Explain Business logo and name

Business name: Blitz

Blitz
Interne
t Cafe
Propos
al

We form our Business name Blitz, actually its came from one of the unforgettable
experience spent with my partner and me, a thunderstorm day my good partner
and me are holding an umbrella and walking together on the middle of the field,
the sky are dark and full of dark clouds, suddenly we see a long and shine white
light are hit the tree in front of us, and the tree are separate with each other. One
that time we think that thunder is strongest and fastest weapon in this world, so
we form our business name as blitz cause we want our business like the thunder
blitz can fight the others competitors in this market and get the top place to let all
people in Malaysia can recognizes our company.

Business Plan Proposal

1

Owners: Lau Kah Seng, Ooi Choon Keong, Tan Si Khai, Ng Qi Han
Business Name: Blitz Internet Caf
Address: Lebuh Pekaka 1, Gelugor, 11700, Pulau Pinang
City, State, ZIP: Gelugor, Pulau Pinang, 11700
Telephone: 04-6463634
Cell Phone: 012-4064073
Fax: Email: [email protected]

TABLE OF CONTENT

Title

Number of page

Executive Summary

Company Summary

Services

Market Analysis

11

Strategy and Implementation Summary

14

Management Summary

18

Financial Plan

19

1. Executive Summary
Blitz Internet Cafe, a cyber cafe located in Gelugor, Pulau Pinang, offers a
perfect spot for the public in social gathering and leisure. It provides customers
free access to the Internet as well as an area for to meet together in a casual
environment under an economical manner. The business intends to obtain
finance from external equity in the amount of RM500,000 for which the
application will be for commencing work on shop renovation, equipment
purchases, and as operating cash flow. Preliminary capital injection has already
been secured by the initial owners, Lau Kah Seng (RM150,000) and Ooi Choon
Keong (RM150,000), Ng Qi Han (RM 100,000) and Tan Si Khai (RM 100,000).
Blitz Internet Cafe will be incorporated as a limited liability company. The four
initial owners will be the shareholders and their personal liabilities will be subject
to a ceiling at the amount of their respective investments. The finance acquired
through this business proposal will allow Jedi Caf to successfully open and
operate as a internet cafe. A comfortable and innovative environment is provided
to the customers with a casual atmosphere. Operations in year one will generate
Blitz Internet Cafe a regular customer base that will allow it to be self-maintained
in year two.

1.1 Objectives
Blitz Internet Cafes objectives for the first year of operation include:

The creation of an exclusive, stylish, innovative environment that will

distinguish Blitz Internet Cafe from other coffee shops.
The creation of a comfortable and casual environment that will bring
people with different interests and backgrounds together for socialization.
High-quality computer equipment, coffee and bakeries at a reasonable
price.
Free access to online services and provide free Wi-Fi.

1.2 Keys to success

The keys to the success for Blitz Internet Cafe are:

The creation of a unique, innovative, good environment that will

differentiate Blitz Internet Cafe from other local coffee shops and future
Internet cafes.

The establishment of Blitz Internet Cafe as a community center for

socialization and entertainment.

The creation of an environment that won't intimidate the novice user. Blitz
Internet Cafe will position itself as an educational resource for individuals
wishing to learn about the benefits the Internet has to offer.

Great coffee and bakery items.

Very few internet cafes at the area.

Potential demand will be high because there are quite some villages in the
area.

1.3 Mission

As Internet has become more popular and grown at an expeditious pace,

easy access has become a part of life. Blitz Internet Cafe provides the public free
access to the Internet, high-quality computer equipment, food and beverages in a
comfortable environment. People from different backgrounds will come to enjoy
the exclusive, stylish, and innovative environment that Blitz Internet Cafe offers.

1.4 Risks
The risks involved with Blitz Internet Cafes business are:

Insufficient demand for the services provided by Blitz Internet Cafe in

Pulau Pinang.
The popularity of the Internet stops to grow.
The opening of new cafs in the same area which offers the exact
services

2. Company Summary
Blitz Internet Cafe, soon to be opened at Gelugor in Pulau Pinang, will
provide the public free access to the Internet and a special and innovative
environment for enjoying top quality of computer equipment, coffee and bakeries.
Individuals of all ages and backgrounds will find Blitz Internet Cafe appealing.
The staffs of Blitz Internet Cafe provide not only top quality service but also
helpful instructions to customers in computer usage. This educational aspect will
attract elderly customers and youngsters who do not own computers at home.
The easy access location also provides residents in the same area convenience
to their gourmet and online needs.

2.1 Company Ownership

Blitz Internet Cafe will be privately owned by the founder and CEO Lau
Kah Seng, and, shareholders Ooi Choon Keong, Ng Qi Han and Tan Si Khai.

2.2 Start-up Summary

Blitz Internet Cafes start-up costs will cover renovation, furniture,
computers, computers equipment, coffee machines and cooking equipment, and
running capital to cover expenses in the first year. The equipment provided to
Blitz Internet Cafe customers with high-speed connection to the Internet forms a
large portion of the start-up costs. These costs will include computers, two laser
printers and a scanner. Besides, the start-up costs will comprise the coffee
machines such as one espresso machine, one automatic coffee grinder, and
other additional equipment. The shop will also require funds for renovation and
modification. Breakdown of the start-up costs is illustrated as follows:
Start-up Costs RM
Legal Fee

1200

Stationeries

1500

Tableware

850

Consultants

2,560

Insurance

900

Rent

1,250
7

Coffee Machines

10,000

Bean Grinder

1,020

Computer Systems, Software, Printer, Scanner

30,000

Internet Lines (Unifi 160mb)

2,800

Fixtures/Renovation

25,640

Total Start-up Costs

77,720

Start-up Assets
Running Cash

30,770

Start-up Inventory

2,565

Total Assets

33,335

Total Requirements

111,055

2.3 Company Location

A site has been chosen in Gelugor in Pulau Pinang for the following reasons:

Nearness to the close-by residents.

Proximity to stylish, upscale restaurants in the same area.
High visibility

Near 24 hours shops (7-Eleven, Mc Donald, KFC, Happy Mart)

3. Services
Blitz Internet Cafe will provide free access to the Internet and computer services
such as printing, scanning to customers. It will also provide customers with a
unique and innovative environment for enjoying top quality coffee and bakeries.

3.1 Service Description

Blitz Internet Cafe will provide its customers free access to the Internet and
common computer software and hardware. Some of the Internet and computing
services available to Blitz Internet Cafes customers are listed below:

Internet browsers.
Laser color printing, copying and scanning.
Popular software applications.

Also, top quality food and beverages, and a comfortable environment will provide
Blitz Internet Cafes customers with a second home, a place to enjoy the benefits
of computing in a comfortable environment.

3.2 Competitive Comparison

Blitz Internet Cafe will be the first cyber caf in Pulau Pinang. Blitz Internet Cafe
will differentiate itself from the strictly-coffee cafes and others internet cafe in
9

Penang by providing its customers with Internet, computing services, coffees and
bakeries

3.3 Fulfillment
Blitz Internet Cafe will obtain its computer hardware from Gadget Zone
Computers located in Penang. The installation of the internet will also be
provided by the Gadget Zone Computers. Electricity shall be installed by one of
the major providers of electricity. At this time, a contract for the bakery items has
not been completed, but Blitz Internet Caf is currently negotiating with some
suppliers to fulfill the requirement.

3.4 Technology
Blitz Internet Cafe will invest in high-speed computers to provide its customers
with a fast and efficient connection to the Internet. The computers will be reliable
and fun to work with. Blitz Internet Caf will continue to upgrade and modify the
systems to stay with current technologies.

3.5 Future services

In the future Blitz Internet Cafe will be able to expand or improve its services. As
Blitz Internet Cafe grows, more communications systems will be added. The
possibility of additional units has been accounted for in the current floor plan. As
the demand for Internet connectivity increases, along with the increase in
competition, Blitz Internet Cafe will continue to add new services to keep its
customer base coming back for more. The improvement of service however
could be possible by providing the customer with additional services such as
increase the entertainment equipment PS4, Xbox One which would attract
more customers and make the current customers stay longer

10

11

4. Market Analysis
Blitz Internet Caf is facing the opportunity of being the pioneer in the Pulau
Pinang cyber caf market. The consistent popularity of coffee, combined with the
growing interest in the Internet, has been proven to be a winning concept in other
markets and will produce the same results in Pulau Pinang.

4.1 Market Segmentation

Blitz Internet Cafs customers can be divided into two groups. The first group is
familiar with the Internet and desires a progressive and inviting atmosphere
where they can get out of their offices or bedrooms and enjoy a great cup of
coffee. The second group is not familiar with the Internet, yet, and is just waiting
for the right opportunity to enter the online community. Blitz Internet Cafs target
market falls anywhere between the ages of 13 and 70. This extremely wide range
of ages is due to the fact that both coffee and the Internet appeal to a variety of
people. In addition to these two broad categories, Blitz Internet Cafs target
market can be divided into more specific market segments. The majority of these
individuals are students and business people.
4.2 Target market segment strategy
Blitz Internet Cafs main intentions are to connect people to the internet,
increase their knowledge by having access to sources from all over the world,
and to increase their social setting, by a new way of communicating. People will
come to this internet caf to check their email, socialize with their friends, and
gather information not found elsewhere.
4.2.1 Market Needs
Factors such as current trends, addiction, and historical sales data ensure that
the high demand for coffee and Internet access will remain constant over the
next five years. Further, there is a high demand for people can come to check
their email and search the web for information. Also, the customers at the internet
caf will also enjoy the freedom of accessing different programs like Microsoft
Word, Power Point and other applications. Blitz Internet Cafe will enjoy the
advantages of name recognition and customer loyalty. Initially, Blitz Internet Cafe
will hold a 100 percent share of the cyber caf market in Gelugor. In the next five
years, competitors will enter the market. Blitz Internet Cafe has set a goal to
maintain greater than a 50 percent market share.
12

4.2.2 Market Trends

A market survey was conducted recently with key questions asked to fifty
potential customers in George town area. Some key findings include:

40 people said they enjoyed free access to the Internet.

44 subjects use the Internet to communicate with others on a daily basis
Rm 2 per hour was the most popular hourly Internet fee.

4.3 Service Business Analysis

The retail coffee industry in Penang experienced rapid growth at the beginning of
the decade and is now moving into the mature stage of its life cycle. Many factors
contribute to the large demand for high-quality coffee in Penang. The climate in
Penang is extremely favorable to coffee consumption. Current trends in this highspending residential area reflect the popularity of fresh and strong coffee.
The popularity of the Internet is growing exponentially. Those who are familiar
with the Internet are well aware of how fun and addictive going online can be.
Those who have not yet experienced with the Internet need a convenient,
relaxed atmosphere where they can feel comfortable learning about and utilizing
the current technologies. Blitz Internet Cafe seeks to provide its customers with
affordable Internet access in an innovative and supportive environment.
Due to intense competition, caf owners must look for ways to differentiate their
place of business from others in order to achieve and maintain a competitive
advantage. The founder of Blitz Internet Cafe realizes the need for differentiation
and strongly believes that combining a caf with complete Internet service is the
key to success with a great opportunity to enter into a profitable niche in the
market.

4.3.1 Distributing a Service

13

The dual product/service nature of Blitz Internet Cafe business faces competition
on two levels. Blitz Internet Cafe competes not only with coffee shops, but also
with Internet service providers. The good news is that Blitz Internet Cafe does not
currently face any direct competition from other cyber cafs in the Gelugor
market.
Heavy competition between coffee shops in Penang creates an industry where
all firms face the same costs. There is a positive relationship between price and
quality of coffee. Some coffees retail at RM8.50/cup while other, more exotic
beans may sell for as high as RM12.50/cup. Wholesalers sell beans to retailers
at an average of a 50 percent discount. For example, a pound of Sumatran
beans wholesalers for RM27 and retails for RM54. And as in most industries,
price decreases as volume increases.

4.3.2 Competition and Buying Patterns

The main competitors in the retail coffee segment within the same location are
Starbucks and KCY Internet Caf. These businesses target a similar segment to
Blitz Internet Caf (i.e. educated, upwardly-mobile students and business
people). However, Blitz Internet Cafe will offer substantial computing services
and gaming equipment such as PS4 and Xbox One to its customers which these
competitors are not providing at the moment.

14

5.0 Strategy and Implementation Summary

Blitz Internet Caf has three main strategies. The first strategy focuses on
attracting novice Internet users. By providing a novice friendly environment, Blitz
Internet hopes to educate and train a loyal customer base.
The second strategy, and most important, strategy focuses on pulling and
increasing in power Internet users. Power Internet users are extremely familiar
with the Internet and its offerings. This group of customers serves as important
function at Blitz Internet Caf. Power users have knowledge and web-browsing
experience that novice Internet users find attractive and exciting.
The third strategy focuses on building a social environment for Blitz
Internet Caf customer. A social environment, that provides entertainment, will
serve to attract customers that wouldnt normally think about using the Internet.
Once on location at Blitz Internet Caf, these customers that came for the more
standard entertainment offerings will realize the potential entertainment value the
Internet can provide.
5.1 Attracting customers
To attract the intended customers, Blitz Internet Caf use different types of
advertising to teach each target group. For the adolescents for example some
posters could be made. These posters could be placed around places where the
adolescents would mainly be present. Places like game-halls and sports club
would be perfect for advertising. Another way of attracting the customer is to
advertise in the local newspaper. By advertising in the local newspaper the
households would get notice of the new Internet Caf. This would result in
attracting the parents of the adolescents and the middle-aged inhabitants of
Penang. These ways of advertising will be stopped after two years. This is
because over such a period of time most inhabitants will have noticed the
Internet Caf and heard about it.
5.1.1 Attract Novice Internet Users
Blitz Internet Caf first strategy focuses on attracting novice Internet users. Blitz
Internet Caf plans on attracting these customers by:
- Providing a novice friendly environment. Blitz Internet Caf will be staffed by
knowledge employees focused on serving the customers needs.
- A customer service desk will always be staffed. If a customer has any type of
question or concern, a Blitz Internet Caf employee will always be available to
serve and assist them.
- Blitz Internet Caf will offer introductory classes on the Internet and email.
These classes will be designed to help novice users familiarize themselves with
these key tolls and the Blitz Internet Caf computer systems.
15

5.1.2 Attract Power Internet Users

Blitz Internet Caf second strategy will be focused on attracting power Internet
users. Power Internet users provide an important function at Blitz Internet Caf.
Blitz Internet Caf plans on attracting this type of customer by:
- Providing the latest in computing technology
- Providing scanning and printing services.
- Providing access to powerful software applications.
5.1.3 Social Hub
The third strategy focuses on building a social environment for Blitz Internet Caf
customer. A social environment, that provides entertainment, will serve to attract
customers that wouldnt normally think about using the Internet. Once on location
at Blitz Internet Caf, these customers that came for the more standard
entertainment offerings will realize the potential entertainment value the Internet
can provide. For example, customer came for playing computer games or PS4
and Xbox One with good environment and equipment.
5.2 Marketing Strategy
Blitz Internet Cafe will position itself as a stylish coffee house and Internet service
provider. It will serve high-quality computer equipment, coffee and specialty
beverages at reasonable prices. Due to the number of cafs in Pulau Pinang, it is
important that Blitz Internet Cafe sets fair prices for its products and computer
service. Blitz Internet Cafe will use advertising as its main source of promotion.
Ads placed in food magazines will help build customer awareness.
Accompanying the ads will be a coupon for discounted coffee and nice bakeries.
5.2.1 Promotion Strategy
Blitz Internet Cafe will implement a pull strategy in order to build consumer
awareness and demand. Initially, Blitz Internet Cafe has budgeted RM5,000 for
promotional efforts which will include advertising with food magazines and inhouse promotions such as offering customers free drinks. Blitz Internet Cafe
realizes that in the future, when competition enters the market, additional
revenues must be allocated for promotion in order to maintain market share.

5.2.2 Pricing Strategy

16

Determining a fair market for cyber cafe is more difficult because there is no
direct competition from another cyber caf in Pulau Pinang. Therefore, Blitz
Internet Cafe has to base its prices for coffee and specialty drinks on the retail
profit analysis provided by our supplier, Jenson Coffee, which has been in the
coffee business for over 50years and has developed a solid pricing strategy.

5.2.3 Sales Strategy

As a retail establishment, Blitz Internet Cafe employs people to handle sales
transactions. Basic computer knowledge and good attitude is a required for Blitz
Internet Cafe employees. If an employee does not possess basic computer skills
when they are hired, they are trained by our full-time technician. Our full-time
technician is also available for customers in need of assistance. Blitz Internet
Cafs commitment to friendly, helpful service is one of the key factors that
distinguish itself from other cyber cafes.

5.2 Competitive Edge

Blitz Internet Caf will follow a differentiation strategy to achieve a competitive
advantage in the caf market. By providing Internet service, Blitz Internet Caf
separates itself from all other cafes in Penang. In addition, Blitz Internet Caf
provides a comfortable environment with coffee and bakery items, distinguishing
itself from other Internet provides in Penang.
5.3 SWOT Analysis
This section will focus on the SWOT analysis. The SWOT analysis is a strategic
planning method used to evaluate the Strengths, Weaknesses, Opportunities,
and Threats involved in a project or in a business venture. SWOT is an
abbreviation for: Strength, Weakness, Opportunity and Threats.
Strength
The strength that Blitz Internet Cafe will have is its dominant position in the local
internet availability. In Penang, the access to internet is very limited however
there are some internet cafs which surely will make competing favorably.
Secondly, Blitz Internet Cafe should have strength in staying up-to-date with the
latest computer software. By keeping the hardware updated with the needed
software the customers will enjoy working with the computers present. Staying
updated with the newest software is also a cheap 'investment' which again would
benefit to the success of the internet cafe.
17

Weakness
Besides the strengths each company/business has its weaknesses. Weakness
can lead to a decrease of a company's success and development. The weakness
of an internet cafe in general is keeping up with the latest hard-ware technology.
Staying updated with the latest hardware is not only an expensive investment it is
an investment which does not sincerely pays off its prices immediately. Over a
period of years such an investment should be needed however it remains
expensive.
Opportunities
As any other organization an internet cafe has its opportunities. Having certain
opportunities offers an organization a possibility to expand their turnover. An
opportunity of an internet cafe is that the global population which is requiring
access to the World Wide Web is slowly increasing. This increase of internet
users should offer the internet cafe a chance to expand the business. Another
opportunity from which the internet cafe might benefit is the possibility of a rising
demand in the market. This raise would be the outcome of the growing popularity
under the inhabitants. Once one is familiar with the World Wide Web one may
introduce his or her social environment to the internet. Thereby the popularity of
the internet will keep on growing and finally this will reflect in an increasing
number of customers for the internet cafe.
Threats
Blitz Internet Cafe will be one of a few located in the city of Penang. However the
internet cafe will face certain threats which can cause a slight decrease in its
popularity in the market. One of the threats the cafe will face is the continuous
reducing price of the availability of internet itself. Because of the lowering price
the internet will become available to a greater population. When this situation
occurs more and more people will have an internet connection at their own
house. This will make the existence of an internet cafe redundant. Another threat
which may threaten the internet-caf is the increase of internet-cafs at a local
scale. When the consumers get the opportunity to choose from a variety of offers
the amount of customers will probably decrease.

18

6. Management Summary
Blitz Internet Cafe is owned and operated by Mr. Lau Kah Seng. The company,
being small in nature, requires a simple organizational structure. Implementation
of this organizational form calls for the owner, Mr. Lau Kah Seng, to make all of
the major management decisions in addition to monitoring all other business
activities.
6.1 Personnel Plan
Blitz Internet Caf requires just a handful of employees in order to function. The
staff will consist of six part-time employees working thirty hours a week at RM6
per hour. Their job is mainly to support customers with any problems with the
computer or internet and next to that they will appoint customer computers. In
addition, one full-time technician (who is more technologically oriented to handle
minor terminal repairs/inquiries) will be employed to work forty hours a week at
RM8 per hour. This simple structure provides a great deal of flexibility and allows
communication to disperse quickly and directly. Because of these characteristics,
there are few coordination problems seen at Jedi Caf that are common within
larger organizational chains. This strategy will enable Blitz Internet Cafe to react
quickly to changes in the market.

Employee

Monthly salary

Part Timer 1

RM720

Part Timer 2

RM720

Part Timer 3

RM720

Part Timer 4

RM720

Part Timer 5

RM720

Part Timer 6

RM720

Technician

RM1280

Total Payroll (8)

RM5600

19

7. Financial Plan
These are personal financial statements for owners Lau Kah Seng, Ooi Choon
Keong, Ng Qi Han and Tan Si Khai. All assets and liabilities are listed.

7.1 Start-up Funding

This business plan is prepared to obtain financing in the amount of RM 500,000.
The supplemental financing is required to begin work on site preparation and
modifications, equipment purchases, and to cover expenses in the first year of
operations. This amount is planned to be repaid by RM40,000 each year by four
years.
Owners investments have already been secured as follows:
1. RM 150,000 of personal savings from owner Lau Kah Seng.
2. RM 150,000 from the second shareholder, Ooi Choon Keong.
3. RM 100,000 form the third shareholder, Ng Qi Han.
4. RM 100,000 from the fourth shareholder, Tan Si Khai.
5. RM 50,000 in the form of short-term bank loans.

20

RM
Start-up Expenses to Fund

77,720

Start-up Assets to Fund

33,335

Total Funding Required

111,055

Assets
Inventory

2,565

Cash Balance

30,770

Total Assets

33,335

Liabilities
Short Term Bank Loans

50,000

Total Liabilities

50,000

Capital
Lau Kah Seng

150,000

Ooi Choon Keong

150,000

Ng Qi Han

100,000

Tan Si Khai

100,000

Total Planned Investment

500,000

21

7.2 Projected profit and loss

Profit and Loss

Year 1

Year 2

Year 3

Sales
Estimated customers

10,000

15,000

20,000

Hourly fee

RM2

RM2

RM2

Coffee

RM6

RM6

RM6

Snack

RM2

RM2

RM2

Total Sales

RM100,000

RM150,000

RM250,000

Technicianl

RM15,360

RM15,360

RM15,360

staff

RM51,840

RM51,840

RM51,840

Legal Fee

RM1,200

RM1,200

RM1,200

Rent

RM15,000

RM15,000

RM15,000

Insurance

RM900

RM900

RM900

Posters

RM420

RM420

RM420

Furniture

RM1500

Stationeries

RM850

Coffee Machines

10,000

Bean Grinder

1020

Expenses
Payroll

Marketing/Promotion

Tableware
Electronics

22

Other expenses
Computer Systems,

RM30,000

Internet Lines (Unifi 160mb)

RM 33,600

RM 33,600

RM 33,600

Fixtures/Renovation

RM25,640

Additional unexpected expenses

RM1,000

RM1,000

RM1,000

Total Expenses

RM188,330

RM119,320

RM119,320

Total Sales

RM100,000

RM150,000

RM200,000

Total Expenses

RM188,330

RM119,320

RM119,320

Profit

RM-88,330

RM30,680

RM80,680

Software, Printer,
Scanner
7.2 Projected profit and loss
Other expenses

* more than 50 customers a day

*40 computers running 3 hours on a daily basis and 7 hours stand-by

23

7.3 Break-even analysis

According to our calculations the expected break-even date will after 1051
days of the second year.

Daily Profit

RM30,680 / 365 = RM84.05

Total Loss 1st year

RM 88,330

Loss divided by daily profit

RM 88,330 / RM84.05= 1051 days

Conclusion

After 1051 days in the second year breakeven will be accomplished.

24

8. Appendix
8.1 Graph

25

26

27

8.2 Blitz internal

Design

28