This assessment will cover following questions:
- Explain the concept and importance of budgeting.
- How budgeting can help in launching an event with selection of food and entertainment.
- What are the major cost items that would be included in budget with analysis of the realistic cost included in the budget.
PART A
Defining launch event
Statement:
To plan for launching a shop “Refresh” which will sell freshly squeezed juices, tea and coffee in the form of celebrity opening.
Launch event:
The event will be launched during weekend, in the evening so that nearby tub stations will also have crowd and people will also have time to attend the event. The event will be launched on site so that along with the promotion people can also have actual look and experience of the shop and its product. In the launch event one or two products as welcome drink will be offered free so that visitors can experience the quality of food. Since it will be a celebrity opening a fitness freak or celebrity will be invited in the event so that it will give message to people that launched products are healthy.
Instead of formal ribbon cutting or opening ceremony there will be full entertainment in the form of music, dance and some performance and interaction session with the celebrity. Though entertainment and food will include cost huge expenses but this strategy will help to create brand awareness and popularity among people. Thus from promotional perspective and achieving business objective these expenses are justified. People are conscious about health and related products but they tend to consider the juices from shop less trustworthy from quality perspective. However when celebrities which are more conscious to health will promote the shop then it will be convenient for the people to trust the products and to buy them. Another benefit of launching product in the form of grand celebrity event is that it will be able to successfully gain the attention of public. In addition to this instead of believing on judgements of others people will get a chance to develop their own opinion by using services at their own. Thus it will be completely justified to make the opening ceremony huge and grand.
PART B
Budget
The launch event will include following costs:
|
Area |
Expected cost |
|
Business registration, licenses and permits |
£14,000 |
|
Marketing expenses including flyer printing, celebrity cost and grand opening event |
£15,000 |
|
Insurance cost (total premium) |
£25,000 |
|
Leasing cost in desired location near tube station |
£120,000 |
|
Operational cost for first quarter (employee cost and bills) |
£70,000 |
|
Inventory, furniture, equipment and gadgets |
£100,000 |
|
Supplier cost (monthly) |
£4500 |
|
Store equipment cost |
£6,000 |
|
Launch event cost |
£7,000 |
|
Website development and other digital promotional tools |
£400 |
|
Miscellaneous |
£6000 |
An estimate of £370,000 will be required to set up a medium scale juice shop. The budget will also include the salary of various staff members for the first three quarters. For starting a business it is necessary that all necessary permits related to health and safety, occupational safety, business registrations must also be complete as the priority. Further a huge amount of investment will be required in inventory and gadgets. It will include all machines or equipment, shop furniture, tableware juice blenders, sound system, staff uniform, slicers, ingredient bins and ice making machines required for the shop.
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