Business idea
This project proposal proposes a business plan, which entails opening a restaurant offering Chinese foods and beverages. The proposed name is for the hotel is Guanxi China Cuisine Restaurant, Guanxi is an important Chinese concept meaning personalized connections or networks. In any business relationship, the Chinese value friendships than any other decree between two parties.
Therefore, the use of this brand name creates the perception that the restaurant is the place where the Chinese would meet other people and establish mutual relationships for future mutual gains. The brand name also presents the restaurant as a place where money paid for foods and beverages offered is reciprocated with value. In the Chinese tradition, Guanxi is all about reciprocation for a good act.
The use of the term Guanxi in the brand name of the restaurant is of principle importance to the success of the restaurant. It reminds the Chinese of their Confucius tradition, which is central to the discourses of Guanxi.
The Confucius culture teaches the Chinese about moral cultivation anchored on paradigms of trust coupled with sincerity. In this sense, the restaurant will offer trustworthy products and services due to sincerity in their production process by paying critical attention to cleanness and hygiene as the restaurant postulates in its advertisements.
Product
The restaurant’s product line borrows from the various Chinese restaurants delicacies specialties within China. The Chuan Cuisine and Xiang constitute two important benchmarks for the restaurant. These two cuisines are famous for various dishes prepared using chili coupled with hot red pepper.
Such dishes include delicacies such as Fuqi Fei Pian, Mapo Tofu, and Sichuan Hotpot. For clients who do not prefer spiced foods, alternative dishes includes rice, noodles, bean curd, dim sum, and Shark’s Fin coupled with Bird’s nest soups.
Dim sum is a uniquely Chinese dish, which is offered in almost every Chinese restaurant. Offering this dish is particularly important since it encompasses not only traditional food for the Chinese, but also it represents an eating culture.
Dim sum constitutes small dishes normally served during snack time usually in small portions. They are usually made in small-biting sizes. Traditional Chinese culture does not permit the incorporation of knives on dining tables. The Confucius culture holds that civilizations advance when instruments, which can be deployed in killing, are not used in dining tables.
Noodles are important to the Chinese and longer ones imply longer life. The restaurant offers noodles in the form of egg noodles (mien) or the rice noodles (bijon). Apart from noodles, rice is an important staple food in China and the rest of Asia.
Rice is a significant food in the Chinese culture as they consider it as fun. The restaurant aims at attracting consumption of its products by offering foods that remind customers of their cultural roots. Hence, rice is an important and inevitable food for incorporation in the restaurant’s menu. The restaurant will serve rice in bowls together with meat and vegetable in the form of toppings.
Marketing
Having established the products offered at the restaurant, the next important aspect of the business proposal entails establishing strategies for marketing the restaurant and its products. Point of sale is a major promotional strategy for the restaurant. This strategy entails painting of the restaurant’s interior with pictorial elements reflecting the Chinese culture.
This aspect ensures that although the restaurant is established in a nation foreign to the Chinese cultural practices, when customers get into the restaurant, the perception of the Chinese culture emerges. Offering foods and beverages reflecting the Chinese cultural heritage also plays an important part in the creation of the Chinese cultural atmosphere while in the restaurant.
In a bid to direct potential customers to the restaurant, a big signboard is erected on the street leading to the restaurant. I also consider printing coupons, which will be distributed in the streets around Oregon to create awareness of the unique Chinese restaurant.
The target is to build a customer base of 3000 customers per day. Building a large customer base requires heavy investment in marketing of a new service or a product (Menon 19). Hence, although expensive, posters are also important mechanisms of marketing the restaurant.
As the restaurant garners more financial resources, marketing will involve the use of magazines and newspapers. A more important mechanism of advertising the restaurant entails the use of social media. Indeed, the Internet can serve the dual purpose of distribution coupled with communication.
Through the deployment of social networks and websites, it is possible to influence a large customer base for foods and beverages offered at the restaurant. This goal is achievable via ardent communication with the potential customers in an effort to persuade them to seek high quality and hygienically prepared Chinese dishes from the restaurant.
The Internet aids in helping an organization to “focus on enabling customers to find information about services” (Fields 14). Brand image of the restaurant cannot be satisfactorily developed if potential clients are not aware of the existence of the company.
Short message service (SMS) can also be useful in building the restaurant’s brand image. SMS has emerged as a powerful tool for sending many short messages to many users within a short time following the development of the telephony technology (Anbu and Mavuso 317).
Organizational structure
The restaurant will be registered under LLC organizational structure. This kind of structure has the advantage of raising funds with ease. It also provides limited individual liability, thus implying that the organization and its owners are two different entities.
The owners of the company are the shareholders. As the founder of company, I will be the chairperson of the board of directors and serve as the risk management director. Other three directors, viz. finance director, human resource, and purchases and chain supplies directors coupled with the CEO of the company will be acquired by means of voting by the Shareholders
All the directors are responsible for leadership in their respective departments, viz. human resource, accounting and finance, corporate management, and risk assessment and control apart from procurement, purchases, and supply chain director who has a number of departments under his/her watch.
These departments are food quality control, marketing, procurement, purchases and supplies, and customer services department. After few months of operation and on recognition of customer responses to the products and services offered at the restaurant, research and design, and IT departments will be introduced.
These departments will be instrumental in enhancing creativity and innovation coupled with services and processes improvement to meet emerging customer needs.
Licensing and regulatory requirements
Several approvals coupled with permits are required while opening a restaurant in Oregon as discussed below.
Business registration license – Acquiring DBA requires filing of the fictional name of the business. This step is followed by the publication of a classified business name via an advertisement in a local daily newspaper. The filing costs are approximately $15 to $95 while the advertisement would cost between $25 and $75.
A business account – For smooth operation of the business in the future, a bank account is required. It enhances the ability of the company to work with convenience in terms of financial management. Although the board of directors would arrive at a decision on the most appropriate bank account, current account is proposed in this case. Merchant’s card machine is also required to enable customers to pay via credit cards directly into the restaurant’s bank account.
Business operation license – For the company to open its doors to clients, a license is required. The application for this license will be made to the City Business in the department of licenses in City Hall. Yearly costs for license renewal are about $70.
Business location approval -The zoning department reserves the mandate of approving the license in terms of suitableness of the location for operation of a restaurant. If the rented building has been housing a restaurant, no extra approval is required.
However, in case the building acquired will open as a restaurant for the first time, zoning department will conduct the necessary reviews coupled with the organization of public hearing in a bid to collect the views of people residing around on the appropriateness of the location for operation of a restaurant.
Permit for sellers – This permit is obtained from the Equalization State board. Before the issuance of this permit, the restaurant has the obligation to report on its sales tax either seasonally or monthly.
Permit from the health department – A county’s health department permit is important since the restaurant will be dealing in beverages and foods. In a bid to acquire this permit, the health department personnel in the Oregon will inspect the restaurant in terms of general cleanness and hygiene of the various appliances coupled with kitchen equipments and appropriateness of the storage facilities for foods.
The qualification for various personnel handling foods will also be inspected before they are given individual health permits to work in the restaurant. Individual health permits will cost $83 while permit for the restaurant will cost $250.
Sign permit – One of the strategies of marketing the restaurant entails advertising through a signboard located on the street leading to the restaurant coupled with erection of posters. Oregon country has various rules for types, sizes, and poster hanging locations. Therefore, it is important to study these rules and make appropriate filings.
County permit – Where the restaurant is located within an area, which is not within the jurisdiction of a given city, obtaining of permits from the neighboring county is crucial.
License for sale of Liquor, beers, and wines – The restaurant mainly deals with serving Chinese foods and beverages. However, some liquor, wines, and beer in small quantities will be served depending on customers’ preferences. This aspect creates the need for seeking licenses for selling liquor, beers, and wines in accordance to the US policy on the sale of the same.
Permit for wastes disposal – Restaurants must produce wastes in the form of foods leftovers and packaging of the raw materials. Considering that Oregon is committed to enhancing environmental sustainability by becoming green, disposal of wastes should be done in accordance to the state’s established rules and regulations on waste management. Hence, the restaurant cannot run without a waste disposal permit.
Fire management permit – Cooking in the restaurant will involve the use of gas and electricity. This aspect means that fire proofing of the restaurant’s facilities by the Oregon’s fire department is of great importance. Assurance that the restaurant is secure from fires and that mechanism of fighting fire adequately are available is important for the purposes of the safety of the restaurant coupled with employees’ safety from both human error and emergency fires.
Environmental protection permit – A lot of refuse water is emitted. Cooking of foods also involves emissions, which are all wastes or by products of the processes of the restaurants. These wastes should be dealt with in accordance to the environmental protection principles. In this effort, the restaurant should acquire a permit from the Environmental Protection Bureau in Oregon.
Risk management, insurance, employee and other matters
Risk management
It is within the mandate of the risks management director through risks management department to ensure that the restaurant remains resilient to risks.
Types of risks
Risks encompass all situations that may cause a company to experience challenges in its operations. In a restaurant, these risks include labor boycotts, failure of customers to embrace the offered foods, reputation risks, unfavorable economic climate, fraud, and the existence of political climate unfavorable to the operation of the organization among others.
In the short term, major risks anticipated by the restaurant are adverse economic climate, reputation risks, and acceptance of the offered foods by the target market.
- Reputation risks
The restaurant is unique in the region. However, this aspect does not imply that the management should not explore various ways of enhancing the reputation of the brand. Indeed, marketing is one of the ways of not only creating awareness, but also building the reputation of an organization (Rust et al. 112).
While constant and increasing flow of customers may be experienced following the extensive promotion campaign, the risk for damage of the reputation of the organization persists.
Such a risk may emanate from isolated incidences of poor food quality, food safety, mechanisms of handling customer complaints, and effectiveness in delivery of customer service. Competitors may also employ various strategies to ensure that they have captured the market share of the company by presenting the company negatively or even stereotyping it.
- Economic situation
Economic climate affects the buying power of customers. In times of the economic downturn, people consider using their incomes in meeting psychological needs only as they increase their savings in a bid to remain secure in an uncertain future.
Eating out in restaurants is part of entertainment; hence, it does not feature in the list of psychological needs. This aspect affects the restaurant in terms of low sale levels. Inflation may also expose the company to financial risks. High inflation means high costs for noble utilities such as electricity, gas, and water coupled with increased employees complains for the organization to increase their salaries and wages.
- Acceptance of foods and beverages
The products and services offered in the restaurant are developed with particular focus on the Chinese consumer. However, in a bid to increase sales levels and ensure that the restaurant breaks even quickly, it is important to promote the foods and beverages offered at the restaurant to other consumers from both American and other foreign nationals.
The main risks involved here entails whether other consumers would accept foods offered due to differing emphasis on the foods and beverages’ requirements. For instance, while the Chinese emphasize more on food smell, color, and taste, their American counterparts emphasize on nutritional needs, especially in the era of increased concerns over unhealthy eating habits.
Guanxi is important in all Chinese gatherings. While in a restaurant, the Chinese order and eat food from one plate sitting around a table. This behavior may be unacceptable in western cultures where people order food in separate plates. The Chinese foods are also highly flavored. Other people seeing the Chinese dishes served on a different table may opt not to even taste and leave the restaurant never to return.
Dealing with risks
Mitigation of the above-mentioned risks requires the adoption of a number of strategies. The first strategy is adhering to food and service quality. Food service is of particular importance since it affects customer satisfaction in the hospitality industry (Mullins 107). On the other hand, without high quality and delicious dishes, the restaurant cannot grow.
A successful strategy to mitigate this risk encompasses recruitment and selection of highly qualified workers. All the people engaged in food handling should be licensed in their respective areas of specialization.
Experienced stewards are most preferred, although the restaurant is also prepared to offer training and development programs for its workers in the bid to ensure that they offer services in a manner commensurate to the Chinese cultural anticipations.
The second strategy encompasses the collection of customer information in the form of after-service feedbacks. This information helps in the development of mechanisms of improving both foods and services to meet concerns of the customers, especially where customers raise some form of dissatisfaction.
For this purpose, the restaurant will establish social media pages and suggestion boxes for customers to register their feedbacks or give suggestions for improvement. The restaurant also provides customer service desk at the reception bay to address customer queries and collect various suggestions from the clients.
The third strategy entails the accommodation of dining habits for the non-Chinese customers who may also love the Chinese dishes. Instead of only focusing on the cultures for order-and-sit-around the table, a section the restaurant will provide a section where people can sit in an alternative way.
In a bid to accommodate persons opposed to the culture of food sharing by way of eating from the same plate, an alternative strategy is to offer take-away food services.
The fourth strategy involves handing risks associated with economic conditions. One of the aspects that make the Chinese restaurants unique in China is their ability to offer foods at low prices. In Oregon, the restaurant will borrow from this model by providing food discounts when household incomes are constrained by economic hardships.
This move will help in positioning the restaurant as an entity that does not only exist to serve its own interests by increasing returns on investments to its owners (shareholders), but also interested in serving the needs of its customers.
Insurance
Employees’ health insurance and insurance of the entire organization against property damage are important aspects. At start up, the organization will employ about 40 people, which means that SEHI (small employer health insurance) programs will be satisfactory. The program is accessible to an organization employing between 2 and 50 people.
Property insurance ensures an organization’s protection against various types of risks including political risks, floods, earthquakes, and fires amongst others. Among these forms of property insurance, insurance against fire is incredibly important. The organization should be free from risks of employees’ theft or fraud.
This assertion creates the necessity for insurance against employee theft to provide a mechanism of filing claims in the event of theft and other offenses acerbated by employees, which may lead to financial risks to the organization.
Intellectual property protection
The American law recognizes the need for protection of both tangible and intangible organizational assets. Currently, the restaurant does not require innovative ideas, concepts, or even creation of new inventions for its operations. However, there are logos, slogans, and trademarks considered as part of the brand characteristics, which need protection under the US intellectual property law.
Employee laws
In the US, various statutory laws seek to protect the rights of employees and they include minimum wage laws, child labor, over time, social security, medical, and compensation laws. Others include health insurance, employee retirement, and labor law poster laws. Compliance to these laws is mandatory for all organizations operating in Oregon including the proposed restaurant.
Works Cited
Anbu, Johnston, and Makana Mavuso. “Old wine in new wine skin: marketing library services through SMS-based alert services.” Library Hi Tech 30.2 (2012): 310-320. Print.
Fields, Erastus. “A unique twitter use for reference services.” Library Hi Tech News 6.7 (2010):14-15. Print.
Menon, Arthur. “Antecedents and Consequences of Marketing Strategy Making.” Journal of Marketing 63.2 (1999):18-40. Print.
Mullins, Leonard. Hospitality Management: A Human Resources Approach, London: Pitman, 1995. Print.
Rust, Ronald, Valarie Zeithaml, and Katherine Lemon. “Customer centered brand management.” Harvard Business Review 82.4 (2008):110-118. Print.