11/10/2008 The Oak, Bristol The Oak

The Oak Business Plan Prepared by: Olly Swayne Prepared for: Mike Pearce

Background Pub closed by Police in September 2008: Customer demographic D & E Cheap dinks Drugs Violence Reopened November 2008 11/10/2008 The Oak, Bristol

Pub closed by Police in September 2008:

Customer demographic D & E

Cheap dinks

Drugs

Violence

Reopened November 2008

History Run as community boozer Strong link to football and sport Recommended by Bristol Rivers web site Reputation for volatility and aggression High Police profile Limited food offer Limited use of beer garden Extremely competitive and developing market place 11/10/2008 The Oak, Bristol

Run as community boozer

Strong link to football and sport

Recommended by Bristol Rivers web site

Reputation for volatility and aggression

High Police profile

Limited food offer

Limited use of beer garden

Extremely competitive and developing market place

Economic Climate PWC recently suggested more than 4,000 pubs will go out of business in the next two years. Pub beer sales are down about 9% Cheap offers in supermarkets Vicious economic downturn Smoking ban Beer Duty hike Poor weather 11/10/2008 The Oak, Bristol

PWC recently suggested more than 4,000 pubs will go out of business in the next two years.

Pub beer sales are down about 9%

Cheap offers in supermarkets

Vicious economic downturn

Smoking ban

Beer Duty hike

Poor weather

Economic Climate Pub closures up to 5 a day and worsening… 30% of Leased pubs “uneconomic” Sector facing "its worst crisis in 70 years" as food and utility costs rocket and more consumers drank at home Consumers are cutting back on trips to the pub according Bank of England 11/10/2008 The Oak, Bristol

Pub closures up to 5 a day and worsening…

30% of Leased pubs “uneconomic”

Sector facing "its worst crisis in 70 years" as food and utility costs rocket and more consumers drank at home

Consumers are cutting back on trips to the pub according Bank of England

Economic Climate Punch announcing that rent concessions had increased to £6 million … analysts forecasting that pub tenants could see a fall in profits of up to 90 per cent next year Pubs, gyms and any businesses that depend on discretionary spending are already bleeding. It won’t be a happy Christmas for the high street . 11/10/2008 The Oak, Bristol

Punch announcing that rent concessions had increased to £6 million

… analysts forecasting that pub tenants could see a fall in profits of up to 90 per cent next year

Pubs, gyms and any businesses that depend on discretionary spending are already bleeding. It won’t be a happy Christmas for the high street .

Demographics 75% Urban Intelligence Caring Professionals 64% Original Suburbs 13% Town Gown Transition 8% New Urban Colonists 3% Just moving In 2% 15% Suburban Comfort 11/10/2008 The Oak, Bristol

75% Urban Intelligence

Caring Professionals 64%

Original Suburbs 13%

Town Gown Transition 8%

New Urban Colonists 3%

Just moving In 2%

15% Suburban Comfort

Retail Proposition Modern, Stylish, Contemporary, Casual Quality food, fast pace of lifestyle, could be Gastro Cosmopolitan audience Low Tempo venues for comfort social interaction Occasions: Relax with Drinks Casual Dining Needs: Going to the Pub - 42% Eating Out - 55% Wines - 30% 11/10/2008 The Oak, Bristol

Modern, Stylish, Contemporary, Casual

Quality food, fast pace of lifestyle, could be Gastro

Cosmopolitan audience

Low Tempo venues for comfort social interaction

Occasions:

Relax with Drinks

Casual Dining

Needs:

Going to the Pub - 42%

Eating Out - 55%

Wines - 30%

The Market Place Casual drinking and dining saturated Predominantly independent operators Demographics polarised between B/C1/C2 and D & E Longest, unbranded High Street in the UK Vibrant and active community spirit ‘ Urban Village’ environment Mixed residential 11/10/2008 The Oak, Bristol

Casual drinking and dining saturated

Predominantly independent operators

Demographics polarised between B/C1/C2 and D & E

Longest, unbranded High Street in the UK

Vibrant and active community spirit

‘ Urban Village’ environment

Mixed residential

The Market Place Within ¾ mile 18 Pubs and Bars 4 Gastro Pub/Bars 7 Town Taverns 2 Family Pub/Bars 6 Venues 6 Community Locals 21 Restaurants 20 Cafés/ Coffee shops 17 Take Aways 11 Supermarkets/ Off Licenses 11/10/2008 The Oak, Bristol

18 Pubs and Bars

4 Gastro Pub/Bars

7 Town Taverns

2 Family Pub/Bars

6 Venues

6 Community Locals

21 Restaurants

20 Cafés/ Coffee shops

17 Take Aways

11 Supermarkets/ Off Licenses

Family Pubs Tinto Lounge The Annex 11/10/2008 The Oak, Bristol

Tinto Lounge

The Annex

Gastro Pubs & Bars Tinto Lounge Zest The Robins Hood Retreat The Flyer 11/10/2008 The Oak, Bristol

Tinto Lounge

Zest

The Robins Hood Retreat

The Flyer

Restaurants Zest Bombay Raj Ganges Fungs Di Meo Cibo Tat Yans La Barrique Delminico Planet Pizza 11/10/2008 The Oak, Bristol

Zest

Bombay Raj

Ganges

Fungs

Di Meo

Cibo

Tat Yans

La Barrique

Delminico

Planet Pizza

Restaurants Natraj Simply Thai EZO Roccos Sheesh Mahal Cassa Mexicana Amici Plantation Thai Pepper Effes Wonderful Thai 11/10/2008 The Oak, Bristol

Natraj

Simply Thai

EZO

Roccos

Sheesh Mahal

Cassa Mexicana

Amici

Plantation

Thai Pepper

Effes

Wonderful Thai

Cafés & Coffee Shops 3Bs café Panini (Closed) International Café Rendezvous Lounge Yum Yums Café Lazz 232 Café (Closed) Metro Café Café Unlimited (Closed) Café Delight 11/10/2008 The Oak, Bristol

3Bs café

Panini (Closed)

International Café

Rendezvous Lounge

Yum Yums

Café Lazz

232 Café (Closed)

Metro Café

Café Unlimited (Closed)

Café Delight

Cafés & Coffee Shops Pronto Café Coffee #1 Halo Café Bar Hatters La Ruca Spice Route Tarte J5 Café Café Aroma 11/10/2008 The Oak, Bristol

Pronto Café

Coffee #1

Halo Café Bar

Hatters

La Ruca

Spice Route

Tarte

J5 Café

Café Aroma

11/10/2008 The Oak, Bristol

11/10/2008 The Oak, Bristol

Community Pubs The Ashley Arms The Queen Vic The Old Fox The Foresters Arms Gloucester Arms The Cat & Wheel 11/10/2008 The Oak, Bristol

The Ashley Arms

The Queen Vic

The Old Fox

The Foresters Arms

Gloucester Arms

The Cat & Wheel

Off Licenses & Supermarkets Bobby’s Carpenter Somerfield x 3 Sainsbury Odd Bins Tesco Metro Bottoms Up Thresher Booze Buster 11/10/2008 The Oak, Bristol

Bobby’s

Carpenter

Somerfield x 3

Sainsbury

Odd Bins

Tesco Metro

Bottoms Up

Thresher

Booze Buster

Take Away Food Dominos Bristol Fryer New Taj La Cuisine Indian Food Kitchen Maxin Chicken Shanghai Express Mad About Sarnies Bishopstone Fish Bar 11/10/2008 The Oak, Bristol

Dominos

Bristol Fryer

New Taj

La Cuisine

Indian Food Kitchen

Maxin Chicken

Shanghai Express

Mad About Sarnies

Bishopstone Fish Bar

Take Away Food Hot Wok Express Joe’s Express Charcoal Grill Ciao Burger Thai Pan Subway Benny’s Chicken Pizza Hut 11/10/2008 The Oak, Bristol

Hot Wok Express

Joe’s Express

Charcoal Grill

Ciao Burger

Thai Pan

Subway

Benny’s Chicken

Pizza Hut

SWOT Analysis 11/10/2008 The Oak, Bristol

Segmentation Population polarised between middle and working classes Currently targeted at working class clientele Working class accounts for less than 1% Disposable income available for ‘healthy value’ offer Gap in the market for Gastro and Family offer Desperate need for great service and quality Food, wine and niche beer focus 11/10/2008 The Oak, Bristol

Population polarised between middle and working classes

Currently targeted at working class clientele

Working class accounts for less than 1%

Disposable income available for ‘healthy value’ offer

Gap in the market for Gastro and Family offer

Desperate need for great service and quality

Food, wine and niche beer focus

Target Generation X C1 & C2 demographic 25 – 45 age range Yummy Mummies Dashing Dads DINKies Older families Fruit bowls & veg’ boxes Fat Face & White Stuff… Sociably sporty, upwardly mobile Independent, Times, Guardian & The Week The great outdoors… German car syndrome Holidays in Europe & camping 11/10/2008 The Oak, Bristol

Generation X

C1 & C2 demographic

25 – 45 age range

Yummy Mummies

Dashing Dads

DINKies

Older families

Fruit bowls & veg’ boxes

Fat Face & White Stuff…

Sociably sporty, upwardly mobile

Independent, Times, Guardian & The Week

The great outdoors…

German car syndrome

Holidays in Europe & camping

Positioning Drastic repositioning required Disassociate with Bristol City FC No gaming machines No permanent screens No bar games No jukebox Urban gastro + shabby chic ‘ Affluenza’ hideaway 11/10/2008 The Oak, Bristol

Drastic repositioning required

Disassociate with Bristol City FC

No gaming machines

No permanent screens

No bar games

No jukebox

Urban gastro + shabby chic

‘ Affluenza’ hideaway

Business Identity Name change required to The Oak John Cabot has very negative connotations Identity change necessary Marketing and positive PR Strategic alliances Community involvement New signage 11/10/2008 The Oak, Bristol

Name change required to The Oak

John Cabot has very negative connotations

Identity change necessary

Marketing and positive PR

Strategic alliances

Community involvement

New signage

11/10/2008 The Oak, Bristol

11/10/2008 The Oak, Bristol

Differentiation Oak Smoked products: Food and drink Oak Smoked themes Oak materials Oak-like values ‘ Oaky’ colour pallet Local provenance and alliances Endorsed specials and menu items 11/10/2008 The Oak, Bristol

Oak Smoked products: Food and drink

Oak Smoked themes

Oak materials

Oak-like values

‘ Oaky’ colour pallet

Local provenance and alliances

Endorsed specials and menu items

The Offer Premium drinks brands Fresh, local produce Simple, reassuring menu Strategic food alliances Great music Great company Home away from home Urban, shabby chic Connecting people Centre of community Comfortable and clean Dynamic bar culture Locally sources ‘Bar Art’ 11/10/2008 The Oak, Bristol

Premium drinks brands

Fresh, local produce

Simple, reassuring menu

Strategic food alliances

Great music

Great company

Home away from home

Urban, shabby chic

Connecting people

Centre of community

Comfortable and clean

Dynamic bar culture

Locally sources ‘Bar Art’

The Operation Focus on standards and service High levels of customer interaction Table service for food Breakfast, Lunch and Dinner service Small experienced team ‘ Managed House’ disciplines Partnerships with local traders Cooperation with Local Authorities 11/10/2008 The Oak, Bristol

Focus on standards and service

High levels of customer interaction

Table service for food

Breakfast, Lunch and Dinner service

Small experienced team

‘ Managed House’ disciplines

Partnerships with local traders

Cooperation with Local Authorities

The Team Director and Manager: Olly Swayne Head Chef and Manager: Accountant: Solicitor: Stocktaker: Payroll: 11/10/2008 The Oak, Bristol

Director and Manager: Olly Swayne

Head Chef and Manager:

Accountant:

Solicitor:

Stocktaker:

Payroll:

Olly Swayne Hospitality Industry experience: Senior Operations & Project Management, Business Development, Business Planning, Process Improvement and Service Quality Branded & unbranded, managed, leased, High Street, out-of-town and HO roles. MBA (Dist), HND (HCIM), Prince2, CMI, MIH, CIPD Personal License, CRB, BII Drugs Awareness 11/10/2008 The Oak, Bristol

Hospitality Industry experience:

Senior Operations & Project Management, Business Development, Business Planning, Process Improvement and Service Quality

Branded & unbranded, managed, leased, High Street, out-of-town and HO roles.

MBA (Dist), HND (HCIM), Prince2, CMI, MIH, CIPD

Personal License, CRB, BII Drugs Awareness

Olly Swayne Leadership, Change and Personal Development: Leadership consultancy and programme development Facilitation of Leadership, Change and Personal Development interventions Accredited practitioner: Personal Effectiveness Profile (PEP 360  model) & MPG™: The Success Connection 11/10/2008 The Oak, Bristol

Leadership, Change and Personal Development:

Leadership consultancy and programme development

Facilitation of Leadership, Change and Personal Development interventions

Accredited practitioner: Personal Effectiveness Profile (PEP 360  model) & MPG™: The Success Connection

Sales & Marketing Service & Quality driven Unique food and drink offer Focus on local provenance Alliances with local suppliers Emphasise community involvement Supplier / producer endorsed menus 11/10/2008 The Oak, Bristol

Service & Quality driven

Unique food and drink offer

Focus on local provenance

Alliances with local suppliers

Emphasise community involvement

Supplier / producer endorsed menus

Sales & Marketing Tailored playlists and Chill FM Newspapers, games and music Stealth marketing via web, database and strategic partners: Riverford, Better Food Wine / Beer / Supper clubs, events and charitable links Loyalty Promotions 11/10/2008 The Oak, Bristol

Tailored playlists and Chill FM

Newspapers, games and music

Stealth marketing via web, database and strategic partners: Riverford, Better Food

Wine / Beer / Supper clubs, events and charitable links

Loyalty Promotions

Business Entity COSine Consulting Limited (CCL) Share capital held by CCL Personal Guarantor Potential share save Profit related pay 11/10/2008 The Oak, Bristol

COSine Consulting Limited (CCL)

Share capital held by CCL

Personal Guarantor

Potential share save

Profit related pay

Capital Investment Lease works and dilapidations Compliance works (CCTV) External Decorations Signage Scheme and lighting Internal decorations Furniture and fittings Capital equipment Audio Visual system Garden improvements Minor Capital Refurbishment 11/10/2008 The Oak, Bristol

Lease works and dilapidations

Compliance works (CCTV)

External Decorations

Signage Scheme and lighting

Internal decorations

Furniture and fittings

Capital equipment

Audio Visual system

Garden improvements

Minor Capital Refurbishment

Financials Considerations Economic conditions worsening and consumer confidence at record low Business turnaround required to secure future viability Capital and marketing investments required Complete repositioning of business Change sales and product mix Liquor margins will be critical Rent to reflect repositioning Sales from very low base Intense competition 11/10/2008 The Oak, Bristol

Economic conditions worsening and consumer confidence at record low

Business turnaround required to secure future viability

Capital and marketing investments required

Complete repositioning of business

Change sales and product mix

Liquor margins will be critical

Rent to reflect repositioning

Sales from very low base

Intense competition

Financials Year 1 Forecasts £5,500 per week average for first 12 months Target turnover £340,500 Gross Profit at 61% Labour costs at 38% Controllable expenses at 15% Fixed expenses at 3.8% EBITDAR = £13,284 Rent = £7,800 EBITDA = £5,484 11/10/2008 The Oak, Bristol

£5,500 per week average for first 12 months

Target turnover £340,500

Gross Profit at 61%

Labour costs at 38%

Controllable expenses at 15%

Fixed expenses at 3.8%

EBITDAR = £13,284

Rent = £7,800

EBITDA = £5,484

Financials Key Performance Indicators Year 1 averages Food .v. liquor split: 23% .v. 77% Food GP = 63% Liquor GP = 60% Labour cost min -£1,510 / max -£3,390 per week Controllable expenses = £982 pw avg EBITDA = 1.6% Rent = 2.3% Rent charge = £150 per week 11/10/2008 The Oak, Bristol

Year 1 averages

Food .v. liquor split: 23% .v. 77%

Food GP = 63%

Liquor GP = 60%

Labour cost min -£1,510 / max -£3,390 per week

Controllable expenses = £982 pw avg

EBITDA = 1.6%

Rent = 2.3%

Rent charge = £150 per week

Financials MAT Performance & Forecast 11/10/2008 The Oak, Bristol

Financials 5 Year Sales Forecast 11/10/2008 The Oak, Bristol

Financials 5 Year Rent Proposal 11/10/2008 The Oak, Bristol

Financials 5 Year Profit Forecast 11/10/2008 The Oak, Bristol

Financials 5 Year Cash flow Forecast 11/10/2008 The Oak, Bristol

Financials 5 Year KPI Forecast 11/10/2008 The Oak, Bristol

Financials Year 1: Cash flow 11/10/2008 The Oak, Bristol

Financials Year 1: Avg Weekly Sales 11/10/2008 The Oak, Bristol

Financials Year 1: Avg Weekly Labour 11/10/2008 The Oak, Bristol

Lease Proposal Lease term: 5 years Phased rent: 2009 Q1 - Q2 £100 pw 2009 Q3 - Q4 £200 pw £150 pw 2010 Q1 - Q2 £400 pw 2010 Q3 - Q4 £500 pw £450 pw 2011 £600 pw 2012 £800 pw 2013 £800 pw Minimum £100 per barrel discount required to hit margins Enterprise start-up investment CCL start-up investment Phased F&F purchase 11/10/2008 The Oak, Bristol

Lease term: 5 years

Phased rent:

2009 Q1 - Q2 £100 pw

2009 Q3 - Q4 £200 pw £150 pw

2010 Q1 - Q2 £400 pw

2010 Q3 - Q4 £500 pw £450 pw

2011 £600 pw

2012 £800 pw

2013 £800 pw

Minimum £100 per barrel discount required to hit margins

Enterprise start-up investment

CCL start-up investment

Phased F&F purchase

Start-up Investment Furniture & fittings CCL Commercial Equipment CCL Interior decoration EI External decoration EI Signage and new lighting EI H&S works EI Compliance works EI Dilapidations EI 11/10/2008 The Oak, Bristol

Furniture & fittings CCL

Commercial Equipment CCL

Interior decoration EI

External decoration EI

Signage and new lighting EI

H&S works EI

Compliance works EI

Dilapidations EI

Next Steps Agree lease terms & timescales Confirm sources of funding Obtain prices for capital works Liaise with potential suppliers to agree terms and service levels Recruit team Liaise with Local Authorities Assess training needs Letter of intent 11/10/2008 The Oak, Bristol

Agree lease terms & timescales

Confirm sources of funding

Obtain prices for capital works

Liaise with potential suppliers to agree terms and service levels

Recruit team

Liaise with Local Authorities

Assess training needs

Letter of intent