MANAGEMENT SKILLS & ENTREPRENEURSHIP (Shahlini Rajndran)

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SHAHLINI A/P K. RAJNDRAN (45)
911124-04-5006
0186NEANEA1016
MSE-MANAGEMENT SKILLS & ENTREPRENEURSHIP

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Table of content
Executive summary 4
Introduction 4
1 Question 1
Vision 5
5
5
5
5
5
5
6
6
6
6-7
Mission
Company summary
Company ownership
Ownership background
Company management structure
Value proposition
Services
SWOT analysis
2 Question 2
The management/workforce 8
8-9Technology
3 Question3
Marketing strategy 9
9
9
10-19
Competitive advantage
Target customer
Finance projection
4 Question4
Relationship to a sucessful entreperneurs strategy 20-21
5 Question5
Proposal to manage risk 21-22
6 Question 6
Common mistakes made by first time entrepreneur 22-23
7 Conclusion 23
8 References 24-25

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The Loft
Shahlini Rajndran
Shahlini211@gmail.co
No 11, Jalan Kubu 75450 Melaka.
014-6482158

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Executive summary
The aim of this report is to come up with an exclusive business plan with details about its basic
strategy information necessary to start up the business. This restaurant business plan is for a
medium in size restaurant located strategically in Malaysia. The loft will focus on emphasizing
on creative and organic ethnic food. The loft’s opportunity gap, management, swot analysis,
marketing strategy and competitive advantages have been discussed. The technology, marketing
and manpower requirement for the success of the business has been identified and discussed
throughout the business plan. A complete financial statement including balance sheet, income
statement and projected forecast amount is also provided for the investors to have overall look at
the projected financial stability. A proposal on risk management and the common mistakes made
has been identified and solution has been given to avoid such issues. The business plan also
explains the relationship status the management should have with the suppliers and customers to
be in the competitive advantage as a strategy plan.
Question 1
1.0 Introduction
In the past 2 decades the organic food industry has been experiencing a huge growth. The sales
of organic food have seen tremendous increases of 20% yearly since 1990. It has been proved
that the rapid increase is because of the consumer being more aware of the possibility of the
health risk they might have because of unhealthy eating habits (Hughner, 2007). Restaurants that
are implementing organic food selection and healthier food choices have been getting more
popular among all age group. The demand for organic food is already been proved by many
researches done by the world health organization (Squires, 2001). Eating organic food is not only
about a person’s individual health concerns but also contributing to the health of the community.
In these past few years Asian market is also experiencing tremendous increase in its organic food
industry(Lockie, 2002). But however many restaurants in Malaysia are not really focused or
aware of these changes in the customers changed behavior, it can simply be said that Malaysians
have minimal awareness compared to other countries.

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1.1 Vision
Our vision is that by 2030, the loaf will be recognized as a global organic and ethnic food
industry leading the organic and health organization with the sector creating more opportunities
of Malaysians economical advantage.
1.2 Mission
The loft is an awesome and great place to eat, interesting food and the combination of intriguing
atmosphere with great excellence. The Loft will know well for its brand name and as a premium
dinning in Malacca as well maintaining an uncompromising principals as the restaurant begins to
grow.
1.3 Company Summary
The loft is medium sized and a single unit restaurant. The main focus is on the creativity and
organic food. The restaurant is located strategically in the heart of Malacca city (Malaysia). The
most important aspect of developing this business is for the financial success, but we believe in
achieving this by offering non greasy, extremely clean food and by providing high quality
services.
1.4 Company ownership
The company will be a limited liability company L.L.C
1.4.1 Ownership Background
Shahlini Rajndran (member):
Legally trained in the UK, she has had a long standing passion for education and health. It’s her
dream to see Malaysia become a global destination for health tourism.
Shamsunnisa M.A. Abdul Jabbar (member):
Bringing more than 30 years of knowledge and experience in the health and education industry,
Mdm Shamsunnisa is a inspiration behind the Loft.

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1.4.3 Company Management Structure
Both, Mdm. Shamsunnisa and Ms.Shahlini Rajndran sit on the board of directors. Ms.Shahlini
Rajndran is the managing director of the company and oversees the daily operation of the
company business. Under Ms.Shahlini Rajndran guidance the company has a number of contract
staff who contributes to the business from various sectors.
1.5 Value proposition
Our value proposition is to give the customers a new model and way to stay healthier and better
life style. When people are healthy, they will have the ability to concentrate better work harder
and also mentally balanced so they can bring the same healthy life style to their family and
community.
 To maintain the food cost under 35%.
 Stay as affordable and casual restaurant to all groups of people.
 Expend and promote advertising in not just the located area but also all over Malacca to
attract tourist and neighboring community.
 Establish and promote the loft as a local staple and an interest point for tourist.
1.6 Services
The loft is an inviting and comfortable restaurant designed in such to make the customers and
tourist to feel satisfied and healthy. The theme and decoration is designed on the local history of
Malacca town. The loft has a very simple customer service policy “all the customers must leave
the restaurant premise happy and satisfied”. The Loft will operate 7 days in a week to fulfill the
customer expectation and needs as Malacca is a Tourist Centre.
1.7 SWOT Analysis
1.7.1 Strength

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The strength of this business is the building and the creative menu itself. The loft offers varies of
local delights as well as many innovative and creative menu choices. The variety of menu is not
only the reason of its strength but also the nutrient value and less health risk in the food items
offered. The increasing demand of organic food and healthier life style is another reason. The
increasing world populations whom are being more concern and well educated are giving
priority to health related issues and matters (Lee, 2009). The time has changed where people are
being more realistic and believing precaution is better than medicine. Asian delicacies, moreover
Malaysian food is very well known worldwide but it is also known as unhealthy food based on
the health risk and Malaysians obesity population (Lee, 2009) n. The loft has become the pioneer
in offering local delicacies with a healthier and organic way. The Loft’s building is LEED
certified, which is also known as green, this means the building project is environmentally
profitable and responsible.
1.7.2 Weakness
The Loft has very creative and innovative concept but it is also a very new idea, brand and
unknown business to the community. The organic food price is also higher than normal
conventional food (Lockie, 2002). As a new business the loft has to overcome its limited fund
and debts during its first year of the business so this is more likely to be weakness and obstacles
to succeed in the first year.
1.7.3 Opportunities
Various opportunities exist within Malaysia because there is no local food offered in an organic
and a healthier way. Malacca being an important tourist Centre in Malaysia has many
opportunities as it is popular among the tourist for medical tourism purpose so it will be a great
opportunity for the loft. The population of health conscious people in Malaysia appeals to many
demographical group. Another opportunity is that increasing demand and health conscious
attitude(Squires,2001).
1.7.4 Threat
There are only a few threat for the loft as, it need to be handled in a more strategic way so that
this business will be successful. Another threat faced by the loft is that the current Malaysian

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economy and the drop of Malaysian currency compared to the previous years. As Malaysian
economy is very bad the citizens are facing very high unemployment rate and people don’t spend
as much as they use to.
Question 2
2.0 The management/Work force
The management philosophy of the loft is based on the respect for all the employees and to fulfill
customers demand and needs. The success for the loft is basically because of its employees and
their caring and warmth to the customers. The loft will be starting its business as a medium and
small restaurant so the employees cost shall be kept in a minimum range. Position that will be
needed to be filled is the management, chef, cleaner, and waiters. Eventually assistant manager is
needed to handle personnel, day to day operation and to make managerial decision when the
owner is not around. Assistant manager is also needed as he needs to monitor the services and
quality of the food delivered to the customer. All employees shall be paid on hourly basis or
monthly basis depending on the employment agreement. Any employees whom is doing
overtime (more than 8 hours a day) shall be given a given an overtime payment for 1.5 of the
normal salary. All the agreement and employment related issues will only be determined in
accordance of the Malaysian employment act 1955 (Act265).
Estimated Payroll (Monthly) Workforce (No) (Amount stated is in USD $)
Waiter 4 1,800
Kitchen (chefs) 4 6,000
Management 2 1,200
Cleaner 2 500
2.1 Technology
In this rapidly growing technological era, everything can be obtained by using social media and
android apps. Every facet of our lives is touched by technology, but with the emergence of
android mobile phoned and cloud computing makes a harder and stronger impact. And it’s very

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rare to go somewhere and not to find a piece of high tech hardware(Rodgers, 2007). And one
restaurant is the other place where we can see the usage of more technology. Online reservation,
online payment methods and social media as a marketing tool technology has inflated there
restaurant business and industry to a new turn. Today technology is seen a massive growth in the
restaurant business as even orders can be made by using I pads or android phones. This will also
reduce the work force and financial sum needed as the job can be done by a piece of hardware
(Rodgers, 2007).
In Future the Loft will consider implementing these methods if it’s getting a positive response
from the customers. Now in Malaysia credit card can also be used as touch and go card. This will
safe everyone’s time and cost. The Loft will provide free internet access and services to its
employee and also the customers. This is important as social media is a huge part of people’s life
nowadays. The Loft is also planning to organize and develop a new app so that the customer can
share their shares and thoughts through social media. As social media is important to the people
it is also a very good an effective marketing strategy (Hughner, 2007). This can be done by using
apps like facebook,twitter,instagram when the customer can check in and then post some
comments and pictures while dinning in the restaurant. The loft sees this as a positive approach
for branding and advertising. Groupon is another application where customers can go online and
review the best place to dine for a reasonable price or discount rate. It is proven that in a
restaurant business the quality, price is the most important aspect for a customer to choose their
dinning place (Hughner, 2007)
Question 3
3.0 Marketing strategy
The lofts marketing strategy is very basic but effective way in reaching the customers in all the
demographic group. The primary and ultimate goal of all the marketing arranged is for
capitalizing the existing customer and for the customer to spread the word about the services and
its food. Public interest is escalated in the latest communication devices and
methods(Yukael,2003). Modern communication methods (technology) such as social
websites,texting,emails,blogs and also many application using android phones. As a very
massive company’s marketing strategic the official website will be integral. The company’s

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branding which are its business cards, letterheads and forms are very important as it has a very
impact on the customer to recognize the brand (Jack, 1997).
3.1 Competitive advantage/edge
The lofts competitive advantage will be its environment, chefs, menu, service and its
management. The environment will be in the green concept and comfortable. Good service is a
must and essential to the loaf. The management will make sure the customers are handled
personally and they are comfortable so that they will be loyal to the restaurant. The organic
ingredients and high quality products used will be compared to the other restaurant business in
the specific are by the customer. The restaurant will gain its popularity as the customers go back
with high satisfaction level (Jack, 1997).
3.2 Targeted customer
As the restaurant business is a pioneer as it provides local organic delicacies, the market
competition is not very massive. The loft will provide the prices according to the current
economical level and the citizen’s capacity of spending. The lofts targeted customers are the
modern family’s as they are more educated and are concern about the health of the family
members. Out main target market is the tourist as Malacca is a place where tourist comes for
vacations and also medical tourism.
3.3 Financial Projection
Financial Projection for the Loft assumed amount which is summarized based on the researches
done to other restaurant business around Malacca. This financial statement and plan covers up
the startup cost required, assumed profit and loss count, cash flow statement and balance sheet
(Buzell, 2008) .
3.4 Important Assumptions

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 The sales forecast is conservatives and assumes a 5% increase in Year 2 and 10% in Year
3.
 The analysis accounts for economic seasonality – wherein some months revenue peak
(such as holidays) and wane in slower months.
 The analysis assumes the owner will take a much smaller salary compared to his chefs; at
any time it is assumed that owner’s withdrawal is available at his direction.
 Sales are cash basis – nonaccrual accounting.
 Moderate ramp-up in staff over the 3 years forecast.
 In general, most restaurant have an 85% gross profit margin.
 In general, most restaurant have an 3 % net profit margin.
3.5 Capital Requirements Plan
At this time, the The Loft requires USD $100,000 of capital funds.
3.6 Capital Repayment Plan
The Loft has forecasted substantial sales revenues by year two. Also by year two the business
will reach profitability and have achieved a healthy profit before taxes. When The Loft begins
their fundraising efforts they will consider options to replace the partnership business formation
that they have currently adopted.

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Table 1: The business start-up cost for the Loft (Amount stated is in USD $)
THE LOFT START-UP EXPENSES AMONUT ($)
EXPENSES
Large Refrigerator 6,000
Tables/Chairs/Furnishing 10,000
Wiring 5,000
Site Design 2,500
Utilities 2,500
Permits, Licenses, Fees, F&B 4,000
Insurance 2,500
Opening marketing and advertising 3,000
Graphic design for signage and menu boards 3,000
Brochures 1,000
Office equipment 600
Computer, Scanner, Printer, Point of System 4,000
Telephone/FAX/DSL 500
Blender (2) 189
Storage racks (3) 300
Music System 3,500
Sinks (2) 600
Cups, Lids 1,000
Stoves 500
PAYROLL
Waiter (4) 1,800
Kitchen (4) 6,000
Management (2) 1,200
Cleaner (2) 500
TOTAL EXPENSES 60,188

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Table 2: The projected profit and loss for the Loft (Amount stated is in USD $)
THE LOFT PRO FORMA PROFIT AND LOSS YEAR 1 –
2018 ($)
YEAR 2 –
2019 ($)
YEAR 3 –
2020 ($)
INCOME
Total Income 186600 201000 215400
Total Cost of Sales 0 0 0
Gross Margin 186600 201000 215400
EXPENSES
Large Refrigerator 6000 - -
Tables/Chairs/Furnishing 10000 - -
Wiring 5000 - -
Site Design 2500 - -
Utilities 30000 30000 30000
Permits, Licenses, Fees, F&B 2500 2500 2500
Insurance 2500 2500 2500
Opening marketing and advertising 2500 2500 2500
Graphic design for signage and menu boards 3000 - -
Brochures 1000 - -
Office equipment 600 600 600
Computer, Scanner, Printer, Point of System 4000 - -
Telephone/FAX/DSL 500 - -
Blender (2) 300 - -
Storage racks 600 - -
Music System 3000 - -
Sinks (2) 800 - -
Cups, Lids 1000 - -
Stoves 2000 - -
PAYROLL
waiter (4) 21600 22800 24000
kitchen (4) 72000 79200 86400
Management (2) 14400 15600 16800
cleaner (2) 6000 7200 8400
TOTAL EXPENSES 192300 164400 180200

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Table 3: The Loft’s projected income for the year 2018 (Amount stated is in USD $)
THE LOFT PROJECTED INCOME 2018
PRO FORMA
PROFIT AND
LOSS
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
INCOME
Total Income 15000 15100 15200 15300 15400 15500 15600 15700 15800 15900 16000 16100
Total Cost Of
Sales
0 0 0 0 0 0 0 0 0 0 0 0
Gross Margin 15000 15100 15200 15300 15400 15500 15600 15700 15800 15900 16000 16100
EXPENSES
Refrigerator 6000 - - - - - - - - - - -
Table/Chair/
Furnishing
10000 - - - - - - - - - - -
Wiring 5000 - - - - - - - - - - -
Site Design 2500 - - - - - - - - - - -
Utilities 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500
Permits,
Licenses,
Fees, F&B
2500 - - - - - - - - - - -
Insurance 2500 - - - - - - - - - - -
Opening
marketing &
advertising
3000 - - - - - - - - - - -
Graphic
design for
signage &
menu boards
3000 - - - - - - - - - - -
Brochures 1000 - - - - - - - - - - -
Office
equipment
600 - - - - - - - - - - -
Computer,
Scanner,
Printer, POS
4000 - - - - - - - - - - -
Telephone,
FAX, ADSL
500 - - - - - - - - - - -
Blender (2) 300 - - - - - - - - - - -
Storage racks 600 - - - - - - - - - - -
Music system 3000 - - - - - - - - - - -
Sinks (2) 800 - - - - - - - - - - -
Cups & lids 1000 - - - - - - - - - - -
Stoves 2000 - - - - - - - - - - -
PAYROLL
Waiter (2) 1800 1800 1800 1800 1800 1800 1800 1800 1800 1800 1800 1800
Kitchen (2) 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000
Clerks (1) 1200 1200 1200 1200 1200 1200 1200 1200 1200 1200 1200 1200
Cleaner (1) 500 500 500 500 500 500 500 500 500 500 500 500
TOTAL
EXPENSES
6030
0
1200
0
1200
0
1200
0
1200
0
1200
0
12000 12000 12000 12000 12000 12000

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PRO FORMA
PROFIT AND
LOSS
INCOME
Total Income 16200 16300 16400 16500 16600 16700 16800 16900 17000 17100 17200 17300
Total Cost Of
Sales
0 0 0 0 0 0 0 0 0 0 0 0
Gross Margin 16200 16300 16400 16500 16600 16700 16800 16900 17000 17100 17200 17300
EXPENSES
Refrigerator - - - - - - - - - - - -
Table/Chair/
Furnishing
- - - - - - - - - - - -
Wiring - - - - - - - - - - - -
Site Design - - - - - - - - - - - -
Utilities 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500
Permits,
Licenses, Fees,
F&B
2500 - - - - - - - - - - -
Insurance 2500 - - - - - - - - - - -
Opening
marketing &
advertising
3000 - - - - - - - - - - -
Graphic design
for signage &
menu boards
- - - - - - - - - - - -
Brochures 1000 - - - - - - - - - - -
Office
equipment
600 - - - - - - - - - - -
Computer,
Scanner,
Printer, POS
- - - - - - - - - - - -
Telephone,
FAX, ADSL
- - - - - - - - - - - -
Blender (2) - - - - - - - - - - - -
Storage racks - - - - - - - - - - - -
Music system - - - - - - - - - - - -
Sinks (2) - - - - - - - - - - - -
Cups & lids - - - - - - - - - - - -
Stoves - - - - - - - - - - - -
PAYROLL
Waiter (2) 1900 1900 1900 1900 1900 1900 1900 1900 1900 1900 1900 1900
Kitchen (2) 6600 6600 6600 6600 6600 6600 6600 6600 6600 6600 6600 6600
Clerks (1) 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300
Cleaner (1) 600 600 600 600 600 600 600 600 600 600 600 600
TOTAL
EXPENSES
22500 12900 12900 12900 12900 12900 12900 12900 12900 12900 12900 12900

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PRO FORMA
PROFIT AND
LOSS
INCOME
Total Income 17400 17500 17600 17700 17800 17900 18000 18100 18200 18300 18400 18500
Total Cost Of
Sales
0 0 0 0 0 0 0 0 0 0 0 0
Gross Margin 17400 17500 17600 17700 17800 17900 18000 18100 18200 18300 18400 18500
EXPENSES
Refrigerator - - - - - - - - - - - -
Table/Chair/
Furnishing
- - - - - - - - - - - -
Wiring 5000 - - - - - - - - - - -
Site Design - - - - - - - - - - - -
Utilities 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500
Permits,
Licenses, Fees,
F&B
2500 - - - - - - - - - - -
Insurance 2500 - - - - - - - - - - -
Opening
marketing &
advertising
3000 - - - - - - - - - - -
Graphic design
for signage &
menu boards
- - - - - - - - - - - -
Brochures 1000 - - - - - - - - - - -
Office
equipment
600 - - - - - - - - - - -
Computer,
Scanner,
Printer, POS
- - - - - - - - - - - -
Telephone,
FAX, ADSL
- - - - - - - - - - - -
Blender (2) - - - - - - - - - - - -
Storage racks - - - - - - - - - - - -
Music system - - - - - - - - - - - -
Sinks (2) - - - - - - - - - - - -
Cups & lids - - - - - - - - - - - -
Stoves - - - - - - - - - - - -
PAYROLL
Waiter (2) 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000
Kitchen (2) 7200 7200 7200 7200 7200 7200 7200 7200 7200 7200 7200 7200
Clerks (1) 1400 1400 1400 1400 1400 1400 1400 1400 1400 1400 1400 1400
Cleaner (1) 700 700 700 700 700 700 700 700 700 700 700 700
TOTAL
EXPENSES
28400 13800 13800 13800 13800 13800 13800 13800 13800 13800 13800 13800

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The above graph shows the projected income for 2 years 2018, 2019 and 2020
The above graph shows the projected income for the year of 2018
RM0
RM50,000
RM100,000
RM150,000
RM200,000
RM250,000
AMOUNT(RM)
YEAR
THE LOFT'S INCOME YEARLY
TOTAL INCOME
TOTAL COST OF SALES
GROSS MARGIN
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
JAN FEB MAC APR MAY JUN JUL AUG SEP OCT NOV DEC
AMOUNT(RM)
MONTH
THE LOFT PROJECTED INCOME (2018)
Sales
Direct Cost of Sales
Other kitchen expenses
TOTAL COST OF SALES
Gross Margin

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0
2000
4000
6000
8000
10000
12000
14000
16000
18000
20000
AMOUNT(RM)
MONTH
Sales
TOTAL COST OF SALES
Gross Margin
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
AMOUNT(RM)
MONTH
Sales
TOTAL COST OF SALES
Gross Margin

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The Loft’s Projected cash flow statement for 3 years which shows the outgoing and incoming cash flow
in the business (Amount stated is in USD $)
The Loft’s projected balance sheet statement for 3 years (Amount stated is in USD $)
PRO FORMA CASH FLOW YEAR 1
(2018)
YEAR 2
(2019)
YEAR 3
(2020)
Beginning Cash Balance $8,000 $39,891 $120,553
Cash Inflows
Income from Sales $186,600 $201,200 $215,800
Accounts Receivables - - -
Total Inflows $186,600 $201,200 $215,800
Total Cash Outflows $145,500 $198,700 $207,500
Operating Cash Balance $39,891 $120,553 $167,479
PROFORMA BALANCE SHEET YEAR 1
(2018)
YEAR 2
(2019)
YEAR 3
(2020)
Assets
Current Assets
Cash $39,891 $120,553 $167,479
Account Receivable $0 $0 $0
Inventory $0 $0 $0
Prepaid Expenses $12,875 $12,875 $12,875
Other Current $8,000 $8,000 $8,000
Total Current Assets $60,766 $141,428 $188,354
Fixed Assets
Improvements $50,000 $50,000 $50,000
Furniture & Fixture $10,000 $10,000 $10,000
Equipment $17,900 $17,900 $17,900
Real Estate $0 $0 $0
Buildings $0 $0 $0
Other Fixed $0 $0 $0
Total Fixed Assets $77,900 $77,900 $77,900

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Question 4
4.0 Relationship and resources a successful entrepreneur’s strategy should have
A successful strategy consists of many elements and the most important part is for the strategy to
have positive relationships in order to have a good resources(Venkataraman, 1997). It is essential
for a entrepreneur to have a successful strategy to lead in their performance. It is common that
entrepreneurship is discussed with strategy process. The main impact on cooperate
entrepreneurship is related to the process of evaluation, uncertainty, risk taking, opportunity and
also innovative. In another term entrepreneurship can also be defined as identification of
unexploited opportunities (Hite, 2001).
Opportunities are excellent basics in describing relationship between the strategy and
entrepreneurship. The strategy management most of the huge cooperation has is to utilize the
existing man power or resources to the maximum rather than spending more funds and to save
cost. Meanwhile entrepreneurship implies on exploring creating new solutions, ideas and
identification of the changing needs of customer (Hite, 2001).
For a start up, the business should focus on have minimal resources and focus on narrow
business scope. For a small scale business the direct involvement is basically at the operative
level so the top management has to insight the day to day operations (Mcgrath, 2011). The
company should have very less unused resources at the operation level because when the top
management observes the operation staffs the it insights to a tighter control. As relationship with
others in the business like supplier and customers are important they have to keep in touch with
the customers and other interaction as this is an external environmental carried out by the top
management (Mcgrath, 2011).
This is a proven for small scale or medium scale business. By working together with cooperate
venture the critical resources such knowledge on production capacity partners will bring better
and unique combination which generates competitive advantages (Hite, 2001). This process will
enhance the small scale business to overcome their smallness as it restricts them from competing
with other cooperate ventures. Strategic in entrepreneurship is important as looking at the
opportunities that others fail to identify or note and succeeding in it. The relationship between
entrepreneurship and strategy is to have integrative approach for promoting extra performance in

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the business. The strategic in entrupership skills is important in managing the resources and
activities or relationship in a strategic and effective to be competitively in the market
(Venkataraman, 1997).
Question 5
5.0 Proposal to manage risk
There is many kind of risk involved in maintaining and running a business. It all depends on how
the entrepreneur decides to deal or to manage the risk occurs (Brockhaus, 1980). Managing risk
is a painful and difficult process. Some risks are uncontrolled from existing where the
entrepreneur has to come up with ways to make it less so that the business will not be highly
affected. It is important to identify the treats and risk to the business. This can be developed
through a good business plan and also risk analysis (Haar, 1988). The steps that should be taken
are preparing a risk management plan to know and identify possible and potential risk to the
business.
The scope of possible risk should be understood and this will directly help to develop strategies
which are cost effective. It’s a must to think broadly about the risk types to the business rather
just focusing on the very obvious concerns for an instant market competition, fire and robbery.
Before the risk assessment takes place the business should be assess (Thompson, 1980).
Activities that are critical for the business should be focused and considered including resources,
staff, key services and things that might directly or indirectly affect them such natural disaster,
illness and power failure (Bhide, 1994).
There is many ways to identify risk, when the clear picture of the business is known then it will
easier to identify the risks. Business plan should be review and focus more on the area that the
business can’t survive without (Thompson, 1980). The risk also should be identified as internal
or external and the level of impact it can has on the business. Financial risk can be a very good
example as it is unavoidable, but the management should know the level of risk they are facing
and extra funding or capital is allocated for these kinds of risks so that it won’t impact the
business majorly. Brainstorming with the employees no matter their level or grade is also
essential because this will make the process of identifying hazard and risk easier. This is simply

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because they are the one whom is exposed and know their individual department well (Bhide,
1994).
What can be done after these brainstorming are a meeting with all the staff to identify and
discuss and get a clear picture of the risk in future and plans to minimize or avoid it can be
identified (Haar, 1988). To analyses risk they should have their own procedure and process.
Treating risk and minimizing risk is what mostly all the business will focus on. Once it already
happened what the business can do to stand strong and overcome it.
Question 6
6.0 Common mistakes made by first time entrepreneur in business
There are many mistakes made which can differentiate a successful and a not successful
entrepreneur. It is proven that this success is not because they are smart or well educated but it is
because they do thing in a different and a more effective way. Entrepreneurs should always
think in a more creative and innovative way to say in a healthy competition and to succeed in the
long run(Bruno, 2000).
6.1 Failure to update, create and use a successful business plan
A business plan is essential to start up any kind or form of business. It is important to transform
the idea to action plan and business. This is also mainly to identify if there is any threat and
opportunities before starting up and funding a business. A business plan also has marketing
analysis and industrial analysis so that it will make the investors to have more confidence in
funding for the project (Cope, 2003). And few of them use their business plan to gauge their
standard and performance level.
6.2 Failure to raise the sufficient funding for the capital
Capital is the fuel for any business and if it is insufficient then it means the business is going to
face some major financial back step (Bruno, 2000). It is a must for all the business to have their
capital to grow. For the new business in the industry the most difficult part is to convince the
investors to fund the new business venture.

23
6.3 Failure to use the marketing tool essential for the growth of business
Marketing is the most important tool in running a successful business. The entrepreneur should
survey and research about the geographical and demographical segmentation of the are the
business is going to be start up before choosing the right marketing strategy which is essential for
the area. These marketing tools should be utilized to the maximum so that the business can stay
competitive and sustain its success (Cope, 2003). A non-organized and failed marketing plan
might turn again the business and make a huge loss due to spending the fund in a wrong medium.
6.4 Failure to executes, select and brainstorm new ideas
In business the entrepreneur should always brainstorm and think of new and creative ideas to
improve and better way to run the business (Charan, 2002). Entrepreneurs whom fail to explore
and be in trend in the business might not be competitive enough in the competitive environment.
The entrepreneur should always be open to new ideas and suggestion made by his surroundings.
It is also important for the entrepreneur to go to conference. Seminars meeting and training and
development programs. This method might also work for the employees as well.
7.0 Conclusion
I can conclude that this business plan can be a very informative for the investors whom will be
funding for the Loft. Basically it is proven that the people are very health conscious and they are
moving towards to a healthier lifestyle. So these changes in today’s world will lead the demand
for healthier and organic food. And more over local organic delicacies will be the first in
Malaysia and Malacca being a tourist center will be a very good start.

24
8.0 Reference
Brockhaus, R.H., 1980. Risk Taking Propensity Of Entrepreneurs. Academy Of Management
Journal, 23(3), Pp.509-520.
Bruno, A.V., Leidecker, J.K. And Harder, J.W., 2000. Why Firms Fail. Business
Horizons, 30(2), Pp.50-58.
Buzzell, R.D., Gale, B.T. And Sultan, R.G., 2008. Market Share-A Key To Profitability. Harvard
Business Review, 53(1), Pp.97-106.
Bhide, A., 1994. How Entrepreneurs Craft Strategies That Work. Harvard Business
Review, 72(2), Pp.150-161.
Charan, R., Useem, J. And Harrington, A., 2002. Why Companies Fail Ceos Offer Every Excuse
But The Right One: Their Own Errors. Here Are Ten Mistakes To Avoid. Fortune-European
Edition-, 145(11), Pp.36-46.
Cope, J., 2003. Entrepreneurial Learning And Critical Reflection: Discontinuous Events As
Triggers For ‘Higher-Level’learning. Management Learning, 34(4), Pp.429-450.
Haar, N.E., Starr, J. And Macmillan, I.C., 1988. Informal Risk Capital Investors: Investment
Patterns On The East Coast Of The Usa. Journal Of Business Venturing, 3(1), Pp.11-29.
Hite, J.M. And Hesterly, W.S., 2001. The Evolution Of Firm Networks: From Emergence To
Early Growth Of The Firm. Strategic Management Journal, 22(3), Pp.275-286.
Hughner, R. M. ., 2007. Who Are Organic Food Consumers?. Journal Of Consumer Behaviour,
Pp. 99-110
Jack Kivela, J., 1997. Restaurant Marketing: Selection And Segmentation In Hong
Kong. International Journal Of Contemporary Hospitality Management, 9(3), Pp.116-123.
Lee, B.H., 2009. The Infrastructure Of Collective Action And Policy Content Diffusion In The
Organic Food Industry. Academy Of Management Journal, 52(6), Pp.1247-1269.
Lockie, S., Lyons, K., Lawrence, G. And Mummery, K., 2002. Eating ‘Green’: Motivations
Behind Organic Food Consumption In Australia. Sociologia Ruralis, 42(1), Pp.23-40.
Mcgrath, R.G., 2011, August. Options And The Enterprise: Toward A Strategic Theory Of
Entrepreneurial Wealth Creation. In Academy Of Management Proceedings (Vol. 1996, No. 1,
Pp. 101-105). Academy Of Management.

25
Rodgers, S., 2007. Innovation In Food Service Technology And Its Strategic Role. International
Journal Of Hospitality Management, 26(4), Pp.899-912.
Squires, L., Juric, B. And Bettina Cornwell, T., 2001. Level Of Market Development And
Intensity Of Organic Food Consumption: Cross-Cultural Study Of Danish And New Zealand
Consumers. Journal Of Consumer Marketing, 18(5), Pp.392-409.
Thompson, M. And Wildavsky, A., 1982. A Proposal To Create A Cultural Theory Of Risk.
In The Risk Analysis Controversy (Pp. 145-161). Springer Berlin Heidelberg.
Venkataraman, S., 1997. The Distinctive Domain Of Entrepreneurship Research. Advances In
Entrepreneurship, Firm Emergence And Growth, 3(1), Pp.119-138.
Yüksel, A. And Yüksel, F., 2003. Measurement Of Tourist Satisfaction With Restaurant
Services: A Segment-Based Approach. Journal Of Vacation Marketing, 9(1), Pp.52-68.
Hunger, J.D. And Wheelen, T.L., 2003. Essentials Of Strategic Management. New Jersey:
Prentice Hall.

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