«12-2013 Business Plan for a Korean Fine-dining restaurant in Las Vegas Jihoon Kim University of Nevada, Las Vegas Follow this and additional works ...»
Weaknesses Competition for discretionary income. A major weakness for Biwon is the competition for discretionary income. Movie theaters are beginning to offer dining options inside their facilities. The limited-service restaurant (“fast food”) offers a much cheaper alternative to dining out. Specialty restaurants offering Italian, Mexican, and Asian cuisine are increasing their product selections. Fine-dining restaurants are actively marketing to customers locally and nationally. World-renowned chefs are opening eating establishments inside resorts throughout the Las Vegas Strip. Each of the aforementioned is within a 5-mile radius to Biwon’s proposed location.
Lack of qualified mid-level management personnel. The available hiring pool for qualified mid-level restaurant management personnel (Shift Managers, Sous Chefs), is extremely limited, as the competition to attain such individuals is fierce. Experienced personnel in upscale Korean restaurants are also limited. Even though compensation exceeds restaurant industrystandards, it is below what other industries in Las Vegas offer for a comparable skill-set.
Opportunities Lack of competition in Korean-themed fine-dining. There are hundreds of Asian
terms of Korean-themed restaurants, there are a few dozen, with the majority located within a 10-mile radius from the Las Vegas Strip. However, none of those restaurants can be considered fine-dining. Biwon will be the first one of its kind in Las Vegas, and will leverage that fact to Americans of Korean descent and Korean nationals visiting the city, as well as affluent Americans and foreign nationals with an affinity for Asian fine-dining.
Rising product and transportation costs. Due to the volatility in the marketplace as it relates to purchasing food products, and the rising cost of fuel in transporting the products, Biwon and its competitors must be cognizant of their pricing structures. As the product travels further down the supply line, the cost will increase, as the supplier and distributor will look to recoup some of their losses. Once those losses are recouped, Biwon must pass those costs to the consumer.
Pop-up restaurants. Also known as supper clubs, pop-up restaurants are being utilized in more frequency than in the past. The main purveyors of pop-up restaurants are existing restaurateurs, aspiring chefs, and budding entrepreneurs; looking to test the market prior to investing in a permanent location. In comparison to food trucks, pop-up restaurants enjoy more favorable location placement relative to their target market: high-density/high-traffic areas. Not to mention, pop-up restaurants have the flexibility of a brick-and-mortar as well as a food truck.
They can be constructed at a fixed location, yet be physically moved at a moment’s notice.
Biwon’s quality controls and financial projections, the skills-set of its personnel, and the industry-specific experience of its management team enable it to effectively operate and manage
Key Financial Indicators
Some key financial indicators:
• Consulting and contracting services
• Purchasing goods and services from various vendors
• Revenue generated from the business, and profits earned by the business Financial Needs In order for Biwon to begin operations, $3 million is required. These funds will allow
Biwon to initiate the following:
• Purchase of cooking equipment, utensils, foodstuffs, portable storage containers, and
• Cover recurring expenses associated in operating the business Use of Proceeds
Biwon will utilize the funds requested to complete the following tasks:
• Commercial insurance fees for business and facility
• Legal, professional, and consultative fees associated with the operation of the
• Purchasing of products associated in operating a high-end Korean restaurant
• Implement marketing and advertising initiatives
• Working capital in covering salaries for employees
• Operating capital in covering expenses related to the running of the company
• Compliance with local, state, and federal laws Table 3 shows the total estimated start-up costs for this new business.
The outlook for Biwon will be determined in the first 12 months of operation. When certain financial benchmarks are reached, the probability of success for Biwon will increase significantly. The revenue generated during this time period will potentially fund the company for years to come.
Immediate Goals (First 24 months) Biwon’s immediate goals are to open its first fine-dining restaurant in Las Vegas within the next 6 to 9 months. This will be done by securing a long-term lease, making tenant/leasehold improvements to the facility, purchasing equipment, furnishing the restaurant, and hiring qualified personnel to run the restaurant.
Short-Term Goals (3-5 years) Starting in the third year of operation, Biwon will begin to diversify its menu to include a larger selection of vegetarian items. Biwon will also look to acquire a property to be able to expand to a free-standing building and subsequently leveraging that asset to open additional locations throughout the United States. Based on Las Vegas’ existing demographics and projected population increase, and the city’s gradual year-over-year increase in domestic and international tourism, it is possible the market can support an additional fine-dining Koreanthemed restaurant. As a result, Biwon has set a 3 to 5 year timetable for opening a free-standing restaurant in Las Vegas (Summerlin).
Long-Term Plan (beyond 5 years) Biwon’s long-term plan is to expand its operations outside Las Vegas, looking towards
Megacities such as Los Angeles and New York will be targeted as the first cities for expansion, as they double as major tourist areas for Korean nationals. Management has set a 5 to 7 year timetable for opening Biwon in Los Angeles and New York.
A prepared restaurateur with ample resources and references has a better chance of successfully opening and operating a restaurant. In addition, a proper business plan can assist the restaurateur to more creatively and accurately envision the big picture and long term goals. One of the very long-term goals for Biwon is to expand outside the United States. This should follow from successful domestic expansion within its Las Vegas market, based on Las Vegas’ existing demographics and projected population increase, as well as the city’s gradual year-over-year increase in domestic and international tourism. A final crowning achievement would be for customers to find a refined fine-dining experience at Biwon of Seoul, after international expansion to South Korea.
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