Hospitality Analysis: Good Times Café and Bar Case Study
The Hospitality industry in Australia faces a lot of competition. This because there are many restaurants, entertainment joints, bars and cafes which offer similar services. However, if a company devises innovative operational strategies, then it may remain competitive in this industry, (Ren et al., p. 13). In this report, the development of a new Café and bar called Good Times Café and bar have been discussed.
Good times Café and bar will be located in Federation square, in Melbourne town. It will provide delicious meals, coffee, tea and snacks for people living in Melbourne. The café will major on providing customers with delicious meals and drinks at high prices. This will make the customers to derive value for their money.
Positioning refers to the place a specific brand occupies in the mind of the customers, (Nunkoo et al., 2013, p. 269). To develop a market position, Good Times’ meals will be different from those of their competitors, as they will be delicious and unique. The café will develop a key position in the hospitality industry as it will be known for providing nice delicious meals prepared by highly qualified cooks.
Segments are positions that businesses occupy in the society, (Brotherton, 2012, p. 24). A particular segment must align to the nature of the business, (Borland & Lindgreen, 2012, p. 174). Good Times Café and bar, will provide both foods, coffee, wines and beer. It will therefore, occupy two business segments- bar and café.
The cafes, coffee shops and bars have grown over the years in Australia. The growth have been necessitated by Australia’s love for quality coffee, beer and wines and a vibrant coffee culture. The Café industry revenue is therefore expected to grow by 7% annually, amid high competition between several cafes, coffee shops and bars, (Esi, 2014, p. 32). This means that for a company in this sector to be competitive, it must major on its strengths, improve on its weaknesses, eliminate the threats and execute any opportunity for improvement. A proper analysis of the Australian market can be achieved by adopting the following plan:
According to the results of the 2016 Census, the Australian national population was 24.4 million people. Out of this population, 19.05% lives in Melbourne, which is 4.5 million people. Since Good Times Café and bar will target customers living in Melbourne, it has an advantage as the large population acts as a potential market for its beverages and foods. The café will also target customers of all age brackets, from youths to adults. People who love coffee and wines form the best targets for this firm.
After dividing the market into different segments, a company should target a specific market segment, (Morgan et al., 2012, p. 271). Segmentation may be behavioral, demographic or geographic. Good Times Café and bar will mainly target the following customers:
People living in Melbourne city, they go to work and prefer taking lunch in town.
People living in Melbourne city, they go to work in the morning and prefer taking delicious breakfast in town.
People living in Melbourne working or not working and prefer taking beer or wine in the evening in town.
The Australian café and bar sector faces a lot of competition since there are many hotels, coffee shops, wine joints and bars in Melbourne and other towns, (Lefebvre, 2012, p. 119). This is shown in the following statistics:
|The Hardware Societe||Melbourne|
|The Grain Store||Melbourne|
|1932 Café and Restaurant||Melbourne|
|Brother Baba Budan||Melbourne|
Barriers to entry
Barriers to entry refers to the restrictions faced by companies in their attempts to enter the market, (Teng et al., 2012, p. 199). These restrictions are mainly posed by competitors. For instance, the Café and bar sectors have been crowded by several players, making it difficult for new firms to enter the market. This may also be a potential barrier for Good Times Café and bar.
Regulations are restrictions put in place by the government to control trade, (Same & Larimo, 2012, p. 10). The regulations in Australia regarding wine and alcohol selling and drinking are strict. This will influence Good Times Café and bar’s operations as it will sell a wide range of wine and beer. Melbourne is found in South Australia, and regulations guarding the drinking of alcoholic beverages and drinking age are derived from the Liquor Licensing Act 1997, (Morgan et al., 2012, p. 271). The current drinking age in Australia is 21 years. The bars and cafes are not allowed to sell alcohol to people below this age.
A business concept development may involve coming up with a business idea, which include a product or a more innovative way of doing business, (Huang et al., 2012, p. 322). Good Times Café and bar will have a detailed website where customers will be able to view the drinks available and their price, wine and beer brands and their prices and descriptions of delicious meals available in the café.
The café will also create a portal, where customers can log in, view available wine brands, meals and coffee and make orders. This is an innovative way of handling customer’s orders as it will ensure customers’ orders are received and processed in time. Customers will also have an option of requesting delivery of meals to their premises. This will ensure customers do not waste time walking into the café to pick their orders.
The main reason why this café will be developed is to enhance customer convenience, and ensure efficiency in processing and delivering customers’ orders through use of technology.
A menu is a list of meals and drinks available in a restaurant, hotel or café, (Bray & Macneil, 2012, p. 333). The sample menu for Good Times Café and bar is as listed below:
|Coffee and tea||REG||LG|
|Bonsoy milk available||4.3||5.9|
|Affogato Espresso with vanilla ice cream||4.3||5.9|
|Hot Chocolate with house made Cadbury chocolate sauce||4.3||5.9|
|Espresso / Short Mac||4.3||5.9|
|Clare Valley, SA||9||42|
|Summer Poppy Sauvignon Blanc ||9||42|
|Jack & Jill Chardonnay ||10||47|
|Mister Fox Moscato ||9||35|
|Bellarine Peninsula, VIC||10||47|
|Central Victoria, VIC||9||35|
|La Linda Riesling ||9||42|
Style of service
Service styles refers to methods used to ensure that customers get their orders in time. In Good Times café, Plated (American) Service style will be used. This is a service style whereby Customers enter the Café and sit, Foods and drinks are pre-portioned in the Kitchen, put in plates and served by waiters and waitresses from the left. Beverages are then served from the right. Used plates and glasses are removed from the right, (Ren et al., 2016, p. 14). This style is very economical, efficient and controllable.
The main aim of a green initiative is to offset greenhouse gases that may be emitted as a result of a particular business operations, (Ren et al., 2016, p. 22). Good Times café and bar will major on using solar energy so as to prevent emission of gases into the atmosphere and also reduce the costs of operation.
The company will use solar photovoltaic systems in its operations. Solar panels will be fitted in the café, which will be used to provide light to the customers, run solar cookers, fridges and other administrative systems in the café. Using solar Cookers will ensure no gases are emitted into the atmosphere. Trees will also be planted in the whole compound so that it remains cool and ensure the environment is conserved.
Legal obligations for storage, food production and service systems.
Food safety standards should be followed as outlined in the Food standards Australia New Zealand (FSANZ).
Australian laws require food producing entities to produce foods that are safe and suitable for eating, (Bray & Macneil, 2012, p. 335). They mainly emphasize on health and hygiene of the food handlers. People who prepare foods in the hotels must be of good health; that is free from foodborne diseases.
Food handlers should be healthy, clean and should not be carriers of foodborne diseases, (Bray & Macneil, 2012, p. 335). Therefore, food handlers must ensure they receive regular checkups and get authorization from health experts to handle foods in the café.
Potentially hazardous foods must be kept under temperature control, (Bray & Macneil, 2012, p. 335). These foods include dairy products, seafood, cooked rice and pasta, cooked and raw meat or foods with meat contents like curries among other foods.
Proper stores control and management ensures that stock records are accurately recorded to eliminate instances of unplanned stock outs, (Teng et al., 2012, p. 200). To keep track of purchases in the Café. I will conduct regular stock takes, whereby I will record the quantity, quality and prices of the stocks available. I will also install SAP ERP system, which will enable me track my client’s orders and manage all the stock operations in the café.
Price: This is the value attached to a product, (Huang et al., 2012, p. 333). The Prices of the meals and wines will be shown in a menu. As shown below:
Product: This is the market offer, (Huang et al., 2012, p. 333). Good Times Café and bar will deal in wines, beer, breakfast lunch and dinner meals. A photo of wine is shown below:
Place: Place refers to the location of the business and the destination of its products, (Huang et al., 2012, p. 333). Good Times café and bar will be located in Melbourne City. A photo of Melbourne city is shown below:
Promotion: This refers to the tactics used by firms to persuade customers to buy their products, (Huang et al., 2012, p. 333). In ensuring that Good Times Cafe and bar receives customers, I will conduct online advertisements in Facebook, using posters and through the website. A photo of an online advertisement is shown:
Level of service: the level of service depends on the firm’s policies, (Huang et al., 2012, p. 333). There are firms which offer after sale services. Good Times café and bar will offer free coffee for those who come for dinner, and a free Package for those who buy take home foods. This is an after sale service.
The café environment consists of strenuous jobs, which relate to serving of customers. Therefore, the employees must have the following skills:
- Commitment: Members must be committed to achieving organizational goals.
- Problem solving: Members must devise innovative ways of solving issues.
- Teamwork: Members must be able to assist fellow colleagues.
- Flexibility: Members must be flexible to handle any duty.
The employees will fall under the Restaurant and Industry Award 2010. This Award regulates the minimum wages and piecework rates, part time or casual loadings, Sunday, Saturday, evening, holiday jobs and other penalties. It also deals with the shift allowances for the employees.
|RESOURCES AND EQUIPMENT||COST IN USD|
|Automatic Drip Coffee makers||$ 2000|
|Milk and water||$8000|
|Industrial Coffee grinder||$2500|
|Containers Pumps and Assorted miscellaneous||$9000|
|Ovens and Toasters||$5000|
|Staff and management expenses||$9000|
How I will acquire the funds
I will borrow the funds from the bank. I will take a loan of about 60000 dollars which is enough for obtaining all the resources required.
Profit is the earnings you obtain after paying all the debts of the business. The following table is a projection of the duration it will take for my business to be profitable:
|Promotion and advertising and enhancing business growth||The first two months|
|Start of services and provision of discounts and promotions||The next one month.|
|Improvement of sales and payment of loans||The next 6 months|
|Gain of business stability and increase in profits||After9 months.|
From the above table it is clear that the business will gain stability and be very profitable after 9 months.
Quality management practices ensure that services are delivered as required, (Huang et al., 2012, p. 333). They may include:
- Ensuring excellent guest service so that the customers come again and again.
- Ensuring food quality: Ensuring foods are cooked well, beautifully plated and served.
- Ensuring proper front-house and back-house cleanliness: cleaning areas that can easily be seen by customers.
- Constantly training employees on Proper food handling and food safety, to ensure that they deliver quality services.
In conclusion, the hospitality industry faces a lot of competition. I will therefore ensure that Good Times café and bar remains competitive by creating a portal, where customers may place orders for the meals and drinks they want. Although Good Times Café will take time to be profitable, if the above strategies are implemented appropriately, then the Café will grow to become the Best Café in Melbourne.