UiTM - BMC Report (ENT300)

ENT300
FUNDAMENTALS OF ENTREPRENEURSHIP
2. BUSINESS MODEL CANVAS REPORT
PREPARED BY:
NO. NAME ID NO. GROUP CODE
1. UMAIRAH BINTI KHAIRI 2018210424 PHM1154D2
PREPARED FOR:
LECTURER’S NAME : AZLI BIN UMAR
SEMESTER : MARCH 2020 – JULY 2020
SUBMISSION DATE : 15th. MAY 2020

TABLE OF CONTENTS PAGE NO.
Introduction 1
Key Partners 2 – 3
Key Activities 4 – 5
Value Propositions 6 – 7
Customer Relationships 8
Customer Segments 9
Key Resources 10
Distribution Channels 11
Cost Structures 12 – 13
Revenue Streams 14 – 15

ENT300 Fundamentals of Entrepreneurship
BMC REPORT (INDIVIDUAL) – THE RUBRIC
Criteria Marks
Allocated
Poor Moderate Satisfactory Good Excellent Weighted
Marks
Obtained (%)
Introduction 10 0 – 2 marks 3 – 4 marks 5 – 6 marks 7 – 8 marks 9 – 10 marks
Many key elements
are not highlighted
Few key elements are
highlighted
Key elements are
fairly highlighted
Key elements are
correctly highlighted
Key elements are
excellently highlighted
Key Partners 10 0 – 2 marks 3 – 4 marks 5 – 6 marks 7 – 8 marks 9 – 10 marks
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are
Key Activities 10 0 – 2 marks 3 – 4 marks 5 – 6 marks 7 – 8 marks 9 – 10 marks
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are
Value
Propositions
10 0 – 2 marks 3 – 4 marks 5 – 6 marks 7 – 8 marks 9 – 10 marks
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are
Customer
Relationships
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are
Customer
Segments
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are

Criteria Marks
Allocated
Poor Moderate Satisfactory Good Excellent Weighted
Marks
Obtained (%)
Key
Resources
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are
Distributio
n
Channels
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are
Cost
Structure
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are
Revenue
Streams
Many key elements
are not highlighted
highlighted
Key elements are
fairly highlighted
Key elements are
Key elements are
Total 100 Total

1
INTRODUCTION
Business Model Canvas is strategic management and starting template for expanding new or
existing business models. In 2005, Alexander Osterwalder has initially proposed the nine "building
blocks" of the Business Model Canvas based on his earlier work on business model ontology.
Around 2008, new canvases for specific niches have emerged. Using the template, any company
can quickly describe their business model. The template consists of nine boxes, which are Key
Partners, Key Activities, Value Propositions, Customer Relationships, Customer Segments, Key
Resources, Distribution Channels, Cost Structures, and Revenue Streams.
For this assignment, I choose a food and beverage company named Secret Recipe Cakes & Café
Sdn Bhd. Founded in 1997 by Tan Sri Dato' Steven Sim, Secret Recipe has successfully established
its brand name in Malaysia, Singapore, Indonesia, Thailand, China, Brunei, Cambodia, Myanmar,
Maldives, and Bangladesh. The company also plans to enter the India and New Zealand markets
in the future. This cafe serves cakes and fusion food with a Halal certificate given by Jabatan
Kemajuan Islam Malaysia (JAKIM). The cafe usually located in shopping malls and prime urban
locations in major cities in the region. Secret Recipe has grown to over 440 cafes throughout Asia
since its establishment. The company also has opened branches in Australia once but because of
the high costs of starting up a franchise, the operation was stopped.
I choose this company because I have interested in researching the food and beverage sector
compared to other sectors. Besides, it is a leading and largest café chain in Malaysia that has a
good reputation and famous among Malaysian because of their delicious cakes. I can say that
almost all Malaysian will celebrate anything with the Secret Recipe cakes. Other than that, as a
Muslim, I think it is good to know that they committed to follow the standards of preparation of
all food and processing plants in the restaurant under the Halal-certification regulatory guidelines
including HACCP and VHM guidelines.

2
KEY PARTNERS
For over 20 years of Secret Recipe through ups and downs in the food and beverage sector, they
succeed to be the leading and largest cafe chain in Malaysia. The achievement that they get today
will never happen without the help of their key partners. A popular actor, model, and TV host;
Awal Ashaari starting being their ambassador for the “Saat Manis Bersama Secret Recipe”
campaign from 2018 until now (refer to appendix B; Figure 1.0). Since the Buka Puasa event and
"Saat Manis Bersama Secret Recipe" press conference in June 2018, they received more customers
than before which is the fans of Awal Ashaari. They also held an event where the Secret Recipe
picks any 10 lucky winners to have an exclusive dinner with Awal Ashaari. This action helps
Secret Recipe gain more profits and popularity.
Next, Secret Recipe also collaborates with GrabFoodMY to deliver their cakes straight to the
customer's door (refer to appendix B; Figure 1.1). This helps when customers lazy, busy, or do not
have their transport to get out and get the cakes that they want from Secret Recipe, they can order
the cakes by food delivery service through GrabFoodMY apps. They also give promotions like
20% off with a purchase of RM50 and above for their customers that use the GrabFoodMY
delivery service to order their cakes. This collaboration helps Secret Recipe gain more profit not
only from walk-in and dine-in customers, or from their delivery service but from also the
GrabFoodMY users.
Lastly, they also do collaborates with Lazada Malaysia (refer to appendix B; Figure 1.2).
Customers can make an order through the Lazada mobile apps and pay using online banking,
Touch 'n Go eWallet, Lazada Wallet, and credit or debit card. Then, Secret Recipe delivery service
will deliver the cakes that the customers order. Secret Recipe also gives vouchers for the Lazada
users such as RM10 off with a minimum spend of RM150 and RM5 off with a minimum spend of
RM75. The offers, promotions, and vouchers given will change from time to time. The function

3
of these vouchers and promotions is to attract customers to spend more, so it will increase their
sales.

4
KEY ACTIVITIES
Key activities are important things for Secret Recipe needs to do to run. In other words, it is the
key thing that the Secret Recipe needs to do to deliver their value propositions to the customers.
Based on research by two scholars named Charles B. Stabell and Øystein D. Fjeldstad, key
activities can be classified into Production, Problem Solving, and Platform/Network.
One of the key activities for Secret Recipe Cakes & Café Sdn Bhd. is to experiment on new recipes
to give their customers new types of dishes in order to bring new customers. As an example, Secret
Recipe introduces a new type of cheesecake named Butterfly Pea Lemon Cheese (refer to appendix
B; Figure 1.3) which is made from premium imported Australian cream cheese infused with
butterfly pea flowers and candied lemon zest.
Next, they also provide more varied options for their customers. For the cakes only, Secret Recipe
has divided the cakes into five categories which are Cream Cakes, Cheese Cakes, Brownies,
Premium Cakes, and Square Cakes. Under each category of cakes, there are lots of cakes type. For
example, under the Cream Cakes category, there are 8 types of cakes and the famous one is
Chocolate Indulgence which is made from a creamy and rich Belgian coverture chocolate and
white chocolate filling. Then for the fusion foods, they have Starter, Asian Classic, Western, Kid's
Club, and Shinjuku Bake. Just like cakes, in every category of fusion food, there are more types
of dishes the customers can choose.
In marketing and promotion, Secret Recipe Cakes & Café Sdn Bhd. usually, do collaborations with
Malaysian celebrities like in 2017 they do a collaboration with Afdlin Shauki for the "Life is
Sweet" campaign (refer to appendix B; Figure 1.4) to attract customers especially his fans to comes
to buy his selected favorite cake in Secret Recipe which is Raspberry Cheesecake and for every

5
purchase of the cake sold for as low as RM88, for RM5, will be donated to Muslim Care Malaysia,
the Chow Kit Foundation, the Charity Care Welfare Organization, and the National Cancer
Council. Throughout this campaign, Secret Recipe used the social media platform to launch a "Life
is Sweet" campaign by holding a competition and giving people the opportunity to win vouchers
and socialize with Afdlin Shauki. They also do promotions like Buy 3 Free 1, Buy 2 Free 1 and
Buy 1 Free 1 for a special celebration like 11.11 for cakes and the fusion foods (refer to appendix
B; Figure 1.5).
For delivering their products, Secret Recipe does their delivery service straight to the customer's
house. They also collaborate with GrabFoodMY for delivering its products. The customers can
download the app from the Play Store for Android users and the App Store for iOS users. So, in
this way, they manage to reach their potential customers that have no time or transport to walk-in
to their outlets.

6
VALUE PROPOSITIONS
A value proposition is a promise made by Secret Recipe to its customers. It is an "easy-to-
understand" reason why the customers should buy the products from the Secret Recipe. Their value
proposition creates value for a customer segment through a different mix of elements to that
segment’s needs. Values might be quantitative like price and speed of service or qualitative like
design and customer experience.
There are lots of customer needs and expectations that a company needs to satisfy. For the Secret
Recipe, customers demand a fair price, a good service, a good product or high quality of food, a
comfortable environment, accessible, and many others.
For the price ranges, Secret Recipe offers an affordable price for the middle and higher-income
groups. But for the lower-income group, the price offered is may be quite high. However, they
guarantee to serve high quality of cakes and their fusion foods. This shows that they are still giving
their customers a fair price for the great quality of food even though for some people the price
range is quite high but it is worth every penny. The statement "Indulge in our selection of cakes to
satisfy your every sweet craving, for all occasions." also shows that Secret Recipe promises its
customer to satisfy the customer sweet craving by serving a high quality of cakes.
Secret Recipe also providing a good service starting from the friendly employees, great customer
serving technique, and they also communicate with their customers through the internet on the
platform like Facebook and Instagram (refer to appendix ; Figure 1.6). The customers also can
give their feedback or any complaint through their Facebook for a quick response.

7
For a comfortable environment, Secret Recipe gives a pleasant and personalized full-service dining
experience, combines a modern contemporary and vibrant interior concept with a comfortable
ambiance for their customers. It gives a great environment for customers to enjoy good food and
quality time with friends, family, or co-workers, after a long day at work.
The business’s location is key to successful operations and overall development. Almost all the
Secret Recipe outlets located in a strategic location full of crowd and easy to access like in the
shopping mall and shop lot. So there is no issue about the car parking lot or what so ever.

8
CUSTOMER RELATIONSHIPS
The relationships that Secret Recipe have with their customers will heavily impact the customer
experience. To keep a good relationship with its customers the company must clarify what is the
type of relationship it wants to establish for every customer segment. Relationships are established
within various channels. Relationships can vary from personal to automated, from transactional to
long-term, and can aim to acquire customers, retain customers, or boost sales.
There are a few types of customer relationships that any company may use such as Personal
Assistance, Dedicated Personal Assistance, Self-Service, Automated Services, Communities, and
Co-Creation. The type of customer relationships that Secret Recipe Cakes & Café Sdn Bhd.
establish with their customers is Personal Assistance. This relationship is based on human
interaction. The customer can communicate with the Secret Recipe's employees to get help during
the sales process or after the purchase is complete. This may occur onsite at the point of sale (POS),
through call centers, by e-mail, etc. The type of customer relationships that they established
genuinely influences the overall customer experience.

9
CUSTOMER SEGMENTS
The mass market is the customer segments that Secret Recipe used. It is focused on a large group
of customers without differentiating the types of customers and aims to satisfy similar customer's
needs and problems. Secret recipe targets its product to sells to teenagers, family, and middle or
high-income groups. They were given price lining that they need to follow to standardize all the
pricing provided by the brand. Their pricing objective is to be reasonably intended to give
opportunities to the average income to experiencing good dining. The range of prices offered by
Secret Recipe is affordable for the middle-income group and higher. This is because of the high
income and modern styles among the people of those living in the area. But it is quite high for the
lower-income group.

10
KEY RESOURCES
Key resources are the most important assets. It allows the Secret Recipe to create and offer a Value
Proposition, reach markets, earn revenues, and maintain the relationships with their Customer
Segments. Key resources can be categorized into Physical, Intellectual, Human, and Financial. In
the Physical category, it includes physical assets such as manufacturing facilities, machines,
buildings, systems, vehicles, point-of-sale systems, and distribution networks. Then, in the
Intellectual category, it includes brand, proprietary knowledge, patents, and partnerships. In the
Human category, it includes creativity and experience. Lastly, the Financial category, which are
cash, credit, and stock.
One of the key resources that important for Secret Recipe is the Physical category. Secret Recipe
has its own machinery and manufactories located in Kempas Johor Bahru, Taman Mayang, and
Kota Damansara, Selangor. They have nearly 350 outlets across the country, two-thirds of the
cafes are french and the rest are their main cafes. Secret Recipe also does delivery service to their
customer's house using their own vehicles. They may use motorcycles but cars also will be used
for the deliveries of Secret Recipe cakes. Cars help to ensure that the cakes are delivered in the
freshest possible condition and handled with care.
Another of their key resources is Intellectual property. Secret Recipe relies heavily on the brand
since they are a leading and largest cafe chain in Malaysia that has a good reputation and famous
among Malaysian. The high quality of cakes that they serve to the customers is their main strength
to be number one among another cafe that also sold cakes.

11
DISTRIBUTION CHANNELS
A distribution channel is a path in which a product or service passes until it reaches the end
intended consumer. This also describes how the payments are made from the end consumer to the
first vendor. Distribution channels may involve wholesalers, retailers, distributors, and even the
Internet. It can be short or long and depend on the number of intermediaries needed to deliver a
service or product.
Distribution channels can be divided into two different forms which are direct and indirect. A
direct channel lets the consumer make purchases from the manufacturer. But an indirect channel
lets the consumer buy the products from a wholesaler or retailer. Products that are sold in
traditional brick-and-mortar stores are usually indirect channels.
Secret Recipe distribution channels are wide. They are selling their products directly to their
customers without the help of middlemen like retailers or wholesalers by opening their own retails
shops. For the past 5 years, Secret Recipe Cakes & Café Sdn Bhd. has registered impressive
double-digit growth and has experienced rapid growth of over 150 cafes throughout the region in
a short period of 10 years.
They also doing e-business by selling their products through the internet. They are using an online
platform to approach more potential customers. For example, they are selling their cakes in through
their website (refer to appendix B; Figure 1.7) and Lazada. However, both channels are working
very effectively because there are customers who love to walk-in to the Secret Recipe outlet and
enjoy their meal in there or to go the outlet to choose their favorite cakes by looking at the cakes
themselves and take it home even though they can just stay at home and order the cakes online.

12
COST STRUCTURES
Cost Structure is the important final step that represents all the costs and expenses that Secret
Recipe incur while operating their business model. It can be categorized into 2 cost structure which
is value-driven and cost-driven. Value-driven cost structures are focus to create more value in the
product itself, not necessarily producing the product at the lowest possible cost. However, cost-
driven cost structures focus on minimizing the costs of the product or service as much as possible.
Secret Recipe is more value-driven because they create more value in the products that they
produce. That is why the price of their products quite high. Machinery and raw material usage is
the most expensive cost that Secret Recipe has to spend because they need good machinery to
produce high-quality products. The most expensive key resources for Secret Recipe is in the
Physical category. They have their own machinery and manufactories includes almost 350 outlets
across all around the country and vehicles for delivery service. While marketing and promotions
are the most expensive key activities for Secret Recipe. This is because they need to pay their
brand ambassador and the celebrities that they hire for promoting their brand.
Cost structures have multiple characteristics includes Fixed cost, Variable cost, Economies of
scale, and Economies of scope. Fixed cost is the amount that never changes with a decrease or
increases the amount of product produces or sold. It is also the expenses that the organization has
to be paid. A fixed cost is usually established by contract agreement or schedules. This includes
the rent and management salaries, insurance, property taxes electricity, and the internet. While
variables cost is the expense that changes in proportion to production output. It depends on the
production volume. These are the items that are directly used in serving customers and differ based
on their total number of sales. For example, the cost of raw materials and packaging. Variables
cost can reduce the breakeven point.

13
Then, the Economies of scale are an advantage experienced by most big companies with a high
output quota. Basically, this is a cost advantage that big companies can enjoy due to their size, the
sheer quantity of output, or scale of operation. Lastly, the Economies of scope refer to the decrease
in costs when a business invests in various markets or a larger scope of operations. The average
cost of production is assumed to decrease if a company opts to grow the number of goods it
produces.

14
REVENUE STREAMS
Revenue is the number of money that is brought into a company through its multiple business
activities like sales of products and services. A Revenue Stream is presenting the cash a company
makes from every Customer Segment. Usually, most businesses need at least one great revenue
stream to obtain money. Every revenue stream might have several pricing mechanisms, such as
fixed list prices, auctioning, bargaining, volume dependent, market dependent, or yield
management. A business model can include transactional revenues occurring from one-time
customer payments like sales, or recurring revenues like a subscription.
Revenue Streams can be generated in several ways includes Asset sale, Usage fee, Subscription
Fees, Lending/Renting/Leasing, Licensing, Brokerage fees, and Advertising. An asset sale is the
most broadly understood revenue stream receives from selling ownership rights to a physical
product. The sale of physical products is when customers pay in cash or using debit/credit cards
for the foods and beverages that they buy from the Secret Recipe cafe and customers are free to do
whatever they want with the products they bought. The customers also can order cakes from them
through their website (online), makes payment through the online banking and they will deliver
the cake to the customer's location.
Next, the usage fee is generated when the customers use a particular service and paying a user fee.
As an example, GrabFoodMY or Secret Recipe delivery service charges customers for the delivery
of a cake from the business outlet to the customer's location.
For the volume-selling, Secret Recipe charges a fixed price for the products they sell. However,
they also have promotion strategies such as offer a Birthday Promotion with the condition of
purchase a whole cake, and the birthday boy or girl will give a complimentary meal or drink. Next,

15
Buy 1 Free 1 Meal On Every 2nd & 3rd Monday Promotion with few terms and conditions like
only valid for dine-in from 6 pm till closing, purchased and the complimentary main course must
be from the selected 5 dishes, and the complimentary main course must be the same or lower value.
Then, they also have promotions like Secret Recipe Teacher's Day Promotion RM3 Off, Secret
Recipe FREE Boba Beverage Promotion, Secret Recipe Jom Berbuka Puasa Set Meals Promotion,
Secret Recipe Lunch Set 20% OFF Promotion, Secret Recipe FREE Mushroom Soup Promotion,
and many more. Some of the promotions may only available for selected dates or days with few
terms and conditions.

FACULTY OF BUSINESS AND MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
ENT300 Fundamentals of Entrepreneurship
BMC REPORT - INDIVIDUAL (20%)
At the end of the assignment, students should be able to demonstrate the entrepreneurial mind in identifying business
opportunities (CLO2-A3)
No. Student’s Name: Student’s ID Group Code Weighted Marks
Obtained (%)
1. UMAIRAH BINTI KHAIRI 2018210424 PHM1154D2
Lecturer: AZLI BIN UMAR

APPENDICES
Appendix A: Business Model – SECRET RECIPE
Key Partners Key Activities Value Propositions Customer Relationships Customer Segments
• Brand
ambassador
• GrabFoodMY
• Lazada
• Experiment on
new recipes
• Provide more
varied options
for the
customers
• Marketing and
promotion
• Delivery
• High quality of
food
• Comfortable
environment
• Accessible
• Fare price
• Personal
assistance
• Teens 13-17
• Family
• Middle and
higher income
group
Key Resources Channels
• Physical –
manufactory,
business outlets,
vehicles
• Brand – Secret
Recipe
• Direct channel –
business outlet
• Online platform –
official website
Cost Structure Revenue Streams
• Marketing and promotion
• Brand ambassador fees
• Fixed costs: salaries, rents, utilities
• Food and beverages sales
• Food delivery sales
• Promotions

Appendix B: Figure 1.0 – 1.7
Figure 1.0: Awal Ashaari as SR Ambassador

Figure 1.1: GrabFoodMY x SR
Figure 1.2: Lazada x SR

Figure 1.3: New type of cheesecake named Butterfly Pea Lemon Cheese
Figure 1.4: Collaboration with Afdlin Shauki for the "Life is Sweet" Campaign

Figure 1.6: Social Media Platform – SR Official Facebook and Instagram

Figure 1.7: SR Official Website

REFERENCES
1. Business Model Canvas. (2020, April 13). Retrieved from
https://en.wikipedia.org/wiki/Business_Model_Canvas
2. Secret Recipe (restaurant). (2020, May 2). Retrieved from
https://en.wikipedia.org/wiki/Secret_Recipe_(restaurant)
3. Secret Recipe Cakes & Cafe Malaysia. (n.d.). Retrieved from
https://www.secretrecipe.com.my/
4. Kenton, W. (2020, February 19). How Distribution Channels Work. Retrieved from
https://www.investopedia.com/terms/d/distribution-channel.asp
5. A, S. (2019, July 29). Types of Distribution Channels: With Example and Methods.
Retrieved from https://www.economicsdiscussion.net/distribution-channel/types-of-
distribution-channels/31760
6. Business Enterprise. (n.d.). Retrieved from https://kokchin1996.wixsite.com/secret-recipe-
assign/page3
7. Customer Relationships. (2014, August 10). Retrieved from
https://bmcintroduction.wordpress.com/customer-relationships/
8. The Business Model Canvas Series: Customer Relationships & Channels. (2019, January
7). Retrieved from https://www.ashtonmcgill.com/introducing-business-model-canvas-
customer-relationships-channels/

9. How do I use the Customer Relationships building block of the Business Model Canvas?
(n.d.). Retrieved from https://strategyzer.uservoice.com/knowledgebase/articles/1194373-
how-do-i-use-the-customer-relationships-building-b
10. How do I use the Value Propositions building block of the Business Model Canvas? (n.d.).
Retrieved from https://strategyzer.uservoice.com/knowledgebase/articles/1194370-how-
do-i-use-the-value-propositions-building-block
11. Twin, A. (2020, January 29). Value Proposition: Why Consumers Should Buy a Product
or Use a Service. Retrieved from
https://www.investopedia.com/terms/v/valueproposition.asp
12. Business Model: Key activities. (n.d.). Retrieved from
https://www.empowerwomen.org/en/ilearn/my-courses/business-development/business-
model/business-model-key-activities
13. How do I use the Key Activities building block of the Business Model Canvas? (n.d.).
do-i-use-the-key-activities-building-block-of
14. How do I use the Key Resources building block of the Business Model Canvas? (n.d.).
do-i-use-the-key-resources-building-block-of-t
15. Cost Structure. (2014, August 8). Retrieved from
https://bmcintroduction.wordpress.com/cost-structure/
16. Cost Structure Block in Business Model Canvas. (2019, September 19). Retrieved from
https://www.cleverism.com/cost-structure-block-in-business-model-canvas/

17. (n.d.). Retrieved from https://www.syioknya.com/DealList/Secret+Recipe
18. How do I use the Revenue Streams building block of the Business Model Canvas? (n.d.).
do-i-use-the-revenue-streams-building-block-of
19. Business Model: Revenue streams. (n.d.). Retrieved from
https://www.empowerwomen.org/en/ilearn/my-courses/business-development/business-
model/business-model-revenue-streams
20. (n.d.). Retrieved from http://www.ecommerce-digest.com/revenue-streams.html
21. Amir, A. (n.d.). example of secret recipe assignment. Retrieved from
https://www.academia.edu/30853159/example_of_secret_recipe_assignment

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