and Culture
For a multiracial country like Malaysia, F&B does have its advantage. In economical aspect, anything that is affordable definitely has a chance. Further more, the current generation has become stronger consumers compared to the last batch. The improvement of lifestyle and better consumer’s right have created an opportunity for JESTER.
On the other hand, food has always been a major topic to Malaysian. With the lack of fast food pie, JESTER is definitely something fresh enough to appeal to consumers. More over, with the help of my lily café, it will attract a large group.
6.3: technology
In this consistent improving society, business cannot afford to just be ordinary, yet there is always a line separating acceptable and risky application.
In my findings, I found a method of saving cost and also appeal to the market of Malaysia. As we all know, F&B franchise holds a very big risk compare to other kind of franchise, because it solely based on crowd and location.
Instead of managing this franchise in the most traditional way, I found something called the lily cafe which is a container like bar or restaurant which enable us to move around. by having the lily cafe, I m able to move to anywhere the crowd is and I can save inventory cost as well as avoiding competition, to solve the possibility of being sabotaged. I can apply for patent right concept to prevent new entry.
Secondly, consumers have the curiosity of trying new vibes. By managing jester in this way allows me to bring jesters advertisement to the next level.
Then from there on I can start a delivery service as well.
Lastly, we are talking about owning the container and not renting, therefore, there is always an alternative of reselling it as a plan B or rent it to other kind of business. In a way, our cost wouldn’t be wasted too much on rent; meanwhile we have something to hold on to in the worst scenario cases.
- lower inventory cost
- lower risk
- unnecessary to rely on logistic
- unique and creative
- maximizing profit with the lowest cost possible