Market/Customer analysis

Market/Customer analysis

            The relevant market for the company is digital restaurant industry for small and medium restaurant, dining halls and hotels

In terms of market opportunity, the restaurant owners did not realize the importance of using the IT management system to handle their employee issues until the end of 1990s. There are few companies existing in the market and promoting different systems to different target restaurant groups. However they focus on is to provide the restaurant owners the ability to manage the employee within the operation scope but we designed a well-integrated system that will enable the communication between employees and employers, the potential labor market and recruiters, the restaurant business and other industries. And all these functions are realized through using the network technology. Therefore, we can conclude that most of the management systems in the current market are local software but what we designed is an integrated system with interface to talk to other social media and local communities.

The market is still young with enough space and huge potential for us to develop and educate. On the other hand, there are many different companies in the market to sell staff scheduling system including some big ones such as IBM, SAP and Microsoft. But these companies’ products are very generic which mainly focus on the huge corporations and organizations. Their enterprise resource planning systems provide the function of managing employees and contractors within the business scope. However, these systems are not specifically designed for restaurant business, which requires highly customized systems and the medium and small restaurants cannot afford the extreme high prices of these ES systems. Compare to the staff scheduling market in general, the media restaurant market is fairly small but new. Base on the analysis. We can clearly see that there does exist many opportunities that allow us to enter the restaurant scheduling system market as a social media company.       

            We have two direct customer groups and one indirect customer group. By saying direct customer, we mean those customers who will pay for the service and usage of our system. They are the potential employees in the job market and owners of the restaurants. The direct customers are currently less educated with this new concept and therefore we estimate a large growth in the market after we promote our system. The secondary which is the indirect customers are the people who are looking for restaurants to have dinner. Since we want to create a digital restaurant on line community, these group of people are vital important to be host on our database to attract the restaurant to buy our product to get access to these potential customers. We will not charge them money because they can get less direct benefit from us too. And we also benefit from the participation of these people and therefore we define them as our indirect customers.

            The majority of the profit will come from the owners of the restaurant since they are the potential buyer for the premium package. These people are mainly mid-age generation and have less education on internet, cell phone and new technology. It will be hard at the beginning to peruse them to buy our service but once there are some restaurants benefit from us, the rest will start considering acquire our system and our sales will enjoy a boom after a certain time of “preparation” period. After reaching the peak of the sale, we should consider to charge premium to the customers to keep our memberships in a certain amount of number. We should not accept all applications from one area because the existing customers will not think they get advantages on others and therefore refuse to keep doing business with us. Therefore we need to increase price and keep the initial members with their original price and only charge them reasonable upgrade fees.

            There are many factors may affect our market share such as:

1.      Government policy

2.      Competitor’s innovation

3.      Restaurant reformation

4.      Employment rate

All these factors may increase or reduce the market share of our system but the majority influence as I mentioned before is the impact from competitors. Since the technology and idea of the system is so easy to be reengineered, we can hardly prevent people copying our idea and come up new ideas to take up the market. The entry barrier of the market is not high enough to keep our position safe. And the only way to keep the business survival is to encourage innovations and seek opportunities to enter related markets.

            To evaluate the digital restaurant market, we can draw a conclusion that the initial marketing procedures will be smooth. We can take the majority of the market share until the competitor’s lunch their new system. Take timing into consideration that the average time that needs to develop a new system is 1 to 3 years, we have a reasonable period of time to take the market share and build up our reputation with our customers. And then, we will mainly focus on two things.   First, develop new update to compete with the competitors’ innovation. Second, take advantage of our existing expertise, experience and networking to seek and develop new market in related field. But overall, there is substantial opportunity and environment for us to enter this market.

Entry, Growth and Harvest

Entry, Growth and Harvest

Once the system is completed and promoted to the market, the cost of the company will be significantly reduced because we can eliminate some developing cost. And therefore we expect to get the initial investment back within one year of promoting our system and start another development loop right the positive profit and feedbacks from our customers.

We may partner with social media companies such as YouTube and FaceBook to promote our product at the entry level. The sales man should also go to visit and call local store to present our system. Additionally, we need to consider participating national conference that related to IT and restaurant. The growth phase of the company can be much easier after we have built up a customer database. Our profit chain will be both new purchases and maintenance fees. However keep upgrading and providing more functions to match customers’ needs is important for the future growth of the company. Once the market is educated, we can reduce the cost of sales and shift it to customer and technical service because people will come to us rather than we come to our customers. The owners of the restaurants will realize that without the help of our system, their store will lost competitive advantage in the market. And with increasing number of registered customers, we need to focus and invest more money on enlarging database, server, and phone center and provide in person consulting service if necessary.

In all, one of the key success variables for our company is the system for sure. And the other one is the sales processing that whether our marketing people can successfully educate our customer and peruse them purchasing our product will large influence the early stage profit and the growth strategy of the company.

Product

Product

Our product is a virtual helper to assist restaurant, school dining hall and even motel owner proper manage their labor force and effectively schedule employee’s working shift through Internet, cell phone and in store. The system will significantly reduce the time, money and labor hour that restaurant owner put on scheduling tasks. The system can provide the visibility of availability of employees and tracking their attendance performance. On the other side, employees can update their information on availability and call off more effectively. By providing fast and real time information up to date, both restaurant managers and employees can effectively communicate with each other and deal with emergency or seasonal situations. The centralized database will keep track of all information transactions, which are also valuable assets for managers to perform forecasting and employee performance evaluation.  Additionally, it will help organizations build up a long term, strong relationship with local labor force and engage the local labor force into job market, by which way, it will help reduce the unemployment rate and increase regional property. And finally reduce the organization’s internal management cost and increase profit.

The unique features that we can provide are:

1.      Communication chancels between all entities within the market

2.      Connection to other social media

3.      Mobile device and internet platform supported

4.      Easy to download and start using the system

5.      Promote the VIP customers by posting information on our internet community

All these unique features can add value to the overall product and enable it to be competitive in the market. The Restaurant owners will be attracted by especially 2,3 and 5 because they give them a much easier and cheaper way to promote them to the local or even boarder community, which saved them a lot of money in commercials. The digital restaurant promote to people a new concept that they do not need to look over the newspapers or TV or magazine looking for jobs in restaurant, new leases, selling information and coupon information. All they need to do is to download our application to their cell phone and click on the related topic they need or they can go to our website and visit our online community to see the feedback from previous employees and employers or the customers.

From the restaurant owner perspective, their live is easier because they need less time on managing employees and pay money on commercials. From restaurant employee’s perspective, they can have more time working on other places and still take shifts in current store; also they can review other people’s feedback to choose the best place to work with. Finally from the perspective of restaurant customers, they can easily choose the one they want to go to eat after searching information from our site.

The time used to develop the product can be long and costly. We have to take this into consideration when making a schedule to promote it to the market. It may take few month even years to develop and the risk that someone else is developing the similar concept is very high. But the good thing is that the majority of the owners of the restaurant did not realize this fancy technology yet and therefore give us a certain period of time to make it alive before the competitors finish theirs.

In addition to time and cost, there are also other drawbacks to the product. The technology is so easy to be copied and infringed and therefore we should set proper protection method to make sure the trade secret will not be stole. And once we promote our system to the public, it will be presented to our competitors and they can easily come up with upgrading ideas and exceed our competitive advantages. Therefore we have to keep improving the performance of this system and keep our advantage in the market.

Issue/market opportunity

Issue/market opportunity

The current problem for the restaurant owners is that they are suffering a hard time to effectively manage their employees for the shifts. The paper management and old local computer management system is out of date, which cause them a lot of unnecessary money to put on the daily scheduling task. The cost of time and efforts are very high and their option for scheduling system is very limit since those systems are very expensive and inefficient.  There is a great possibility that a new restaurant scheduling system will provide more functionalities than the current ones and replace them eventually. This new system will provide more ways of doing business and preforming scheduling  tasks such as enabling cell phone integrations, central database and fast responding which will eventually reduce the cost of employee management and increase the efficiency of managing part time and full time employees in a restaurant.

Based on the opportunity screen, we find that there are potentials that we can find as opportunity to compete with existing vendors in the market. First of all, the system that we are promoting to the market has an improvement concept of the existing systems and can be viewed as a “new generation” product. It can not only provide basic functions but also the premium functions on the network to link to other digital medias and enable our primary customers link themselves to other industries and internet community. The customers are reachable and easy to contact. They are local restaurant owners and we can easily find them using the yellow book or search their conduct information online. The benefits of this system to users are significant. It will save the restaurant owners’ time on planning their employee’s schedule, managing human resource and improve productivity. Furthermore, since the product is not tangible, therefore it has an infinite life time than physical products. As long as we can properly maintain and provide updates to it, customer can use it as long as they want.

The market size is huge; there is a billion dollar restaurant market in the US and much bigger one internationally. The trend of information technology and internet will also make the digital restaurant market grow bigger and faster in the near future. In terms of cost, we do have very competitive advantage on keep operational cost low and profit margin high. Since we are internet based company, there is no need to hire someone to operate in stores and the money saved from renting local stores are huge especially for a startup company. On the other hand, there are also big cost exist including development f the new system, marketing and human resource. The development process may be the most expensive one because it is related to hiring technical people, building up labs and applying for intellectual property protection.

Regulation of Pet Shops

Regulation of Pet Shops

Information Technology Venture Capital is Dead – Part I

Information Technology Venture Capital is Dead – Part I

Partnership

Partnership

Opportunity

                Trend of the market

Nowadays, with the increase of labor cost and tight economy, there is a great demand for the scheduling system from restaurant and hotel industry. The owners of the restaurants need to reduce their cost on employees, improve scheduling efficiency so that they can effectively hire and lay off employees. In addition, the employers need to attract both skillful and fresh employees from the labor market and their targets are mainly college and high school students. With the development of wireless services, internet and e-communication technology, more and more people are going on line to use social networks such as facebook, my space and craigslist for job hunting and communicating with their friends.

All of the traditional industries are moving toward paperless and get on line, so is the restaurants. Even though there are existing vendors in the market to provide such service and functionality, however the increase number of demand for such systems is significantly higher and more functions that enable the restaurant owners promote their store to the local community are required. Based on this situation, we, the super R schedule group proposes to promote our scheduling system to the restaurant industry and provide consulting service to the middle and small size restaurants in rural areas.

Target and size of the market           

The existing market is large enough for us to start and gain profit within three years of lunching our system.  Three of the most successful and largest IT companies have already occupied the large restaurants and major hotel market. However, their focus is mainly in large cities rather than small towns. Most of the small size restaurants in the rural areas still do not have an idea on the new concept and they are not educated by our competitors yet. Therefore, we set our goal to surrender the large cities by taking the small cities and town’s market share. Also, the market in the US has great potential to growth due to the fact that this concept is relatively new and it is possible to educate more restaurant owners to adopt our system.

Additionally, the potential market and profit chain come from over sea market. The trend of information technology gives us a great advantage to reach customers over sea to easily educate them with our concepts and ideas. We can set several actual locations in the major cities in other countries to provide real time and in person service. The system can also be translated into different languages to server different customers with different nationalities.  We may also consider building up a customer support center to provide phone service to the customers all over the world. Along with a on knowledge sharing system  that customers can reach everywhere in the world, the training process become easy to manage and we may spread the concept though internet using social networks such as YouTube, Twitter, FaceBook and others to any place on the earth quickly and easily.

Face to changes

Our goal is to build up an information technology company provide restaurant scheduling system which can save our customer time and money on managing their employees. Our subjective is to establish an on line and digital venture mainly provide service and provide download of our system on line. There are several advantages of building a on line venture than a traditional in store company such as low cost of operating,  less risk, less capital needed for start up and most importantly, it is agile. The formation of a digital company is very flexible in terms of face challenges and changes. We have less pressure on rentals, employee salaries and taxes. The majority of the cost of our company will be the developing of new system or adding new functionalities. We are able to provide both high and low customization service to our customers which means we can easily switch from low cost plus low price to premium whenever the market or the economy changes.  Overall, we have less cost, large market potential and great flexibility to adapt to any situation.

End user analysis

There are two majority groups of the end users we can reach. On one side, they are the owners of the restaurants, on the other side; they are the employees who are seeking new jobs or shifts to work in local restaurants. Therefore, we designed two major components in the system for satisfying these two major groups.

                Restaurant owners

                The needs for restaurants owners are :

1.       Find skillful employees

2.       Find cheap employees

3.       Schedule work shifts for employees

4.       Balance light and heavy operations

5.       Monitor employee performances

6.       Build up good reputation in the local labor market and community

7.       Find out the potential leader and promote him or her to the manager

The needs for the potential and existing employees are:

1.       Find good or better employer with good compensations and pay

2.       Easy to manage their time and work as they wish to work

3.       Build good reputation in the industry and being hired by better employer

4.       Get promotion and get a leadership position

Based on these requirements, we find out that the only way that we can make our system being accepted and successful is to integrate the functions designed to satisfy these two different groups together. We need to build up a centralized database and server to effectively build up a communication between every employer and every employee. By providing them the necessary information and communication channel, both employees and employers can reach their goal and therefore become happy after using this system. And finally pay for the service or even pay for premium for additional service.

As we will reach many industries when promoting our product to the market, it is easier for us to build up partnership with some existing companies in order to take advantage of their reputations and relationship pool. We will consider three major industries to partner with. First is the staffing company. They own a large resource on people who are seeking jobs in restaurant industries. We can consider partnering with them to better manage this resource. The staff company can use our system to collect and send out hiring information and we can link the employee database to the restaurant’s owner’s interface, so that the owners will be able to oversee any possible employees that they can hire the next day when they fire someone. And every restaurant owner is required to provide feedback to the employee regularly to help the future employer effectively select best employee they can hire. Furthermore, the employee should also make comments on the working environment, employer and feelings about working in certain restaurants, so that other people will be able to make the best choice when they are seeking jobs.

The second partnership is the software industry. By working together with them, we can together develop a user friendly system and save a significant cost to start up. We can share the license with them or make an agreement to pay them certain percentage of income in the future or provide them with common stock as compensation. The benefit of partnering with a technology oriented company is that they can design and make a system cheaper, better and faster. And we can use our idea and design as the asset to put into the project. We may consider long term relationship with the software company since we need their expertise.

The last option of partnership is the social network companies. These organizations have the resource of promoting our product to the market. We may consider adding our system as an application in apple store or on facebook or on other platforms. We can share certain percentage of the profit to this social network site whenever anyone of their customers makes a payment and become our customer.

Steps to build partnerships can be hard and complicated for us as a startup company.  We have less resource and human network within IT, Staffing and social network industry. However there are still few ways we can try to promote us to these partners. The easiest one is to promote us to some free social network sites such as twitter, blogs, my space and Face Book. We can add a video to market us on YouTube and by a Google AD from Google. Also, we can try to seek help from universities by talking to professors, researchers and program coordinators. These people have the necessary relationships with local business and they may be helpful to help us establish the connection to these partnerships. Finally, we should not miss any conference that is relative to our subjects. We need to seek any possibility to present our company, product and our ideas, to make people feel interested in us.

The relationship can be visually represented by the following flow charts:

System development

Partnership with Software Company

 

Partnership with Staffing company

 

                              

 

Partnership with social network company

we will target our customer though three ways. First, we need to build a distribution channel though major newspaper and on line searching engines such as