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Sweet MoM Foods

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Executive Summary

Sweet MoM Foods is a food business that will engage in sale of ready-made food for the consumers. The company focuses on the young male and female customers especially those in colleges and employed who have little to no time to make home-made delicacies. The growth of the fast foods industry brings a major form of competition in the industry but Sweet MoM Foods differentiates itself as a restaurant that understands the health needs of the consumers and hence makes healthy meals that can be delivered or have the customers walk in and have their breakfast, lunch, or dinner (Liu et al., 2022). The company will focus on selling different types of dishes giving the customers an opportunity to call and book their best delicacy to provide all the customers from different parts of the world to experience good food and bring home closer to them.

The company understands that there is a need to provide delicious foods that meets the expectations of the customers. At the same time, there is need for effective order management in order to prevent delays. Thus, there is need to hire professional chefs who will provide the delicacies as demanded by the customers (Rajput et al., 2020). There is also a need to hire a technical team that will manage the online order system, the management of the company website and the social media management. The target customers are the young people in the age of 18 years to 40 years. These are customers who have the time to eat out or order their meals since they are working or lack large families.

External Environmental Analysis

Political Factors

Political factors will play a crucial role in enhancing the opportunities for Sweet MoM Foods or threaten its operations. The UK health and hygiene regulations are strict and it is important to adhere to them failure to which the business will face legal consequences (McCarty et al., 2022). The breaching of the rules and regulations can lead to loss of money and damages that are caused to the brand reputation. The other laws and regulations affecting the business is the employment laws which stipulate the need for equality and pay regulation. The business must adhere to these laws for effective performance. Other political factors affecting the business include the government tax policies. High taxes will affect the revenues and the actual profits made in the business.

Economic Factors

The performance of Sweet MoM Foods can skyrocket or dwindle depending on the economic conditions. The effects of COVID-19 includes the slowdown in the economy (Gursoy et al., 2020). The reduction in the income in the targeted customers can result to low sales or poor performance in the long run. COVID-19 also increased unemployment and hence this reduces the number of customers and the effective sales from the business. UK also charges high rental fees and this will affect the profit margins.

Social Factors

The customer behaviors have changed with most customers being aware of the health impacts of fast foods. Thus, there is a rising demand for health meals that the customers can access easily (White et al., 2020). Sweet MoM Foods will cater for the local needs of the UK population and those that come from other cultures. The change in customer behaviors and focus on foods with low carbohydrates and beverages which are low in sugar will increase the market standings for the business.

Technological Factors

Sweet MoM Foods relies on technology to increase its marketshare within London. The business will thus adopt advanced technology to increase orders, marketing, and enhance public relations (Janssen et al., 2018). The use of advance ordering services is meant to attract more customers. At the same time, the use of chat bots is important to enhance the responses given to the customers and avoid delays in their enquiries when it comes to orders. However, these technologies can render some of the employees redundant.

Environmental Factors

Sweet MoM Foods will take several steps to respond to the environmental concerns. The customers are already aware of the effects of global warming. Thus, the restaurant will have recycling g units to ensure the plastics and the cups are recycled and hence avoid their environmental impacts (Janssen et al., 2018). There are also environmental laws and regulations in UK that must be adhered to. The business will thus have a measure to determine the greenhouse gas emissions and the daily plastic use.

Legal Factors

The UK has an established legal system. Thus, Sweet MoM will have to adhere to established laws including the payment of the local councils. It has also to adhere to the food safety standards and hygiene regulations (McCarty et al., 2022). The relaxed regulations make it easier to operate in a market. However, these laws can be a source of major legal disputes which affects the operations of the business and the profits.

Industry Analysis

Industry Rivalry

Sweet MoM Foods will face high competition in the restaurant industry. There are high number of firms in the industry especially dealing with fast foods (Nguyen et al., 2018). There is also high aggressiveness of the firms as they try to attain a better market share. These factors coupled with low switching costs where the restaurants can change from fast foods to the sale of the healthy food menus, the company will experience high competition.

Customers Bargaining Power

The restaurant faces high customer bargaining power due to the low switching costs. The customers can easily change from one restaurant to another. There are also a large number of providers who have the ability to meet the needs of the customers (Ashby, 2018). The customers can demand for price changes because there are available substitutes to help them satisfy their needs.

Suppliers Bargaining Power

The suppliers in Sweet MoM Foods have weak bargaining power. This is because there are a large number of suppliers and hence it is possible to change from one to another. There is also low forward vertical integration of the suppliers hence they do not have control in the distribution network (Nguyen et al., 2018). There is also high overall supply of the raw materials used in the restaurants.

Threat of Substitutes

The substitutes are the alternatives that the customers have for the goods and services provided by the restaurant. There is high substitute availability due to availability of foods from artisanal food producers and the fast foods (Ashby, 2018). The consumers can also make their meals at home. It is easy to shift from the Sweet MoM Foods to other restaurants available in London. Thus, the company will have to use approaches such as high product quality to ensure the customers remain attracted.

Threat of New Entrants

New entrants can impact Sweet MoM Foods negatively due to reduction in the financial performance and market share. The low switching cost increases the probability of new entrants in this industry. The capital required is also low and hence new entrants can easily enter the market (Ashby, 2018). Many small and medium businesses however, lack the resources to create a strong brand that can match that of the existing ones.

Key People and Skills

The business requires people with different skills including technical skills. The first type of employees required are the chefs who are the most important in ensuring the recipes are effectively delivered in all cases (Janssen et al., 2018). The chefs need to have an understanding of regional foods and recipes in order to match the requirements in the business. The second type of skills is the accountants. These are the people responsible for ensuring the business operations are all well managed financially. These are important people in enhancing performance. There is also a need for marketers. These are people with different skills who are responsible for ensuring the company brand is enhanced and that they reach new consumers on the products being sold. These should be people with social media management skills because it will be a major marketing approach used (Theis et al., 2018). The IT Technician will be responsible for managing all the aspects related to the websites, the cybersecurity measures, and updating the software patches to prevent the occurrence of successful attacks in the business.

Financial Feasibility

The startup cost for the business will be moderate because it will start as a food outlet that can accommodate 50 customers at a single time while at the same time making online sales. The initial costs will include the cost of renting a space for the business, the equipment necessary for the kitchen and the beverages section, the cost of licenses and that of the marketing (Graham et al., 2020). In total, the initial cost will be approximately 520,000 Euros. This will be funded from the personal savings, family loans, and the loans from the financial institutions within UK. Estimates are as shown in Appendix 1.

Although the initial costs are high, it is expected that the business will be able to make sufficient amount of money in order to break even within the shortest time possible. The sales forecast for the next one year are shown in appendix 2. These sales show that as the customers keep knowing the benefits of the Sweet Mom Foods and their recipes, they will be able to make increase their purchases. There is also high expectations of repeat customers. The business is expected to break even in one year.

References

Ashby, A. (2018). Developing closed loop supply chains for environmental sustainability: Insights from a UK clothing case study.  Journal of Manufacturing Technology Management. https://www.emerald.com/insight/content/doi/10.1108/JMTM-12-2016-0175/full/html

Graham, F., Barker, M., Menon, M., & Holdsworth, M. (2020). Acceptability and feasibility of a café-based sustainable food intervention in the UK.  Health Promotion International,  35(6), 1507-1518. https://academic.oup.com/heapro/article-abstract/35/6/1507/5815616

Gursoy, D., & Chi, C. G. (2020). Effects of COVID-19 pandemic on hospitality industry: review of the current situations and a research agenda.  Journal of Hospitality Marketing & Management,  29(5), 527-529. https://www.tandfonline.com/doi/full/10.1080/19368623.2020.1788231

Janssen, H. G., Davies, I. G., Richardson, L. D., & Stevenson, L. (2018). Determinants of takeaway and fast food consumption: a narrative review.  Nutrition research reviews,  31(1), 16-34. https://www.cambridge.org/core/journals/nutrition-research-reviews/article/determinants-of-takeaway-and-fast-food-consumption-a-narrative-review/84FCD3376168AF5B70FBC51B4799ECEF

Janssen, H. G., Davies, I. G., Richardson, L. D., & Stevenson, L. (2018). Determinants of takeaway and fast food consumption: a narrative review.  Nutrition research reviews,  31(1), 16-34. https://www.cambridge.org/core/journals/nutrition-research-reviews/article/determinants-of-takeaway-and-fast-food-consumption-a-narrative-review/84FCD3376168AF5B70FBC51B4799ECEF

Liu, R., Sun, Y., & Wang, J. (2022, March). Influential Factors of Sales Revenue in the Fast-Food Industry. In  2022 7th International Conference on Financial Innovation and Economic Development (ICFIED 2022) (pp. 2832-2838). Atlantis Press. https://www.atlantis-press.com/proceedings/icfied-22/125971976

McCarty, K., Paranthaman, K., Jenkins, C., Sedgwick, J., & Crawley-Boevey, E. (2022). Lessons learned from the investigation and management of an outbreak of Shigella flexneri associated with a restaurant in London, 2019–2020.  Public Health,  205, 130-132. https://www.sciencedirect.com/science/article/pii/S0033350622000439

Nguyen, Q., Nisar, T. M., Knox, D., & Prabhakar, G. P. (2018). Understanding customer satisfaction in the UK quick service restaurant industry: The influence of the tangible attributes of perceived service quality.  British Food Journal. https://www.emerald.com/insight/content/doi/10.1108/BFJ-08-2017-0449/full/html?skipTracking=true&utm_source=TrendMD&utm_medium=cpc&utm_campaign=British_Food_Journal_TrendMD_0&WT.mc_id=Emerald_TrendMD_0

Rajput, A., & Gahfoor, R. Z. (2020). Satisfaction and revisit intentions at fast food restaurants.  Future Business Journal,  6(1), 1-12. https://link.springer.com/article/10.1186/s43093-020-00021-0

Theis, D. R., & Adams, J. (2019). Differences in energy and nutritional content of menu items served by popular UK chain restaurants with versus without voluntary menu labelling: A cross-sectional study.  PLoS One,  14(10), e0222773. https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0222773

White, M., Aguirre, E., Finegood, D. T., Holmes, C., Sacks, G., & Smith, R. (2020). What role should the commercial food system play in promoting health through better diet?.  Bmj,  368. https://www.bmj.com/content/368/bmj.m545

Appendices

Appendix 1: Start-up Cost

Cost Type	Euros
Annual Rental cost	200,000
Furniture	800,000
Kitchen equipment	700,000
Initial stock	400,000
Licenses	100,000
Employees’ salaries	1,500,000
Start-up marketing expenditure	150,000
Start-up operating expenses	450,000
Total start-up cost	4,400,000

Appendix 2