Heart Of Indi Business Analysis

The Heart of India is a new quick serve Indian restaurant serving an exceptional experience in fresh authentic Indian food to be located in the Chicago loop near the intersection of Adams and Wabash (See Appendix K). A quick serve Indian food restaurant is a unique concept with an atmosphere of the far-east with the sounds of authentic Indian music bringing flavorful Indian food quickly during lunch and dinner at reasonable prices. The restaurant will serve traditional north Indian (Punjabi) cooking featuring flavorful vegetarian and meat dishes as well as appetizers Indian breads, wraps, Indian desserts, and an Indian burger. Customers will have an option to customize their food with 3 levels of hot spices. Vegetable substitutions will
be made for bread and rice for the carb conscious and the menu will include flavorful low fat entrees.
Indian food is distinguished by the variety of cooking techniques and the sophisticated use of species and herbs such as cinnamon, turmeric and cayenne. Spices used in Indian food have been shown to have medicinal value (1).
The quick serve restaurant business is one of the fastest growing segments of the restaurant industry in the United States.
Between 1970 and 2000 sales in the American fast food sector increased by $104 billion dollars (2) and $150.1 billion is projected for 2007 (3). Americans now spend more money on fast food than on education or new cars (2).
The Chicago loop was chosen for the location of the restaurant because there are many businesses and a diversity of culture (See Appendix A.2 for ethnic population). There is high foot traffic in the chosen location of over 8,000 people per day during the work week (4). There are currently no quick serve Indian restaurants in Chicago, but Indian food is no stranger to Chicago. Indian food has been enjoyed by Chicagoans since the 1972 (29) and is still popular today. See Appendix H for near loop Indian restaurant reviews.
Our target markets are employees, residents, students and tourists in the Chicago loop who go out to lunch and dinner. We expect that 80% of our business will occur between 11:30 to 1:30 based on seating capacity, size of our restaurant and the business of a local ethnic restaurant(4). We are targeting these groups because there are over 300,000 employees (6) and there are over 45,000 attending school in this area (7). Tourism in Chicago increased 10% from 2001 and 2005 and Chicago is ranked 3rd in Travel and Leisure's top ten cities in the U.S. and Canada
(8).
Our survey results identified that 83% of those surveyed eat at fast food restaurants during lunch and 68.8% would likely eat at an Indian quick serve restaurant. They showed interest in eating low fat, low carb and a choice of three levels of spices. We will easily satisfy these customer needs in our menu offerings.
There are many fast-food and quick serve restaurants in the Chicago loop, but there are no quick-serve Indian restaurants.
The competitors included Subway, Panera Bread, Chipotle, Taza, McDonalds and Burger king to name a few. There are eight full service Indian restaurants near the loop, but these are not close to our restaurant location. The fast-food and quick serve restaurants we are competing against have better economies of scale than our restaurant so we will compete with them on our flavorful food, food quality and excellent service in order to stay competitive. Our prices are competitive with the other quick service restaurants and higher than the fast-food restaurants. See Appendix L for an example of the planned menu. Our competitors have brand recognition and our promotions targeting our various markets will familiarize people with our restaurant and increase
sales.
Because of the dense concentration of employees and high foot traffic, our projected revenues are $405,000 for the first year of business. This will increase to $554,400 by the end of the third year. The average unit price for the first year will be $9.00 and will increase to $10 by the third year. Our variable product cost will be 30% of the average unit cost and decrease to 29% by year three. Our food cost per unit is slightly lower than food costs for the industry average which is approximately 32.5% (30).
The Heart of India will offer an excellent alternative to other restaurants in the area. It will serve delicious Indian food with fast and reliable service for people with a limited lunch schedule. We will differentiate our restaurant by offering healthy Indian food with substitutions for low carb conscious customers and flavorful low fat food in a quick serve format.