BAR BQ TONIGHT

R E PO RT O N A FO RE I G N C O U NTRY I NV E S TME N T

PREPARED FOR MR. SALEEM AHMED PRESID EN T

PREPARED BY MR. SALMAN AHMED S.MANAG ER STRATEG IC PLANN IN G D EPT.

APRIL 18, 2013

TA BLE O F CON TE NTS

Executive Summary I. INTRODUCTION a. Authorization and Purpose

ii 3 3 3 3 4 4 5

b. Time frame II. DESCRIPTION OF IMPLEMENTATION THE PROGRAM a. Analysis

b. Cost & Administration III. CONCLUSION AND RECOMMENDATIONS

E X E C U T I V E S U M M A RY
TITLE: Report on a Foreign Country Investment

AUTHORIZATION RECOMMENDATION This report responds to the request of the President, Mr Saleem Ahmed, that to identify & recommend whether a restaurant Bar- BQ Tonight should expand ,establish a subsidiary, permit franchising, locate an overseas branch in Malaysia .It has been suggested that we should tap this market and make investment.

TIME FRAME Finally, if the recommendation is accepted, the program could be put into effect within four months.

INTRODUCTION Bar BQ Tonight, for many years, has been highly renowned restaurant in the city. We have consistently maintained our food quality in this highly competitive industry. With such a perspective of expanding our business in Malaysia, we look toward tapping in a highly potential growth market.It seems that their tradition, culture, religion, taste are resembled with us and other factors also support us to make investment. It is therefore considered ideal place for establishing new franchise. ANALYSIS Presently, there are more than 3500 restaurants operating in the city. We have shown tremendous growth in the highly competitive market in the past decade. While considering to Malaysia, mushrooming of restaurants in the past years is seen there as well. The detailed demographics are shown in the table-1

It is concluded here that majority of youngster in the group of age 21-30 deeply showed interest in dining out on regular basis which is 40 % of the total population.

Initial Costs of Opening a Franchise The initial costs of opening a franchise are detailed as under Initial franchise fee:

Cost paid to the franchisor to buy the business. It may or may not include training, location selection, ongoing support, etc.

 Capital investment: money for the start-up inventory, property taxes, legal bills, zoning fees and more.

This investment can also include real estate and equipment purchases, which must be in accordance with the franchise package specifications hiring contractors for construction and remodeling may be a possibility. Working capital: money youll need to survive the initial start-up phase.

This money covers expenses such as training and payroll until the business begins to turn a profit. Continuing fees:

Royalties, management service fees, advertising and marketing fees, etc. The detailed costing is shown in Table 2 Type of Fee Initial Franchise Fee Building Costs Site Development Costs Additional Development Costs Equipment, Fixtures and Signs Electronic Cash Register/Retail Info Systems Opening Inventory Miscellaneous Opening Costs Licenses, Permits, Fees and Deposits Uniforms Insurance Travel and Living Expenses While Training Marketing Start-Up Fee Additional Funds (3 months of operation) Total Estimated Initial Investment Low $40,000 $190,000 $0 $22,000 $300,000 $16,050 $7,000 $16,800 $3,500 $400 $4,500 $2,000 $5,000 $81,000 $688,250 High $80,000 $350,000 $10,000 $75,000 $450,000 $23,550 $15,000 $68,100 $5,500 $1,200 $15,000 $45,000 $7,500 $184,000 $1,329,850

ADMINISTRATION The suitable option is to make franchise opening in the Kuala Lumpur city with administration solely by third party.

CONCLUSION & RECOMMENDATION The investment needed for opening a franchise is far less than the overall profit gain and other external factors associated with this investment allow to immediately investing in the business. It is highly recommended to open franchise in Kuala Lumpur city.