We return to our business plan, now to simulate business strategies, quantify alternative scenarios and improve the results we want to obtain.
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Table of Contents
The pandemic has had a significant impact on all companies, both directly and indirectly.
That is why there have been some changes in the way companies have adapted the provision of their service.
In fact, they adapted not only to the new rules imposed by Public Health, but also to the change in the behavior of customers who, for fear or because of the imposition of security rules, prefer to make transactions more safely, using digital technologies .
We witnessed an explosion of e-commerce, with many Portuguese people incorporating this model in their consumption habits, having exceeded the volume of physical purchases, during confinement.
This trend has continued, even during the period of deflation.
The European Investment Bank (EIB) gives our country a high score on its digitization index (EIBIS), considering Portugal strong in the adoption of digital technologies.
Likewise, the European Innovation Scoreboard, considers Portugal among the “Highly innovative countries".
In the restaurant business, which was the example we adopted, we have already registered the introduction of menus in electronic format using QR Codes, the growth of the “take away”, the reservation of tables online, the possibility of ordering online and home delivery .
Can we continue to innovate? Can information technology help us?
These are some of the questions we now ask.
Let's think about more innovative strategies, put the assumptions of those strategies on our business plan spreadsheet and see their results.
After analyzing what is going on around us, which restaurants have been more successful and what strategies they have adopted, we will simulate alternative business strategies to the services we provide.
Sales or Income
We introduce take-away meals, which can be lunches that can have drinks, juices and desserts although the price of these is not included in the menu.
In relation to what we had done previously, we considered a different distribution of the quantities sold for each of the standard menus.
|Nr of Dishes / day||Prices of dishes with VAT||Total / Day|
With this distribution, the average value of the lunch menu price was € 9,40 with VAT included, ie € 8,17 without VAT. We consider that the meal has an average VAT of 15%.
We also consider the sale of confectionery and breakfasts under the same take-away regime and special brunches by advance order.
We put these new sales assumptions on the spreadsheet and also in Year 1, the beginning of our project, a value lower than Year 2 in which the business, it is expected, is at cruising speed.
|INCOME||People per day||Price per unit without VAT||Nº Days, events per year||Total Year 1||Total Year 2|
|Take Away lunches||50||8,17 €||300||€ 112||€ 122|
|Beverages, Juices, Desserts Take Away||30||4,07 €||300||€ 18||€ 36|
|Special Brunches||40||24,39 €||50||€ 36||€ 48|
|Confectionery and Breakfast Take Away||30||2,03 €||300||€ 12||€ 18|
|Total Income (€)||€ 178||€ 226|
Direct Costs or Variable Costs
Direct costs or variable costs are slightly different from what we had planned.
In take-away meals, as they are delivered by a partner, we consider a reduction in the margin since we have to pay a fee for this service, since the customer does not take his meal.
Therefore, we admit, in this aspect, to make an agreement with a delivery company, to avoid the fixed cost of having our own distribution structure.
If we consider that we can deliver a large part of our capacity, then we can weigh the costs of this structure, the benefit of an eventual improvement in the quality of delivery and see if it will be more profitable than subcontracting.
We can also review the unit cost of the menus we are considering, but, for now, we maintain the assumptions.
|CONSUMPTION / Costs||Incidence on the Selling Price (%)||Unit value without VAT||Total Year 1||Total Year 2|
|Take Away lunches||40%||3,27 €||€ 44||€ 49|
|Beverages, Juices, Desserts Take Away||25%||1,02 €||€ 4||€ 9|
|Special Brunches||35%||8,54 €||€ 12||€ 17|
|Confectionery and Breakfast Take Away||25%||0,51 €||€ 3||€ 4|
|Total Consumption (€)||€ 64||€ 79|
Human Resources Strategy
We will simulate and evaluate different business strategies, now using the average employee remuneration.
|CHARGES WITH STAFF||Monthly value||Rates||Total for 14 months||Total Year 1||Total Year 2|
|Total No. of Workstations||5||5|
|- Senior Personnel / Average Compensation||1||1||4||4|
|Wages (€)||€ 2||€ 32||€ 79||€ 80|
|- Management||€ 1||€ 17||€ 17||€ 17|
|- Senior Personnel / Average Compensation||€ 1||€ 15||€ 61||€ 62|
|Social Security Charges (€)||€558||€ 7||€ 18||€ 19|
|- Management||€297||23,75%||€ 4||€ 4||€ 4|
|- Senior Personnel / Average Compensation||€261||23,75%||€ 3||€ 14||€ 14|
|Total Personnel Charges (€)||€ 2||€ 40||€ 97||€ 99|
It will be a way to have high motivation and we can have the best team, able to face new challenges.
However, we maintain the staff with 5 people, of whom 1 is the manager.
Fixed Costs or External Supplies and Services
We also adjusted the fixed costs of Supplies and external services that we consider to be necessary.
We introduced a budget for advertising on social networks, for example, advertising on Instagram, giving note of the new services we are providing.
We consider the possibility of technical support in Information Technologies, to create a simple website that considers the possibility of online reservations or even advance purchase.
To maintain motivation in our human resources, we have introduced a quality and productivity award, with annual payment.
To reward the customers who take the products, we will include a budget in Marketing, whose final form should be considered.
|SUPPLIES AND EXTERNAL SERVICES||Notes||Estimates||Monthly value||Year 1||Year 2|
|Subcontracts (ROC)||€150||€ 1||€ 1|
|Electricity||€300||€ 3||€ 3|
|Fuels and Gas||€100||€ 1||€ 1|
|Tools and utensils||Maintenance, cleaning, laundry and ironing, HCCP||€245||€ 2||€ 2|
|Office material||Bank office||40 €, 25 €||€65||€780||€796|
|Incomes and rents||€500||€ 6||€ 6|
|Render space||€500||€ 6||€ 6|
|Insurance||€147||€ 1||€ 2|
|Work Accidents||2% Payroll||€47||€564||€ 1|
|Other insurance||Personal Health Insurance||€100||€ 1||€ 1|
|Marketing||€100||€ 1||€ 1|
|Social Media Advertising||€100||€ 1||€ 1|
|AIP / AHRESP shares||€40||€480||€490|
|IT technical support||€100||€ 1||€0|
|Occasional travel||€100||€ 1||€ 1|
|Performance Awards||Annual||€ 2||€ 5|
|Other ESF||Additional support||€100||€ 1||€ 1|
|TOTALS||€ 2||€ 27||€ 30|
We admit some changes to the investments, taking into account these new scenarios.
Eventually, part of this investment may be for the purchase of special baskets for transporting brunches or for the purchase of some e-commerce software.
|INVESTMENT||Acquisition value||Amortization Rate||Amortization Amount||Description|
|Tangible Fixed Capital / Tangible|
|-Adaptation / Expansion of facilities||€ 2||10,0%||€200||Paintings and Repairs|
|-Administrative and Social Equipment||€ 1||12,5%||€125||Mobile Equipment, Internet, Stereo|
|-Kitchen equipment||€ 10||33,3%||€ 3||Palamenta, POS, barcode reader, Convector Oven, Freezers, Towels, Baskets for Brunches, ...|
|-Tools / Utensils||€0||25,0%||€0|
|Intangible / Intangible Fixed Capital|
|-Studies and Projects||33,3%|
|Interest on investment|
|Miscellaneous / Start-up expenses||€ 2||100,0%||Income security, Company Constitution, Miscellaneous Records, Inauguration, Software|
|Working capital||€ 31||2||Nr Months||Salaries + SS + FSE + MP|
|TOTALS||€ 46||€ 3|
In this plan we consider € 13.000 of tangible fixed capital, € 2.000 in start-up expenses, which we consider to be 100% amortizable in the first year.
Finally, we consider for petty cash we would need capital for 2 months of activity, ie €31.752.
|ORIGIN OF FINANCING||ADDED VALUE OF|
|Social capital||€ 5|
|Supplementary Payments||0 €|
|Sub Receipt Prepayment||0 €|
|Foreign Capital||€ 41|
|Loans from members||€ 41|
|Incentives (IEFP…)||0 €|
|Investment support||0 €|
|Others (jobs)||0 €|
|Lost Fund Grant||0 €|
In order to reach the total capital required, if the share capital is € 5.000, we will have to resort to other forms of financing. In this case, we put this source as loans from the partners.
Since the spreadsheet is fully automated, we have an immediate view of the result of these assumptions.
|INCOME STATEMENT ACCOUNT||Year 1||Year 2|
|Income||€ 178||€ 226|
|Services provided||€ 178||€ 226|
|Costs||€ 196||€ 213|
|Cost of stocks sold||€ 64||€ 79|
|FSE||€ 27||€ 30|
|Personnel charges||€ 97||€ 99|
|Amortization and Depreciation||€ 5||€ 3|
|Exploration results||-18 169 €||€ 12|
|Result after charges||-18 169 €||€ 12|
|Income tax for the year||0 €||€ 2|
|net income||-18 169 €||€ 10|
Assim, muito rapidamente, vemos que o Resultado Líquido é positivo a partir do 2º ano, um bom sinal para o seu Business plan.
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