Online_Food_Ordering_-_Business_Plan

Online mobile food ordering Software technology Perpared by: Table of contents Title | Page | 1- Executive summary | 1 | 2- Introduction | 2 | 3- Background | 2 | 3-1- Paving the way | 3 | 3-2- Free at least | 5 | 3-3- Customer-based strategies for a wireless word: Mobility | 6 | 4- Introduction to the business | 7 | 4-1- Preface | 7 | 4-2- Our business | 7 | 4-3- Purpose | 8 | 4-4- The most common reasons of customer unhappiness | 8 | 4-5- Feature of online delivery | 8 | 4-6- Vision statement | 9 | 4-7- Mission statement | 9 | 4-8- Main values and differentiation | 10 | 4-9- Goals | 10 | 5- Current situation and business analysis from different aspects | 11 | 5-1- Industry analysis | 11 | 5-2- Competitive analysis | 11 | 5-3- SWOT Analysis | 11 | 5-3-1- Strengths | 12 | 5-3-2- Weaknesses | 12 | Title | Page | 5-3-3- Opportunities | 12 | 5-3-4- Threats | 13 | 5-4- Competitive advantage | 14 | 6- Critical assumptions and constraints | 14 | 6-1- Target market | 14 | 6-2- Market limitation | 17 | 6-3- Marketing strategy | 18 | 7- Ordering system | 18 | 7-1- Ordering | 19 | 7-2- Delivery process | 19 | 7-3- Payment procedure | 19 | 8- Budget estimation and financial analysis | 20 | 8-1- Start-up cost | 20 | 8-2- Operation cost | 20 | 8-3- Costs value at the end of the year (with discount rate) | 21 | 8-3-1- Start-up costs | 21 | 8-3-1- Operation costs | 22 | 8-3- Sales forecast | 23 | 8-3-1- First group | 24 | 8-3-2- Second group | 25 | 8-3-3- Third group | 26 | 8-3-4- Total income | 27 | 8-4- Net profit | 28 | 1- EXECUTIVE SUMMARY Online mobile food ordering named Orderonline is a website which offers the products of different restaurants in a particular geographical area to customers. The website contains the menu so they can order online. Orderonline has contract with some restaurants so their menus are offered on the website. The customer can visit the website, choose type of the food, and the restaurant and then he/she will be able to go through this particular menu and order his/her meal, type of main course, appetizer, dessert, and the quantity of each. Then the meal will be delivered to their address (if he/she is a registered user the food will be brought to other places rather than their registered address). Also the customer can go to the restaurant and collect the food him/herself. The process of paying for the food will be done by PayPal or by cash either at the place of delivery or the restaurant. This website is customized to be used on cell phones especially iphone. The revenue of the website will be from the restaurants. It means that customers pay the same price as they would if they call or go directly to the restaurant. Instead for each of the placed orders the Orderonline will earn 5% of the order’s price from the particular restaurant. The advantages of using this website are: 1- Customers place the order before arriving at home, office, etc. So the food will be ready and deliver as they get to the desired destination. 2- Customers can order online and do not have to pay for telephone call. 3- Customers can see the whole menu, photos and price. This is not available in ordering by phone. 4- Customers do not have to talk to the operators and the common misunderstanding in this process will be eliminated. 2- INTRODUCTION Food is undoubtedly the most important need of the human being. According to this fact many businesses are forming around the “food” topic. Everyday a lot of new ideas are born all over the world. Another certain fact is the rushing world. People prefer to eat out especially on working days. Here in Malaysia eating out is a habit not like some other parts of the world for fun or for saving time. People prefer to eat out in this part of the world. So the food business has been prospered. We can add another thing to the previous facts mentioned which is time is gold. So what can help people save their time will be acceptable and appreciated. After all above we can conclude if there is an opportunity for people to order their food by the phone via Internet before arriving at home or the restaurant so when they arrive it is ready and also fresh it will be a great one. 3- BACKGROUND Access to Web services used only to be through desktop computers. Improvement of laptop, personal digital assistants (PDAs) and mobile phone technology, along with the expansion of mobile networks, caused this no to be the case anymore. The number of mobile web users is growing rapidly, now more than half of the world pays to use one. Advances in wireless communications and computer technologies have made the mobile Web a reality. The mobile Web is the answer to the need for anytime, anywhere access to information and services. Many wireless applications have already been distributed and are available to customers via their mobile phones and PDAs wirelessly connected. 3-1- PAVING THE WAY Powerful social, technological and trade are the basis of the movement for a mobile phone society. The proliferation of digital devices and the popularity of the Internet are bringing people from students to managers, they expect information anywhere and anytime. Voice and data are integrated into mobile platforms and wireless communication standard for higher capacity. A growing number of Wi-Fi hotspots in public places and wireless LANs in home and businesses 'desire to increase the users' full-time connectivity. 3-1-1- Powerful, flexible mobile devices – Technology providers are developing technologies that enable device manufactures to create sleek, new products enable highly mobile enabled, flexible interoperability. 3-1-2- Integrated wireless connectivity – Through research, development and cooperation of industry, technology providers are helping designers to offer mobile users the ability to move seamlessly between networks In Their offices, homes and public spaces. Major manufacturers are using new technologies and products to create devices that offer a secure and reliable wireless Internet. Mobile subscribers to browse the Internet in color, receive e-mails on the move, access and multimedia messaging and location-based notebooks, mobile phones and PDAs to stay connected, authenticated, secure and easy to use different types of networks, LAN and WAN 2.5 / 3G and GPRS. 3-1-3- Anytime, anywhere applications – The technology industry works together in the creation of platforms, applications, tools that allow developers to easily provide content and services on a wide range of devices and networks. Initiatives in location-aware computing field enable developers and service providers to quickly create services that enhance the mobile experience of users with information such as maps, local services, payments, and traffic control or weather warnings. The new multimedia technologies will open new dimensions in mobile computing, allowing developers to create 3D worlds on mobile devices. 3-2- FREE AT LEAST The mobile future is accessible. Industry leaders provide resources, expertise and commitment to change the way we work, play, communicate and live. New technologies and standards are the basis for creating new and powerful features, easy connectivity, reliable and innovative mobile applications that give users the freedom and Flexibility to connect and interact anytime, anywhere. And finally, we can take it with us. 3-3- CUSTOMER-BASED STRATEGIES FOR A WIRELESS WORLD: MOBILITY The combination of mobility and one-to-one business strategy creates a win-win relation. It offers companies new opportunities to develop richer, more profitable relationships with individual customers. With the mobile channel, companies can make on-the-fly, one-to-one offering that succeeds Because They are tailored to the specific needs of a customer at a specific time and location. On the B2C side, for example, a customer can travel throughout Europe and the need to find a hotel room for the night. We could easily allow their mobile device to locate hotels near its price range. Conscious of its request, the hotel could immediately respond to an offer tailored to their needs and preferences expressed previously. The result : The customer receives a personalized experience at a reasonable price, while the hotel chain loyalty and a greater share of customers. 4- INTRODUCTION TO THE BUSINESS 4-1- PREFACE Orderonline is online food ordering and delivery a. Our goal is to provide food of best quality from customer choice to their door or make it ready for collection. with online ordering and payment system it is more convenient and the time will not be wasted. Orderonline goal is to make ordering food as simple as possible. We eliminate the confusion, the speed of the experience, and give the customer all the fun and easy to use functionality they want to continue using our product. Best of all it is free to use for all our customers. They pay the same price that they will in condition of calling ahead or going to a restaurant. The mobile revolution is just beginning and we hope to be there with our customers in their pocket when they are hungry. 4-2- OUR BUSINESS We are committed to providing the best delivery experience for our customers by the way of online ordering. Whether our customer aims to have lunch or bring dinner, Orderonline has all their main foods, appetizers, desserts and beverages. 4-3- PURPOSE The purpose of our activity is to embark on a new and competitive style of ordering food. Our main objective is making profit through serving our customers. The other major goal is to help people save time and have fun. We want to add value in life with the most wonderful gourmet emotions on their doorstep. 4-4- THE MOST COMMON REASONS OF CUSTOMER UNHAPPINESS • They can hardly find table during lunch or dinner hours in the restaurants • It takes to long for the food to be cooked • Their food is not hot when they bring it home • Restaurant is too crowded during meal hours • It takes too much time for them to get their order • Sometimes people who arrived after them, are served before them • They have to wait again in the queue when they go to buy something else 4-5- ONLINE ORDERING DISTINCTIVE ATTRIBUTES • Serving customers are done in a more convenient way than previous methods •This e-delivery allows a greater relation to customer by providing advanced services to its customers. • Customers can cancel or modify the order with a simple click without making a lot of trouble for them • With this unique system of ordering customers are able to choose from different foods of different styles and different restaurants. • Customers can see the pictures and ingredients of foods to choose more easily. • Customers select the food they want and determine the date and time the food should be delivered 4-6- VISION STATEMENT Our objective is multi-faceted not just gaining profit. We will achieve this goal, trying to consider: •The impact of our job on our customers’ life •The effect of our business on the environment •The quality of relationship between manager, customers and suppliers, which we try to be built on generosity, trust, understanding and fairness These factors and our responsible actions about them will make our result and will make us a sense of usefulness and commitment beyond our financial goals. 4-7- MISSION STATEMENT "Change the way, food is delivered” Businesses do not change for the sake of change, companies usually change because the consumer is asked or forced to change. This is not the industry forcing change is as a consumer. 4-8- MAIN VALUES AND DIFFERENTIATION • Satisfying customers by providing novel services and high quality ones • Be at the top, not just an ordinary one. • Continuous team members participation in idea generating cycle. •We look for continuous improvement in everything we do. • Building relation with the customers on the basis of trust and responsibility •We focus on innovative approach to business. •We are committed to fairness and mutual honor in all our activities. •We know that success grows in the environment of individual initiative and team work and we will take this into consideration in all our activities 4-9- GOALS • We are committed to satisfy our customers expectations all the time. • We aim to be leader in the market of food and food delivery in providing excellent service to all our customers •We will take every threat as an opportunity to innovate •Our goal is to increase the profitability and reputation. 5- CURRENT SITUATION AND BUSINESS ANALYSIS FROM DIFFERENT ASPECTS 5-1- INDUSTRY ANALYSIS Although food industry is highly competitive, it can gain advantage of the changes that modern life has force into people lives. Nowadays it is become more natural and common not to cook at home due to the fact that many people do not have enough time to do so. The trends are very important and Orderonline provides food to customers with the most practical method. 5-2- COMPETITIVE ANALYSIS Although Orderonline is a novel system in the industry of food delivery, it is not free of competitive pressures. Competitors are the take away process of the restaurants and also the delivery system of each restaurant. 5-3- SWOT ANALYSIS Orderonline website is trying to get chance out of its strengths and be aware of the threats, weaknesses and opportunities. The statements below show the strengths and weaknesses, opportunities and threats. 5-3-1- Strengths • Low-risk product development because the products currently exist • Use of non-traditional ways • Use of an opportunity, which is lack of time • Use of new technologies • Convenience is an important factor of food delivery 5-3-2- Weaknesses • Lack of public confidence in the system of ordering online and finally get their desired food 5-3-3- Opportunities • Continue to develop the business throughout the country • Upgrade your site to encourage more decorum in the dining business. • Improve the model of customer Service • Continue to review and update menu options • Expand the service to delivery of supermarket and other goods. 5-3-4- Threats • Food contamination and epidemic disease caused by that • Competition. • Downturn in economy • Government policies • Placing online orders are limited to people who have access to the internet 5-4- COMPETITIVE ADVANTAGE There are three main ways in which we can create an advantage over our competitors: 1. Establish an innovative website with the food revision option 2. Expanding number of suppliers (restaurants we sell online their food) 3. Use of advertisement and promotion 6- CRITICAL ASSUMPTIONS AND CONSTRAINTS 6-1- TARGET MARKET With Orderonline, the term “customer” holds two meanings; firstly as a reference to “consumers” who may order a meal from Orderonline, and secondly as restaurants that we help them broaden their customer area. The primary target “consumer” group for the first phase of Orderonline fits the profile of a medium to high-income earner. The second group is the restaurants, which play a pivotal role in our success, providing quality products at competitive prices. We start with a limited number of them as shown below and we will try to expand this list to hundreds. 6-2- Market limitation Ordering food through Orderonline is just possible by using cell phones (best device is iphone). So the customer just have to user their cell phone to order not his/her desktop or laptop. On the other hand the service is presented in a particular geographical area. Of course as time passes it can be developed and cover other places too. 6-3- Marketing strategy As Orderonline is a system for ordering the food online one of the best methods for advertising the service is through websites. It can be advertised on social networks and other websites. Outdoor advertising also is efficient since hungry people on the way see the advertisement. In the relation with restaurant the marketing strategy will not be fixed. The commission percentage, which is got from restaurants, will change according to the amount of orders placed through Orderonline. As the amount of the placed order increase the commission percentage will also increase (The maximum percentage is fixed). 7- ORDERING SYSTEM It is now so easy to order food from your place by Orderonline website since the Internet has become so available to everyone. Customers can browse many restaurants in their area, menu and display options together. The command is only a matter of clicking on what they want. The order will be sent to them or it will be ready for them to go and take it. Best of all its completely free! Customers must not be a member to use this website, But if they register for a free account, it will be even easier ordering food in the future, because they do not have to enter their address Every time. They can store all your contact information so you have to enter once. Join also allows them to see a history of all orders. They may also see their favorite meal and quickly re-order. 7-1- ORDERING The customer starts by selecting restaurant. Checks out the full menu list. Decides what he/she wants and simply clicks on it to add it to his/her order list. In the quantity field he/she will enter the number of the food selected. He/She will see this on the screen and it shows him/her everything he/she has ordered along with the total price. When he/she is sure he/she has chosen everything needed, just clicks on 'Place Order'. After letting us know the delivery address of his/her order and choosing whether he/she want to pay by cash or card, just will sit back, relax and wait for his/her food to be delivered. 7-2- DELIVERY PROCESS All restaurant, which have contract with Orderonline, is connected to the website and able to see a report about the ordered have been placed of their products. The report contains the order details such as name, address and telephone number of the customer and also the type and amount of the food ordered. 7-3- PAYMENT PROCEDURE * On line payment through Paypal * In cash at the time of delivery of order * In cash at the time of collecting your food from desired restaurant 8- BUDGET ESTIMATION AND FINANCIAL ANALYSIS 8-1- START-UP COST The start-up costs of developing Orderonline website and in other word the business of ordering food online in this websites are as below: Title | Estimated cost | Research and development of the website | $5000 | Domain and host registering | $1500 | Sum | $6500 | 8-2- OPERATION COST The operation costs of the project and the other word maintaining, updating and upgrading the website are as follow: Title | Estimated cost (per month) | Website administrator | $800 | Internet access | $50 | Sum | $850 | 8-3- COSTS VALUE AT THE END OF THE YEAR (WITH DISCOUNT RATE) 8-3-1- START-UP COSTS Title | Estimated cost | Estimated cost value at the end of the year | Research and development of the website | $5000 | $5202 | Domain and host registering | $1500 | $1560 | Sum | $6500 | $6762 | 8-3-1- OPERATION COSTS Month | Website administrator | Internet access | Sum | Sum value at the end of year | 1st | 800 | 50 | 850 | 881 | 2nd | 800 | 50 | 850 | 878 | 3rd | 800 | 50 | 850 | 876 | 4th | 800 | 50 | 850 | 873 | 5th | 800 | 50 | 850 | 870 | 6th | 800 | 50 | 850 | 867 | 7th | 800 | 50 | 850 | 864 | 8th | 800 | 50 | 850 | 861 | 9th | 800 | 50 | 850 | 858 | 10th | 800 | 50 | 850 | 856 | 11th | 800 | 50 | 850 | 853 | 12th | 800 | 50 | 850 | 850 | Sum | 9600 | 600 | 10200 | 10387 | So the total cost of the first year of the project is estimated to be: Total cost = $6762 + $10387 = $17,149 8-3- SALES FORCAST As mentioned in earlier parts the benefit of the website comes from the commission got from the restaurant for them the order has been placed by Orderonline. In other words for every placed order from Orderonline a commission equal to 5% of the order price will be gained by Orderonline. To calculate the Orderonline income we should estimate the number of customers order through the website and the money thay pay for it. We divide the customers to 3 types, at first the ones who eat alone and try cheaper foods, second the ones who eat in pair and also try cheaper foods or the ones who eat more expensive foods but lonely, and the third ones who eat in group and try cheap or medium priced foods. Another assumption is the number of customers are growing everyday, for example for the first month we can assume that we have only one person of the first kind each day but by marketing tools we will make it 1.5 times each month in comparison to the previous month. The calculations for the estimated benefits are as follows 8-3-1- First group Month | Number of customers | Amount of per order ($) | Total amount of orders ($) | Orderonline commission (%5) | 1st | 30 | 10 | 300 | 15 | 2nd | 45 | 10 | 450 | 23 | 3rd | 68 | 10 | 675 | 34 | 4th | 101 | 10 | 1013 | 51 | 5th | 152 | 10 | 1519 | 76 | 6th | 228 | 10 | 2278 | 114 | 7th | 342 | 10 | 3417 | 171 | 8th | 513 | 10 | 5126 | 256 | 9th | 769 | 10 | 7689 | 384 | 10th | 1153 | 10 | 11533 | 577 | 11th | 1730 | 10 | 17300 | 865 | 12th | 2595 | 10 | 25949 | 1297 | Sum | 7725 | | 77248 | 3862 | 8-3-2- Second group Month | Number of customers | Amount of per order ($) | Total amount of orders ($) | Orderonline commission (%5) | 1st | 30 | 25 | 750 | 38 | 2nd | 45 | 25 | 1125 | 56 | 3rd | 68 | 25 | 1688 | 84 | 4th | 101 | 25 | 2531 | 127 | 5th | 152 | 25 | 3797 | 190 | 6th | 228 | 25 | 5695 | 285 | 7th | 342 | 25 | 8543 | 427 | 8th | 513 | 25 | 12814 | 641 | 9th | 769 | 25 | 19222 | 961 | 10th | 1153 | 25 | 28833 | 1442 | 11th | 1730 | 25 | 43249 | 2162 | 12th | 2595 | 25 | 64873 | 3244 | Sum | 7725 | | 193120 | 9656 | 8-3-3- Third group Month | Number of customers | Amount of per order ($) | Total amount of orders ($) | Orderonline commission (%5) | 1st | 10 | 50 | 500 | 25 | 2nd | 15 | 50 | 750 | 38 | 3rd | 23 | 50 | 1125 | 56 | 4th | 34 | 50 | 1688 | 84 | 5th | 51 | 50 | 2531 | 127 | 6th | 76 | 50 | 3797 | 190 | 7th | 114 | 50 | 5695 | 285 | 8th | 171 | 50 | 8543 | 427 | 9th | 256 | 50 | 12814 | 641 | 10th | 384 | 50 | 19222 | 961 | 11th | 577 | 50 | 28833 | 1442 | 12th | 865 | 50 | 43249 | 2162 | Sum | 2575 | | 128746 | 6437 | 8-3-4- Total income So the total income of the first year without discount rate would be: Total income of the first year = $3.862 + $9.656 + $6.437 = $19.956 If we assume that the discount rate is 4% per year we will have 0.33% per month so the amount of income at the end of the rate would be: Month | Commission for 1st group | Commission for 2nd group | Commission for 3rd group | Sum | Sum value at the end of year | 1st | 15 | 38 | 25 | 78 | 80 | 2nd | 23 | 56 | 38 | 116 | 120 | 3rd | 34 | 84 | 56 | 174 | 180 | 4th | 51 | 127 | 84 | 262 | 269 | 5th | 76 | 190 | 127 | 392 | 401 | 6th | 114 | 285 | 190 | 589 | 600 | 7th | 171 | 427 | 285 | 883 | 897 | 8th | 256 | 641 | 427 | 1324 | 1342 | 9th | 384 | 961 | 641 | 1986 | 2006 | 10th | 577 | 1442 | 961 | 2979 | 2999 | 11th | 865 | 2162 | 1442 | 4469 | 4484 | 12th | 3862 | 9656 | 6437 | 19956 | 19956 | Sum | 6427 | 16068 | 10712 | 33208 | 33334 | Total income of the first year = $33.334 8-4- Net profit As above calculations shows: Total income of first year: $33.334 Total cost of first year: $17.149 Because tax is a cost that is related to the income it was not possible to predict it at first but now we can predict it Total tax of first year = %15 * $33.334 = $5000 So the Net profit of the first year of the project will be: First year profit = $33.334 - $17.149 - $5000 = $11.185 Percentage of Net profit to Revenue = %33.5 References: 1-Christopher Ververidis , George C. Polyzos, Mobile marketing using a location based service, Athens University of Economics and Business 2- Buddy R. Kluin, Mobile Lifestyle, New challenges for the Service Industry