Thesis-financial plan

By evaluating the availability and accessibility of these critical resources, we can effectively plan and execute the business strategy, ensuring optimal utilization of resources and achieving long-term success in the vibrant culinary landscape of Podgorica.

Skilled Culinary Professionals. Podgorica, and Montenegro in general benefits from a pool of skilled chefs, cooks, and service staff, thanks to its culinary schools and diverse hospitality industry. Recruiting talented individuals with expertise in Italian cuisine and fine dining service will be crucial.

Training and Development Programs. Implementing comprehensive training programs to enhance staff skills in culinary techniques, customer service, and hospitality standards will ensure the delivery of exceptional dining experiences.

Recruitment Strategies. Partnering with culinary schools, leveraging online job portals, and networking within the local hospitality community will facilitate recruitment efforts.

Capital Investment. Securing initial capital for restaurant setup, including lease agreements, interior design, kitchen equipment, and inventory procurement, is essential. Exploring financing options such as bank loans, investment partnerships, or crowdfunding can provide the necessary funds.

Budget Planning. Developing a detailed budget that allocates resources effectively across various aspects of restaurant operations, including marketing, staffing, and inventory management, is crucial for financial sustainability.

Revenue Projections. Conducting thorough market research and financial forecasting to estimate revenue streams, profit margins, and break-even points will inform strategic decision-making and investment priorities.

POS Systems. Integrating advanced Point-of-Sale (POS) systems with capabilities such as inventory management, table reservations, and sales analytics will streamline operations. This technology will help manage resources more effectively, reduce wait times, and ensure a constant supply of fresh ingredients. Ultimately, this will lead to a more seamless dining experience for guests, enhancing their overall satisfaction.

Online Reservation Platforms. Leveraging online reservation platforms and mobile apps will make it easier for customers to book tables conveniently. This improved accessibility will not only attract more patrons but also provide them with a smooth and hassle-free reservation experience, thereby elevating their overall dining experience at the restaurant.

Digital Marketing Tools. Utilizing digital marketing tools such as social media platforms, email marketing, and search engine optimization (SEO) will amplify the restaurant's online presence. This strategic approach will help attract a broader audience, engage with the community, and drive revenue growth. By effectively communicating unique offerings and events, a strong brand identity and loyal customer base can be built.

Implementing these modern technologies and digital tools at Arte, Sapienza e Maestria will not only enhance efficiency and customer service but also solidify the restaurant's position as a premier dining destination in Podgorica, Montenegro.

Restaurant Space. Securing a suitable restaurant space in a prime location within Podgorica, with ample dining area, kitchen space, and aesthetic appeal, is essential for attracting customers and creating memorable dining experiences. A prime location with sufficient space ensures comfort and accessibility, drawing in more patrons and providing a pleasant atmosphere.

Kitchen Equipment. Investing in high-quality kitchen equipment, including stoves, ovens, refrigeration units, and cooking utensils, ensures efficient food preparation and maintains food safety standards. High-quality equipment will enhance the speed and quality of service, ensuring dishes are prepared to perfection while adhering to health and safety regulations.

Interior Design and Furnishings. Designing an inviting and aesthetically pleasing dining environment with attention to decor, furniture, lighting, and ambiance contributes to the overall dining experience and customer satisfaction. A well-designed interior creates a welcoming atmosphere, encouraging customers to relax and enjoy their meal, which in turn fosters repeat visits and positive reviews.

Proactive risk management strategies are essential to anticipate and mitigate potential risks and challenges associated with operating in Podgorica. By identifying potential risks, assessing their likelihood and impact, and implementing appropriate mitigation measures, the restaurant can enhance its resilience and increase the likelihood of long-term success and resilience in the face of uncertainties.

Risk. Podgorica's restaurant scene is diverse, ranging from traditional Balkan cuisine to international dining options. The risk lies in understanding the competitive landscape and identifying opportunities to carve out a unique niche.

Likelihood. Moderate to High, depending on the number and quality of competitors in the area.

Impact. Potential loss of market share and revenue if unable to differentiate from competitors or attract a loyal customer base.

Mitigation Strategy. Thorough market research and a well-defined value proposition tailored to the target demographic can help mitigate this risk Implement effective marketing strategies to promote brand awareness and attract customers. The focus should be on delivering exceptional dining experiences to differentiate from competitors.

Risk. Economic fluctuations, such as recessions or currency devaluation, can impact consumer spending habits. In times of economic uncertainty, consumers may prioritize essential expenses over dining out.

Likelihood. Moderate, as economic conditions can be unpredictable and influenced by various external factors.

Impact. Decreased revenue and profitability, challenges in covering operating expenses, and potential financial instability.

Mitigation Strategy. Maintain a flexible budget and financial contingency plan to adapt to changing economic conditions. Diversify revenue streams by offering catering services, hosting events, or introducing promotional offers during slow periods. Monitor economic indicators and adjust pricing or marketing strategies accordingly.

Risk. Operational inefficiencies, staff turnover, supply chain disruptions, or equipment failures may impact the restaurant's ability to deliver consistent service and quality.

Likelihood. Moderate to High, as operational challenges are common in the restaurant industry and can arise unexpectedly.

Impact. Negative customer experiences, reputational damage, loss of revenue, and increased operating costs due to the need for repairs or replacements.

Mitigation Strategy. Implement robust operational procedures and staff training programs to ensure smooth day-to-day operations. Maintain relationships with reliable suppliers and vendors to minimize the risk of supply chain disruptions. Conduct regular maintenance and inspections of equipment to prevent breakdowns and downtime.

Risk. Non-compliance with health and safety regulations, food hygiene standards, or licensing requirements could result in fines, penalties, or legal action against the restaurant.

Likelihood. Moderate, as regulatory requirements are essential but may be complex and subject to change.

Impact. Legal liabilities, damage to reputation, temporary closure of the restaurant, and financial repercussions.

Mitigation Strategy. Stay informed about relevant regulations and ensure strict adherence to health, safety, and licensing standards. Invest in staff training on compliance protocols and conduct regular audits to identify and address any areas of non-compliance.

Risk. Natural disasters, public health crises, political instability, or acts of terrorism could disrupt normal business operations and impact the safety and well-being of customers and staff.

Likelihood. Low to Moderate, depending on the geographical location and prevailing socio-political climate.

Impact. Forced closure of the restaurant, property damage, loss of revenue, and potential harm to the restaurant's reputation.

Mitigation Strategy. Develop a comprehensive business continuity plan to address various emergency scenarios and ensure the safety of customers and staff. Maintain adequate insurance coverage to protect against property damage, liability claims, and business interruption losses. Stay vigilant and monitor local news and government advisories to proactively respond to potential threats or crises.

Arte, Sapienza e Maestria offers a distinctive dining experience by combining genuine Italian cuisine with interactive workshops, forums, and cooking classes. With the aim to go beyond mere dining, the restaurant will create a dynamic community hub where customers can fully engage in Italian culture, learn new skills, and connect with like-minded individuals.

The value proposition is based on:

Authentic Italian Cuisine

The menu, curated by skilled chefs trained in traditional Italian culinary techniques, features dishes meticulously prepared using premium ingredients to deliver an authentic taste of Italy in the heart of Montenegro.

Interactive Workshops and Forums

Recognizing that dining is an experience beyond food, the restaurant will offer regular workshops and forums covering various aspects of Italian culture, cuisine, and lifestyle. Customers can participate in hands-on sessions led by experts on topics like wine tasting, pasta making, olive oil appreciation, and Italian language and culture.

Hands-on Cooking Classes

For those interested in enhancing their culinary skills, interactive cooking classes led by talented chefs are provided. Participants can learn the secrets behind traditional Italian recipes, techniques and tips for infusing authentic Italian flavours into their dishes.

Community Engagement

The restaurant serves as a meeting point for locals and visitors to come together and share their love for Italian food and culture. Through workshops and forums, it foster a sense of community where individuals can connect, learn from one another, and build lasting relationships.

Unique Dining Experience

Setting Arte, Sapienza e Maestria apart from traditional Italian restaurants, it offer an immersive experience that stimulates all the senses. From the enticing aromas emanating from the kitchen to the lively discussions during forums, each visit promises a memorable and enriching experience.

Cultural Exchange

By introducing Italian culture and cuisine to Montenegro, cultural exchange and appreciation among customers are promoted. Through diverse workshops and forums, patrons have the opportunity to explore Italian traditions, customs, and culinary heritage, fostering a deeper understanding and respect for global cultural diversity.

In essence, the restaurant presents a compelling value proposition that goes beyond just gastronomy. With a focus on authentic cuisine, interactive workshops, and community engagement, it delivers a unique dining experience that satisfies both the palate and the intellect, leaving guests inspired, enlightened, and eager for more.

In addition, this project matches some of the actual Montenegro’s need. Among them it is possible to find:

Local agriculture. By sourcing ingredients locally, the project can help support Montenegro's agricultural industry, promote sustainable farming practices, and contribute to its local economy.

Health options. Providing healthy and lighter Italian dishes can align with the growing health-conscious trend among Montenegro's people.

Employment opportunities. The project's interactive approach can create new job opportunities for locals in the hospitality industry, specifically in the areas of cooking, hospitality, and customer service.

Cultural exchange. The project's focus on Italian culture can help foster cultural exchange between Montenegro and Italy, promoting mutual understanding and appreciation.

Community Engagement. Engaging with the local community through events, promotions, or partnerships with local organizations can foster a sense of belonging and loyalty.

By understanding and embracing the preferences of the population, the restaurant can tackle the challenge of supplying a dining atmosphere that truly connects with local tastes, all while playing a part in enhancing the overall well-being of the community.

In order to properly deliver the value proposition to customers and consequently generate revenues, this business must perform some core activities analysed below.

Production

To reflect the culinary variety proposed and to demonstrate commitment to the territory, Arte, Sapienza e Maestria guarantees the use of fresh and high-quality ingredients from both Italy and Montenegro. In addition, despite the respect that chefs will have towards traditional Italian recipes, there will be reinterpretations that incorporate elements typical of the Montenegrin territory.

Restaurant service

Offering a unique experience to customers is one of the main objectives that will be made possible thanks to the desire to create a welcoming and inviting environment, with attentive and professional staff providing a courteous and personalized service.

Parallel weekly activities

In order to build community engagement, a series of parallel activities will be organized on weekdays where a lower turnout at the venue is expected. In this sense, interactive workshops, structured cooking lessons and forums will take place. The experts called to conduct these sessions will not only be chefs, but also qualified people in different fields such as nutrition, food psychology, environmental protection in the production and distribution of food, etc.

The topics will all be related in some way to the Italian gastronomic culture and the territory of Montenegrin, thus encouraging cultural exchange through dialogue and exchange of ideas between participants.

Collaborations and partnerships

By collaborating with local experts, chefs, and cultural organizations, the restaurant aims to further enrich the parallel activities with high quality content. A collaboration with cultural organizations such as, for example, the Community of Italians of Montenegro - Zajednica Italijana Crne Gore[footnoteRef:33] has been evaluated. Even partnerships with local culinary institution are considered. This can involve activities like hosting guests’ lectures, offering internships, organizing collaborative events, and developing educational programs tailored to aspiring chefs or culinary enthusiasts. These initiatives aim also to leverage the expertise of culinary schools, provide learning opportunities, and strengthen ties with local culinary community. [33: Gore, C. d.-Z. (n.d.). Zajednica italijana crne gore. Retrieved from www.comunitamontenegro.org: https://www.comunitamontenegro.org/it/o-nama/]

According to the IAB's V Annual Study of Social Media, 85% of the audience follows influencers on social media[footnoteRef:34]. Therefore, partnering with an influencer who aligns well with the brand presents a strategic opportunity to effectively advertise the restaurant. [34: Adglow, M. T. (n.d.). The impact of social media in the food industry. Retrieved from adglow.com: https://www.adglow.com/en-us/blog/the-impact-of-social-media-in-the-food-industry ]

In addition, many of the suppliers are local companies chosen to ensure the supply of fresh, high-quality ingredients while supporting the local economy.

Human Resource Management and Training

Arte, Sapienza e Maestria will give particular attention to the staff. Indeed, this is the most important task of its mission: to involve and enthuse those who choose the restaurant. In this regard, the team will be continuously trained, with particular attention to effective communication, proper interaction with customers and updating on the latest culinary trends. Only in this way can a high-quality service be guaranteed.

Promotion and Marketing

To promote both the restaurant itself and the parallel weekly activities, targeted marketing strategies through online ads, social media and email marketing will be implemented in such a way as to involve both regular customers and new potential customers. As time goes by, we also aim to exploit the restaurant’s reputation as a meeting and sharing place to attract as many participants as possible to parallel activities.

In delivering the products and services of Arte, Sapienza e Maestria to customers, a multi-channel approach will be adopted to cater to diverse preferences and maximize accessibility. The following channels are planned to be utilized:

Direct Sales. The primary channel for delivering products and services will be through direct sales at the restaurant premises. Customers can dine in and enjoy authentic Italian cuisine in a sophisticated ambiance or opt for take-out options for convenience.

Online Platforms. Leveraging online platforms will extend the restaurant's reach and accessibility to a broader customer base. The restaurant's website will feature an online reservation system, allowing customers to book tables in advance.

Collaboration with Hotels and Tourism. According to a research conducted by Huey Chern Boo and Anna Mattila, writers of the Journal of Foodservice Business, co-branding, which involves the partnership of two or more brands to achieve mutual goals, is a strategic business choice for numerous hotels and restaurants in the Western world, particularly in the United States and Europe[footnoteRef:35]. Partnering with hotels, resorts, and tourism agencies will create opportunities for collaboration in promoting dining experiences and packages to tourists and visitors. This channel leverages the existing customer base of hospitality establishments and enhances the restaurant's visibility among tourists seeking authentic culinary experiences. For example, a franchise steak house in Ritz Carlton hotels gives the perception of quality since the steak house is associated with a quality hotel brand[footnoteRef:36]. This association creates an immediate perception of quality for consumers, who trust familiar brands. Technology greatly enhances the potential for successful co-branding initiatives. [35: Huey Chern Boo, Anna Mattila. (n.d.). A Hotel Restaurant Brand Alliance Model. Retrieved from https://www.researchgate.net/publication/233328895_A_Hotel_Restaurant_Brand_Alliance_Model] [36: M.Khan. (n.d.). Co-branding in the Restaurant Industry. Retrieved from https://www.cabidigitallibrary.org/doi/abs/10.1079/9781845930127.0073#:~:text=For%20example%2C%20a%20franchise%20steak,%2D%20nology%20is%20co%2Dbranding.]

Arte, Sapienza e Maestria serves a well-defined consumer base with unique demographics, preferences, purchasing behaviors, and pain areas. Understanding these factors is critical to effectively meeting client needs and ensuring the restaurant's success.

Ideal customer profile

Arte, Sapienza e Maestria's ideal clientele are men and women aged 25 to 55. They are often middle to upper-middle class, with a disposable income and a college education. Professionally, they frequently work as professionals, business entrepreneurs, tourists, and expats. These clientele appreciate good meals, cultural events, and travel. They cherish quality, authenticity, and cultural heritage, and are especially interested in culinary arts, wine tasting, cultural events, and gastronomy. They are typically adventurous, social, and value-driven.

Customer Preferences and Purchasing Behavior

Customers appreciate real Italian cuisine that emphasizes quality and traditional recipes, served in a sophisticated yet inviting dining setting. They anticipate high-quality, individualized service and value interactive eating experiences like cooking workshops and cultural activities. They frequently dine out for both leisure and professional purposes, are willing to pay more for luxury dining experiences, and base their dining decisions on internet evaluations, social media presence, word-of-mouth recommendations, and previous experiences.

Supporting research reveals that there is a high desire for authentic Italian dining experiences. The International Food Information Council's[footnoteRef:37] poll found that 78% of customers rate food quality as the most important consideration while dining out. According to OpenTable[footnoteRef:38], guests prioritize authenticity and traditional recipes, especially in Italian food, where real ingredients and cooking processes are highly regarded. [37: International Food Information Council. (2022, May). 2022 Food & Health Survey: Diets, Food Prices, Stress and the Power of Gen Z. Retrieved from https://ific.org/media-information/press-releases/2022-food-health-survey/] [38: OpenTable. (2024). Best Italian Restaurants. Retrieved from https://www.opentable.com/cuisine/best-italian-restaurants-maryland-md]

A research by Restaurant Business Online indicated that customers are increasingly interested in immersive and engaging eating experiences, such as cooking lessons and culinary festivals. These activities enhance the entire dining experience and build loyalty. This trend is consistent with the rising popularity of culinary tourism, in which people seek out distinctive and culturally stimulating eating experiences while abroad.

Online reviews and social media have a significant impact on these clients' purchase behaviors. TripAdvisor found that 94% of guests choose restaurants based on online evaluations, emphasizing the necessity of having a strong online presence and favorable reputation. Furthermore, social media platforms serve as vital tools for connecting with customers and developing brand recognition. 71% of consumers are more inclined to suggest a restaurant if they have had a favorable social media engagement with the company.​ Understanding these preferences and behaviors allows Arte, Sapienza e Maestria to better tailor its offerings and marketing strategies to meet the expectations of its target customers, resulting in a memorable and satisfying dining experience that encourages repeat visits and positive word-of-mouth referrals.

STP (Segmentation, Targeting, Positioning) is a marketing framework for identifying and categorizing customer groups, selecting the most attractive segments, and creating a unique value proposition for each. It's crucial for a business plan because it helps focus marketing efforts, optimize resource allocation, and enhance competitive advantage by effectively addressing customer needs.

Segmentation criteria help businesses categorize customers based on specific characteristics like demographics, behavior, or needs. Understanding diverse customer segments fosters better engagement, higher satisfaction, and increased market competitiveness. To identify the market segmentation for Arte, Sapienza e Maestria the following are the criteria taken into account.

Geographic. Customers are in Podgorica, Montenegro

Demographics. Include age, income, occupation, education level, and family size.

Psychographics: include lifestyle, interests, and cultural preferences.

Behavioural characteristics: include dining habits, frequency of dining out, preferences for Italian cuisine, and willingness to participate in culinary seminars, workshops or events.

Segments can be described as it follows:

Young Professional. People aged 25 to 35 with moderate to high incomes who work in corporate or creative industries and enjoy trying new foods and experiences. With their discretionary income and adventurous energy, they represent a profitable market for the restaurant's distinctive offers.

Food enthusiasts. People of all ages and income levels who are enthusiastic about food, cooking, and cultural exchange and are prepared to invest time and money in culinary experiences. Given their intense interest in this type of activities, they are likely to like the restaurant's participatory workshops and forums.

Tourists and Expats. Visitors to Podgorica, including both tourists and expats, are looking for genuine Italian dining experiences and cultural immersion. By catering to this desire for authentic Italian experiences in Montenegro, businesses can effectively appeal to a diverse consumer base. Numbers and data are missing.

Regarding the methodology, the team will use demographic, psychographic, and behavioural elements from market research surveys, observations, and customer data analysis to segment customers.

The core target profile is young professionals and food enthusiasts, with a secondary focus on tourists and expats. Young Professionals are urban inhabitants with moderate to high incomes, adventurous taste preferences, active social media use, and a desire for unusual experiences. Food Enthusiasts encompass diverse demographics who are passionate about culinary experiences, eager to spend money on high-quality dining, and interested in cultural learning.

Regarding market needs, both segments seek authentic Italian cuisine, looking for true Italian flavors and dining experiences. They desire interactive workshops and events to learn and participate in culinary activities and cultural exchanges. Additionally, they expect a quality dining environment with a friendly atmosphere, attentive service, and an aesthetically pleasant ambiance.

With reference to the target strategy, Arte, Sapienza e Maestria will target its core target profile with marketing initiatives on social media, forums, and local events. Exclusive deals and discounts will be offered based on their interests and preferences to attract and engage these key customer segments.

Brand positioning statement: Arte, Sapienza e Maestria is Podgorica's top destination for authentic Italian cuisine, engaging culinary experiences, and cultural immersion.

Points of Parity (PoP) are the attributes or benefits that a brand shares with its competitors. These are essential for establishing category membership and ensuring that customers recognize the brand as a legitimate player within a particular market. Moreover, they ensure that a brand meets basic customer expectations and competitive benchmarks, establishing credibility and relevance in the market. The following are the PoP for Arte, Sapienza e Maestria:

· Excellent italian cuisine

· Warm atmosphere

· Excellent service

Points of Difference (PoD) are the attributes or benefits that set a brand apart from its competitors. These unique characteristics give customers a compelling reason to choose the brand over others. They are what create differentiation and competitive advantage, driving customer preference and loyalty by highlighting unique value propositions that address specific needs or desires. Arte, Sapienza e Maestria will have these PoD:

· Cooking classes

· Interactive workshops

· Forums

Together, PoP and PoD help businesses develop a strong brand positioning that balances meeting essential expectations and offering distinctive benefits.

To maximize the revenue and ensure long-lasting profit, the restaurant will adopt a flexible pricing strategy that is consistent with the competitive landscape in which it operates. The approach chosen considers the quality of the products and services offered, the peculiarity of the parallel activities organized, the needs of the target customers, the gaps that this business proposal proposes to fill and the dynamics of the reference market.

For what concerns the price strategy, cost-based, flexible, differentiated, premium and competitive strategy will be adopted.

Cost-based pricing. The total food cost of each dish is determined considering the quality and shipping cost of the ingredients used, the complexity of the preparation, the added value of the culinary experience offered and the general expenses of the restaurant as a percentage calculated and weighted (fixed costs and variable costs). For instance, the cost of preparing a dish such as " Pappardelle di pane di segale al ragù di cinghiale" would include the price of rye breadcrumbs, wild boar meat, and other ingredients, as well as the labor and overhead costs. The final price reflects these costs plus a markup to ensure profitability.

Competitive pricing. Once determined, this is compared with the prices of direct competitors in the area and, by adopting a competitive pricing strategy, the amount that best reflects its positioning as a high-quality Italian restaurant will be chosen. For example, if competitors charge €25 for a comparable pasta dish, the restaurant might set a similar price to attract customers while still reflecting its premium positioning.

Differentiation pricing . Arte, Sapienza e Maestria will adopt a differentiated pricing strategy to adapt prices to the various customer groups. For example, staff could offer tasting menus for customers looking for an exclusive experience, or cheaper options for customers who prefer a more informal meal.

Flexible pricing. The parallel activities, however, will be quantified according to their duration, the quality and quantity of the material provided, the educational value offered and the cost of the expert or cultural organization involved in the activities. For instance, a cooking workshop might be priced higher if it includes rare ingredients and expert chefs, while a shorter, simpler class could be more affordable. This approach ensures that the pricing reflects the value provided in each unique experience.

Premium pricing. Private events or corporate dinners will be priced at a premium to reflect their bespoke nature, personalized menus, and exceptional service. This higher cost is justified by the exclusivity and added value provided in these tailored experiences.

The promotion strategy for the restaurant encompasses several key elements.

Digital marketing. It includes the optimization of the restaurant’s website for search engines to attract organic traffic, an active engagement on social media platforms to interact with customers and promote special events, and a regular newsletter and e-mail campaign to keep subscribers informed about upcoming events, promotions or new menu.

Collaborations. Food bloggers, local influencers, and culinary experts will be asked to collaborate to promote the restaurant, helping reach a wider audience and build credibility.

Cross-promotional activities. Partnerships with local businesses will create joint promotions and package deals. These collaborations will extend the restaurant’s reach and attract tourists seeking authentic culinary experiences.

Community engagement. The restaurant will host weekly activities to position itself as a cultural hub, attracting both regular customers and new visitors, fostering a sense of community and encouraging word-of-mouth promotion.

Sales promotion. Strategies like discounts, special offers, and limited-time promotions will be implemented to draw customers during-off peak hours and seasons. This approach will help maintain steady customer flow and boosts sales during slower periods.

Customer feedback integration. Customer feedback will be continuously collected and analyzed to refine promotional strategies and pricing. This ensures that offerings align with customer expectations and preferences, enhancing satisfaction and loyalty.

Finally, on more general considerations, the team will constantly monitor revenue and adapt pricing and promotion strategies based on seasonality, customer demand and market trends to maximize the overall turnover.

Authors: Sigari M., Stanojevic A., Dendinovic K. (2024, June)

PRODUCT

A fine dining experience is offered through a menu that covers a wide range of authentic Italian dishes. Additional services such as interactive cooking workshops, structured cooking lessons, and forums on various topics related to Italian gastronomy and Montenegrin culture will enrich the offering. Event hosting for private functions will further diversify revenue streams. Reinterpretations of traditional recipes will be proposed, always emphasizing the freshness and high quality of ingredients sourced from both Italy and Montenegro.

PRICE

The pricing strategies will reflect the quality and level of services offered. Specifically, they will encompass cost-based, flexible, and premium pricing. The cost-based strategy is employed to determine the price of each dish by considering the quality of ingredients, shipping costs, preparation complexity, and operational expenses. Flexible pricing will be primarily implemented for additional activities, taking into account the amount guests are willing to pay. Finally, premium pricing will be adopted for private events to ensure that the added value and uniqueness of these services are accurately reflected in the price.

PLACE

The restaurant will be strategically positioned in Podgorica, the capital of the country. Regarding the facilities, the venue will feature both indoor and outdoor dining areas, a space reserved for activities and a welcoming ambiance. Additionally, an online presence on digital platforms will be established to ensure a wider reach.

PROMOTION

Effective promotional strategies will be essential to build awareness and attract customers. Arte, Sapienza e Maestria will utilize digital marketing, partnerships with influencers, and community engagement. Social media, email marketing and a well-optimized website will be used not only to reach a wider audience, but also with the aim to rank high in search engine results for keywords. Collaborating with influencers will help the brand to advertise its unique offerings effectively. Finally, hosting weekly activities will position the restaurant itself as a cultural hub.

Various revenue streams are outlined to ensure the financial success and sustainability of the restaurant.

The primary source of revenue will be food and beverages sales, featuring a diverse range of authentic Italian dishes, including appetizers, main courses, desserts, and beverages. Additionally, exclusive fine dining experiences such as tasting menus or chef’s table events will be offered, commanding premium pricing and generating higher revenue per guest. These experiences will be tailored to special occasions or themed culinary events to enhance customer satisfaction and loyalty, although they will not coincide with other activities such as workshops, cooking classes, or forums.

Cooking workshops and classes will serve as another revenue streams, where participants pay a fee to learn cooking techniques, prepare authentic Italian dishes, and enjoy the results of their labour. These hands-on experiences will appeal to individuals or groups looking to enhance their culinary skills in a fun and interactive setting. The management team will organize a weekly schedule to allocate these extra-activities to pre-evening hours while maintaining regular restaurant operations during dinner hours.

Furthermore, the restaurant will generate revenue through event hosting, renting out the restaurant space for private events and offering catering services for off-site events to tap into a broader market. Private events, corporate functions, and special occasions will be catered with customized menus, thereby showcasing the restaurant’s culinary expertise.

Partnerships and collaborations with local businesses, hotels, event organizers, food bloggers, or influencers will create joint promotions and cross-promotional opportunities to drive incremental revenue and expand the restaurant’s reach. Additionally, sponsorships, advertising, and loyalty programs will provide supplementary revenue streams.

To ensure the successful execution of Arte, Sapienza e Maestria’s sales strategy, a customer-centric approach will be implemented, prioritizing personalized service, attention to detail, and a welcoming ambiance.

To increase the average ticket and generate additional revenue, staff will use cross-selling and up-selling strategies. Up-selling is the sales technique where the customer is induced to buy a product of superior range, or perhaps the suggestion of a product that belongs to a brand that for the seller has a higher margin than the original preference. On the other hand, cross-selling consists in increasing the value of the transaction by providing products or services that are in some way connected with the initial purchase choice, in order to make the offer richer and more complete[footnoteRef:41]. For example, wine suggestions can be offered to match dishes, as well as desserts suggestion, coffee offering after a meal, or optional additions like appetizers or extra side dishes can be proposed. [41: Strategia e Business. (n.d.). Cross-selling e up-selling per vendere di più. Retrieved from https://strategiaebusiness.com/vendere-di-piu-con-le-tecniche-di-up-selling-e-cross-selling/ ]

The restaurant will also leverage modern technology, including an online reservation system, digital menus, and a loyalty program to reward repeat customers.

By diversifying revenue streams and exploring innovative monetization strategies, Arte, Sapienza e Maestria can maximize profitability and sustain long-term growth in the competitive restaurant industry.

At Arte, Sapienza e Maestria, the customer journey is designed to be immersive, engaging, and delightful, from the moment a guest first hears about our restaurant to the time they leave after an exceptional dining experience. The goal is to create lasting memories and foster a deep connection with patrons.

AWARENESS AND DISCOVERY

Marketing and Advertising. Through strategic marketing campaigns, both online and offline, the aim is to attract customers by highlighting the unique blend of Italian and Montenegrin cuisine. This includes social media marketing, search engine optimization, and local advertising in Podgorica. A study carried out by Ohio University found that, in the e.g., US, 57% of independent restaurants fail within the first 3 years. For franchises, the figure is even higher, at 61%[footnoteRef:42]. The majority of failed restaurants had to close because they were not making enough sales to cover their overheads and make a profit. There were just not enough diners coming through the door. Good marketing goes a long way to solving that issue. [42: Jeff Grabmeier, H.G. Parsa - Ohio State University . (2003, September 07). Restaurant Failure Rate Much Lower Than Commonly Assumed, Study Finds. Retrieved from https://news.osu.edu/restaurant-failure-rate-much-lower-than-commonly-assumed-study-finds/]

Word of Mouth and Referrals. According to Barry Berman, expert in retail and operations management, customer referrals significantly contribute to business growth and success[footnoteRef:43]. They enhance trust and credibility since people trust recommendations from those they know. Referrals are also a cost-effective marketing strategy, as satisfied customers promote the business at no direct cost. Referred customers have higher conversion rates due to built-in trust. Encouraging referrals boosts customer loyalty and retention, creating a community of loyal patrons. Referrals expand a business's reach to new audiences, resulting in high-quality leads familiar with the business. Additionally, referrals provide valuable feedback for improvement and contribute to positive word-of-mouth marketing, enhancing the business's market image. [43: Horizon, Barry Berman - Business. (2016). Referral marketing: Harnessing the power of your customers. Retrieved from https://www.sciencedirect.com/science/article/abs/pii/S0007681315000956]

Events and Workshops. By organizing and hosting a variety of culinary workshops, cooking classes, and forums, Arte, Sapienza e Maestria offers multiple engagement opportunities for potential customers. Some of them may include e.g. workshop on how to make homemade pasta, or a seminar on best- kept secrets of a perfect baked pizza. Apart from the workshops, some events featuring sommeliers are planned, allowing guests to delve into the fascinating world of wine. Focus would be on both Montenegrin and Italian wines, perfectly balancing our vision. These events serve as unique touchpoints, allowing individuals to experience restaurant's offerings firsthand, connect with the brand on a deeper level, and foster a sense of community around culinary expertise. Through these interactive and educational sessions, the team aims to showcase the richness of their cuisine and create lasting impressions that drive brand loyalty and customer retention.

CONSIDERATIONS

Website and Online Presence. As confirmed by Procedia Economics, an academic journal specializing in research in the fields of economics and finance, an effective online presence is paramount for modern restaurants seeking to attract and retain customers[footnoteRef:44]. The restaurant’s website will serve as a comprehensive resource, offering detailed information about menu, upcoming events, and the unique aspects that set Arte, Sapienza e Maestria apart. By featuring high-quality photos and customer testimonials, it will convey the ambiance and exceptional quality of the offerings. The UK-based Italian restaurant chain Gusto[footnoteRef:45] fulfills the up-mentioned standards when it comes to website and online presence. The digital platform will not only enhance visibility but also provide potential customers with a virtual preview of the dining experience, fostering engagement and driving foot traffic to the establishment. [44: Elena-Iulia Apăvăloaie - Procedia Economics and Finance. (2014). The Impact of the Internet on the Business Environment. Retrieved from https://www.sciencedirect.com/science/article/pii/S2212567114006546?via%3Dihub] [45: Gusto. (n.d.). Gusto - Elegantly Italian. Retrieved from https://gustorestaurants.com/about-us/]

Online Reviews and Social Proof. According to Bright Local[footnoteRef:46], 86% of consumers read online reviews, and 91% of consumers trust them. The number of online reviews is steadily increasing, with over 730 million reviews currently on TripAdvisor[footnoteRef:47] and more than 184 million on Yelp. Positive reviews on such platforms are crucial in shaping potential customers' perceptions and decisions about visiting our restaurant. These endorsements from satisfied diners provide social proof and build trust, significantly influencing new customers' choices. By actively managing and encouraging positive feedback on these platforms, Arte, Sapienza e Maestria can enhance its reputation, attract a broader audience, and ensure a steady influx of guests eager to experience culinary offerings. Each review left about the Arte, Sapienza e Maestria is to be revised, and replied to. Negative feedbacks are to be revised, responded to, and finally considered for potential improvement. [46: Sammy Paget - Bright Local. (2024, March 6). Local Consumer Review Survey 2024: Trends, Behaviors, and Platforms Explored. Retrieved from https://www.brightlocal.com/research/local-consumer-review-survey/] [47: Tayeen, A.S.M. Mtibaa, A., Misra, S., Biswal, M. (2021, January 2021). Impact of Locational Factors on Business Ratings/Reviews: A Yelp and TripAdvisor Study. Retrieved from https://link.springer.com/chapter/10.1007/978-3-030-67044-3_2]

RESERVATION AND ARRIVAL

Easy Reservation Process. Restaurant customers value the convenience of online reservations but also appreciate the personal touch of phone bookings. Cornell University conducted a study[footnoteRef:48] of 696 customers found that nearly one-third had made online reservations, with younger diners more likely to do so and dining out more frequently. Online reservations use do not vary by gender (51.1% female, 48.9% male). Those who reserved online found it more convenient than phone reservations and felt that websites provided more information about the restaurant. Therefore, customers of Arte, Sapienza e Maestria can make reservations both through our user-friendly online booking system or by phone. The online system will send confirmation emails and reminders to ensure a smooth reservation experience. [48: Kymes, Sheril E. (2009, March 02). How Restaurant Customers View Online Reservation. Retrieved from Cornell University Library: https://ecommons.cornell.edu/items/dbe97f30-aaf8-433e-a309-cc5693bb7c87]

Warm Welcome. In any hospitality setting, fostering a welcoming atmosphere is crucial for establishing a solid foundation for the guest experience. Upon arrival, guests will be greeted by friendly staff and offered a choice of indoor or outdoor seating, depending on their preferences and availability. As Roberta Nedry states in her blog post called The Power of Welcome: Hospitality Beyond Property Borders on hospitality[footnoteRef:49], the power of welcome is to affirm the guest made the right choice and is further welcome to enjoy each aspect the restaurant has to offer. [49: Roberta Nedry. (2011, July ). The Power of Welcome: Hospitality Beyond Property Borders. Retrieved from Hotel Business Review: https://www.hotelexecutive.com/feature_focus/2302/the-power-of-welcomehospitality-beyond-property-borders]

DINING EXPERIENCE

Ambiance and Atmosphere. Ambiance, design, and atmosphere are crucial in restaurants because they set the mood, create a memorable experience, and influence customers' perceptions of food quality and value. A well-crafted ambiance can enhance enjoyment, encourage repeat visits, and differentiate a restaurant in a competitive market. The design of Arte, Sapienza e Maestria, combining modern elements with traditional Italian aesthetics, creates a warm and inviting atmosphere. Soft lighting, comfortable seating, and tasteful decor set the stage for a memorable dining experience.

Menu and Service. The menu offers a diverse selection of Italian dishes, featuring both classic recipes and innovative reinterpretations using local Montenegrin ingredients. Restaurant’s knowledgeable staff will provide recommendations and insights into the dishes and beverages, enhancing the dining experience.

Interactive Elements. Guests can participate in interactive cooking sessions or observe chefs at the culinary hub, adding an educational and entertaining dimension to their visit. By organizing and hosting a variety of culinary workshops, cooking classes, and forums, Arte, Sapienza e Maestria provides numerous engagement opportunities for potential customers. Examples include workshops on making homemade pasta or seminars on the best-kept secrets of perfect pizza baking. Additionally, events featuring sommeliers are planned, allowing guests to explore the fascinating world of wine with a focus on both Montenegrin and Italian varieties, perfectly aligning with the restaurant's vision. These events serve as unique touchpoints, enabling individuals to experience the restaurant's offerings firsthand, connect with the brand on a deeper level, and foster a sense of community centered around culinary expertise. Through these interactive and educational sessions, the team aims to showcase the richness of their cuisine, creating lasting impressions that drive brand loyalty and customer retention.

POST-DINING ENGAGEMENT

Feedback and Reviews. Feedback and reviews are invaluable for the business as they provide essential insights into customer preferences and satisfaction levels. Actively seeking feedback demonstrates commitment to improving services, fostering trust and loyalty among patrons. According to Sammy Paget, Content Marketing Management for Bright Local, positive reviews serve as powerful marketing tools, influencing potential customers' perceptions and decisions, while a strong online presence with favorable feedback can significantly enhance a restaurant's reputation and attract new customers[footnoteRef:50]. [50: Paget Sammy. (2024, March 6). Local Consumer Review Survey 2024: Trends, Behaviors, and Platforms Explored. Retrieved from https://www.brightlocal.com/research/local-consumer-review-survey/]

Follow-Up Communication. Follow-up communication is equally important for maintaining a connection with customers beyond the dining experience. Personalized emails and newsletters keep customers informed about special promotions, upcoming events, and new menu items. This ongoing engagement encourages repeat visits and enhances customer loyalty, ultimately driving business growth.

Roosa-Maria Aalto[footnoteRef:51] is the owner of a marketing company. After being interviewed, she gave her proposal for the project. It is possible to find it at the end of this paragraph. [51: Alto, R. M. (2024, May 10). Request for quotation for enterprise marketing management. (M. Sigari, Interviewer)]

The total marketing expenditure is divided into four primary categories: Brand Development, Digital Marketing, Collaborations, and Contingency Funds.

A total of € 2000 has been allocated for the Brand Development of a strong visual identity and brand guidelines such as the logo usage, colour selection, typography, and tone of voice. This one-time expense ensures a cohesive and professional appearance across all marketing materials and channels.

The total for Digital Marketing amounts to € 7 600 in total. To maintain a consistent and engaging presence on social media, € 250 per month have been allocated, totaling € 3 000 annually. This budget will cover content creation, including graphics, videos, and copywriting, ensuring social media channels effectively engage with the target audience.

An additional € 250 per month, totaling € 3 000 annually, has been earmarked for Google Ads and SEO efforts to drive traffic and improve search engine visibility.

€ 50 per month, totaling € 600 annually, is set aside for email marketing campaigns to encourage leads and retain existing customers.

€ 1 000 are for initial website creation and a total of € 1 200 per month for ongoing maintenance.

An annual total of € 4 200 are destinated to collaborations. Partnerships with influencers are budgeted at € 200 per month, amounting to € 1 800 annually, to leverage their reach and influence within Arte, Sapienza e Maestria target market.

Nowadays, there are different categories of influencers. The restaurant will mainly collaborate with nano-influencers. Typically, with between 1 000 and 10 000 followers, they offer several key benefits for brands[footnoteRef:52]. They achieve higher engagement rates than larger influencers because their followers view them as equals, fostering a sense of trust and authenticity that leads to better conversion rates and a higher return on investment. These influencers are affordable, often accepting lower fees or product exchanges, making them accessible to start-up companies as well. [52: Team EMB - Expand My Business. (2023, July 31). Nano Influencers: Unleashing Authentic Impact for Marketing Success. Retrieved from https://blog.emb.global/the-power-of-nano-influencers/]

€ 150 per month have therefore been allocated for local partnerships, totaling € 1,800 annually, to strengthen community ties and enhance local visibility.

Contingency funds will serve as financial security cover. The annual allocated amount for this purpose is € 2 600, although it is expected that with the support of a professional company, these funds will not need to be utilized.

The total budget is € 16 200, which divided among 12 months makes an average of 1350 €. This amount illustrates what the costs would be for a company operating in this sector to manage marketing activities.

However, it is interesting to note that costs can be cut considerably if one relies on freelancing platforms such as, for example, Fiverr or Upworks. According to the first quarter report of 2024 published by Fiverr[footnoteRef:53], there is a growing trend in the use of its services. The reasons for this are lower costs compared to traditional agencies, greater flexibility and wider availability of professionals[footnoteRef:54]. [53: Siobhan Aalders. (2024, May 9). Fiverr Announces First Quarter 2024 Results. Retrieved from https://investors.fiverr.com/node/8921/pdf] [54: Fiverr Team. (2020, October 2). Why is Fiverr Business A Good Option for Your Business? Retrieved from https://blog.fiverr.com/post/why-is-fiverr-business-a-good-option-for-your-business]

This marketing budget plan will be reviewed quarterly to ensure alignment with marketing goals and to adjust as necessary based on market trends and campaign performance.

Authors: Sigari M., Stanojevic A., Dendinovic K., Aalto R.M. (2024, June)

Authors: Sigari M., Stanojevic A., Dendinovic K., Aalto R.M. (2024, June)

To effectively market Arte Sapienza e Maestria, leveraging social media platforms is essential. Instagram and Facebook have been selected as primary channels because of their distinctive features, extensive audience reach, and high engagement potential. LinkedIn will be employed as a supplementary tool for both hiring and engaging professionals interested in exclusive dining experiences.

Instagram

Instagram is a visually oriented platform for sharing photos and videos, offering filters, stories, and reels, and designed to connect users through visual content and interaction. According to a study conducted by Statista[footnoteRef:55] in April 2024, Instagram's primary user demographic is aged 18-34, which aligns with a significant portion of the restaurant's target audience. [55: Statista. (2024, April). Distribution of Instagram users worldwide as of April 2024, by age group. Retrieved from https://www.statista.com/statistics/325587/instagram-global-age-group/]

Distribution of Instagram users worldwide as of April 2024, by age group

Source: Statista 2024

In accordance with Envolution[footnoteRef:56], magazine dedicated to web marketing, Instagram is a powerful tool for creating brand identity and fostering follower loyalty, with a high conversion rate of followers into actual customers. [56: Envolution - Web Marketing Italia, Rosario Mammella. (n.d.). Instagram Marketing: il social per la brand identity. Retrieved from https://www.envolution.it/social-media-marketing/instagram-marketing-il-social-per-la-brand-identity/]

The social media allows to showcase culinary creations through high-quality images and videos. By using Instagram Stories and Reels, the restaurant can provide a behind-the-scenes look at the kitchen, highlight special dishes, presents new plates, and share customer testimonials. Moreover, Instagram allows the creation of content through frames of cooking classes, workshops, or forums that can spark customers' curiosity and encourage their engagement.

As directly shown in the Ig section for creators[footnoteRef:57], its algorithm favors engaging content, which means that consistent posting and interaction with followers can significantly boost visibility. Additionally, by utilizing hashtags and location tags, Arte, Sapienza e Maestria can reach a broader audience beyond immediate followers. [57: Instagram Blog for creators. (n.d.). Explaining ranking and signals: see how Instagram algorithms can work for you. Retrieved from https://creators.instagram.com/grow/algorithms-and-ranking?locale=en_US]

Influencer collaborations, particularly with food bloggers and nano-influencers can further enhance restaurant’s reach and credibility, as their endorsements are often perceived as more authentic and trustworthy. Research made by Trendonline[footnoteRef:58] (platform that deals with analysis of digital economy, marketing, and media), indicates that nano influencers can further enhance restaurant’s reach and credibility, as their endorsements are often perceived as more authentic and trustworthy. In fact, unlike influencers with millions of followers, nano-influencers have a smaller following, niche interests, and greater relevance at a specific and local level. Their low profile allows people to identify with them, optimizing influencer marketing operations as they are more likely to respond to comments in a personal and attentive manner. [58: TrendOnline. (2022, March ). Ecco perchè i nano-influencer sono un investimento migliore! Retrieved from https://www.trend-online.com/marketing-digitale/cosa-sono-i-nano-influencer/]

Facebook

Facebook remains a powerful platform for businesses due to its vast user base and diverse age demographic. It is particularly effective for targeting an older audience, aged 25-44, who frequently use Facebook to discover new businesses and engage with content. As for Instagram, the graphic below provided by Statista[footnoteRef:59] shows the ages of Fb users around the world, also divided between men and women. [59: Statista. (2024, April). Distribution of Facebook users worldwide as of April 2024, by age and gender. Retrieved from https://www.statista.com/statistics/376128/facebook-global-user-age-distribution/]

Distribution of Facebook users worldwide as of April 2024, by age and gender

Source: Statista 2024

Facebook strategy will focus on creating a community around Arte Sapienza e Maestria, utilizing features such as Events, Groups, and detailed posts. On Facebook, the restaurant can share comprehensive updates, including new menu items, special events, and promotions. The platform's advanced targeting options for advertisements allow to reach potential customers based on their interests, location, and behaviors. Furthermore, by engaging with followers through comments and messages, a loyal community can be fostered, and an excellent customer service can be provided.

Facebook Insights provide essential data to optimize page performance, track content trends, and understand user demographics. Utilizing them enables to monitor engagement and refine strategies based on data-driven insights, ensuring that content maintains relevance and impact.

Moreover, integrating Facebook with Instagram allows for a cohesive cross-platform marketing approach, maximizing our outreach and engagement efforts.

Linkedin

The user base of LinkedIn primarily consists of professionals aged 18-54, making it an ideal platform to reach business executives, corporate clients, and professionals.

Distribution of LinkedIn users worldwide as of April 2024, by age group

Source: Statista 2024[footnoteRef:60] [60: Statista. (2024, April). Distribution of LinkedIn users worldwide as of April 2024, by age group. Retrieved from https://www.statista.com/statistics/273505/global-linkedin-age-group/]

Arte, Sapienza e Maestria’s target audience on LinkedIn includes corporate clients seeking sophisticated dining options, industry professionals like chefs and food critics for endorsements and collaborations, and the local business community for partnerships. LinkedIn serves multiple strategic purposes for our restaurant. It serves as a hub for professional networking, allowing to connect with businesses, local influencers, and industry professionals within the food and hospitality sectors. These connections have the potential to foster not only joint ventures, but also new business opportunities.

Restaurant’s approach on LinkedIn includes actively engaging with the target audience through strategic content sharing. The venue's appeal for corporate gatherings, business lunches, and professional events will be highlighted, aiming to attract corporate clients seeking unique dining experiences. Additionally, LinkedIn will be used to position Arte Sapienza e Maestria as a thought leader in the culinary and hospitality industry by sharing insightful content such as articles on culinary trends, behind-the-scenes’ operations, and event highlights.

Strategic actions on LinkedIn involve maintaining a robust company page that showcases our offerings and updates, implementing content marketing strategies through articles, blogs, and event updates, actively engaging with followers through comments and industry discussions, and utilizing targeted advertising to promote events, special offers, and corporate packages.

REVENUE PROJECTIONS

1. Monthly Revenue Projections

· Average daily number of customers: 60

· Average ticket per customer: € 50

· Monthly revenue: (60 ppl) x (€ 50) x (30 days) = € 90 000

2. Quarterly Revenue Projections

· Q1 (January – March): (€ 85 000) x (3 months) = € 255 000.

· Q2 (April – June): (€ 95 000) x (3 months) = € 285 000.

· Q3 (July – September): (€ 100 000) x (3 months) = € 300 000.

· Q4 (October – December): (€ 90 000) x (3 months) = € 270 000.

3. Annual Revenue Projections

· Annual revenue: (Q1)+(Q2)+(Q3)+(Q4) = € 255 000 + € 285 000 + € 300 000 + € 270 000 = € 1,110,000

SEGMENT ANALYSIS

Arte, Sapienza e Maestria plans to serve a diverse clientele in Podgorica, each contributing uniquely to the restaurant's overall success. This segment analysis provides insight into the primary customer groups, including local residents, tourists, business professionals, and families. Additionally, understanding seasonal variations in revenue, with distinct peaks and troughs throughout the year, is crucial for strategic planning. By analyzing these segments and seasonal trends, the restaurant can tailor its offerings and marketing efforts to maximize customer engagement and profitability.

· Local residents: 50% of revenue = € 555 000

· Tourists: 30% of revenue = € 333 000

· Business professionals: 15% of revenue = € 166 500

· Families: 5% of revenue = € 55 500

· Peak Season (July - September): 27% of annual revenue = € 300 000

· Off-Peak Season (January - March): 24% of annual revenue = € 270 000

· Shoulder Seasons (April - June and October - December): 49% of annual revenue = € 540 000

Regarding the growth strategy, several factors have been taken into account.

MARKET EXPANSION

Expanding Arte, Sapienza e Maestria to new markets presents a significant opportunity for growth. By opening a new location in another Montenegrin city, the restaurant can tap into additional revenue streams and increase its overall market presence. This strategic move is projected to significantly boost total annual revenue, enhancing the restaurant's profitability and brand recognition across Montenegro.

· Projected new market revenue (e.g., a new location in another Montenegrin city): €200,000 annually

· Total projected revenue with expansion: €1,110,000 + €200,000 = €1,310,000

MENU INNOVATION

· Expected revenue increase from new dishes and seasonal specials: 5% of current annual revenue = €55,500

· New projected annual revenue: €1,110,000 + €55,500 = €1,165,500

PARTNERSHIPS AND COLLABORATIONS

· Estimated revenue increase from joint promotions and events: 3% of current annual revenue = €33,300

· New projected annual revenue: €1,110,000 + €33,300 = €1,143,300

CUSTOMER LOYALTY PROGRAMS

· Expected increase in customer retention and repeat visits: 5% increase in annual revenue = €55,500

· New projected annual revenue: €1,110,000 + €55,500 = €1,165,500

ONLINE PRESENCE

· Increase in online sales and digital marketing impact: 7% of current annual revenue = €77,700

· New projected annual revenue: €1,110,000 + €77,700 = €1,187,700

COMMUNITY ENGAGEMENT

· Projected revenue from community events and local partnerships: 2% of current annual revenue = €22,200

· New projected annual revenue: €1,110,000 + €22,200 = €1,132,200

OPERATIONAL EFFICIENCY

· Cost savings from streamlined operations: 5% of annual costs (€500,000 estimated total costs) = €25,000

· New projected annual profit: €1,110,000 - (€500,000 - €25,000) = €635,000

CUSTOMER EXPERIENCE ENHANCEMENT

· Revenue increase from improved customer satisfaction and repeat business: 4% of current annual revenue = €44,400

New projected annual revenue: €1,110,000 + €44,400 = €1,154,400

The table below shows a summary of projections and grow.

Authors: Sigari M., Stanojevic A., Dendinovic K.,

RIVEDERE TUTTA LA TABELLA DI CUI SOPRA

A passionate and experienced management team oversees Arte, Sapienza e Maestria, and they are committed to achieving the company's goal of making Podgorica a leading destination for genuine Italian fine dining. The team is made up of individuals with diverse backgrounds and expertise, united by their passion for exquisite cuisine and ensuring guests satisfaction. They not only cultivate returning customers, but also inspire others to visit through their positive experience.

CEO – Chief Executive Officer

The CEO of Arte, Sapienza e Maestria plays a crucial role in guiding the company's strategic direction, overseeing day-to-day operations, managing stakeholders, developing talent, and mitigating risks. They are responsible for setting the vision, implementing the business strategy, and ensuring the organization's success in delivering an exceptional Italian fine dining experience while creating long-term value for stakeholders.

CFO – Chief Financial Officer

The Chief Financial Officer (CFO) plays a pivotal role in managing the restaurant's financial health, overseeing budgeting, forecasting, and financial reporting processes. They are responsible for optimizing operational efficiencies, controlling costs, and maximizing profitability through strategic financial planning and analysis. Additionally, the CFO liaises with stakeholders, investors, and financial institutions to ensure compliance with regulations and facilitate business growth initiatives.

Both CEO and CFO’s roles are assumed by Restaurant Manager.

CEM - Customer Experience Manager

The Customer Experience Manager at Arte, Sapienza e Maestria is important in creating unique dining experiences for visitors. They constantly monitor all aspects of service delivery, ensuring that customers feel welcomed, appreciated, and happy during their stay. From greeting customers upon arrival to handling any problems with style and efficiency, the Customer Experience Manager is essential to maintaining the restaurant's reputation for quality. They collaborate closely with personnel to ensure high service standards, adapt experiences based on guest preferences, and solicit feedback to improve the entire dining experience. The CEM contributes to lasting impressions and client loyalty by cultivating a culture of hospitality and constant development.

This role is assumed by the Floor Supervisor.

EC – Executive Chef

The Executive Chef is the head of a kitchen, overseeing culinary operations in a restaurant or hospitality setting. Responsibilities include menu creation, ingredient sourcing, kitchen staff management, maintaining food quality and safety standards, controlling costs, and ensuring customer satisfaction. The EC also innovates dishes and coordinates with other departments to align culinary offerings with the establishment's goals. This position necessitates an excellent understanding of both classic and current Italian culinary practices.

Event Coordinator

The Event Coordinator has the responsibility to plan and coordinate restaurant events, to collaborate with clients to design event packages, handle logistics, and ensure that events run well and fulfil client expectations. The work of the Event Coordinator is critical to the success of private and corporate events. This role is tasked also with overseeing all aspects of campaign production and implementation. Their responsibilities include strategizing, analyzing, and leading their team to ensure the smooth execution of campaigns, fostering strong relationships with both clients and colleagues throughout the process.

Every member of the management team contributes special abilities, backgrounds, and viewpoints to their individual positions, which helps the restaurant succeed and expand. The management team works together, meeting on a regular basis to discuss plans, handle challenges, and innovate. With its collective expertise and passion, Arte, Sapienza e Maestria is confident in its ability to create exceptional culinary experiences and accomplish its strategic objectives in the competitive dining scene of Podgorica.

The advisory board for Arte, Sapienza e Maestria will be made up of people with a wide range of skills related to the restaurant's operations and strategic growth. It will be composed by owners, Restaurant Manager, Executive Chef, Floor Supervisor and Event Coordinator.

The owners of the restaurant, who also serve as key decision-makers, are responsible for overseeing the overall strategic direction and making crucial business decisions based on the Advisory Board's recommendations.

Restaurant Manager is responsible for overseeing the daily operations, ensuring financial stability, and maintaining exceptional customer service standards. This role encompasses both the CEO and CFO responsibilities, guiding the restaurant's strategic vision and financial health.

Executive Chef leads the culinary team, overseeing menu creation, ingredient sourcing, and kitchen operations. Their expertise ensures that our restaurant delivers high-quality and innovative dishes, maintaining culinary excellence.

Floor Supervisor manages the waitstaff, ensuring efficient service, handling customer complaints, and maintaining the restaurant's ambiance. Additionally, they assume the role of Customer Experience Manager, ensuring guests have a memorable dining experience.

Event Coordinator handles the planning and execution of events, from private dinners to corporate gatherings. They collaborate with clients to design event packages, manage logistics, and ensure seamless event execution.

The advisory board will meet quarterly to evaluate the restaurant's performance, discuss strategic objectives, and offer advice on significant topics. Additional meetings may be organized as necessary to handle pressing issues or specialized initiatives.

The advisory board's functions are varied. They will help define long-term strategic objectives and offer feedback on corporate development and diversification initiatives. The board will assess the restaurant's financial performance and operational efficiency and make recommendations for improvement and expansion. They will use their industry contacts to form partnerships and collaborations, find possible investors, and handle business possibilities.

Furthermore, the board will play an important role in risk management by identifying possible risks and advising on mitigation techniques, ensuring that the restaurant is ready for regulatory changes and market volatility. They will also keep the management team up to date on industry trends and innovations, promoting the use of new technology and techniques to improve the customer experience and operational efficiencies.

Arte, Sapienza e Maestria intends to successfully manage the competitive landscape by employing its advisory board's skills and insights, assuring long-term growth and success.

To ensure smooth operations and efficient administration at Arte, Sapienza e Maestria, the organizational structure will be hierarchical, with roles, duties, and reporting links defined. This hierarchical structure will assist to speed decision-making processes and improve communication at all levels of the company.

TOP MANAGEMENT

The owners are the people who have the power to accept or refuse the suggestions of the Advisory Board.

The Restaurant Manager oversees restaurant operations and ensures strategic and daily objectives are accomplished. They oversee financial management, general business planning, and maintaining the highest levels of customer service. During service, they welcome guests, assist the waitstaff when needed, and close the register.

MIDDLE MANAGEMENT

The Executive Chef will oversee the culinary personnel, plan the menu, source supplies, and ensure food quality. They will also be accountable for maintaining kitchen hygiene and safety requirements.

Events Manager is responsible for promoting the restaurant, managing public relations, arranging events, and overseeing social media and other marketing platforms.

SUPERVISORY LEVEL

The Sous Chef oversees kitchen operations, manages workers, and ensures uniformity in food preparation.

Floor supervisors will oversee the waitstaff, guaranteeing efficient service, addressing client complaints, and keeping the restaurant's environment. Despite these responsibilities, during service, they act as part of the waitstaff.

OPERATIONAL STAFF

Chefs and cooks will be responsible for preparing dishes according to the menu, maintaining kitchen cleanliness, and adhering to safety standards.

The waitstaff will serve guests, collect orders, bring meals, and assure their pleasure. Bartenders are responsible for creating beverages, managing bar inventory, and keeping the bar area clean.

The cleaning staff will be responsible for keeping the restaurant clean and sanitary, including the kitchen, dining area, and toilets.

This hierarchical structure ensures that all team members understand their roles and responsibilities, establishing a culture of responsibility and quality. Clear reporting and communication channels will improve operational efficiency and guarantee that the restaurant provides a high-quality eating experience for its patrons.

The Executive Chef and Sous Chef have closely connected roles. In fact, although the Sous Chef holds a less prominent position, they can take control in the absence of the Executive Chef (e.g., during their days off).

It is important to note that Sommelier, Floor Supervisor, and Restaurant Manager are considered as waitstaff. Each of them, despite having additional and specific responsibilities associated with their roles, serves tables during service.

The specifics for each employee will be agreed upon during the contract negotiation.

Authors: Sigari M., Stanojevic A., Dendinovic K

Below are examples of the shift schedules for the staff, divided between room staff, kitchen staff and back of house staff. This last term refers to the staff whose working hours do not coincide with the restaurant’s service hours.

These tables are designed to ensure that all employees have two consecutive days off each week while maintaining optimal coverage for the restaurant's operating hours. The aim is to balance employee well-being with the restaurant's operational needs.

Authors: Sigari M., Stanojevic A., Dendinovic K

According to ConsulenzaRistorazione[footnoteRef:61], a consulting company specialized in the restaurant industry, a waiter in a fine-dining restaurant typically serves between 10 and 15 guests per shift. Based on this benchmark, the schedule provided for the dining room staff is designed to meet demand effectively. [61: ConsulenzaRistorazione. (2022, September). Come calcolare il personale che serve in un ristorante. Retrieved from https://consulenzaristorazione.it/9531-2/#:~:text=Di%20norma%20nella%20ristorazione%20classica,menu%2C%20dal%20numero%20di%20commensali.]

Authors: Sigari M., Stanojevic A., Dendinovic K

During the service, one staff member is dedicated to preparing appetizers and desserts, another focuses on main courses, and a third is responsible for side dishes and accompaniments.

Matteo Rossi, the Kitchen Chef at Cruix Restaurant in Barcelona, was interviewed for the study and development of the kitchen staff schedule. According to him, the provided schedule effectively meets the operational needs of the kitchen.

Monday and Tuesday are identified as the days with the lowest customer affluence. This thesis is supported by a study conducted by Womply[footnoteRef:62], company which analyzes data to optimize restaurants’ business. According to this research, restaurants experience the lowest average daily revenue on Mondays, earning approximately 45% less than the best-performing day, which is usually Saturday. Tuesday follows closely, with revenues about 42% lower than Saturdays. Consequently, fewer staff members are scheduled for service on these days. [62: Womply. (n.d.). State of Local Restaurants 2020. ]

The total count indicates the number of staff present for service. Shifts will be rotational to ensure fairness and efficiency. In the event of operational requirements, such as special events, staff will be redistributed as necessary to meet demand.

Authors: Sigari M., Stanojevic A., Dendinovic K

The Event Manager is scheduled to work on weekdays, as their presence is essential at forums, workshops, and cooking classes held on Tuesday, Wednesday, and Thursday.

The cleaning of both the dining area and the kitchen falls under the responsibilities of the designated personnel. Consequently, the cleaning staff will focus on maintaining the cleanliness of areas designated for supplementary cultural activities, as well as assuming the role of washing dishes.

Arte, Sapienza e Maestria believes that developing a competent and devoted workforce is essential for providing outstanding dining experiences. Its research-driven multi-channel recruitment approach includes leveraging online job portals, social media platforms such as LinkedIn and Facebook, and participating in local job fairs to attract varied individuals that share their passion for hospitality and commitment to excellence.

Employee recommendations and networking in the hotel sector are also valued, as evidenced by research demonstrating that they result in greater retention rates and faster hiring due to cultural fit.

The recruiting process prioritizes fairness and openness, supported by research demonstrating the efficacy of structured interviews and tests in predicting job performance and cultural fit. This technique provides a bias-free screening process that fosters diversity and inclusion, which is consistent with research calling for equitable hiring practices. By focusing on identifying candidates with the right skills, attitude, and cultural fit, Arte, Sapienza e Maestria hopes to cultivate a team that is enthusiastic, motivated, and committed to providing exceptional service, fostering a workplace environment conducive to long-term success and employee satisfaction.

Arte, Sapienza e Maestria is committed to providing fair and competitive compensation to its employees, in accordance with Montenegro's minimum wage regulations.

The restaurant ensures that all employees receive wages that meet or exceed the minimum standard. The restaurant is also committed to delivering fair and reasonable remuneration packages that recognize the achievements and efforts of its team members. Beyond legal compliance, the compensation package may include benefits like food allowances, employee discounts, and opportunities for professional growth. The objective is to create a supportive and rewarding work environment that enhances employee satisfaction and loyalty.

By adhering to minimum wage laws and providing competitive compensation packages, Arte, Sapienza e Maestria demonstrates its commitment to fair labour standards while upholding values of honesty and respect for all employees.

According to a study conducted by Statista's Research Department[footnoteRef:63], which provides economic data analysis, the minimum professional salary in Montenegro in 2024 is 532,5 euros per month, totaling 6.390 euros annually. [63: Statista Research Department. (2021, March 4). Montenegro: number of cars per 1,000 inhabitants 2010-2018. Retrieved from https://www.statista.com/statistics/452151/montenegro-number-of-cars-per-1000-inhabitants/]

According to HR Solutions[footnoteRef:64], a group of companies which offer payroll and HRSolutions to companies around the world, an employee costs the company about 8,3% more than the salary received by the worker. For the purpose of this analysis, a percentage of + 9% has been taken into account. [64: HR Solutions. (n.d.). Montenegro - Servizio paghe e risorse umane. Retrieved from https://hrsolution.ag/it/paesi/montenegro-3#Costi_per_il_datore_di_lavoro_Montenegro]

The following table presents the average salaries in Montenegro[footnoteRef:65] for various professional roles at Arte, Sapienza e Maestria divided among salary received by employee and the linked cost for the company. [65: SalaryExplorer. (2024). Average Salary in Montenegro 2024. Retrieved from https://www.salaryexplorer.com/average-salary-wage-comparison-montenegro-c144]

Authors: Sigari M., Stanojevic A., Dendinovic K

These figures reflect Arte, Sapienza e Maestria's commitment to fair and competitive compensation in line with Montenegro's economic standards.

By multiplying the average salary by the number of workers engaged in various roles, the total allocated for personnel salaries can be obtained. This amount is 19.047,75 € per month, of which 18.039,50 € is for fixed staff and 1.008,25 € for variable staff.

Authors: Sigari M., Stanojevic A., Dendinovic K

Arte, Sapienza Maestria recognizes the significance of providing its staff with extensive onboarding and training to ensure they have the information and skills needed to flourish in their professions.

The onboarding process will introduce new workers to the corporate culture, rules, and processes. Each new recruit will be allocated a mentor who will guide and encourage them throughout their first few days with the team.

In addition to onboarding, the restaurant will provide continuing training and development opportunities for workers to improve their abilities and advance professionally. Training sessions will cover everything from culinary skills to customer service standards, ensuring that team members are well-equipped to provide excellent experiences to customers.

ONBOARDING CHART

Authors: Sigari M., Stanojevic A., Dendinovic K

Arte, Sapienza e Maestria will be established as a Limited Liability Company (LLC) in Montenegro. This legal structure offers several advantages that align with our business goals and operational needs.

To be a Limited Liability Company presents several advantages.

1. Limited Liability. The owners (members) are not personally liable for the company's debts and obligations, protecting personal assets.

2. Flexibility. An LLC offers flexibility in management structure and profit distribution, allowing us to tailor the business operations to our specific needs.

3. Tax Benefits. Montenegro provides favorable tax rates for LLCs, which can result in significant savings. Profits are taxed at the company level, and members can also benefit from the double taxation treaties Montenegro has with other countries.

Mrs. Marnela Markovic[footnoteRef:66] is a Montenegrin Tax and Business Advisor who has been interviewed to obtain the following information. [66: Markovic, M. (2024, June 7). Tax system in Montenegro. (K. Dendinovic, Interviewer)]

Income tax is paid by all legal entities that carry out commercial activities in the country. This can be the sale of any goods that are produced in Montenegro, the provision of services in the country, dividends, the use of natural resources of the country, risk insurance and other types.

The standard income tax rate is 9%, by realized profit of 0 - 100 000€. When profit is higher than 100 000€, yet lower than 1.5 million €, the income tax rate is 12%, and finally if more than 1.5% of profit is realized, the tax increases to the 15%[footnoteRef:67] . [67: Tax Administration of MNE. (2024, January 11). Law on corporate income tax. Retrieved from https://me.propisi.net/zakon-o-porezu-na-dobit-pravnih-lica/ ]

Interesting fact: this is one of the lowest rates in Europe. Also, legal entities pay additional taxes, on dividend income: 15%. This tax money is going to the country budget, but there is additional tax, so called surtax, which is 15% of the 15% dividend income, and this surtax is filling the local budget, of the city in which the business is registered and operating[footnoteRef:68]. [68: Tax Administration of MNE. (2024, January 11). Law on corporate income tax. Retrieved from https://me.propisi.net/zakon-o-porezu-na-dobit-pravnih-lica/]

Taxes on food and beverages served in a restaurant are regulated in the following way:

· Food that is prepared in restaurant, drinks with no added sugar: 7%

· Drinks with added sugars: 21%

Taxes on buying the supplies for the food:

· Basic (e.g. Raw meat, flour, eggs): 7%

· Processed (e.g. Ham, cheese, sausages): 21%

To open a business in the country, it is necessary to register a company with a minimal registered capital of €1 and appoint a director. The company will be registered within 10-15 days.

Establishing Arte, Sapienza e Maestria involves several crucial steps to ensure compliance with Montenegrin regulations and successful business operations. This chapter outlines the detailed formation process, including name reservation, drafting the Articles of Association, registering with the Central Registry of Business Entities, opening a business bank account, and obtaining necessary tax registrations. Additionally, securing business licenses and permits, as well as setting up e-signature for fiscalization, are essential to legally operate and efficiently manage the restaurant.

1. Name Reservation. Reserve the company name Arte, Sapienza e Maestria with the Central Registry of Business Entities.

2. Articles of Association. Draft and notarize the Articles of Association, outlining the business purpose, management structure, and member responsibilities.

3. Registration. The company is to be registered at the institution called CRPS Montenegro (Center of Registered Business Entities), providing necessary documentation such as the Articles of Association, identification documents of the founders, and proof of business address. For the founders with Montenegrin citizenship (Kristina, Ana) the personal ID should be provided, whereas for the foreigner founder of the restaurant (Martina), passport is needed.

4. Bank Account. Open a business bank account in the name of the LLC for financial transactions and providing initial capital.

5. Tax Registration and CEO Registration. The next step is appointing the CEO (founder or the third party) and obtaining tax identification number (TIN) from the Tax Administration of Montenegro.

6. Licenses and Permits. Secure any required business licenses and health permits (Min. Technical Requirements) from local authorities to operate as a restaurant.

7. E- signature for Fiscalization. This signature costs € 30 and is crucial for the obtaining the Software for fiscalization which serves as a way of monitoring of supplies, materials, beverages, but also invoices, etc). As of 1.01.2021., all invoices are directly forwarded via this Software to the Server of Montenegrin Tax Administration Office.

· Annual Reporting. Submit annual financial statements and other required reports to the relevant authorities.

· Tax Compliance. Ensure timely payment of corporate taxes, VAT, and any other applicable taxes.

· Employment Laws. Adhere to Montenegrin labor laws, including employee contracts, minimum wage requirements, and workplace safety regulations.

By establishing Arte, Sapienza e Maestria as an LLC, the benefits of limited liability, operational flexibility, and tax advantages, positioning our restaurant for sustainable growth and success in the Montenegrin market can be leveraged.

Arte, Sapienza e Maestria will be placed in Podgorica, the capital of Montenegro, at The Capital Plaza[footnoteRef:69]. Due to its prime location and vibrant atmosphere, it aligns perfectly with the vision for an exceptional dining experience. The Capital Plaza is situated in one of Podgorica's most attractive areas, close to shopping malls, the City Kvart settlement, the University, and state institutions, ensuring a steady flow of diverse and discerning clientele. [69: The capital Plaza - Podgorica (Montenegro). (n.d.). Retrieved from https://thecapitalplaza.me/]

According to the Journal of Kores Planning Association[footnoteRef:70], a prime location and well-developed infrastructure in a commercial area boost pedestrian traffic, with these pedestrians potentially becoming customers, thereby increasing product sales and enhancing the viability of stores in such areas. Restaurants are highly sensitive to walkable environments due to their unique characteristics. [70: Shin SM Choi MJ. (2001). An empirical analysis of the effect of pedestrian volume on retail sales. Journal of Kores Planning Association.]

The commercial zone's dynamic environment, spanning two levels and featuring a lively small square, hosts a variety of cultural and social events, attracting both locals and tourists. This vibrant setting provides the ideal backdrop for our restaurant, where we aim to offer not just a meal, but a unique and memorable adventure.

The seamless connection between the ground floor and level -1, with its mix of renowned shops, cafés, restaurants, and leisure amenities, creates an inviting space for patrons. The Plaza's design and layout, which facilitate pedestrian flow and gathering, perfectly complement our restaurant's ambiance and design.

Furthermore, The Capital Plaza's robust infrastructure, including 282 parking spots and advanced facilities, ensures convenience for our guests. The center's reputation as a lifestyle destination, frequented by sophisticated business professionals and shoppers, aligns with our target market, enhancing our potential for growth and success.

In summary, The Capital Plaza offers the perfect blend of location, atmosphere, and amenities, making it the ideal setting for Arte, Sapienza e Maestria to thrive and become a landmark in Podgorica's culinary landscape.

Restaurant's physical site will have both indoor and outdoor dining areas, each tailored to suit different preferences and climates. The indoor dining space will include tasteful and comfortable seating configurations that will create a warm and welcoming atmosphere for visitors to enjoy. In addition, a fully functional kitchen will be available for guests to actively participate in cooking seminars and workshops under the direction of experienced chefs. Instead, the outdoor seating represents another option to go along with the interior dining experience, letting customers enjoy a meal outside while taking in the atmosphere of the city. To create a calm and peaceful ambiance, the outdoor space will be beautifully decorated with cozy seating options and vegetation such as olive trees and citrus trees.

Key facilities and infrastructure required to support our operations include:

· Dining Area. Guests will be accommodated in a roomy dining space with cozy seating options and a welcoming ambiance to enjoy their culinary adventure. With consideration for comfort and privacy, the layout will be designed to maximize dining experiences for both individuals and groups. Including an outdoor dining area will add charm and authenticity, offering guests the delightful experience. Moreover, it will expand seating capacity, cater to guests' preferences for open-air dining, and enhance the overall ambiance, creating a more inviting and versatile dining environment.

· Kitchen. At the center of the activities will be a cutting-edge kitchen facility furnished with contemporary culinary tools and appliances. The kitchen will be set up to facilitate the accurate and effective preparation of traditional Italian cuisine, guaranteeing the highest levels of flavor and quality. This part is reserved for the cooking team.

· Culinary hub. Integrated within the dining area, interactive cooking stations will let patrons create their own meals with the help of talented chefs, allowing them to partake in the culinary experience. The essential culinary tools, supplies, and safety precautions will be provided at each station to guarantee a smooth and delightful experience for our visitors.

· Bar. To go along with the food selection, a special bar section will provide a variety of Italian wines, spirits, and drinks. The bar will be manned by skilled bartenders who may enhance the whole dining experience by suggesting matches and offering insights on Italian wines.

· Restrooms. To enhance guests’ comfort and convenience, the restaurant will offer clean and restrooms that comply with accessibility and hygiene standards.

· Parking. To ensure convenience and easy access for visitors arriving by car, several parking options will be accessible nearby. While the percentage of Montenegrins who use vehicles for mobility varies depending on factors like as urbanization and infrastructure development, it is worth noting that car ownership and usage has increased in recent years. This trend is especially evident in metropolitan places like Podgorica, where public transit options are limited, and people frequently depend on vehicles for everyday commuting and movement. Furthermore, Montenegro's thriving tourism industry has contributed to increased car usage, as visitors frequently rent cars to explore the country's stunning landscapes and coastline areas. A study made by Statista shows that Montenegro had a motorization rate of 332 passenger cars per one thousand inhabitants in 2018[footnoteRef:71], meaning every 3 person is Montenegro owns and drives a car, making parking essential feature when opening a restaurant. [71: Statista Research Department. (2021, March 4). Montenegro: number of cars per 1,000 inhabitants 2010-2018. Retrieved from https://www.statista.com/statistics/452151/montenegro-number-of-cars-per-1000-inhabitants/]

In general, site and amenities will be planned to provide visitors with a warm and unforgettable experience, demonstrating dedication to quality and genuineness in all facets of the business.

According to TCP Office[footnoteRef:72] (The Capital Plaza Office), which provided the quotation for the location, the price for the commercial space includes 120 m² of interior area and 20 m² of exterior area, totaling 140 m². The rate is 26 euros per square meter, resulting in a monthly rent of 3,640 euros. This price also includes the cost of kitchen furnishings. [72: Office, T. (2024, July 29). Request for a business premises rental. (A. Stanojevic, Interviewer)]

Launching and operating Arte, Sapienza e Maestria restaurant in Podgorica requires a comprehensive assessment of the resources necessary to ensure its successful establishment and ongoing operation. The following factors encompass financial resources, technology, and physical assets.

Financial resources should be allocated across initial capital investment, operating expenses, and reserve funds.

A. INITIAL CAPITAL INVESTMENT

Lease Agreement. Funds are needed to secure a suitable location in Podgorica for the restaurant, including lease deposits and rental payments. The rental cost of a restaurant in Podgorica can vary depending on several factors, including the location, size of the space, condition of the property, amenities provided, and the overall demand for commercial real estate in the area.

Interior Design. Budget for interior design services, including decor, furniture, lighting, and ambiance enhancements to create an inviting atmosphere aligned with the restaurant's concept. As a rough estimate, the interior design of a restaurant in Podgorica could cost anywhere from €50 to €200 or more per square meter, depending on the level of sophistication and luxury desired.

Kitchen Equipment. It should be invested in high-quality kitchen appliances, cookware, utensils, and food preparation stations to ensure efficient kitchen operations and food quality.

Dining Room Furnishings. Funds should be allocated for tables, chairs, linens, tableware, glassware, and decorative elements to furnish the dining area and enhance the overall guest experience.

Initial Inventory. Funds should be set aside for purchasing food and beverage inventory, including fresh ingredients, wines, spirits, and non-alcoholic beverages, to meet initial demand upon opening.

B. OPERATING EXPENSES (numbers will be provided)

Payroll. Budget for salaries, wages, and benefits for kitchen staff, serving staff, management, and administrative personnel required to operate the restaurant effectively should be made.

Rent and Utilities. Funds should be allocated for monthly rental payments, utility bills (electricity, water, gas), maintenance costs, and other recurring expenses associated with leasing the restaurant space.

Marketing and Promotion. A marketing budget for advertising, promotions, social media marketing, website development, and other promotional activities should be set aside.

Inventory Replenishment. Plan for ongoing expenses related to purchasing food and beverage inventory, including restocking ingredients, wines, and other consumables to meet regular demand and maintain menu offerings.

Contingency Fund. Reserve funds to cover unforeseen expenses, emergencies, seasonal fluctuations, and operational challenges that may arise during the restaurant's operation should be considered.

C. RESERVE FOUNDS (numbers will be provided)

Emergency Fund. Funds to address unexpected expenses such as equipment repairs, maintenance emergencies, staffing shortages, or other unforeseen operational challenges should be set aside.

Seasonal Fluctuations. Anticipate fluctuations in business volume and revenue throughout the year, particularly during peak seasons and holidays, by maintaining reserve funds to cover expenses during slower periods.

Growth and Expansion. It´s important to allocate funds for future growth initiatives, expansion plans, renovations, or investments in new business opportunities to support the long-term sustainability and growth of the restaurant.

Conducting a thorough technology analysis is essential for restaurants to identify and implement the right technology solutions that align with their business objectives, enhance operational efficiency, improve the customer experience, and maintain a competitive edge in the industry.

A. Point-of-Sale (POS) System

· Invest in a modern POS system to streamline order taking, payment processing, and inventory management.

· Choose a POS system that integrates seamlessly with kitchen display systems (KDS), online ordering platforms, and reservation management software for enhanced efficiency and guest satisfaction.

· Implement features such as tableside ordering tablets or mobile POS devices to improve order accuracy, reduce wait times, and enhance the overall dining experience.

B. Reservation Management Software

· Utilize reservation management software to efficiently manage table reservations, guest seating, and dining room flow.

· Choose a user-friendly platform that allows guests to make reservations online, view availability in real-time, and receive confirmations and reminders via email or SMS.

C. Kitchen Management Systems

· Implement kitchen management systems to optimize food preparation workflows, monitor inventory levels, and track recipe costs.

· Choose a system that offers recipe management, batch cooking, and food waste tracking capabilities to minimize food waste and maximize profitability.

· Utilize kitchen display systems (KDS) to improve communication between kitchen staff and servers, reduce order errors, and enhance kitchen efficiency during peak service hours.

D. Customer Relationship Management (CRM) Software

· Implement CRM software to capture guest data, preferences, and feedback to personalize the dining experience and foster customer loyalty.

· Utilize CRM tools to send targeted marketing campaigns, special offers, and personalized promotions based on customer behaviour and dining history.

· Integrate CRM data with the POS system to track customer spending patterns, frequency of visits, and overall satisfaction levels to identify opportunities for improvement and retention.

By investing in following physical assets, Arte, Sapienza e Maestria can create a welcoming and functional space that enhances the dining experience for guests and supports efficient operations in Podgorica.

A. Location and facilities

· Secure a prime location in Podgorica that offers high visibility, convenient access, and ample parking for guests.

· Ensure that the restaurant space is spacious enough to accommodate dining areas, a bar/lounge area, kitchen facilities, restrooms, and storage areas.

· Invest in interior design and décor that reflects the restaurant's concept and ambiance, creating a welcoming and visually appealing environment for guests.

B. Kitchen equipment

· Equip the kitchen with commercial-grade appliances and equipment required for food preparation, cooking, and storage.

· Essential kitchen equipment includes stoves, ovens, grills, fryers, refrigerators, freezers, food processors, and dishwashing stations.

· Choose energy-efficient appliances and ergonomic designs to optimize workflow and minimize operational costs.

C. Dining Furniture and Fixtures

· Select high-quality dining furniture, including tables, chairs, booths, and bar stools, that are comfortable, durable, and aesthetically pleasing.

· Invest in lighting fixtures, artwork, and decorative elements that enhance the ambiance and atmosphere of the dining areas.

· Consider incorporating outdoor seating areas or a patio to provide guests with additional dining options, especially during favourable weather conditions.

D. Bar equipment and Supplies

· Set up a well-equipped bar area with essential equipment such as a bar counter, refrigeration units, glassware, cocktail shakers, and bar tools.

· Stock the bar with a diverse selection of alcoholic and non-alcoholic beverages, including wines, spirits, beers, cocktails, and specialty drinks.

· Ensure that the bar area is staffed with knowledgeable bartenders who can prepare drinks to guests' preferences and offer recommendations on wine pairings and specialty cocktails.

E. Audiovisual equipment

· Install audiovisual equipment such as sound systems, speakers, and televisions strategically throughout the restaurant to create a pleasant ambiance and enhance guest experiences.

· Invest in lighting control systems to adjust lighting levels and create different moods or atmospheres throughout the day and evening.

Mrs. Marnela Markovic[footnoteRef:73] is a Montenegrin Tax and Business Advisor who has been interviewed to obtain the following estimations. [73: Markovic, M. M. (2024, June 7). Bills' estimation for a restaurant in Montenegro. (K. Dendinovic, Interviewer)]

According to the expert, a restaurant occupying approximately 140 square meters is expected to consume around 7000 Smc of gas, 26.000 kWh of electricity, and 1,800 m3 of water annually. The total cost of these consumptions amounts to approximately 650,34 euros, as detailed below.

GAS

7,000 standard cubic meters correspond to approximately 73.850 kWh. Assuming this consumption and average cost of 0.04 euros per kWh:

· Monthly gas consumption: 73.850 kWh / 12 months = 6.154,17 kWh

→ Monthly gas cost: 6.154,17 kWh * 0.04 euros/kWh = 246,17 euros

ELECTRICITY

Assuming an average cost of 0.10 euros per kWh and an annual consumption of 26,000 kWh:

· Monthly electricity consumption: 26,000 kWh / 12 months = 2,166,67 kWh

→ Monthly electricity cost: 2,166.67 kWh * 0.10 euros/kWh = 216,67 euros

WATER

Assuming an average cost of 1,25 euros per m3 and an annual consumption of 1.800 m3:

· Monthly water consumption: 1800 / 12 months = 150 m3

→ Monthly water cost: 150 m3 * 1,25 euros / m3 = 187,50 euros

The weekly activity program is meticulously designed to integrate dining services with interactive sessions seamlessly. The schedule is organized to enhance customer engagement and ensure operational efficiency. Below is a detailed outline of the weekly activity program:

Lunch Service. Available on Friday, Saturday, and Sunday from 12:00 to 16:00 on two shifts.

Dinner Service. Available daily from 19:00 to 23:00 (Monday to Thursday) and until 23:30 (Friday to Sunday) on two shifts.

Cooking Class. Held once a week from 16:30 to 18:30, scheduled from Monday to Thursday based on the host's availability.

Workshop. Conducted once a week from 17:00 to 18:30, scheduled from Monday to Thursday according to the host's availability.

Forum. Available once a week from 17:00 to 18:00, scheduled from Monday to Thursday based on the host's availability.

According to the 2023 annual report on the restaurant industry conducted by FIPE (Italian Federation of Public Establishments)[footnoteRef:74], 62% of restaurant revenues are generated between Friday and Saturday. The remaining 38% is distributed among the days from Sunday to Thursday. Consequently, Arte, Sapienza e Maestria has strategically chosen to schedule extra activities on the days of the week with lower attendance. This approach serves two primary purposes: the former, to enhance revenue on days anticipated to generate lower income, and the latter, to capitalize on the natural tendency of customers to dine out during weekends by providing a service specifically tailored to the dining experience. [74: FIPE - Federazione Italiana Pubblici Esercizi. (2023). Ristorazione: Rapporto Annuale 2023. ConfCommercio.]

Below is a table illustrating an example of the calendar of activities.

Authors: Sigari M., Stanojevic A., Dendinovic K

The pre-service staff briefing is a crucial meeting held before each service, where the manager or on-duty supervisor gathers the entire team. This meeting covers both general and specific topics, ranging from the gastronomic offerings to communication issues among staff members. The primary goal is to ensure that all team members receive the same information clearly and transparently, enabling them to deliver high-quality service.

During this daily briefing, the chef reviews the menu in detail, discussing flavors and recommended responses for guests seeking light and fresh options. The chef also highlights regional specialties, popular dishes, and those recommended for discerning and adventurous diners, including any new or unfamiliar items. The sommelier complements this by providing up to three wine pairing suggestions.

Additionally, the restaurant manager addresses service specifics, such as reservation statuses, upcoming celebrations, and any particularly demanding tables. They detail the characteristics of the aperitifs, appetizers, and dessert wines offered by management, ensuring these selections cater to all guests, including those abstaining from alcohol or following a diet. The manager also explains the quality and service method for any surprise gastronomic offerings.

The restaurant manager addresses service specifics, such as the reservation status, celebrations, and demanding tables. They detail the characteristics of the aperitif, appetizers, and dessert wines offered by management, which are typically appreciated by guests, including those who abstain from alcohol or are on diets. The manager also explains the quality and service method for any surprise gastronomic offerings.

Waitstaff and team members use this opportunity to ask questions, clarify potential issues, and seek information.

Each dish is accompanied by a concise description, followed by a comprehensive table that outlines the ingredients, their quantities, waste percentages (if applicable), price per kilogram, and the unitary cost. This transparent approach offers a clear understanding of the culinary and economic considerations behind each creation.

It's important to note that all prices reflect those of July 2024, the month during which this part of research was conducted. To ensure accuracy and authenticity, suppliers have been contacted directly by phone, as this method proved to be the most effective way to gather detailed information. For reference, a complete list of our suppliers is provided in a dedicated section of this document.

Panzanella

Panzanella

A typical dish from the Tuscan folk tradition, this vibrant salad showcases the simplicity and freshness of local ingredients: ripe tomatoes, crisp cucumbers, rustic bread, and aromatic basil. This harmonious blend epitomizes the essence of Tuscan cuisine, celebrating the natural flavors and textures in every bite.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M.

*All prices shown refer to July 2024

Pesci in carpione

Fish in sour

This dish leverages the abundance of local fish, featuring carp marinated in a tangy carpione sauce. It is traditionally served with tomato-greased bread, offering a perfect balance of flavors and textures that highlight the richness of regional ingredients.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M.

*All prices shown refer to July 2024

Arancino

Arancino

A beloved staple of Sicilian cuisine, this rice croquette is stuffed with savory meat sauce and deep-fried to a golden perfection, resembling an orange. It captures the essence of Sicilian culinary tradition, to which it represents an homage.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Olive ascolane

Ascoli olives

Hailing from the Marche region, this delicacy involves pitting olives and stuffing them with a savory meat filling, then breading and frying them to a crispy perfection. A true testament to the region's culinary creativity.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M.

*All prices shown refer to July 2024

Crostini ai fegatini

Liver crostini

Tuscany, as showcased in this menu, celebrates the raw material without distortion, allowing it to shine. These simple crostini are soaked in broth and generously slathered with a coarse innards pâté, epitomizing the region's authentic and straightforward culinary approach.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Vitello tonnato

Veal with tuna sauce

A classic from the Piedmont tradition, this dish marries land and sea. It features tender veal rump cooked at a low temperature, paired with a rich sauce of capers, anchovies, tuna, and extra virgin olive oil.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Pizz'e scarola

Pizza and escarole

A quintessential dish from Campania, the birthplace of pizza, this simple yet distinctive creation features a fried calzone filled with escarole. The typical bitterness of escarole perfectly complements the crispiness of the fried dough, creating a harmonious and delightful culinary experience.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Panzerotti

Panzerotti

A cherished dish from Apulian tradition, these delectable pockets of dough are sealed and filled with a savory blend of tomato and mozzarella cheese, then fried to golden perfection.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Pljevaljski Sir Focaccia e puntarelle

Pljevaljski Sir Focaccia and puntarelle

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Tortelli nena kaymak e aglio selvatico

Tortelli nena, kaymak and wild garlic

Inspired by the classic tortelli ricotta and spinach, our rendition features a richer twist with kaymak, a creamier cheese with a slight fermented tang that preserves the original's acidity. Nena, a Balkan wild spinach used sparingly due to its rarity, adds a unique garnish. Completing the dish is a beurre blanche infused with Balkan wild garlic and spinach oil, capturing the essence of the Balkan Mountains.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Orecchiette cime di rapa

Orecchiette pasta with turnip greens

This dish is a true reflection of Puglia, across the Mediterranean, where the climate influences similar yet distinct local products. Orecchiette pasta is paired with tender turnip greens, garlic, oil, and chili peppers. It epitomizes our menu's philosophy of showcasing the essence of a region through a few exceptional ingredients, prepared simply yet beautifully.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Pappardelle di pane di segale al ragù di cinghiale

Rye bread pappardelle with wild boar ragout

This traditional Tuscan dish pays homage to ancient times when hunting wild boar was crucial for protecting crops. Our version enriches the pappardelle with rye breadcrumbs, not only embracing sustainability but also enhancing the dish with a unique texture and depth of flavour.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Caciucco alla livornese

Livornese-style caciucco

This traditional dish from Livorno draws inspiration from riblja corba, featuring a rich fish soup with octopus, mussels, clams, redfish, and gurnard. Served atop slices of garlic-toasted bread, the dish is presented uniquely: the cooking broth is poured tableside, reminiscent of riblja corba tradition. As the bread absorbs the flavourful broth, it transforms into a caciucco, highlighting the ingenious reuse of ingredients to achieve culinary excellence.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Faraona 1983

Roast guinea fowl with homemade mustard and pink puree

A distinctive dish from Lombard cuisine, tracing its roots back to the 1700s. This selection stands out in our menu for its unique use of guinea fowl, a departure from typical Italian fare, accompanied by delectable homemade mustard.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

La torta della nonna

Grandma's pie

This homemade tart filled with custard, served with ice cream and adorned with pine nuts, offers a nostalgic taste of the flavors cherished throughout an Italian's life.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Bonet chutney di pesche e crumble alla mandorla

Bonet peach chutney and almond crumble

This dish beautifully combines two classic Piedmontese desserts. On one side, Pesche e Amaretti features an almond cookie nestled inside a peach, mimicking its stone. On the other, Bonet offers a spoon dessert rich with the bitter notes of chocolate. The combination is harmoniously balanced by the freshness of peach, the bitterness of chocolate, and the crunch of almond crumble.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Tiramisù

Tiramisù

Layers of delicate Savoiardi soaked in espresso, interlaced with creamy mascarpone cheese, and dusted with cocoa powder. Each bite offers a harmonious balance of textures and flavors, epitomizing the decadence and sophistication of traditional Italian cuisine.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

*All prices shown refer to July 2024

Summarizing, the table below shows the unitary cost of each dish on the menu.

Authors: Sigari M., Stanojevic A., Dendinovic K, Rossi M

As shown in the table, the total cost of the whole menu is 11 €, while the total of the individual selling prices is 92 €. Doing the proportion, the food cost is about 12%.

92 : 100 = 11 : x

x = = 11,95 = 12 %

8. Financial Plan

8.1 Total Income

The restaurant has an indoor seating capacity of 40 people and an outdoor seating capacity of 18 people.

Each service is divided into two shifts, totaling four hours of operation daily.

As discussed above, the catering market in Montenegro is affected by tourism which reaches its peak during the summer months and then declines during the winter season.

Arte, Sapienza e Maestria will be open 7 days a week, with dinner service from Monday to Sunday and lunch service on Friday, Saturday and Sunday.

For the first year after opening, an average attendance of about 47 people per day is expected. This result is the average between the expected capacity in winter and summer, respectively 40 and 55 people. It should be noted that this figure represents an average; actual attendance may vary, with some days experiencing higher or lower numbers.

Multiplying the expected attendance by the number of monthly opening days gives the monthly attendance: 1.410.

EXPECTED MONTHLY ATTENDANCE = 47 * 30 = 1.410

The expected average ticket is about 35 € per person. By multiplying this value by the total expected monthly attendance, a value of 49.350 € is obtained which represents the total gross income.

TOTAL GROSS INCOME = 35 € * 1410 = 49.350 €

This revenue figure must be adjusted to account for taxes and food costs.

In Montenegro, businesses with annual revenues less than € 100,000 are subject to a 9% tax on their revenue. Therefore:

49.350 € – 9% = 44.908,5 € = 44.908 €

Arte, Sapienza e Maestria has a food cost which is equal to 15% of the total revenue.

49.350 € – 12% = 43.428 €

In summary, a total of 21% is deducted from the gross revenue for taxes and food costs, resulting in an amount of 38.986 €.

49.350 €– 21% = 38.986 €

Regarding extra activities, the venue has a maximum capacity of 30 people. For the initial opening period, an attendance of 20 people per day is expected, amounting to 60 people per week, 240 per month.

With an average selling price of €25 per person, the projected monthly revenue from these activities is €6,000, calculated as follows:

TOTAL GROSS INCOME = 25 * 240 = 6.000 €

As before, this value is also subject to a 9% of taxes and a 12% of food cost. In this case, the latter percentage is used mainly for the purchase of materials necessary for carrying out the activities.

6.000 – 9% = 5.460 €

6.000 – 12% = 5.280 €

Thus, a total deduction of 21% is applied, resulting in a total revenue of 4.740 €.

6.000 – 21% = 4.740 €

In conclusion, combining the two sources of income, Arte, Sapienza e Maestria achieves a total net revenue of 43.726 €.

TOTAL REVENUE = 38.986 + 4.740 = 43.726

Below is a summary table of all values calculated so far.

Authors: Sigari M., Stanojevic A., Dendinovic K

8.2 Total Expenses

Furniture and equipment, rental costs, staff salaries, bills and marketing expenses have already been analyzed in detail in the preceding chapters and paragraphs.

The initial investment is about 250.000 €, which includes room furnishing costs, materials and active liquidity reserve. Martina, Kristina and Ana contribute to the investment with a capital of 35.000 € each.

To get an idea of the monthly amortisation that you would have to deal with under these assumptions, we asked ERSTE for a quote. Considering a loan of 145.000 € to be repaid in 5 years with fixed interest rates, the total is 2.660,59 € = 2.661 €. In particular, the rates considered are:

· TAN: 3,85%

· TAEG: 4,35%

· EURIRS: 2,65% IRS for 5 years

· SPREAD: 1,20%

To gain insights into the licenses and permits required for operating a restaurant in Podgorica, an interview was conducted with Mrs. Marnela Markovic[footnoteRef:75], a Montenegrin Tax and Business Advisor. The necessary permissions are the following. [75: Markovic, M. (2024, July 31). Commercial Licenses and Permits in Montenegro. (M. Sigari, Interviewer)]

Authors: Sigari M., Stanojevic A., Dendinovic K

The annual total is therefore 1.500 €, which divided on a monthly base is 125 €.

LICENSES AND PERMISSIONS PER MONTH = = 125

Srđan Džodžo[footnoteRef:76], is a consultant working for IFS (Insurance Financial Solutions) who has been interviewed in order to know the prices for health insurances and commercial ones. [76: Džodžo, S. (2024, August 01). Advice on insurances necessary for a business in Podgorica. (A. Stanojevic, Interviewer)]

Health insurance costs approximately 600 € per year per employee. Considering that there are 19 people working for Arte, Sapienza e Maestria, the annual total expenditure amounts to 11.400 €.

ANNUAL HEALTH INSURANCE = 600 * 19 = 11.400

In addition, there are some insurances that is recommendable to have for a commercial business. Their total is 2.400 € divided as it follows:

Authors: Sigari M., Stanojevic A., Dendinovic K

Summing up the values obtained for health insurance and for the local, it gives an amount of 13.800 €.

TOTAL INSURANCES = 11.400 + 2.400 = 13.800

Dividing the total into 12 months, it gives 1.150 €.

TOTAL INSURANCES PER MONTH = = 1.150

Finally, there is a last expense to consider: the maintenance. On average a restaurant of Arte, Sapienza e Maestria’s dimensions pays about 6.400 € per year which, on a monthly basis means 533,33 € = 535 €.

The final values are summarized in the table below.

Authors: Sigari M., Stanojevic A., Dendinovic K

8.3 Net Profit

The monthly net profit is calculated by subtracting the total monthly expenses from the total monthly net income.

NET PROFIT PER MONTH = 43.726 – 29.159 = 14.567 €

The net monthly profit is derived for 89 % from the restaurant’s fine-dining service, while for the remaining 11 % from extra activities.

Authors: Sigari M., Stanojevic A., Dendinovic K

In order to continue with the financial analysis, it is useful to divide the monthly fixed expenses according to the percentages that the different sources of income bring to Arte, Sapienza e Maestria.

As for the profit, also the expenses have to be divided according to the above percentages. In particular, 89 % of 29.159 € is 25.951 €, which represents the monthly fixed expenses allocated to the service. Consequently, the amount of 3.208 € describes the remaining 11% allocated to monthly fixed expenses for extra activities.

Authors: Sigari M., Stanojevic A., Dendinovic K

8.4 BEP: Break-Even Point

The break-even point is the point where total income equals total costs, that is, where the company has neither a profit nor a loss. To calculate the BEP, you need to divide the total fixed expenses by the contribution margin per unit.

This value can be calculated in units or in values.

The formula for BEP in units is:

BEP IN UNIT =

The formula for BEP in value is:

BEP IN VALUE = BEP IN UNIT * AVERAGE PRICE PER CUSTOMER

8.4.1 BEP: Restaurant

Monthly fixed expenses: 25.951 €

Average price per customer: 35 €

Variable cost percentage: 21%

The variable cost per customer is obtained by multiplying the average expenditure per person by the variable cost percentage.

VARIABLE COST PER CUSTOMER = 35 * 0,21 = 7,3 €

The margin of contribution per client is obtained by subtracting from the average price per customer it linked variable cost.

MARGIN OF CONTRIBUTION PER CLIENT = 35 – 7,3 = 27,7 €

Now that all the data are available, the formula can be applied:

BEP IN UNIT = = = 937

BEP IN VALUE = BEP IN UNIT * AVERAGE PRICE PER CUSTOMER =

= 937 * 35 € = 32.795 €

In conclusion, to ensure that no loss is recorded by the restaurant business, Arte, Sapienza e Maestria must serve 937 people per month for a total of 32.795 €.

8.4.2 BEP: Cooking Classes, Workshops and Forum

Monthly fixed expenses: 3.208 €

Average price per customer: 25 €

Variable cost percentage: 21%

The variable cost per customer is obtained by multiplying the average expenditure per person by the variable cost percentage.

VARIABLE COST PER CUSTOMER = 25 * 0,21 = 5,25 €

The margin of contribution per client is obtained by subtracting from the average price per customer it linked variable cost.

MARGIN OF CONTRIBUTION PER CLIENT = 25 – 5,25 = 19,7 €

Now that all the data are available, the formula can be applied:

BEP IN UNIT = = = 163

BEP IN VALUE = BEP IN UNIT * AVERAGE PRICE PER CUSTOMER =

= 163 * 25 € = 4.075 €

In conclusion, to ensure that no loss is recorded by the extra activities, Arte, Sapienza e Maestria must have 163 participants per month for a total of 4.075 €.

Authors: Sigari M., Stanojevic A., Dendinovic K

These calculations provide a clear view of the break-even point both in terms of units (customers) and value (€) for both activities of the restaurant Arte, Sapienza e Maestria.

8.5 ROI: Return On Investment

The ROI measures the effectiveness of an investment by quantifying the percentage return obtained relative to the initial cost. It helps evaluate profitability and compare different investment opportunities. It is calculated on an annual basis.

The formula for calculating is:

ROI = * 100

Annual net profit: 14.567 € * 12 = 174.804 €

Initial investment: 250.000 €

ROI = * 100 = 69,92 %

In conclusion, the ROI for this investment is 69,92 %, indicating substantial profitability. This high return highlights the investment's effectiveness in generating significant returns relative to the initial cost, making it a compelling opportunity.

8.6 ROE: Return On Equity

The ROE measures the profitability of invested equity, indicating how much profit a company generates with shareholders' money. It helps assess the efficiency in managing its own resources. It is calculated on an annual basis.

The formula for calculating is:

ROE = * 100

Annual net profit: 174.804 €

Equity capital: 35.000 * 3 = 105.000 €

ROE = * 100 = 166,48 %

In conclusion, an ROE of 166,48% demonstrates exceptional profitability, highlighting the company's effective use of shareholders' equity to generate substantial returns.

SENSITIVITY ANALYSIS

It serves to know how the profit would change if some scenarios change. The selling prices don’t change.

1ST CASE: AFFLUENCE DECREASE

· Attendance: From 47 ppl per day to 42 people per service: (which represent a decrease of more or less 12%)

REMEMBER! Calculate the total x 30 days!

· Calculate the monthly gross income, gross income – taxes, gross income – food costs, net income (table pg. 109)

· Calculate the net profit (reference at page 112)

· PAY ATTENTION: Expenses here don’t change

· Compare new data to bep (create a table of pag. 115)

2nd CASE: INCREASE OF FOOD COST

· Attendance: 47 ppl

· Pag. 106: change the data of unitary cost of each dish (second column) of 15%. (for example, the total amount is 11 euros. Adding the 15% to this, the result would be 12, 65 euros = 13 euro)

· Change the proportion at pag.107

92 : 100 = 13 : x

x = = 14,13 = 14 %.

So, 14 % is the new percentage of food cost.

· Do again table pg. 109. Remember that now the total percentage to use in order to get the net income is 14 % (food cost) + 9 % taxes = 23%

· Calculate the net profit (reference at page 112)

· Compare new data to bep (create a table of pag. 115)

3RD CASE: MIX OF THE 2 PREVIOUS ONE

· Create all the tables combining the last 2 cases

· Compare new data to bep (create a table of pag. 115)

3 YEARS PROJECTION

Talking with Matte and my uncles, they told me that in the first 5 years of opening activity, no change on prices should be considered. Even if there is inflation or whatever, it’s not realistic to increase prices every here. So, average ticket will remain the same for the 2nd as well for the 3rd year.

2ND YEAR

· Affluence for restaurant: from 47 to 50 ppl per day (an increase of 7% from 1st year)

· Affluence for extra activities: from 20 to 22

· INFLATION: search (and insert the reference) about the average inflation rate in Montenegro on annual basis. This percentage will affect the bills as well as the food cost. INLFATION RATE IN MONTENEGRO IS 5,4%

· PAY ATTENTION: if the inflation rate is 5,4%, this percentage should be add to the total food cost. If the starting food cost total amount is 11 euros, adding the 5,4% to this, the result would be ….

· Marketing: Add +20% on the monthly rate

· Do again expenses table pag.112

· Calculate again the net profit

· Compare to bep (table 115)

3RD YEAR

· Affluence for restaurant: from 50 to 53 ppl per day (an increase of 7% from 2nd year)

· Affluence for extra-activities: from 22 to 25

· PAY ATTENTION: In this case the inflation rate has to be considered referring to data from 2nd year. For example, if in 2nd year the total food cost considering the inflation rate of 5,4% had as a result, now we have to add the 5,4% to that result

· Marketing: Add +20% on the monthly rate

· Do again expenses table pag.112

· Calculate again the net profit

· Compare to bep (table 115)

Please follow the form that is written in financial part (use the same formula fonts)

You have everything written in 3 YEARS PROJECTION

You have all informations about the costs in Financial part so follow them; dont do not invent numbers, but use the existing ones in the project

Dont do sensitiviy analysis because its alredy done!

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Net monthly Profit Distribution: Percentages

Fine-dining service Extra Activities 0.89 0.11

Monthly Expenses Distribution: Values

25.951 €

3.208 €

Fine-dining service Extra Activities 0.89 0.11

Fine-dining service Extra Activities 25951 3208

119