CHAPTER I

Introduction

A. PURPOSE OF THE BUSINESS

A demand of high quality coffee products, service and training/simulation for

students of the Hotel and Restaurant Management (HRM), wherein the academic and

administration provide a low operating cost of products and services and income and on

the job training, assessment and as a part of the curriculum, which will help generate funds

for the hotel and restaurant department in sponsoring for competitions, student activities

and maintenance of laboratory equipment will be the sole purpose of the study which will

benefit not only the students but also the faculties, other employees and visitors of the

University. Therefore, we are proposing for a coffee shop or a café that will serve espresso

coffee and other specialty coffee product as a training/simulation room for HRM students,

which can cater good quality coffee and pastry demands and needs of the students,

faculties, and visitors which will be named as “CAFÉ FIT TO YOU”.

B. SUMMARY.

What is good about this coffee shop is that, HRM students will run the

operation guided by a café manager which will be employed as staff of the university

overseeing the technical and non technical aspects of the café operation. Training of

students and introduction of the workplace is also part of its responsibility. And prepare the

coffee drinks in the absence of students: (semestral brake, enrollment, vacations). Along

1
with the manager will be 2 the custodial employee working in shift (AM and PM) to assist in

the preparation and maintenance of the working area, service and also perform the task of

the students in their absence.

This will also help the HRM students to practice handling a business particularly in

a Café environment by managing the café, preparation of mise and place with the help of

manager and custodial to be hired. Since HRM students will give their major share in the

operation of the canteen, it will be an advantage of the canteen to have a minimal expense

in the manpower because HRM students will not be paid but they will work in the café as a

trainee/OJTs and could be used to show case products of the HRM in their laboratory..

CHAPTER II

THE BUSINESS

A. MISSION STATEMENT

Our mission is to provide globally competitive training skills for hotel and

restaurant management students; promote products and continuously grow through

innovation and dedication to excellence, to be in class above our competitors by providing

personalized service and excellent performance with upholding the University of

Pangasinan.

B. OBJECTIVE

1. To provide a globally competitive students through hands on training and

application of academic knowledge in the industry.

2
 2. To provide affordable and quality cup of coffee to the customers.

3. To immerse the HRM students in the working industry.

4. To support the hotel and restaurant management programs and activities

C. COMPETITIVE ADVANTAGES

Among other establishments that offer coffee drinks to their customers are most

Café Fit To You’s limited and full service coffee shops. Café Fit To You’s direct competitors will

be other coffee shops located at Zamora street, Poblacion, Mangaldan, Pangasinan( near in

St.Thomas Catholic School). Many customers favor smaller independent establishments that

offer cozy atmosphere and good coffee affordable prices. Café Fit To You Cafe is a good

example of such competition. We estimate that Café Fit To You’s hold approximately 35%

market share in that neighborhood, Café Fit To You’s appeals 25% of customer’s, with the

remaining market shares split among other establishments. Café Fit To You will position

itself as a unique coffee shop that not only offers the best tasting coffee and pastries but

also provide home-like cozy and comfortable environment, which established corporate

establishment’s lack. We will cater to customer’s bodies and minds, which will help us grow

our market shares in this competitive market.

3
Location – The café will be situated at the Zamora’s Street, Poblacion, Mangaldan,

Pangasinan ( near in St.Thomas Catholic School) and may be used as a venue for

seminars and meetings

Manpower –Low overhead cost in labor wages because the HRM will run the entire

operation with the help of a manager and custodial worker

Non Commercial Establishment – Also a laboratory for hotel and restaurant

management students, this can also be used as an assessment area for bartending

NC IV or also known as “Barista”

Price – Products priced at or lower than indirect competitors.

4
 SWOT ANALYSIS

The following SWOT analysis captures key strengths and weaknesses within the

company and describes the opportunities and threats facing the business.

Strengths

 CFTY will be located near at the St. Thomas Catholic School where the

customers mostly walk by.

 Well trained employees with experiences in management in restaurant

establishment.

 No direct competitors

 Low overhead expenses

 Student and university involvement

 Supported by the university

 Non profit establishment

 Minimal operation input

 Convenience and relaxing environment

Weaknesses

 Academic calendar break and major holidays

 Limited menu

 The Café Fit To You Coffee Shop's limited brand equity.

 A limited marketing budget to develop brand awareness.

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Opportunity

 Abundant new prospects of coffee drinkers

 Provide and training students in the coffee industry

 A growing market with a significant percentage of the of the target market still

unaware of the Café Fit To You Coffee shop.

 Increasing sales opportunities as people become familiar with the advantages of

the structured conversation system.

 The ability to lower variable costs through efficiency gains.

 Future expansions for an assessment venue

 Small meetings and seminar venue

Threats

 Economic stability which affects the cost of raw materials

 Outside factors which sells 5 peso coffee vendo machine

KEY SUCCESS FACTORS

 Store design that will be both visually attractive to customers, and designed

for fast and efficient operations.

 Employee training to insure the best coffee preparation techniques

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  Marketing strategies aimed to build a solid base of loyal customers, as well as

maximizing the sales of high margin products, such as espresso drinks.

 Provide the best products and easy to recall to every customers so that it’s

their trademark for them to go back again in our business.

 Staff. Hire employees with a work experience and have a strong background

with the position that they want to fill up if they are fit to their job

satisfaction.

 Product. They must be original recipe or menu with no copying of different

styles to the other business establishment.

 Service. Serve your customers very well and treat them properly. Because

customers always right. Be humble to every customers.

 Maintaining a cost of goods on foods at below 50%.

 Excellent customer service.

 Attracting customers who find value in the Café Fit To You, Coffee Shops

offering and who will frequent the Shop regularly in order to meet like-minded

single people.

D. MARKETING STRATEGY

The main strategy is to educate and target the students in the coffee drinking

culture. With a low overhead cost with the help of OJT, a lower price can be presented to

attract more clients in the coffee shop. A concept that is unique and a strategy that can

separate the its competitors. Hotel and Restaurant Management (HRM) students will be the

7
key of success for the coffee shop.

Product Strategy

The café will launch new products through social media and offer its customers the

best tasting coffee beverages in the area. This will be achieved by using high quality

ingredients and strictly following preparation guidelines. The store layout, menu listings

and marketing activities will be focused on maximizing the sales or higher margin espresso

drinks. Along with the espresso drinks, brewed coffee and teas, as well as some

refreshment beverages, will be sold in the coffee shop. Café Fit To You Coffee shop will also

offer its clients pastries, small salads and sandwiches.

Pricing Strategy

The café will have its products at a very low price consistently to maintain the

loyalty of our customers pricing will be in a medium basis, meaning it is between a lower

and higher price. It will be offer at a reasonable price especially to the customers. Café Fit

To You, primarily utilizes coupons and discounts because we believe that the most valuable

customers demographic of daily coffee consumers is not influenced by discount programs

or coupon. Compared to our competitors Café Fit To You comparably priced. By offering a

wide selection of both regular and gourmet coffee, we believe that Café Fit To You’s prices

can appeal to even the most price sensitive consumers.

Customer Service Strategy

8
 Tie up with the university as a marketing tool to promote new HRM enrollee in the

future. Many services are involving both actions of employees and customers, which is

essentially showed in the case of Coffee Shop. Strategically, service personnel are important

source of product differentiation. It is often challenging for café to differentiate itself from

similar business in benefit bundles it offers or delivery system. Café Fit To You recognized

this problem. The strategies of Café Fit To You are offering customers with the friendly

service. For instance, Café Fit To You treat their employees as their partner rather than

employees. They provide their partner with three months training, which educate them

with the basic knowledge of Café Fit To You services skills and culture. The promotion

training is also offered for staff self-development. The management will record the names of

their customers, personalized their service and offer the service individually.

In Café Fit To You case, customers have to stay in the actual process of production

in order to receive service, so their behavior and their reaction for the service encounter will

play important role. The nature of these interactions strongly influences the customer’s

perception of service quality.

Process strategy

Process refers to the procedures or processes that are developed to ensure the

customer has a positive and memorable experience. When marketing products:

 Products are manufactured or purchased on time.

 Products deliver the required quality and performance levels.

 Sufficient stock is on hand to meet customer demand.

9
  Products reach the customer in a timely manner.

 Products reach the customers in good condition.

 The paperwork is accurate and timely.

When marketing services:

 Staff and trainees are available to perform the service when and where

required.

 Staff and trainees provide the service to the required performance level.

 Sufficient staff and trainees are available to perform the service.

E. TARGET MARKET

With very limited when it comes to market because it is located near the Sschool,

which means that the possible numbers of market of the cafe will depend on the enrollment

population of St. Thomas Catholic School. However, it is somewhat a good location because

competitors are also limited and there is a very high profit margin due to low overhead

expenses. Employees and undergrads are potential target since they are the most active

market in coffee, therefore target the following markets:

 Students

 Academic Faculties

 Other employees

 Visitors

F. QUALIFICATIONS

MANAGER

 Must be a graduate of Hotel and Restaurant Management with working

10
 experience of at least 2 years in managing service

 Trainings and certificate of Barista or TESDA NC4 Barista

 Excellent customer and training service skills

 Good communication skills

 Must have a strong planning and organizational skills

 Must be flexible

 Must have the ability to cope under pressure

 Good accounting skills

CUSTODIANS

 At least high school graduate with at least 5 months of working experience in

restaurant industry

 Must be flexible and have initiative

 Good communication skills

 Must have a training in barista and bartending

 Must be alert and active

 NC holder for bartending and barista

CHAPTER III

A. DESCRIPTION OF BUSINESS ACTIVITY

Coffee Shop serves coffees, teas, milk and snack, and aside from the laboratory

aspect of the café, the venue can also be used to hold small functions, meeting and

seminar. Small, local coffee shop can establish a solid reputation in their communities,

11
attracting large volumes of highly loyal, sometimes daily patrons. Marketing a coffee shop

requires more subtlety than other business, however, as these establishment is s

noncommercial establishment and serve as a training area for hotel and restaurant student

which can providers a highly social experience greatly reliant on word of mouth advertising

and personal invitations existing customers. Café Fit To You Cafe utilizes a focus strategy on

its market. By specifically primary segments they can cater specifically to their need

Our target market are all people that they want to eat or to buy our products

whether dine in or take out in our business establishment. Whenever you are single, have

partners or have friends are always welcome to eat and enjoy the snacks and pastries that

they want to order.

The operation flow will follow the ISO process of the university, and as part of the

university, profit sharing will adopted as 20% HRM funds and 80% for the university as the

financer. All income will be remitted at the finance and it’s the responsibility of the

manager to record all transactions and balancing the accounts. Only daily the operating

expenses or petty cash will be endorsed to the manager.

A. PRODUCT AND SERVICES

Café Fit To You Cafe offers hot and cold coffee, tea and snacks for the client and it

will be served to them by employees with respect to the customers at their satisfaction.

Espresso, brewed coffee coffees with such varieties such as mocha, candy bar, latte and

brewed coffee. Complementing the coffee will be a smoothie line including wild berry,

peach, strawberry and lemonade. Rounding out the simple menu line will be pastries. The

12
offering may vary with season ability but the primary line will muffins, bread, cookies,

scones and rolls. We are offering at a cheaper price.

PRODUCT DESCRIPTION

Quality of a product service is determined by the customer’s perception of the

degree and excellence of its characteristics. Quality is the key issue of the relationship

marketing which heavily influences the customer’s satisfaction. Most customers thinks that

Café Fit To You coffee shop offers the same service and products quality as other coffee shop

do.

MENU DESCRIPTION

The names of the products are will be based on the standard recipe of the different

types of coffee so that the customers will not be confused and as part of education the

public of the types of coffee concoctions. Pastries and other products will supplied by the

suppliers of university. Some products are also produced by HRM from their laboratory in

bread and pastries.

Espresso a short black coffee topped with natural crema (the

Holy Grail of espresso) poured to a length of 30ml and not

filling the cup.

Strong Espresso a double shot of coffee.

Short Black an espresso run longer until the cup is nearly full. Should have a dark layer of

cream.

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Macchiato meaning stained or spotted (i.e. with milk). A serving of espresso stained with a

teaspoon of milk.

Cappuccino a full-bodied intense espresso topped with two kinds of

heated milk, steamed and frothed. Steamed milk is milk that has

been scalded –its volume is unchanged. Foamed milk is both heated

and aerated. The classic proportions are one-third espresso, one-

third steamed milk and one-third foamed milk.

Café Latte made with espresso and four parts steamed milk with no foam on top.

Vienna Coffee cup is filled two-thirds with espresso coffee and topped with whipped cream.

Mocha a cappuccino with chocolate mixed in by whipping with steam

Frappuccino is a trademark for a line of frozen coffee beverages sold by Starbucks. It

consists of coffee or other base ingredient (e.g., strawberries and cream), blended with ice

and other various ingredients, usually topped with whipped cream.

Milk tea refers to any form of beverage found in many cultures, containing some

combination of tea and milk. 

MENU PRICING

Espresso 55 pesos Café Latte 75 pesos

Strong Espresso 60 pesos Vienna Coffee 55 pesos

Short Black 55 pesos Frappuccino 70 pesos

Cappuccino 60 pesos Mocha 65 pesos

Macchiato 55 pesos Milk tea 65 pesos

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 CHAPTER IV
FINANCIAL ANALYSIS
A. Recipe Costing

Espresso

INGRIDIENTS AMOUNT TOTAL COST

Shot espresso coffee 1shot 3.00

Water 1 cup 0.30

3.30/serving

Yield: 1 serving
Computation:
3.30*400
100 = 13.2

Desired Food Cost of 400% Selling Price

Cappuccino

INGRIDIENTS AMOUNT TOTAL COST

Shot espresso coffee 1shot 3.00

Steamed milk ½ cup 7.50

Milk foam ½ cup 3.75

14.25/serving

Yield: 1 serving
Computation:
14.25*400
100 = 57

Desired Food Cost of 400% Selling Price

15
 Short Black

INGRIDIENTS AMOUNT TOTAL COST

Shot espresso coffee 1shot 3.00

Water 1 cup 0.30

3.30

Yield: 1 servings
Computation:
3.30*400
100 = 13.2

Desired Food Cost of 400% Selling Price

Mocha

INGRIDIENTS AMOUNT TOTAL COST

Milk 1 cups 15.00

Cocoa 1 tablespoons 0.68

Brown Sugar 1 tablespoons 0.70

Ground Coffee ½ tablespoon 0.59

Vanilla Extract ½ teaspoon 0.14

17.11/serving

Yield: 1 servings
Computation:
17.11*400
100 = 59.86
Desired Food Cost of 400% Selling Price
= 59.86 = 65.00

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 Macchiato

INGRIDIENTS AMOUNT TOTAL COST

espresso 1 jigger 3.00

chocolate milk 1/3 cup 5.00

syrup 2 tablespoons 1.43

sugar 1 tablespoon 0.55

vanilla extract 1/4 teaspoon 0.07

10.05

Yield: 2 servings8.86/2 servings = 5.03/serving

Desired Food Cost of 350% Selling Price

Cafe Latte

INGRIDIENTS AMOUNT TOTAL COST

Milk 1 1/4 cups 18.75

Flavored syrup 2 tablespoons 2.10

Espresso 1 (1.5 fluid ounce) jigger 3.00

23.35/serving

Yield: 1 serving
Computation:
23.35*300
100 = 70.05

Desired Food Cost of 400% Selling Price

17
 Frappuccino

INGRIDIENTS AMOUNT TOTAL COST

espresso 1 jigger 3.00

chocolate milk 1/3 cup 5.00

Flavored syrup 2 tablespoons 2.25

sugar 1 tablespoon 0.55

vanilla extract 1/4 teaspoon 0.07

ice cubes 3/4 cup 0.31

11.18

Yield: 2 servings 11.18/2 servings = 5.59/serving

Desired Food Cost of 400% Selling Price

Milk tea

INGRIDIENTS AMOUNT TOTAL COST

Tea ½ cup 8.00

Milk ½ cup 7.50

Flavored syrup 2 tablespoons 2.10

ice cubes 1 cup 0.41

18.01/serving

Yield: 1 serving
Computation:

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 18.01*350
100 = 63.04

Desired Food Cost of 350% Selling Price

Vienna coffee

INGRIDIENTS AMOUNT TOTAL COST

Espresso 1 (1.5 fluid ounce) jigger 3.00

Whipped Cream 1 tablespoon 0.74

3.74/serving

Yield: 1 serving
Computation:
3.74*400
100 = 14.96
Desired Food Cost of 400% Selling Price
= 14.96 = 55.00

B. Specification of Equipment

Here are following which is needed in the operation of the business. Cleaning and

maintaining of this equipment must be based on the lifespan of the item

Machineries and Equipment

Item Quantity Unit Price Total Price

Espresso Coffee Maker 1 180,000.00 180,000.00

POS System 1 15,000.00 15,000.00

Blender 1 2,500.00 2,500.00

Television 1 4,500.00 4,500.00

Wi-Fi Router 1 1,500.00 1,500.00

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 TOTAL 203,900.00

Supplies per Week

Description Quantity Unit Price Total Price

Thermal Paper 2 23.00 46.00

Tissue Paper 3 packs 15.00 45.00

Cleaning Towel 2 8.00 16.00

Sponge and scrub 1 6.00 6.00

Dishwashing Liquid 1 bottle 12.00 12.00

Glass Cleaner 1 70.00 70.00

TOTAL 195.00

Supplies per Month

Description Quantity Unit Price Total Price

Thermal Paper 8 23.00 184.00

Tissue Paper 10 packs 15.00 150.00

Cleaning Towel 3 8.00 24.00

Sponge and scrub 2 6.00 12.00

Dishwashing Liquid 3 bottles 12.00 36.00

Glass Cleaner 2 70.00 140.00

TOTAL 546.00

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Supplies per Year

Description Quantity Unit Price Total Price

Thermal Paper 90 23.00 2070.00

Tissue Paper 110 packs 15.00 1650.00

Pot Holder 6 5.00 30.00

Cleaning Towel 9 8.00 72.00

Sponge and scrub 6 6.00 36.00

Dishwashing Liquid 30 bottles 12.00 360.00

Glass Cleaner 5 70.00 350.00

Spin mop 1 510.00 510.00

TOTAL 5,078.00

Inventories

Weekly Monthly Yearly

21
Descrip Unit Quantit Total Quanti Total Qty Total

tion Price y Price ty Price Price

Milk 63.00/L 2 126.00 16 1,008.00 160 10,080.0

Cocoa 309.00/ (2) 618.00 (5) 1,545.00 (50) 15,450.0

Powder 454g 454g 454g 454g 0

Brown 47.00/K 2 94.00 6 282.00 70 3,290.00

Sugar

Vanilla 139.00/ 1 139.00 2 278.00 10 1,390.00

Extract bottles bottle bottles bottles

White 55.00/K 3 165.00 8 440.00 80 4,400.00

Sugar

Syrup 100.00/ 2 bottle 200.00 4 400.00 48 4,800.00

(Chocola bottles each bottles bottles

te,

Caramel

Chocolat 120.00/ 3 360.00 10 1,200.00 50 6,000.00

e Bar 100g

Melon 100.00/K 2 200.00 8 800.00 48 4,800.00

Lime 120.00/K 2 240.00 8 960.00 48 5,760.00

Banana 30.00/K 2 60.00 8 240.00 48 1,440.00

22
 Apple 65.00/K 2 130.00 8 520.00 48 3,120.00

Orange 65.00/K 2 130.00 8 520.00 48 3,120.00

Mango 100.00/K 2 200.00 8 800.00 48 4,800.00

Instant 260.00/

Coffee 200g (2) 200g 520.00 (8) 2,080.00 (96) 24,960.0

Granule 200g 200g 0

Strawbe 100.00/K 2 200.00 8 800.00 48 4,800.00

rries

Waterm 25.00/K 2 50.00 8 200.00 48 1,200.00

elon

Plain 78.00/ (2) 350g 156.00 8 624.00 48 3,744.00

Yogurt 350g

Peanut 75.00/65 (1) 655g 75.00 (30) 225.00 (35) 2,625.00

Butter 5g 655g 655g

Honey 2,500/L 1L 2,500 1L 2,500.00 2 gal 16,000.0

8000/gal 0

Papaya 20.00/K 2 40.00 8 160.00 48 960.00

Honey 100.00/K 1 100.00 3 300.00 30 3,000.00

Dew

Melon

Vanilla 95.00/ (1) 350 95.00 (3) 285.00 (35) 3,325.00

23
 Yogurt 350g g 350g 350g

Almonds 780.00/K 1 780.00 2 1,560.00 20 15,600.0

Powder 56.00/55 1 56.00 3 168.00 24 1,344.00

ed Sugar 0g

Water 25.00/ 3 75.00 15 375.00 36 900.00

gal=20L

Salt 10.00/K 1 10.00 1 10.00 8 80.00

Caramel 100.00/2 1 100.00 2 200.00 22 2,200.00

Sauce 83g

Creamer 67.50/30 2 135.00 7 472.50 75 5,062.50

0g

Chocolat 360/gal 1 360.00 2 720.00 20.00 7,200.00

e Ice

Cream

Iced Tea 10.00/ 15 150.00 60 600.00 600 6,000.00

pack

Coffee

Bean 305.00/K 2 610.00 4 1,220.00 48 14,640.0

(Arabica 0

&

Robusta

24
 )

Ice 20.00/K 4 80.00 16 320.00 192 3,840

Cubes

Straw 25.00/1 1 25.00 1 25.00 10 250.00

pack(100

pcs)

TOTAL 8,779.00 TOTAL 21,837.50 TOTAL 185,932.50

Kitchen Utensils

Description Quantity Unit Price Total Price

Measuring Cups 1 35.00 35.00

Measuring Spoons 1 35.00 35.00

Measuring Glass 1 55.00 55.00

Weighing Scale 1 255.00 255.00

Spoon 15 15.00 225.00

Fork 15 15.00 225.00

Pastry Plates 15 20.00 300.00

Pitcher 3 65.00 195.00

Irish Coffee Glass 3 box (6 pcs) 150.00 (6 pcs/box) 450.00

Coffee Mugs 20 30.00 600.00

25
 Hi ball Glass 2 box (6 pcs) 150.00 (6 pcs/box) 300.00

Glass (ordinary) 3 box (5pcs) 80.00 (5pcs/box) 240.00

Water Goblet 3 box (6 pcs) 80.00 (6 pcs/box) 240.00

TOTAL 3,155.00

Salary and Wages

The salaries are in minimum wage wherein the project proponents follow the

minimum rate as set by the DOLE.

Employee Hour/ Day/ Salary/wages No. of Day/ Salary/wages

Position day week daily (PHP) Employe mont monthly

es h (PHP)

Manager 8 7 350.00 1 30 10, 500.00

Custodial 8 6 253.00 2 24 12,144.00

TOTAL 856.00 3 22,644.00

C. Commencement Capital

The financial cost will be provided by the University since it is owned and a part of

University of Pangasinan.

The initial capital of the will be Php 420,709.50

Total Project Cost

COST FACTORS AMOUNT

26
Pre operating Expenses 2,000.00
 Recipe testing

Equipment and Machineries 207,055.00

Startup Cost 22,383.50

TOTAL INVESTMENT COST 420,709.50

Projected Income Statement

(per week)

Sales 6,500.00

Cost of Sales (15%) 975.00

Gross Profit 5,525.00

Less: Operating Expenses

Supplies 195.00

Net Profit 5,330.00

Projected Income Statement

(per month)

Sales 27,500.00

Cost of Sales (15%) 4,125.00

27
Gross Profit 23,375.00

Less: Operating Expenses

Supplies 546.00

Net Profit 22,829.00

Projected Income Statement

(per year)

Sales 900,000.00

Cost of Sales (15%) 135,000.00

Gross Profit 765,000.00

less: Operating Expenses

Supplies 5,078.00

Net Profit 759,922.00

Profit Sharing

University HRM departement

30%

70%

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 Seventy percent (70%) of the profit will be for the University Administrators for the

maintenance of the café and for the operating and other expenses of the café as well as the

café’s indirect expenses (electricity, water bills, etc.) Thirty percent (30%) will be for the HRM

department and this will help them for their laboratory expenses and it will also serve as their

fund and it will use for academic purposes.

29
30