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Entrepreneurship is the process of creating something new of value by devoting the necessary time and effort, assuming the accompanying financial, psychic and social risks
(Hisrich and Peters, 2002)
Nehar Begum is the owner of Runnymede Tandoori, an Indian take-away in Egham High Street situated North-West Surrey. Egham is a small town located between Englefield Green, Sunningdale, Thorpe and Virginia Water. Known for the largest Ferrari and Maserati dealership in Europe, it is renowned for its traditional architecture and high value homes.
The takeaway is positioned in the heart of Egham High Street between a hairdressers and a betting shop. Being the first Indian take-away opening in 1995 selling a variety of authentic Indian food, offering free home deliveries for meals over £10 under a 4 mile radius.
The takeaway employs three chefs, two delivery drivers and one front shop assistant. During times of peak periods, extra temporary contracts to cater for this extra demand.
Runnymede Tandoori’s customers are majority the local public as orders are either delivery or collected. Indian food cannot be consumed on the go therefore walking past trade is very low.
In 1995, Nehar purchased the freehold property costing her approximately £100,000 and spent £40,000 for major refurbishment work on the site. This investment was needed to bring the store to a standard where it can trade from.
3.1. Step I
Firstly we searched through the Yellow Pages to decide the business to pick. Shakir mentioned his father’s friend owns a takeaway on Egham High Street. We managed to contact the owner Nehar, asking if she would be able to spare time to assist with our assignment in an interview and if she could disclose some information on the business. This was asked to ensure time was available for interviews before Runnymede Tandoori was chosen.
3.2. Step II
Telephone calls were made to Nehar asking if she had any time for an interview on the dates below. Most of the time we were unable to speak to Nehar or we had rung during busy periods so unable to converse.
3.3. Step III
We called on the interview date to again to ensure the time was convenient, all was well.
A set of questions were planned to ask Nehar on the running of her takeaway. Some were asked to analyse the operations and to establish a better knowledge of the entity. Questions asked alongside the reasons, followed by the reply by Nehar are found on the next page.
3.4 Step IV
INTERVIEW – OWNER OF RUNNYMEDE TANDOORI
DATE: 28th November 2007TIME:11:00 amLOCATION:Egham (Restaurant)
PRESENT:Nishal Tankaria Shakir AhmedCharnjot Rai
Ivelina Ivanova Mrs Nehar Begum
Name: Mrs Nehar BegumAge: 53Education: None
Other businesses owned: None
- When was the business established? To get more of an understanding on how long the business has been running and how much experience the entrepreneur has.
- I established the business 1995, my husband previously owned an Indian Restaurant in Egham which I had experience in running. This was very helpful to me as I have a good knowledge of the operations involved. I learnt that customers are the main priority; they must be kept happy at all times.
- Did you have any previous knowledge or expertises in business before taking on the venture? Skills that the entrepreneur may have gained before establishing the business that may have helped in the current venture.
- I learnt that customers are the main priority. The customer orders must be on time, if delays occur the business may lose loyal customers. My knowledge helped run the business because I learnt how to manage staff and control my stock levels.
- Did you experience any difficulties when establishing the business? Understand problems encountered and how they were dealt with and measures used to stop other problems arising.
- No, not many. Gyash had run a restaurant for over 10 years and had a good relationship with the local people. This was helpful to me as I had support from them and I could spread the word more easily.
- What would you call the most challenging time of your business? Periods the business struggled and learning processes that took place.
- Summer is probably the most difficult. During this time most families go on holiday. As business is quiet during this period I do some promotional offers. I offer a 10% discount on collected meals; and a further cold beverage range. This worked better than offering a discount, as the demand is higher for cold beverages during this time. What I learned from this was that I must have seasonal offers in order to keep up with customer demand.
- Have you experienced any highs when running the business? A period that Nehar felt the business was at its peak. This could go into detail by asking why these highs were achieved.
- In the late 90’s and the early 2000’s the business was at its best. All of my loyal customers, who purchased on a regular basis, were recommending others. Also took large events catering such as birthday parties and wedding events. One reason for my business’ peak during this period is because there was little competition. Runnymede was the only Indian takeaway in Egham at the time. The neighbouring town, Englefield Green had no Indian take away, most of the customers were ordering from me. As the business was growing I had to employ another delivery driver.
- What were the sources of finance for the initial launch? Get an idea how much finance was injected into the business.
- Some from Gyash’s business and borrowed from the bank. Borrowing from Gyash business was ideal as I had no interest to pay back and also meant I didn’t need to borrow as much from the bank.
- How many people are employed? To categorise the business as either a small/medium size. Also get an idea of overheads that the business has in terms of wages.
- At Runnymede Tandoori have three chefs, two delivery drivers and one front shop assistant. Out of the three chefs’ there is one head chef. He has to most responsibility in the kitchen operations, preparing main curry dishes and monitoring the other chefs’ performance. The second chief is responsible for all the Tandoori dish’s cooked in a clay oven. The third chef is responsible for preparing small side orders and starters and packing the orders. Each driver covers certain areas within the delivery radius range. The front shop assistant takes customer orders and cashes up daily and ensuring a sufficient cash flow is maintained in the till.
- What are your plans for the future of the business? If the business wishes to expand the existing restaurant or open new restaurants in other locations in the future.
- As it stands I don’t wish to expand my business. I was thinking of turning my takeaway into a restaurant. The reasons stopping me from doing this is planning permission and more finance needed.
- What makes your business different to others? Any USP’s that the business may have that differentiates it from others. This USP will add value, giving the business more of a competitive advantage.
- I feel that my business is different as it offers more of a personal, friendly service. My many loyal customers that make regular orders and have a good relationship with me make my quality. I try to build a friendly relationship with all customers in order to make them loyal customers.
- What is your local competition? Treats the business may have on a local level.
- Egham is a very small town but there are many restaurants here. Although not many offer Indian food, they are still competition. Competition increased in 2000, as two new Indian takeaways were opened Red Rose and Monsoon. This significantly affected Runnymede Tandoori, and as years have passed, more restaurants in Egham have opened.
- How does this competition affect you? To the extent that the competition affects the running on the business and measures put in place to deal with competitors (pricing strategies).
- Turnover at Runnymede Tandoori did decline so I decided to renovate the shop front, to give it a more modern look. I also decided to change the menu design and make certain dishes cheaper. I felt by doing this it will attract more customers. I spent approximately £3,000 on new renovations and menu costs. This did make a difference in sales turnover however it wasn’t a significant change.
- What are your largest costs? Areas that the business can monitor to lower, in turn increasing their profits.
- When the business first opened, the largest costs were repaying the bank loan. Over the years the supplier costs have increased considerably which became my biggest expense. I used to have one main supplier that was Asian Food Centre in Hounslow, because they were increasing their costs I found a new local supplier in Staines called Ayisha Mahal, a cheaper wholesaler, lowering my costs.
- Have you conducted any steps to lower your costs? If so, please mention. As mention in question 12.
- I have only reduced my supplier costs.
- Do you have any other ventures in mind away from the business? As mentioned in question 8
A: Apart from turning my take away into a sitting in area, none yet.
- Please could you give an indication of your profits and/or turnover throughout the past 3 years? (Appox) Understand how many customers may have a year and overall incomes, also total costs they may have.
A. Over the past three years my business was still making a profit, however it is decreasing. My expenses were near enough still the same.
Nehar would not be considered as being very entrepreneurial. This is evidential by looking at the menu in comparison to similar Indian restaurants. Distance of delivery of competitors in similar Indian takeaways in the local area as shown below:
Appendix … and … shows the similarities between Runnymede Tandoori’s menus compared to their close competitor, Egham’s Spice and Grill.
Nehar does however offer a unique dish that others do not therefore having incentives for each visiting customer, even if it is their first and last visit it encourages them to keep returning, this could be considered as having entrepreneurial skills.
There is no solid evidence that Nehar has any entrepreneurship skills, but the level of loyal customers that continue returning to the restaurant is high, suggesting that Nehar must be doing something right for these returning customers. This could be due to the previous restaurant that Nehar’s husband owned, being the first Indian restaurant in the early eighties; these customers now eat at Runnymede Tandoori.
“The action by which the owner develops and maintains contacts for trading and business purposes” (Chell and Baines 2000:196)
Runnymede Tandoori is part of a small network that includes suppliers, customers, local competitors, family and friends and last but not least the Government.
Runnymede Tandoori have two suppliers:
- Asian Food centre in Hounslow - Small orders such as spices and plastic bags
- Ayisha Mahal in Staines - Main suppliers where meat and chicken are bought.
These suppliers offer a high standard that Nehar requires in terms of food and both businesses have a strong established a long-term business-to-business relationship.
Runnymede Tandoori being customer orientated, Nehar’s aim is to provide them with the best quality Indian food in the local area with friendly service. Most of their customers range from middle to upper class mainly category A, B and B1 which is an example of a top-down traditional marketing concept.
Competitors include all restaurants in Egham. The direct competitors include Monsoon and The Red Rose, Indian Restaurants that offer take away and delivery services. They are relatively recent therefore Nehar has more loyal customers giving them more of an advantage.
Rules and legislation need to be followed. This includes paying taxes, following health and safety regulations by making sure there is no potential danger for staff and non –staff members occupying the property, following the employment regulations etc.
5.5. Family and Friends
Runnymede Tandoori is a family business, this means profits are shared among family. Loyal customers, who are or became family friends, order from the takeaway making 70% of Runnymede Tandoori’s profits.
Marketing the takeaway can increase the number of customers by vast numbers. Nehar spent time on researching and analysing the possible methods and tactics that could use in order to keep the business ahead of the other local competitors.
Due to financial restrictions, a great deal could not be spent on big marketing campaigns. As her husband opened a restaurant previously, she had the advantage of his existing customers and the knowledge of how to run a business on her own.
As this was the first Indian takeaway in Egham, managing to fill in that gap in the market, she had a ‘monopoly’ as such in the local area.
Gyash, Nehar’s husband had his business was in the same industry making loyal customers over 10 years, who also knew Nehar. The business took the approach of being customer orientated rather than product orientated; they felt a good relationship is the order-winning factor. This relationship helped to disclose what their customers thought of quality of the food and the service offered, all feedback was used constructively.
Word of mouth was the best way of starting the advertising activities. In addition, Nehar spent part of her opening capital on direct mail i.e. printing and distributing leaflets/menus (appendix.).
This method of advertising proved to be the least expensive as she had control over how many to print. Making the menu unique and memorable so that it can clearly be distinguish from other Indian restaurants and takeaways.
After some time she also advertised in a local newspaper to aware the public of the takeaways presence and to enhance sales further.
During our interview, she had mentioned that a very well known Indian chef, also a good family friend, went to the restaurant and advised her to add an additional dish that was his favourite. He showed her how to prepare it and she offered it to their customers. They all loved it and recommended the take away to their friends and relatives. Nehar was wary of the new invented item, but fortunately it was not necessary, as her customers loved it.
6.1. 4 I’s
The variety of interactive activities used to build up relationships with customers and business partners are known as the 4 I’s. (Innovation, identification of target market, interactive marketing methods and informal information gathering through networks/customers) (Lecture 8 “Marketing and Selling”).
The above are well applied by Nehar. Based on the interview and on the short informal talk with the owner, we found out that their target audience are middle-aged families to elderly couples with more dispensable income then other UK average.
In order to gather information and feedback from her customers, Nehar putted a “feedback box” on the till where each customer can leave their opinions, whether positive or negative all was accepted constructively, this allowed the takeaway to give customers what they wanted. However, Nehar is also very traditional and reluctant to change, innovation is not easily. Her opinion is that if she had been successful all those years of trading, why she should change anything. This is understandable, but on the other hand this means that her competitors have an advantage over her, as she is rarely willing to offer her customers something new on the menu.
Nevertheless, she is using other methods to be unique and has a group of very local customers. Offering incentives such as free delivery for next order, discount vouchers and a free meal of their choice when they order the special “family deal”. Also cut outs of paper are kept in a jar next to the cash register with incentives written on. When customers pay for their order they pick a piece of paper as a ‘lucky dip’ and receive that incentive next time an order is placed, bringing the customers back into the takeaway.
6.2. 4 P’s
These are controllable parameters that depend upon any internal and external environmental limitation the aim of which is to help make decisions that create perceived value and generate a positive response (www.netmba.com).
Nehar uses an integrated marketing communications which means that she combines a variety of advertising methods such as sales promotions, press advert and personal selling in order to create awareness, interest, desire and action (AIDA).
A SWOT analyse was prepared by Nehar which allowed her to investigate the strengths and weaknesses of the business, which the possible opportunities and threats. This enables Nehar to maintain the strong position of her business and minimises the potential risks by creating a contingency plan.
PEST is another method of monitoring and controlling the business’ activities by analysing the political, economical, social and technological issues. This is helpful to her in order to be up to date with any new legislation as well as technological and lifestyle changes.
A business run by a group or family can be categorised as a family business. This is only when 50 percent or more of the business is solely owned by one or a few family members.
Ownership and Control
Runnymede Tandoori has one owner, Nehar. She has the power to run the operations as she wishes and do not need to consult anybody else before making decisions.
Problems could occur with employing family as it can be difficult to discipline them. However, Runnymede Tandoori does not have this problem as none of the staff is family member. Learning this from Gyash’s business, Nehar was reluctant in employing family.
Management strategies and styles
Runnymede Tandoori has built up a loyal staff as seen from the business’ low staff turnover. Evidence of this is seen from the chefs of the business who have been there since the opening in 1995. Advantages include trusted staff running the business if Nehar was ever called away.
Staffs within the business are flexible and are multi-skilled in the event of an ill team member. This in turn increasing motivation as job enlargement and enrichment suggests workers will not get uninterested.
Nehar controls all operations within the business. Communication is passed down the hierarchy to the chefs, front staff and delivery drivers.
Providing a service that she feels is unique compared to her competitors has been portrayed through loyal customers coming back over and over again.
The long term outlook
The first mission for the takeaway was to recover its start-up costs so profit could be made as soon as possible. As it stands, these costs are recovered included the full mortgage paid. Nehar does not wish to lose track on traditions that she built foundations of the business, such as the quality and customer service they offer. Problems may occur when traditions restrict the business to adapt to changes in the environment when competitors change, leaving the takeaway at a disadvantage.
Looking to expand is always a question. The debate is that if the expansion will increase sales and ensure that capacity is not wasted. Those who may not known Runnymede Tandoori for its food and are choosing from the three Indian takeaways on the High Street may be persuade more customers to order from Runnymede on its external image.
Nehar search for lowering costs continues. As she cannot control the competition directly, maximising her profits by producing more efficiently can help. Another example is calling family members for help in busy business instead of requesting staff for overtime.
Ethnicity refers to the cultural differences and the race issues that are bought to the company and its stakeholders.
Runnymede Tandoori is situated within a predominately Caucasian area, and the reason why Nehar felt that the business would be successful is due to the gap in the market, with no Indian takeaways when first opened.
Employment Laws stress that an employer cannot discriminate on the grounds of race or ethnicity when recruiting. As a result of this the staff is employed, not by their race but their own skills and experience.
On the grounds of General Occupation Qualification (GOQ), where to create a culture, an employer can argue the reason of choice of a certain race or ethnicity. The takeaway has an Asian front staff to create the ideal atmosphere of an Indian takeaway and therefore discrimination laws can not apply.
8.1. Economies of scale – McDonald’s has a competitive advantage in that they produce on a mass bases. Producing in such a way results in reduced costs. Smaller firms such as the takeaway produces to the demand required, buying in smaller quantities therefore cannot take advantage of these scale economies.
8.2. Finance – Many sources of finance can be used to raise extra income; these are significantly different depending on type of ownership of the business. As a sole trader Runnymede Tandoori the advantages are the privacy of finance statements in comparison to large firms such as McDonalds, as McDonalds a plc is required to by law.
Nehar has unlimited liability and is responsible for any debts made by the business irrespectively of the amount. Lenders are less willing to lend huge amount of capital, as security is needed that the debts can be recovered. This was not a problem for Nehar as most of the funds needed were raised from savings and only a small amount borrowed from a bank.
8.3. HR - As Runnymede Tandoori is a small trader; a specialised HR department is unnecessary when employing five people. In contrast, McDonalds, a multinational company has funds and reasoning to have this department whereas Runnymede Tandoori does not.
8.4. Marketing - Marketing activities will vary depending on the funds available to carry out the campaign. Nehar has to use cheaper methods of advertising the business through the use of leaflets, local newspaper adverts and word of mouth. The marketing activities for an enterprise such as McDonald’s will consist of well researched, in depth information for best methods of maximum the reach and frequency of customers. These include mass reach by using marketing medium such as TV, press and the Internet, whereas for a small takeaway, local press and direct mail would be best practice.
8.5. Technology - Small businesses, such as the takeaway cannot afford high technological equipment compared to companies such as McDonalds. As a result remain on the same level of efficiently while those who can afford technology become more efficient resulting in the smaller firms becoming less competitive. This is irrelevant for Runnymede Tandoori as they wish to keep to traditional methods of food preparation.
Small businesses can aspire to function as those of larger organisations to increases efficiency, lowering costs thus increasing profits. Finance is a key issue for sole traders such as Runnymede Tandoori. It can also be argued that in terms of practically, smaller organisations need not function as larger organisations as the target audience for smaller firms are divided geo-demographically, serving to the local area, whereas larger firms serve on a mass bases. As a result each business needs to adopt its own best practice suited to their own company.
PURPOSE OF MEETING:
This was the first meeting, which we held regarding the assignment. We firstly looked at the specification and went through it as a group. We identified what was required from us a group and then discussed each part.
We looked at the first part, which was to identify a small business venture. We firstly discussed what this was and then started to list a number of choices that we felt would be suitable.
We narrowed our search down to three possible options for our chosen business/venture. These were a car garage, which was locally based to Nishal’s home, Lower Feltham. The problem identified with this was that the owner was on holiday and unavailable, so this would not fit into our assignment dates. We also had a possibility of an off licence that was in Hillingdon closely locate to Charnjot. However the problem that was identified with this was that it was a new business that had only been open for less than 6 months and therefore would not be appropriate, as it only has limited information.
However Shakir’s father had a close friend and recommended him to us to use as a small business venture. The business was a restaurant called Runnymede Tandoori based near to Shakir’s home within Egham. This business sounded idealas it was well established and would be able to provide us with good source of information, as there was a close connection with the business.
After the decision we decided that it would be an ideal time to start some work on the assignment. We gave Shakir the responsibility to carry out some desk research on the business, the reason we chose him was as he lives close to the restaurant and also that he can be well informed about the business.
Meanwhile in our own time I, Nishal and Ivelina decided to contact the owner and arrange a suitable time and date for a meeting. We produced a number of questions to help us with the assignment so we could get an in depth knowledge into the company.
Nishal Tankaria Charnjot Rai Ivelina Ivanova Shakir Ahmed
PURPOSE OF MEETING:
This was a quick meeting just to see how the assignment progress was going. Shakir had already started doing an analysis into the company. Looking at the work so far Shakir’s had gained a lot of information such as the competition within that area, location and customers within that area.
In the mean time I, Iva and Nishal had started on creating questions for the interview. We looked at the best language to use but also how to maximise the information we could get within the limited time.
The aim that we set for the next meeting was to have the questionnaire complete and the interview arranged.
PURPOSE OF MEETING:
This was the final meeting before the interview. The interview was to be held on the 26th. We split the questions up and made sure that we all could get the best possible answers and replies to help us with our assignment.
We went over the questions and discussed once more if they would be suitable.
We then gave each other small pointers to maximise the effectiveness of the interview and to make sure the interview ran smoothly.
Nishal Tankaria Charnjot Rai Ivelina Ivanova Shakir Ahmed
PURPOSE OF MEETING:
Within this meeting we met up to look at how much work had been done so far. We were able to identify that the majority of B was done. We then spilt the remaining parts. We each chose one part each and the remainder of the parts to be done would be done as a group.
The date we planned to have this done by was 7th December. This is when we would go over the work, which we did individually, and aim to work on the parts remaining
PURPOSE OF MEETING:
This was the part when we made sure that all the work was done we, met up as a group and worked and finalised the final parts of the group assignment.
We had just to conclude the parts, which we had been working on in the last few days.
As a group we were happy with the outcome of the assignment as we felt that we had put a lot of effort and time into this assignment.
As we finished very late we were unable to proof read it. The plan was that on Saturday (15th) I and Nishal would meet up and print off the assignment with the appendices and make sure that it was all flowing and make sure that everything flowed as it should.
The plan was that I would print off the whole assignment and I would drop it in to collage on Monday morning before 9am.
Nishal Tankaria Charnjot Rai Ivelina Ivanova Shakir Ahmed