Shopping Centre

8/10/2021
Business Plan

Rotenda Khumela
Table of Contents

1. Executive Summary
2. Mission
3. Business description
4. Business environment
5. SWOT Analysis
 Strength
 Weakness
 Opportunity
 Threat
6. Industry background
7. Competition
8. Marketing
9. Operation and management
10. Finance Plan
1. Executive Summary

This business plan contains a structure of a shopping centre which is a collection of

independent retail stores, services, and a parking area conceived, constructed, and
maintained by a management firm as a unit. The shopping centre will be made up of a retail
store which is already established which can either be Shoprite, Spar, boxer or Pick n Pay.
The other stores in the shopping centre will not be a lot i.e. They can either be between 3 to
7 stores which can be made up of a combination of clothing and other small stores.

2. Mission

The mission of the shopping centre is to provide for the people of the village, to ensure that
they do not have to travel a very long distance to do their groceries and other shopping
objective. The shopping centre will also develop the village that it operates in and ensure
that it can give back to the community by a way of employment, close access to a
convenient shopping for the community etc, this will also help to improve the lives of the
people in the community. In the area where the shopping centre operates there are no
other close by shopping centres or retail store that operates, the other shopping centres are
about 30 to 40 kms away this as a result gives the shopping centre a competitive advantage
as almost all the people in the area will be doing the shopping in the retail store that is being
established this as a result does not only improve the lives of the people in the community
but it also give the owner of the shopping centre a less risk in investing and a sustainable
business operation.

3. Business description

As discussed above the aim of this business plan is to establish a shopping centre with a
retail store that has already been established and other stores which can range between 3 to
7 stores in total. The shopping centre is not a unique thing in south Africa, there are a lot of
shopping centres around the country. However what makes this shopping centre to be
unique and different is the fact that it is being established in a rural area where there are a
lot of people in the community that straggles to do their shopping in a day to day basis.
These people are mostly working class with a source of income, other group of people can
include old age people that depends on pension and old age social grant, these people often
find themselves in need of a groceries and other needs such as clothing etc as a result they
find themselves having have to travel for more than 30 kms to do their shopping as a result
the shopping centre exists to close the gap and improve the lives of the people in the
community while also returning a good return for the investor. The shops that will be
included in the shopping centre will be familiar stores that have already been established in
the country, this helps the customers that will be buying in the shopping centre to not
strangle in doing their day to day shopping as the stores that they use to travel a long
distance in the past will be closer to them.
4. Business environment Analysis

The environment that the shopping centre will be operating in will be a small village
operating in the north of south Africa (Limpopo – Venda), A decision to open this shopping
centre was due to the lack of shopping centre operating in and around the areas i.e. as
stated above people in the community often find themselves having to the travel a long
distance of more than 30 kms to do their shopping as a result the shopping centre will be of
help to the people of the community. The place which the business will be operating in can
be considered to be convenient place to operate as we saw in the past during the time when
the country was unrest and there was a large number of looting of stores happening around
the country there was not a single store in Venda that was looted as a result the shopping
centre will be operating in a safe place and also the people of the community will care for
their shopping centre as without it they need to travel a long distance to do their shopping
as a result the shopping centre will be operating in a safe place where there is less crime and
this will also result in a cost saving for the investor the investor will not have to deal with
damages or high cost on insurance.

5. Swot Analysis

Strength, Weakness, opportunity and threats

 Strength

The strength of the shopping centre is the fact that there is enough capital to
establish everything including the security guards, maintenance and administration
without any difficulties or shortfall i.e. at the start there will be no need to contain
loans or require external funding as the investor aims to cover all the cost incurred
at the start of the business. The other strength includes awareness i.e. the people
involved in establishing the shopping centre knows the community and it’s target
market.

 Weaknesses

The weakness of operating the shopping centre might be the fact that there is no
people in the community with the experience to operate a shopping centre. The
other weakness can include neatness of the shopping centre since the shopping
centre will be operating in a village which is not developed the shopping centre
might not be very neat and the place can be contain dust since there are only dirt
roads in the streets. There are not a lot of weaknesses that can harm the operation
of the shopping centre.

 Opportunity

The opportunity of operating the shopping centre includes competitive advantage

since there are no other shopping centres operating near by this gives the shopping
centre an advantage of having have to operate without competition i.e. almost
every one in the community will do their shopping there, including people from
outside the community. Other opportunity may include government rebates and tax
reduction and other government reliefs such as BEE.
  Threats

Threats can include the ongoing unrest of the country, should the looting of the
shops increase to an extend where it can reach Venda the shopping centre can be at
risk of being looted. Other threat include ongoing Pandemic with the lockdown from
the government, more people are losing their jobs due to lockdown and if this
continues there will be less spending from the customers and the shopping centre as
a result will not be making enough profit.

6. Industry Background

Shopping centre falls under Consumer and retail, with the following impact as shown below:

We project real household spending in South Africa to recover over 2021, growing by
4.3% y-o-y. We do note that the economic impact of the Covid-19 pandemic did
create a significantly low base from which to grow from. We estimate that
household spending contracted by 5.9% over 2020. The South African government’s
support measures were aimed at households and businesses that were negatively
impacted by Covid-19 and were implemented in April 2020 and subsequently ended
at the end of April 2021. The most recent retail sales data from Statistics South
Africa indicates that while retail sales have improved from 2020 lows, the recovery
remains fragile in 2021 as South African consumers remain cautious with regard to
their purchasing decisions amid high levels of uncertainty with regard to their wage
and employment prospects. While South Africa’s vaccine rollout began in February
2021, the vaccination rate in the country remains low and this presents a risk of
further Covid-19 restrictions in response to a rising number infections in the country.

Source: https://store.fitchsolutions.com/all-products/south-africa-consumer-retail-report

The Global Retail Development Index window of opportunity has closed for South Africa,
mainly because of a very well established retail market reaching saturation according to the
authors of this report. The window of opportunity has closed because consumers are now
more used to modern retail in general. There is high discretionary spending available.
Competition is fierce both from the local and foreign retailers, retail real estate is expensive
and not readily available. SeeDIAGRAM 1 GLOBAL RETAIL EXPANSION Source: AT Kearney;
Global Retail Expansion: Keeps on moving, http://www.atkearney.com, (adjusted by author).
 Besides the consumer spending the industry itself is less impacted by covid 19 and hard
lockdowns by the government as the retail store is considered to be the producer of
essential goods and services as a result even during the lockdown level 5 once implemented
by the government the retail stores continued to operate without any issues, the only issue
that impact the retail store will be the capacity of the people allowed to be in the store and
maintaining the social distancing.

7. Competition

As stated above the shopping centre will experience competition advantage as there not
enough shopping centres in Venda and the closest shopping centre is about 30 km away, this
as a result give the shopping centre a competition advantage and provides for the investor
to earn a high return. The return on investment will be high given the fact that almost
everyone in the community will do their shopping there daily.
8. Marketing

There is no marketing plan in place, the village is a very connected place and as a result
people will become aware of the shopping centre without having have to carry out any
marketing or advertisement. The will be no advertisement cost as a result, people will
become aware of the shopping centre through a hear say process and others will pass by
and see the shopping centre as the shopping centre will be located in the main road. Hear
say is a very common and effective way of advertising in Venda and in no time almost
everyone will be aware of the shopping centre from the point when it is still in construction,
as most people will be very excited of the establishment of a shopping centre in their
community. Upon opening of the shopping centre there will be a lot of people queuing
outside just to go inside and do their shopping.

9. Operation and management

The shopping centre will be operated by one manager, a supervisor and small staff given the
fact that the shopping centre will not be a big place a small team to do the accounting books
and administration of the shopping centre will operate and run the shopping centre on a
daily basis. Other employees will include security and people involved in maintenance. Other
staff to be involved in the shopping centre includes cashiers which will be employed by their
own respective store owners.

10 Financial Plan

The shopping centre will be financed by a single investor who will be responsible for all the
contraction and setting up of the shopping centre to be completed. There will not be a loan
or requirement to have additional investors in the business. The finance of the shopping
centre will be conducted and ran by a person with enough knowledge to ensure that the
finance of the shopping centre is operating effectively without any misuse or
mismanagement of the funds