• 1 Executive Summery

This is a business plan proposal for the establishment of cafe having

the name “Mars café” in Addis Ababa. The name Mars derives from the
partners name by taking and conjoining first latter. This profile
envisages the establishment of a cafe for the delivery of cafeteria
services. The present demand for the proposed service delivery is
estimated from different perspective and it expected to decline after five
year of its operation but through diversifying the customer service
approach we intend to handle the existing customers along with
attracting new customers. The cafe will expect to create employment
opportunities for 10 persons. The total investment requirement is
estimated at about Birr 634,360and out of which Birr 415,000 is
required for furniture and kitchen equipment. From the total cost
investment 20% covered by Owens capital the rest 80% will borrow
money from Dashen international bank.
• 2 Background Of The Business And Justification For The
Business
Mars café is a new café partnership with an expected to open in July,
2026 G.C at the heart of Addis Ababa, and expected to give a standardize
café service in Addis Ababa. Mars will specialize in Fast foods, Dinners,
Coffee, Tea, Cappuccino, Frozen, Ice-cream, homemade cookies, Free
WIFI (The benefits of offering free WiFi in a cafe is attracting more
customers, encouraging longer stays, enhancing customer satisfaction,
enabling remote work or study, promoting social media sharing, and
providing a competitive edge in the market.) and other related activities.

In Addis Ababa there are many cafe that give services to their customers
but they cannot still satisfy the need and want of the customer in terms
of both quality and quantity. In order to maximize customer satisfaction
so that Mars decide to open a café in Addis Ababa city. Mars target
customers are intellectuals, artists, and writers with reserved VIP seats,
and students, couples, families and foreigners. Mars café expected to
serve this area well.
 This plan offers financial institutions an opportunity to review our
vision and strategic focus. It also provides a step-by-step plan for the
business start- up, establishing favorable sales number, gross margin and
profitability.

Establishing this cafe has beneficiary in maximizing the wellbeing of the

society from different perspective. Some of them are,

• Increase the income of the owner

• It create employment opportunity
• It satisfy the need of the customer(quality and quantity) within a reasonable
price
• It provide better place for younger’s in spending their time.
• It contributes for the development of the surrounding area.
• Increasing government revenue through taxation (Business profit tax and VAT).
In general these business increases the welfare of society and this business
does not result any environmental pollution, since it have very low by-
product and if any (is use as food for cattle’s especially for pig farms).

• Feasibility Study
• Marketing And Demand
• 3 Marketing Survey
Addis Ababa is experiencing a trend toward the creation of evening
dining/entertainment venues. They are popular and gaining more
recognition. Evidence of this is found in local news and magazine
coverage. These venues are finding new homes in the areas close to
and/or adjacent to downtown.

Target Customer

One of Mars target customers are artists, teachers and writers who need a
nice quite cozy place to think and do their work with reserved VIP seats and
for commons and foreigners. The other target customer of Mars is couples
that want to recreate themselves.

Mars strategy is based upon targeting and serving:

• The typical Addis Ababa intown resident. This urban professional

 works long hours and has relatively little time to cook at home.
She/he has an active social life and spends a substantial amount of
disposable income maintaining it.
• The many businesses which regularly use restaurant dining as an
function of conducting business.

Market Segmentation

A restaurant/coffee house would provide one of the best food and

beverage opportunities for more than 30,000 per month and adjacent
neighborhoods.

Market Analysis

potential customers Growth Year 1 Year 2 Year 3 Year 4 Year 5

A.A Area Residents 4.00% 1,568 2,725 5,798 7,878 12,066

Hotel/Convention/Vis 6% 2,100 3,915 4,452 5,820 6,143

Downtown Workers 10.6% 3,350 8,020 10,624 11,349 10,419

Total/average 6.6% 147,018 165,660 186,874 211,047 238,628

• Business Demand

Estimated demand levels based on Central Statistics Agency household

income, consumption, and expenditure surveys as well as based on a
sample survey undertaken using observation of the current demand for
existing cafés and restaurant beside the population size.

The demand for the service is directly related with the growth of the
population and income of the society. Taking this in to consideration annual
average growth of 6.6% is applied to forecast the future demand then it
expected to decline after its maturity over the 5 year period. But through
diversifying the service that provided to the customers, the café will able to
maintain keeping its customers.

The mars café will offer high quality coffee, tea and cappuccino, fast foods
and dinner at a very reasonable price. Also sell homemade cookies, cakes,
brownies, and Doughnuts, with fair price.4

Key Features of the Products and Services

All drinks will be made with filtered water and the highest quality
ingredients can get. Frozen drinks will have caramel or chocolate syrup
drizzled in the glass and over the drink. Cappuccino will have whipped
cream toppings as well as the option for candy sprinkles. Cookies will
have the option of a chocolate or caramel dip and sprinkles. also offer
designer flavored cream and five kinds of sweetener, i.e. sugar, honey,
Equal, Splenda, and Sweet-n-Low. Cream and sweetener is at no extra
charge. Furthermore, the fast foods includes chips, cookies, Burger,
pizza, Mushebek, Baklaba, Halawa, Fetera, and dinner include Kitffo, Key
Wott, Minchet.

Production of Products and Services

Mars will use only filtered water and will brew our coffee in commercial
coffeepots that will be thoroughly cleaned between uses. Mars will bake
and cook cookies, brownies, fast foods and dinner in our own on-site oven
from proven recipes, daily.

Future Products and Services

Within the next three to five years we expect to branch out into catering and
offer homemade pies, whole or by the slice.

Comparative Advantages in Production

Mars low overhead and cheaper pricing will be the key to Mars success.

In Addis, the industry is quite large, for example in Piassa there are many
cafeterias, we can found cafeterias in average almost 50 meter apart but
around sadist kilo there are a few cafeterias.

Key Industry Trends

This industry is booming at the present time, there is a trend toward small
cozy places and away from the large generic chain.
The cafeteria business does not show signs of slowing down. With new
innovations such as flavorings and additives, it should continue for some
time.

Mars customers will be attracted by service in addition to this they may

be attracting through standardize customer approach, building, chairs,
tables, glasses and strategic placement.

The restaurants and cafes that make up the community of establishments

in the area surrounding. Their concepts range from typical fast
food/chain venues to expensive fine dining establishments. However, the
predominating nature of the immediately surrounding restaurants and
ccafeteria is casual/upscale.

Description of Key Competitors

Of the few cafeterias in the area, some are large chain with a very
expensive product, others are really home style cafeterias, the last one,
and competitors are a traditional store with a "tea room".

Mars Located in the heart of Addis, while its location near many
longstanding restaurants and cafeteria would seem to offer considerable
overflow, the café is easily seen from the street and parking is at a
premium. Its concept has received very favorable press in Sidist kilo.

Strength

Consider quality of food and service with a reasonable price, and its
skilled manager together with its bright waiter can attract customers, so
it has acceptance (brand name) by the customer.

Weakness

No variation on menu or service it provides. Most of its activities like the

menu are limited.

Romina Restaurant: Located in Arat kilo . The location is on the street

and can be perceived as a marginally safe area. Nevertheless, the café
 remains wildly popular given the parking difficulties.

Strength

Often have interesting alternative dishes on the menu and designer

décor. The evening atmosphere is also so attractive and suitable for
customers.

Weakness

Even if there is widely varying standards of food and service, they are
often expensive which does not consider the buying capacity of the
customers.

Oasis cafe: Located on nearer to Addis Ababa Institute of technology, this is a

corporate coffeehouse which provides coffee, tea, cakes and sandwich service.

Strength

This cafeteria has relatively many customers because of its good location.

Weakness

The quality of the goods, not giving evening service and are not that
much satisfactory beside the low price

Analysis of Competitive Position

None of these establishments features a coffeehouse atmosphere or live

or recorded evening entertainment.

Relative to the location of these establishments, the center of town is

centrally geographically located. Its location will easily allow for
passengers from those who came others area. .

Mars pricing strategy and comfortable atmosphere will be the key to our
success. None of the other cafeteria in the area can offer this.

Competitive Edge

Mars will position itself as unique cafeteria where its customers can not
only enjoy a cup of perfectly brewed coffee but also spend their time in
an ambient environment. Comfortable sofas and chairs, dimmed light
 and quiet relaxing music will help the customers to relax from the daily
stresses and will differentiate Mars cafeteria from current competitors.

• 5 Financial Analysis
Mars want to finance growth mainly through cash flow. Mars recognize
that this means we will have to grow more slowly than we might like.

The most important indicator in Mars inventory turnover. And have

to make sure that food inventory turnover stays at approximately four
turns per month.

Mars do not want to let average collection days get above 45 under any
circumstances. This could cause a serious problem with cash flow,
because our

working capital situation is tight. Most credit sales will be via credit and
debit cards. Also do have plans to initiate direct billing for law firms and
other businesses conducting regular visits. Mars must target a net profit
of 14% at the least, and hold marketing costs to no more than one to
three percent of gross sales.

The Start-Up Expenses

Include:

• LEGAL expenses for obtaining licenses and permits as well as the

accounting services totaling Birr3,000
• Marketing promotion expenses for the grand opening of Java Culture in
the amount of Birr3,000 and as well as flyer printing (1160 flyers at
Birr0.50 per copy) for the total amount of Birr3,580.
• Consultant’s fees of Birr3, 000 paid to ABC Espresso Services for the help with
setting
up the coffee bar.
• Insurance (general liability, workers' compensation and property
casualty) coverage at a total premium of Birr2, 400.
• Pre-paid rent expenses for one month total amount of Birr 20,400.
• Premises remodeling in the amount of Birr10, 000.
• Other start-up expenses including stationery (Birr800) and phone
and utility deposits (Birr 3,500).
Important Assumptions

The financial plan depends on important assumptions, most of which are shown in
the following table. The key underlying assumptions are:

• Assume a slow-growth economy, without major recession.

• Assume of course that there are no unforeseen changes in technology to

make equipment immediately obsolete.

• Business Goal, Mission and Objective

• Objectives of The Business

Mars primary goals over the next year are:

• Renovate our space in Addis Ababa, Sidist kilo.

• Acquire equipment necessary for business, i.e. coffee pots, cappuccino
machines, blenders, etc.
• Make agreement with the supplier of Mars raw material and bakery vendors.
• Create a cozy, artist friendly environment (i.e. choice of colors, choice of
music, decor)
• Open for business and become the most popular café in the area.
• Expand our business in different in area of the country
• Targeting and maintaining a net profit of at least 14 % by the second year.
• To generate monthly sales to reach Birr 15000 by the end of forth
month of operation, and Birr 30000 monthly by the end of the first year
of operation. Mars use different attractive methods to get more
customers over time. For instance we provide less price compare to the
another cafeterias and we also provide some entertainment activities for
the customers like showing DSTV, inviting music bands for special days
like Valentine ’s Day and there will also be candle night on Sunday. This
plan includes chapters on the company, products and services, market
focus, action plans and forecasts, management team and financial plan.
• Vision And Mission
 Mars cafe will become the foremost coffee shop in the area. We will
serve a perfect product at a very reasonable price. We will also be a
meeting place for every

individual that want to use cafeteria service. Mars will create an

atmosphere conducive to creative expression and promote the creative
process.

The cafe's aim is simple. It will provide a completely sophisticated,

sensual, yet casual dining and/or coffee house experience for the many
Addis people and visitors who frequent the city's casual dining spots and
entertainment venues.

Mars aim to be able to employ several full time members of staff and
build up a team so that the partners can be clear of routine tasks and
consentret on day to day activities like meeting customer, supervising
the cafeteria, holding extensive promotion activity and so on which help
the business to develop well.
• Keys To Success
The keys to success in this business are:

• Product quality: Food, coffee-based beverages, and entertainment are

our products. They must be of the high quality and value.

• Service: Mars patrons are paying to have a good time. Their experience
will suffer if service is not of the highest caliber. Each member of the staff
will be courteous, efficient, and attentive.

• Marketing: Mars will need to target our audience early and often. While
the business is located in a central and accessible location, many people
will have to be re- introduced to the neighborhood .

• Management: Mars will need to have a firm grasp on food, beverage, and
labor costs. The dining/entertainment/coffeehouse experience must be
delivered in a fashion that will not only inspire repeat business, but
encourage word-of-mouth recommendations to others. Proper
inventory, employee management, and quality control is key.
• The greatest locations - visibility, high traffic pattern, convenient access.

• The finest reputation - word-of-mouth advertising, promotion of our

community mission of charitable giving.
• Strategies
• 6 Sales Strategy
My sales strategy includes:

• Establish coffee service at local businesses

• Sell gift cards, frequency cards, pre-paid cards, and offer discounts to key groups
• Create an ongoing sampling program
• Conduct a consistent, aggressive marketing program
• Be an active member of the community; be visible at charitable functions
• Solicit customer feedback to constantly improve and streamline our operation
• Staff salaries that are 10% above the industry average in order to attract
the best people
• Hiring for attitude so that Mars always have a friendly, enthusiastic staff
to make customers feel welcome and appreciated; constant staff training
to assure the best quality possible
• To reduce customer waiting time, and create efficient product ordering

• Create a mobile kiosk to take Dark Roast Java into the community at
special events, farmer's markets, art shows, etc.

• Pricing Strategy
Food, drinks, and entertainment options are priced to give us an
attractive margin while at the same time offering value to the consumer.
Mars want repeat business. And also want the experience to remain
fresh. Within lies why the food, beverages, and musical/entertainment
programming will be relatively flexible.

Comparing with other competitive cafeterias we will provide fewer

prices to our customers. Mars will offer two sizes of drinks, small Birr
4.00 and large Birr 7.00. Our cookies and brownies will sell for Birr
12.00 each.

• Promotion Strategy
 The first step that Mars take in promoting our cafeteria is conducting an
opening ceremony. On this ceremony different well known peoples will
be invited and some part of the customers will also be invited. Also invite
our neighbors to have a good public relationship.

Intend to advertise in the local newspapers and offer a "frequent

drinkers club" discount to our best customers. We will also send out
advertise through direct mail, which will include cents off coupons.

Mars will promote our company name and label almost more than the
product itself, because to be successful besides have to stand for brand-
name integrity, excellent menu offerings, and first class entertainment
and fun.

Mars will have Happy Hour, price reduction for special days, like holidays,
Valentine’s Day. As well as provide special Torta cake for those
of who celebrate their birthday parties in our cafeteria with low price.

One thousand one hundred sixty flayers will be distributed in the

adjacent neighborhood, on the University campus, at the malls and in the
selected office buildings within two weeks prior to the opening of Mars
cafeteria. Subsequently, free postcards with Mars endorsement will be
printed to increase the company visibility among the patrons

• 7 Implementation, Resource Plan and Organizational Structure

• Time Plan
The operation of the project will start at the beginning of 2018 after
certain pre- request activities are accomplished.
The time schedule is stated as follows;

No Activities Time schedule

1 Developing the project Dec 1- jan25

2 Obtaining the license from concerned body Jan27- Feb 20

3 Purchase materials and renting the building Feb 21-May 10

4 Promotional activity May 12-June 16

4 Start running the business July 1 2018

• Resource Plan

No Item Cost

1 Coffee boiler machine 70,000

2 Kitchen equipment 150,000

2 Refrigerator 60,000

4 Sofas and chairs (furniture) 265,000

5 Rental for building 30400

6 Labor cost 35960

7 Miscellaneous expenses 23000

Total cost of the business 634,360

• Human Resource Plan

The personnel plan calls for hiring 14 full-time salaried employees at
start-up. Any additional hires will be part time and devoted to the
expansion of any catering function, as well as increased
capacity/operation of a private party function.

Employee salaries are as follows:

No. Sr. Manpower No. Monthly Salary (Birr Annual Salary (Birr)
1 General manager 1 3,500 42000
2 Chief 1 1500 18000
3 Line cook 2 1200 28800
4 Waiter 6 1700 122400
 5 Dishwashers/Bussers 3 1500 54000
6 Guards 1 1500 18000
Sub total 14 23600 283200
Benefits (10% basic salary) 2360 28320
Total 25960 311520

• Organizational Structure
Mars organizational structure will be a simple pyramid style with the
owners putting in as much work as the employees. An additional
manager (to be hired) will assist in maintaining and reviewing
operations of the restaurant and the entertainment venue/bar.

A chef (to be hired) will manage kitchen operations and be crucial to

maintaining food inventory stability and assistance in menu
development.

An assistant manager/senior server (to be hired) who will be a salaried

employee will provide regular table service as well as assistance to the
manager and the general manager. A sous-chef/line cook (to be hired)
will perform secondary management functions in the kitchen as well as
provide assistance to the chef in main kitchen/cooking functions.

Part-time personnel will be hired to handle bartending, serving, and

dishwashing functions. The marketing and accounting function will be
handled by independent contractors/consultants

• Financial Plan

• Sales Projection

The most important indicators in our case are daily seating "counts" and
weekly sales numbers. Also make sure that we are turning our inventory
rapidly so as to avoid food spoilage. Our project to perform at five years
projects .from those out of which one would be a small scale and others would
be of an intermediate implementation. The source of sales would be the fees
for the feasibility studies.

• Income Projection
 Income from 1st year 2nd year 3rd year 4th year 5th year

Hot drinks & Beverages 121875 148125 183900 202650 223462

Cakes & cookies 121875 148125 183900 202650 223462

Fast foods 243750 296250 367800 405300 446926

Lunch & Dinner 162500 197500 245200 270200 297950

Total income 650,000 790,000 980,800 1,080,800 1,191,800

• Cash Requirement

The business at least needs 344,360.00 birr for business establishment,

commencement of operations and liquidity support.

The shareholders will have equal share and business are obtained in two ways.

• From shareholders 20%

• From Bank 80%

• Source of Financing

The finance for this business would be obtained from shareholders and banks.
From bank Mars provide the start up cash of 275,485.00 birr it have interest from
bank. Each members of the company should buy share by 11,478.60. Hard work is
expected from us to be successful in competition and to return birr taken from the
bank with interest.
• 8 appendix
• Supporting Documents

• Legal agreements

The following agreements hold for all partners involved in the venture:

• In case one partner wants to part ways from the company he

or she must inform the company one month ahead of time
• All company secrets should be protected by all members of the organization
 • Salaries of employees would be paid when revenues of the
organization exceed 50% of first months cost
• Dissolving of partnership is allowed if the venture has returned
the costs involved ahead of the six month.

• References

• Ethiopian business development service network (EBDSN), How

to write a business plan 2005/6 E.C
• AAIT Entrepreneurship for Engineers lecture note/ Zerihun G. /

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