Business Plan For Expansion Of Foreword Coffee Roaster In Australia

Company Overview

In this report, a business plan for expansion of the Foreword Coffee Roaster will be created. This expansion of the coffee company will be planned in Australia because the Australian coffee market is very high due to the coffee culture followed by the people. This plan consists of many aspects to analyze the proper market approach, analysis, and condition to expand. To make proper expansion some strategic approaches are also used as a Marketing matrix. The coffee industry is in booming in Australia and for the analysis of this PESTLE analysis is used and for the internal analysis of the company to either company can expand, SWOT analysis is being used. For any analysis, there is a need to show some different side of the business to attract the consumers and for this approach Foreword coffee roaster, competitive analysis, and strength is also measured. To sustain in the market competitive edge is also shown in the report to show the strong point of the company. Proper analysis of product offer, market audience, and the market is analyzed to show how compatible this market is to make expansion. Market audience and the culture are being analyzed to check whether the market approach is followed or not. Proper financial highlights are included to check the approach needed to make expansion and a small approximate budget plan is created to show an idea of budgeting for this expansion.

This company started in 2017 as a Hole-in-a-wall café at the National University of Singapore. This company started with a vision to empower peoples who are facing some kind of disability or need special needs. To empower these types of individuals job opportunities and proper equality is offered by the company and after getting this scenario they get success in the business and then expand themselves in cities. After this success, they change its name to Foreword Coffee Roaster and then increase the approach of serving coffee and coffee products. They import coffee beans and some products from Asia, Laos, Thailand, Indonesia, and also from China. The company tries to get in contact with farmers directly and connect to make a direct connection and avoid the high rates of a middleman. By this, farmers also get good rates and high earnings. The foreword is also marked with enabling mark of the Platinum Award to show best practices of disability employment. This company is also B Corp certified which shows their working is proper in the areas of environment, social work, community work, customer management, and governance. This certificate shows that the company is following all the aspects of sustainability in the market (Foreword. 2022).

The business plan of the Foreword Coffee Roaster is for the expansion of the company in the international market. Australia is the best market for expansion because many things show positive aspects of the coffee market and this is the reason Foreword Coffee has the chance of making the expansion in this market. this plan consists of market analysis by using proper models like PESTLE and SWOT and for the marketing of the business, a marketing mix is used (Bottrill, Ludowici, & Turner, 2018). This marketing plan is making this work in the new market and some competitive advantages are also included to show what kind of positive advantages Foreword Coffee is carrying.

Business Plan

In this market analysis external and internal both markets analysis is carried out. By doing so proper management and planning are carried out (Shepherd et al., 2015). Through this analysis, a proper market analysis of the coffee industry of Australia is done and by conducting a SWOT analysis company analysis is being done as per the market.

Political: – Political environment of the industry is not very unstable. Political integration and breakdown of local market are an external element that shows opportunities and threat to the Foreword Coffee Roaster and international development. Moreover, government policies for enhance infrastructure develop new opportunity for Foreword Coffee Roaster to access more suppliers and consumers.

Due to this stable feature, a boot to investment in this market is always high and always encouraging international business. Nonetheless, even due to being ranked under the top 10 countries with stable political market Foreword Coffee Roaster failed to make an expand in Australia (Self, 2021).

Economical: – In 2008 Australia’s market faced a financial crisis and this is the reason behind the failure of many companies of coffee in the market. The Australian coffee market is growing at a slow pace(Krishnan, 2017). Due to continuous losses in the economy, many companies are in debt and thus they take loans to handle their procedures. The development of countries and failure redundancy rate develop opportunities for Foreword Coffee Roaster to gain more profit from the different markets around the globe. Nevertheless, the increase in labour prices in Australia is an external element that threatens Foreword Coffee Roaster.
Social: – Australian market is a highly efficient market as compared to other market features. Three are a diverse culture of people with the demand for diverse products and services in the industry. Australian coffee market is one of the largest coffee markets in the world. (Grieco, 2015). Foreword Coffee Roaster must identify the following social external elements in the macro-environment that including

Independent coffeehouse movement.
Developing middle class
Developing coffee culture.
Raise health consciousness.

Technological: – Before starting a firm in any new industry, it is critical to do research and innovation. This study and advancement help a business to determine whether or not overall economic circumstances are good for them to continue operating (Imbun, 2014).

Technology transmission to coffee farmers.
Raise adoption of mobile technology for online purchase.

Legal: – In terms of corruption, the Australian judicial system is one of the worlds least compromised. Foreword Coffee Roaster must be identifying the following legal elements that includes

Raise employment guidelines.
Product security rules.
Emerging GMO regulations

But Foreword Coffee Roaster has opportunity to enhance performance by satisfy item safety rules. Correspondingly, Foreword Coffee Roaster can improve supply chain to identify rules on elements from genetically modified organism.

Environmental: – Australia has a vast geological region and a tourism-oriented development strategy. There are different ecological external factors in its remote environment that includes

Increasing support for environmentally friendly items.
Raise availability and adoption of sustainable procedures in business.
Developing access to sensibly found elements.

Strength	· The location presence in the many nations can act as one of the key strengths of the Foreword Coffee Roaster. It shows that company can reach the target market easily and reach the customer with easy accessibility (Arisanti, 2021). · The strong financial location and health can permit the Foreword Coffee Roaster to make other investments. · The large product portfolio can permit the Foreword Coffee Roaster to expand client base and offset the loss from one good category with advantage get from the other. · The Foreword Coffee Roaster have robust online presence on the dissimilar social networking sites and efficient social media administration can improve the effectiveness of the positive e-WOW and create a good bond with the consumer. · Good product quality raises brand loyalty and enhances the Foreword Coffee Roaster’s performance in the competitive market.
Weakness	· The Foreword Coffee Roaster can draw criticism from the atmosphere for the poor waste administration practice and inability to integrate sustainability in the operations. · Less expenses on the research and development work that can weaken the Foreword Coffee Roaster performance due to market knowledge (Body, 2021). · The insufficient current asset negatively affects the liquidity stage and harm the whole performance of business. · The Foreword Coffee Roaster may lose competence due to the low inventory management practice. · Decision making in the Foreword Coffee Roaster take too much time and cause a costly delay in product new product in the market. · Lack of employee turnover and organisational pledge can raise the hiring cost and lower the Foreword Coffee Roaster productivity.
Opportunity	· The exponential development in the population and specifically in the old and major consumer market segment is a good new opportunity for the Foreword Coffee Roaster. · Increase in the consumer disposable income and raise in the affluent consumer base can be taken as a new opportunity to produce more good products (Body, 2021). · Consumers may prefer the new and unique service and product as the outcome of changing taste. · Enhance the consumer standard and lifestyle which means more consumption of products and services, and more opportunity to inspire the purchase of coffee. · The fundings offer by the government and other policies to make the atmosphere of business more friendly is a positive external atmosphere factor for Foreword Coffee Roaster. · The lessening of boundaries and increased international interrelation permit the Foreword Coffee Roaster to get the global market, target location dispersed client base, and raise profitability.
Threat	· The modification regulatory agenda of the new sticker rule imposes a big threat to the Foreword Coffee Roaster. It makes compliance with lawful standards more multifaceted and stimulating for the business. Inability to comply with modified rules increases the risk of costly lawsuits. · The raise number of skilled employee in the market can make it hard for the Foreword Coffee Roaster to attract new employees (Loizia et al., 2021). · The increase in inflation the price of production and affect the business effectiveness. · The raised number of unintended and straight competition affects the Foreword Coffee Roaster’s skill to sustain and enlarge the client base (Pramagista & Wandebori, 2021). · The fading economic situation affects Foreword Coffee Roaster’s performance when they directly sustain and expand the client base. · The international push the business to the cross-national wall and deal with the cultural diversity which may have harmful influence if the Foreword Coffee Roaster lacks the cultural intelligence. · The developing atmosphere sustainability trend acts as the key risk when offering goods and facilities that are not environmental friendlies. It draws the negative publicity and criticism from the conservationist and affects the brand’s goodwill in a competitive market (Pramagista & Wandebori, 2021).

The Foreword Coffee Roaster SWOT analysis need business to differentiate between threat having long-term and short-term implication. Threat with fast implication require to be identified on priority basis to evade any possible damage. Although risk with long-term suggestion can be undertook after address the immediate threating factors.

Competitive analysis is the strategy that includes research key competition to gain insight into the sales, goods and marketing tactics. Execute robust business plan, warning off rivals, and detention market share are just a few advantages of conducting a inexpensive market analysis.

Identify the rivals- this means that rivals of the Foreword Coffee Roaster can create an issue in entering the market. The rivals are Gloria Jeans Coffees, Hudson’s Coffee, and Starbucks Coffee (Basems et al., 2021).
Analyse their business model – some common aspects to study that include type of restaurant that includes a coffee restaurant, full service, and quick service. Additional service that includes taking away, online food delivery, and seating arrangement. Ordering application that includes Deliveroo, Menu log, Happy cow, and Uber eats (Dedhia et al., 2021). Menu and theme that have different variety of coffees and some snacks.

Foreword Coffee Roasters

Gloria Jeans Coffees

Hudson’s Coffee

Starbucks Coffee

· Have own websites.

· Business has substantial location reach, consumer base and maintain a robust brand identity.

· Strong market positioning that includes safe good position among the key leading coffee selling place globally.

· High skilled staff that includes coffee is formed with skilled employee to work efficiently that make high production on daily basis (Krylov, 2022).

· Highly strong goodwill.

· Good customer flow

· Premium coffee blends.

· Growth in stores because of reputation.

· Acquisitions that hold to 6 company contains Seattle’s Best Coffee, Teavana, Tazo, Evolution Fresh, Torrefazione Italia Coffee, and Ethos Water.

A marketing strategy that includes the Foreword Coffee Roaster plan will be based on communicating value to the targeted segments. This will be done in a variety of ways; the first way will be strategically placed marketing (Stevens et al., 2021). Moreover, marketing will be done by a strategic bond with other companies that have the same consumer demographics.
Mission- Motivate the can-do spirit to realize the major in every specific.
Marketing objectives- Grow an increase in turnover while attaining a status quo state, grow brand awareness by a steady, monthly increase of new consumers, and grow awareness of a structured conversation system measured by clients coming to the Foreword Coffee Roaster to meet others (Shirin, 2021).
Target audience – Foreword Coffee Roaster customers can break down into different groups, single and non-single people. But the group singles are the major target

Single- self-evident.
Professionals- these characteristics in intuitive since the underlying factor of Foreword Coffee Roaster is considerate discussion and most experts appreciate by infuriating discussion.
Age – 25 to 50-year-old person are the biggest.
Income- More than $40,000 (Stevens et al., 2021).

Positioning- the Foreword Coffee Roaster will leverage its competitive edge including-

A different method to get solo together is called the structure chat system. This system was thorough in the goods and services.
This system is a competitive edge as many coffee houses do not have a niche that they are concentrating on. While every coffee shop has a specific flavour and that is why a person will choose another the flavour is only surface deep.

	Slightly harmful	Harmful	Extremely harmful
Highly unlikely			Economic crisis
Unlikely		Raise the cost of materials and elements.
Likely		A big number of coffee rivals.

Marketing mix
Product – obsessive client attention in the mantra. All the products and services will be distributed from Foreword Coffee Roaster is to do whatever requirements to be done to impress the clients. While this could minimize the short-term profit, it will reinforce long-term profitability (Ferrell et al., 2021).
Price – the price scheme is fully based on standard industry practices.
Place – all the products and services will be distributed from Foreword Coffee Roaster (Agzamov et al., 2021).
Promotion – The highly successful marketing will be with all the products and services will be distributed from Foreword Coffee Roaster on a weekly basis. Furthermore, the strategic bond will be developed with businesses, the use of social media and a grassroots promotion system (Li et al., 2021).

Financial objectives of Foreword Coffee Roaster-

Reach profitability within the one year.
A double-digit development rate for the forthcoming year.
Lower the variable price by efficiency gains

Foreword Coffee Roasters			Income Statement
		For the Years Ending June 2020 and forecasting
Revenue		2020	2021	2022	2023	2024	2025
	Sales revenue	1,00,000	1,05,000	1,10,250.00	1,21,275.00	1,33,402.50	1,46,742.75
	COGS (total direct material)	49,900	52,395	55,015	57,765	60,654	63,686
Gross profit	50,100	52,605	55,235	63,510	72,749	83,056			contribution	54,450	65,850	74,943	89,802	1,05,756	1,22,914	–
Expenses									Breakeven Quantity	0.56932966	0.470766894	0.41365	0.3452034	0.293128	0.252209
Human resource expenses
	Wage expenses ($15 for 2000 hours)	30,000	30,000	30,000	30,000	30,000	30,000
	Marketing expenses	3,000	3,150	3,308	3,473	3,647	3,829
	Rent	1,000	1,000	1,000	1,000	1,000	1,000
	Start-up costs	2,550
		40,000	36,000	32,000	28,000	24,000	20,000
	Insurance Expense	600	600	600	600	600	600
Total Expenses	77,150	70,750	66,908	63,073	59,247	55,429
	Net Income Before Taxes	(27,050)	(18,145)	(11,672)	437	13,502	27,627
	Income tax expense	5,346	5,346	5,346	5,346	5,346	5,346
Income from Continuing Operations	(32,396)	(23,491)	(17,018)	(4,909)	8,156	22,281
	{42}
Net Income	(32,396)	(23,491)	(17,018)	(4,909)	8,156	22,281
	Particulars	2020	2021	2022	2023	2024	2025
ASSETS
1. CURRENT ASSETS
CASH AT BANK	8,524	9,376.40	10,314.04	11,345.44	12,479.99	13,727.99
ACCOUNTS RECEIVABLE	7,000	7,700	8,470	9,317	10,249	11,274
SUPPLIES ON HAND	15,000	15,000	15,000	15,000	15,000	15,000
PREPAID Insurance	300	300	300	300	300	300
TOTAL CURRENT ASSETS	30,824	32,376	34,084	35,962	38,029	40,302
2. LONG TERM FIXED ASSETS
LONG-TERM INVESTMENTS
EQUIPMENT	3,60,000	3,20,000	2,80,000	2,40,000	2,00,000	1,60,000
Building	3,00,000	300000	300000	300000	300000	300000
Machines		88,000	88,000	88,000	88,000	88,000	88,000
TOTAL FIXED ASSETS	7,48,000	7,08,000	6,68,000	6,28,000	5,88,000	5,48,000
TOTAL (1+2+3)	7,78,824	7,40,376	7,02,084	6,63,962	6,26,029	5,88,302
LIABILITIES AND OWNER’S EQUITY
1. CURRENT LIABILITIES
ACCOUNTS PAYABLE	75,000	82,500	90,750	99,825	1,09,808	1,20,788
bank overdraft	10,000	11,500	12,075	12,679	13,313	13,978
TOTAL CURRENT LIABILITIES	85,000	94,000	1,02,825	1,12,504	1,23,120	1,34,767		2020	2021	2022	2023	2024	2025
2	Long term loan	5,56,220	4,66,867	3,72,527	2,63,711	1,43,398	9,455	Net assets	1,37,604	1,79,509	2,26,732	2,87,748	3,59,511	4,44,080
3. OWNER’S EQUITY	1,70,000	2,04,000	2,44,800	2,93,760	3,52,512	4,23,014	Total capital employed	6,93,824	6,46,376	5,99,259	5,51,459	5,02,909	4,53,535
PROFIT FROM P&L		(32,396)	(23,491)	(17,018)	(4,909)	8,156	22,281	Net profit to capital employed	-4.7%	-3.6%	-2.8%	-0.9%	1.6%	4.9%
TOTAL OWNER’S EQUITY	1,37,604	1,80,509	2,27,782	2,88,851	3,60,668	4,45,296

TOTAL (1+2+3)	7,78,824	7,41,376	7,03,134	6,65,065	6,27,186	5,89,517
	Particulars	2020	2021	2022	2023	2024	2025
	Current ratio	0.36	0.34	0.33	0.32	0.31	0.30
	Debt-equity	0.71	0.63	0.53	0.40	0.23	0.02
	Debt to total assets	0.74	0.66	0.56	0.42	0.24	0.02

Conclusion

A business strategy for the expansion of the Foreword Coffee Roaster was produced in this paper. The coffee company’s expansion was being planned in Australia since the Australian coffee market was particularly large due to the country’s coffee culture. This strategy considers several factors in order to determine the best market approach, analysis, and expansion conditions. Some strategic techniques, such as a Marketing matrix, are also employed to ensure optimal expansion. The coffee business in Australia was flourishing, and PESTLE analysis was being used to analyse it, as well as SWOT analysis for internal company study to see if either firm can expand. To attract customers, every study must demonstrate a distinct part of the firm, and this strategy Foreword coffee roaster, competition analysis, and strength was also measured. In order to demonstrate the company’s strength, the report includes a section on how to maintain a competitive advantage in the market. A thorough examination of the product offering, market audience, and market is conducted to determine how suitable this market is for expansion. The market audience and culture were examined to see if the market strategy was being followed. A modest estimated budget plan was made to demonstrate an idea of budgeting for this growth, and proper financial highlights are added to examine the method needed to make expansion.

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