Market Analysis

Question: Write an essay onMarket Analysis. Answer: Introduction A comprehensive business plan will get success if business activities involve in accomplishing specific objective of the business. To engage in the new business, a detailed marketing research needs to be done considering a realistic business plan. In this assignment, a new industry will be launched in the city of Melbourne, Australia. The business is all about a small restaurant, Tasty Food Restaurant and will provide services to the local community of Melbourne. After introducing purpose and scope of the business, the plan will analyzed an in depth situation analysis covering environment analysis, customer analysis, competitors market and others. Furthermore, the researcher will clearly include the target market and proposed marketing strategy to reach the ultimate estimated business goal. However, a realistic budget must be incorporated into this marketing plan to execute it successfully. Although the researcher must include all his/her ideas and activities within the budget becaus e this is a small, new restaurant business proposal which is definitely required some time to flourish in the city of Melbourne. To successfully serve for the local community offering delicious multi-cuisine dishes at their best prices and will become one of the efficient and affordable food destination for the local customers is the main purpose of this plan. Scope of the plan The scope of the business is completely depends on the product and market feasibility researches if there have enough opportunity of food business in the local area of Melbourne. Based on the market research the following attributes are justified that the scope of the plan is quite feasible and realistic. The positive attributes are as follows: As predicted, Melbourne to be the Australias biggest city by 2050 (Krockenberger 2015) Growing population and huge food demand Diverse food habits All the above are the fundamental reasons which increases the scope or opportunity of Tasty food restaurants in the proposed market of Melbourne. Methodology Before starting the restaurant business venture in Melbourne, Testy Food Corner will collect data and information through primary method and secondary method. An extensive online survey process will be followed in the quantitative data collection section of primary research. In this sector the business will collect responses regarding the food habits, choices, preferences of consumers. On the other hand, the qualitative research will be done through analyzing the situation of already exists companies who are engage in the same business line in Melbourne. Furthermore, the researcher will explore the market condition by collecting data through the secondary research. Here the significant data and relevant information will be collected by going through brochures, current observations regarding existing business owners pictures of the other small food business and so on. Situation Analysis The current business scenario must be analyzed before start up the business operation. This is the foundation step of any market research project. By analyzing the internal, external environment related to the proposed business, Tasty food restaurant shall be capable to understand target customers, competitors, and environment and so on. Market Analysis Australias most heavily populated state, Victoria has a population of 5.5 million and its capital, Melbourne, is 4 million peoples city, known for its globalised cosmopolitan culture all over the world (Robertson and Yeoman 2014). The best recognized part is that Melbourne is recognized as the nations capital for business start up. Here the small businesses captured 83 percent of all business market in the city of Melbourne (Boschetti, Fulton and Grigg 2014). Though Tasty Food Restaurant is a small food business, the current food market of Melbourne needs to be analyzed to understand the industry trends, business prospects, trends and so on. Changing social trends is responsible for a strong growth in the Restaurants industry over the previous five years. This food industry is expected to post annualized growth of 6.2 percent in the coming by the end of next financial year, to net 13.1 billion. Busy lifestyle is also one of main reasons of Australian flourishing restaurant industry (Walker and Redmond 2014). This trend of the market is expected to continue in 2016-17 by many market researchers and further predicts high revenue by 2.3 percent during that fiscal year. Company Summary Tasty Food Restaurant is the small business company where multi cuisine food dishes will be available. As per the predicted growth in the worlds population from 7 billion in 2011 to over 9 billion by 2050, the company is looking for to establish their business in the local areas at Melbourne by incorporating different cuisine in their menu lists (Guo et al. 2016). Being a small organization, the company is having low workforce strength. Now the company is mainly concentrating to introduce traditional, Chinese, Sushi, and Continental food dishes to attract local consumers. A high degree of domestic cooking and the takeaway food sector with roast dinners, fish and chips, the Australian meat pie are very popular among Australian cuisine. All this will be incorporated in the list of items although the company is visioning to deliver foods at an affordable price. Product Overview: The USP of the Tasty Food Restaurant would be to make available multiple cuisines under one roof. As per the recent trend, Australians are not often stick in one types of cuisine (Alonso and Krajsic 2014). To changing food demand keeping in mind, many unique dishes will be provided for their target consumers. Meat will be the key component of their dishes because Australian cuisine likes to incorporate this in all their dishes (Shariff et al. 2015). On the other hand, there is a huge demand of organic food dishes in Australia (Chen and Elston 2013) In this way, Tasty Food Restaurant would like to possess haute cuisine and nouvelle cuisine establishments, to offer both local and international foods to satisfy strong multiculturalism of Melbourne. This is because Australian cuisine is largely influenced by French food habits. Environmental Analysis Here the researcher will analyze market by PEST analysis: Political: Political barriers to entry in the Restaurant industry are low (Lucas, Cunningham and Lamberton 2013). This indicates Melbourne may have high rate of entries and exits of food establishments in the industry. It means the new entrants can enter the market at significantly low set up costs by leasing equipments, premises, furniture and fixtures and so on. Furthermore, Australia has commitments under the WTO agreements on tariff and non-tariff duties, subsidies, and local support for agricultural products. Therefore, raw materials can easily be available for Tasty Food Restaurant. Economic: Being free market democracy and an impressive economic progress, the company can ensure entrepreneurial development for the market sustainability (Dyster and Meredith 2012). Due to economic development, high skilled workforce availability is the main driving force for any business development. Specifically, it is favorable for small business market. Social: As the globalised cosmopolitan culture of Melbourne, a variety of food preferences are available in the market (Khan 2014). Furthermore, diminishing leisure time and busier lifestyles of Australians have increasing led consumers to turn to restaurant for meals on regular basis (Fung 2013). Therefore, there is a huge market opportunity for Testy Food Restaurant. Technology: There is a concern of rising costs of raw materials, energy and labor in Australia. For this, improved food processing techniques and food preservation system helps to reduced food preparation time in the restaurant industry. Customer Analysis The company needs to satisfy the customer demands on daily basis (Solomon 2014). According to the recent survey report, dining habits of Melbournians rather Australians have changed, but restaurants are still popular (Ausfoodnews.com.au, 2016). Meat and three veg are Australians most popular meal according to that report. There has been found that chicken has certainly overtaken red meats in popularity where 20 percent people are consumed beef and 31 percent consumers like to prefer eating chicken (Forson and Counihan 2013). Research into credit card spending by American Express in Melbourne indicated that expenditure has come fallen down despite restaurants remain popular among Australians. This is further revealed that 83 percent have noted a fall in customer spend driven hugely by changing habits in the environment of restaurant rather than a drop off in customers ((Lee, Sardeshmukh and Hallak 2015). The market has been slightly saturated because up market establishments in inner city suburbs of Melbourne had noted a drop in frequency of customers. Eating deserts are being avoided by major section of Australian consumers. Furthermore, taking huge amount of beverages are among very popular food habits in Australia. Competitors Analysis There are many of the small restaurants already doing business well in the city of Melbourne. However, the best part about that all are created their own market and they do have own range of customers. No prominent brands are dominating the market so far. So there is a huge maker opportunity for Tasty Food Restaurant in Melbourne. The researcher has found some of the small dining restaurants name like Small Victoria, Small French Bar, ARZ Food Services, The European, Hawk and Hunter, Nora and may others (Wellard, Glasson and Chapman 2012). Therefore, Tasty Food Restaurant needs to compete with all quick service restaurants, bars within the area of Melbourne. Recently, this has been noted that many foreign family chain restaurants started their franchising in different cities of Australia such as USA brands Mac Donald, KFC and so on. These restaurants have significantly greater marketing and operating resources that any locally establishing restaurants. Therefore, this new company nee ds to be a perfect strategy for make it successful in the long run. SWOT Analysis In this section, the internal factors regarding the restaurant business which will directly impacts on Tasty Food Restaurant will be evaluated by extensive SWOT analysis in the below: Strength Melbourne has a large population and diverse cultural people are staying together (Krockenberger 2015). It is favorable for the new food restaurant not just because a huge foods will be consumed by consumers but there people will get an opportunity to experiment other cultures food like Thai, Sushi, Chinese and so on. There are a huge skilled workforce are available in the market of Melbourne due to high population (Bahn and Cameron 2013). Tasty food restaurant also get skilled labors at low costs as well. The local availability of the human resource is the biggest advantage for new entrant companies because the company can reduce their business establishment costs at the end. However, low start up costs is strength of this restaurant business. Legal barrier like tariff or non-tariff charges are low in the Australian Market. These factors are favorable for the company because the company cannot face any long proceedings for getting restaurant license to officially operate within Melbourne. A huge product demands are available in the local area of Tasty food restaurant. Such demands not only for Australian cuisine but they also preferred other international cuisines as well. This would surely become one of the prime strengths for the company. Therefore, the company can generate huge revenue if they do business strategically. Stable Australias economy and huge predicted growth of small restaurant business may definitely a strength of the small dining business. Weaknesses: Low turnout of profit at the initial stage shall definitely be considered as a weakness. Australia is a multicultural nation, thus not many customer will enjoy trying other foods out of their culture. Interior design of the outlets or dining space often looks cheap compare to large restaurants available in the city of Melbourne. In the service industry, customers often complaint about service inconsistency or less food quality or hygiene related issues Less financial strength is the biggest concern for any small size businesses. Tasty Food Restaurant, therefore, needs to make financial plan for effectively. Opportunities Increasing demand for multi cuisine dishes among Australians Changing customer habits may be give added inspiration to food service providers to deliver unique dishes or serving a specific type of ethnic food which definitely not served elsewhere in the area. There is less control over franchisees compare to large restaurants or family food chain restaurants. Employment rate will be higher in the food servicing industry to explore new small restaurant in the market Threat In the city of Melbourne, many small existing restaurant businesses are available. So it would definitely become a challenging part to enter in the same market. Low barrier in the entry level makes this industry more competitive Marketing Objectives The marketing objectives are the elemental for incorporating all efforts and ideas for make a successful business. The marketing objectives of Tasty Food Restaurant are to provide a healthy, unique and delicious dining experience. Secondly, the employees are driven by passion for the food they would serve. To provide highest level of customer service with the help of service promotion and make the nest food available to their target customers is another marketing objective of Tasty Food Restaurant. Thirdly, providing multi cuisine dishes at the best market price is other marketing strategy of the company. Target Market In this section, Tasty Food Restaurant would identify who the target customer is for their restaurant business. Here the company is going to target local youth, professionals, and single people. However the company will not consider high end professional executives as their target consumers because they would definitely prefer to book tables in large restaurant for their lunch or dinner options. Here the Australian youth have take away food habits. Generally they like to eat Non-vegetable food dishes. Sometimes, people love to eat organic food dishes, giving priorities to their health. Target consumers Age group Preferred food cuisines Local youth 20-35 Australian cuisine, Sushi, Chinese Single meddle people 35-47 Organic food dishes Professionals Above 25 Thai, Sushi, Chinese Dishes Proposed Marketing Strategy The unique marketing strategy for any new product of the market is the USP of any new business. In this section, the researcher will go through marketing mix technique for accomplish the marketing objectives of Testy Food Restaurant. Product/Service: Tasty Food Restaurant would be responsible for providing good food dishes for the local communities of Melbourne. Establishing how the product is different compare to other small restaurants dishes must be evaluated. The company will introduce new ethnic dishes to gather most of the customer responses. Depending upon the introductory responses, the company would further offer something new. The dishes would be available for all types of customers. Furthermore, variety of beverage items will also be provided for high professionals or local youth of Melbourne. In the menu, different types of meat items would be the delivered to get maximum food satisfaction from their target customers. Price: The introductory food prices must be lower compare to other small restaurant at Melbourne. This lower price structure will continue for short term period when company may establish their brand recognition in the market. Furthermore, the owner of the business will maintain the flexibility regarding the price structure. For instance, different cuisines obviously will use different ingredients. Therefore, price of the raw material must be varied with one dish to another. However, it will ensure by the authority that the cost of every dish must include the cost of the ambiance and workforce wages; otherwise it would be difficult to generate enough revenue at the end of the month. Here the company shall be required to recruit 2 chefs for their restaurants who have experiences in the multi cuisine food preparation before. Therefore, fund will be allocated for additional human resources as well. Promotion: A unique product promotion strategy will be introduced to generate awareness in the market. Here this small business, products will be promoted by mentioning the USP of the business - lowest food dishes, providing fresh quality food for their consumers, or southing ambiance or friendly dining atmosphere where couples or friends can enjoy their time. All this promotional content will be promoted through advertising in the local newspaper, or printed hand bills and many others. All other options like promotion through social media site or website cannot be feasible because these are all expensive promotional platforms. On the other side, Tasty food restaurant will generate traffic during slow times by offering special promotions, for instance, buy 2 meals get one free before 7 p.m to get consumers at the door will be applied occasionally. Place: Melbourne has been chosen as the best city for business establishment. Currently the Central area of Melbourne will be selected for establishing first outlet of this new company. After getting response, the company will later decide if there will be any possibility to explore this restaurant chain in any other parts. Basically those places will be acceptable where large numbers of gathering can be possible such as beside Cinema Hall or theatre, Stadium or educational institutions. Marketing Budget This is an estimated marketing budget where all costs are included which are incurred during product or service promotion in the market. A projected resource allocation is important for make the business going. In this marketing budget, all marketing related expenses shall be incorporated by the Tasty Food Restaurant. The total expense row sums the individual expenses rows of this restaurant company. On the other hand, the annual expense column sums the months for each row, including the net rows. Marketing Budget Marketing Expense Budget Q-01 2016 Q-02 2016 Q-03 2016 Q-04 2016 2017 2018 Advertising $5,000 $5,250 $5,513 $23,706 $26,077 $28,684 Catalogs $2,000 $3,000 $2,000 $2,000 $11,500 $12,700 Product Distribution $3,000 $5,900 $6,400 $3,400 $19,900 $20,300 Promotions $4,500 $4,300 $4,400 $3,600 $15,600 $15,000 Organised events for publicity $2,300 $2,100 $0 $0 $20,200 $22,000 PR $3,800 $2,399 $4,335 $3,455 $14,344 $13,567 Dining space development and further rennovation $14,000 $0 $0 $0 $3,400 $5,433 Service $2,000 $3,400 $2,100 $1,345 $10,200 $11,400 Staff Training $1,300 $1,500 $1,200 $1,100 $6,900 $7,400 Other $1,000 $1,000 $1,000 $1,000 $12,000 $15,000 Total Sales and Marketing Expenses $38,900 $28,849 $26,948 $39,606 $140,121 $151,484 Conclusion With this marketing plan, Testy Food Restaurant can flourish their food dining business in the city of Melbourne. The company has exploited their limited resources for making this marketing plan an effective one. Being a small organization, the company has been promoted their food business through mouth promotion, hand-bills, television marketing, however, the social media platform or official website promotion are not possible for Tasty Food Restaurant. After the detailed situation analysis, this has been figure out that there is no dominating small restaurant within the Melbourne. The researcher has further revealed that there are huge multi cuisine food demands because the city is full of cosmopolitan culture. However, it will definitely take some time to establish the brand recognition among many others. But the goal can be achieved if Testy Food Restaurant introduces new food dishes frequently as per the customer choices. Here the price structure and soothing dining ambiance will definitely take into special consideration. References: Alonso, A.D. and Krajsic, V., 2014. 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