Standing Sushi Bar in

Sweden
Anaya Sachdev
Garcia Nsue Christian Silvestre
Jack Ong Yuan Sun

1
Contents
1. Macro-Analysis
a. PESTLE Framework Analysis
2. Industry Analysis
a. Economic Considerations
b. Porter’s Five Forces Analysis
c. Key Drivers of Change
d. Key Competitors
e. Industry Key Success Factors
f. SWOT Analysis
g. Value Chain Analysis
h. Strategic Issues
3. Business Strategy
a. Business Model - Osterwalder's
Framework
b. Entry Mode
c. Strategy (Posture, Business Strategy,
Functional Strategies, Goals and
Initiatives, Stakeholders)
d. Strategic Initiatives
4. Marketing Strategy (Segmentation and
Positioning)
5. Financial Strategy and Forecasts
2
Contents
1. Macro-Analysis
a. PESTLE Framework Analysis
2. Industry Analysis
a. Economic Considerations
b. Porter’s Five Forces Analysis
c. Key Drivers of Change
d. Key Competitors
e. Industry Key Success Factors
f. SWOT Analysis
g. Value Chain Analysis
h. Strategic Issues
3. Business Strategy
a. Business Model - Osterwalder's
Framework
b. Entry Mode
c. Strategy (Posture, Business Strategy,
Functional Strategies, Goals and
Initiatives, Stakeholders)
d. Strategic Initiatives
4. Marketing Strategy (Segmentation and
Positioning)
5. Financial Strategy and Forecasts
3
Macro Landscape of Sweden -
PESTLE Analysis
Political Economic Social
● Political Stability ● Stable economic ● Shift in trends
● Low corruption growth towards ethnic
● FDI-friendly ● Low inflation & cuisine, convenience
interest rate and healthy food
● High cost of labour

Legal Technology Environment

● Minimum wage, ● Growth in fintech ● Environmental laws
labour laws, ● Online shopping ● Increasing consumer
regulations, prevalence awareness
competitive laws

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 4
Political Factors in Sweden
Politically stable
- Ranked 31st on Political Stability Index
- Index reflects the likelihood of a disorderly transfer of government power, armed conflict, violent
demonstrations, social unrest, international tensions, terrorism, as well as ethnic, religious or
regional conflicts
Low corruption in the political sphere
- Ranked 6th out of 180 countries on Consumers Perception Index 2017
Governmental support for FDI
- High level of openness in the market with large imports and exports (84% of GDP)
Relatively low corporate income tax rate
- New law reduces corporate tax from 22 percent to 20.6 percent in January of 2021
Implications:
● Conducive political environment to pursue F&B business
● Good FDI policies allow SSB to set up easily
● Reduces political risk of conducting business
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 5
Economic Factors in Sweden
Stable economic growth
- GDP Annual Growth Rate averaged 2.63 percent from 1994 - 2018
- Projected to maintain a level of 2.60 in 2020
- Services industry has increased from 60.06 percent to 65.18 percent from 2007-2017
Implication: Increased investment in infrastructure; increased spending power of consumers &
confidence in the market

Low interest rates & inflation

- Interest rate: -0.5% ; Inflation: 1.9%
Implication: Increase circular flow of money by increasing demand and investments, but this could
affect household debt

High labour cost

- Ranked highest amongst the EU; one of the highest in the world
- Due to highly skilled workforce
Implication: Could lead to higher cost of labour but higher skills can mean greater productivity
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 6
Social Factors in Sweden
Changes in lifestyle and trends
● Desire for more food options: ethnic cuisines
○ Uncreased interface with foreign food cultures through travelling and immigration, especially
towards asian cuisines
○ They are also generally receptive, intrigued and open to new ideas and concepts
● Convenience
○ Increasing demand for food able to provide convenience due to busy lifestyles
● Developing Health-Conscious Mindsets
○ Increased acceptance of the younger consumers towards vegetarian ingredients and healthy
food
○ Higher education leads to higher awareness on food supply chain. Food quality and healthier
food options are an emerging trend
Implications:
● These consumption trends open up a largely untapped market of fast, convenient and affordable
health-centred food
● Able to appeal to large proportion of population, and their openness allows SSB to differentiate
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 7
Technological Factors in Sweden
Growth of Fintech
- Increasing use of mobile payments and cashless payments
Online Shopping
- Due to increasingly busy lifestyles, online food shopping is currently booming and
opportunities can be identified
- Growth of food delivery services (DeliveryHero & Foodora)
- 94% of population have internet, 4th highest usage in the world
Implications:
● FnB outlets have to ensure innovation in payment methods or keep up-to-date with
technology to bring convenience to consumers
● Factoring in the opportunity of online food retail, we have to consider providing delivery
options to open up streams of revenue

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 8
Legal Factors in Sweden
Minimum Wage:
- No legal minimum wage in Sweden
- Wage determined by age and level of experience
Implications: this can impact businesses production costs and efficiency as more experienced workers are more
costly
Labour Law:
- Swedish labour market is heavily organised and has a strong position
- 70% of labour market is unionised
Implications: Important to ensure fair conditions and good working environment for employees
Regulations:
- National Food Agency’s Code of Statutes provides guidelines for ‘keyhole symbol system’
- Various regulations set out by National Food Agency before company can be set up
Implications: Strict adherence to rules
Competition Law
- Prohibits against anti competitive cooperation
Implications:
Conditions
Macroencourage
Factors competition, which
Industry is vital for
Analysis SSB entering
Business Strategy a foreign market
Marketing Financial Strategy Risk 9
Environmental Factors in Sweden
Environmental Protection Act 1969:
- Included a permit regime for environmentally hazardous activities
- Integrated approach aimed at regulating essentially all negative environmental impacts from an activity
- Provisions concerning remediation of polluted areas
Implication: Will need to adopt an environmentally friendly approach to waste

Consumer Awareness
- Increased demand for strong hygiene factors in food outlets
- Reducing meat consumption and increasing vegetable intake can reduce greenhouse gas emissions
- Encourages corporate social responsibility
Implications:
- Sell food in small, affordable doses to minimize food wastage
- Greater plant-based oriented options and diets
- Transparency in food-supply chain and processes

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 10
Contents
1. Macro-Analysis
a. PESTLE Framework Analysis
2. Industry Analysis
a. Economic Considerations
b. Porter’s Five Forces Analysis
c. Key Drivers of Change
d. Key Competitors
e. Industry Key Success Factors
f. SWOT Analysis
g. Value Chain Analysis
h. Strategic Issues
3. Business Strategy
a. Business Model - Osterwalder's
Framework
b. Entry Mode
c. Strategy (Posture, Business Strategy,
Functional Strategies, Goals and
Initiatives, Stakeholders)
d. Strategic Initiatives
4. Marketing Strategy (Segmentation and
Positioning)
5. Financial Strategy and Forecasts
11
Economic Considerations
● Consumption Trends of Swedes: 24% of Swedes predict that they will eat less meat in the coming
five years, 31% state that will eat more fish and 34% state they will eat more vegetarian food (Nordic
Food Survey)
○ Impact: Greater shift towards healthy food options and opens up the market demand for
healthy food and beverage with less emphasis on meat

● General Price of Food in Sweden: Big Mac Index has Sweden ranked 2nd with an average price of
USD5.83. For comparison sake, Singapore is ranked 13th with an average of $4.28 (Statista).
○ Impact: Serves as a microcosm for how food in Sweden are exceptionally expensive. The high
prices, complemented with how few healthy options were found in Sweden and the options
were too expensive for young people, opens up a demand for healthy fast food that taste good
and is reasonably priced
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 12
Economic Considerations
● Market for Fast Food in Sweden: While average Sweden customers eat out 168 times per year
(France, Italy Spain over 100 a year) and fast food chain makes up 13% of market share with
around 7,000 fast-food outlets as of 2016. (Chamber Trade Sweden Market Report)
○ Impact: Great opportunity to enter a market. While fast food consist of healthy and unhealthy
options, our cheap and healthy option figures to be survivable

● Raw Materials Availability: Substantial amount of imports (30%-40%) are attributed to food raw
materials which are not/cannot be produced within the country
○ Impact: supply chain management options include importing, especially since ingredients
required in sushi is generally imported

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 13
 Porter’s Five Forces

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 14
Threat of New Entrants High

Low barriers of entry to the F&B industry and Swedish market

● Low capital requirements (lower fixed cost)
○ there is minimal need for economies of scale to enter the industry
● Great ease of doing business and supportive government policies
● There are great many fast casual dining businesses such as eateries, cafes,
restaurants which are privately owned
Zero switching cost for consumers
● Low concentration of market
● Absence of large players that dominate the market
● Huge diversity of businesses in F&B
Brand identity
● SSB seeks to be differentiated
F&B industry draws a thin profit margin (3-5%)
● Acts as deterrent as the profits are not generally attractive
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 15
Threat of Substitute Products High

Zero switching cost

Availability of substitutes
- Extremely large number of substitutes in the F&B market
- E.g. Other Japanese restaurants (strong substitutes), fast food, healthy food, cafes,
bars, home-cooked food, instant food etc.

High propensity to substitute

- Due to nature of the F&B industry, consumers typically select food options in a
random manner and are unlikely to eat the same thing everyday
- However, mitigated by differentiation of SSB to attract customers to return more
frequently

Substitute product quality: more lower quality substitutes than higher

- SSB prides itself on quality, which Japanese food is typically known for

Substitute product price: both lower and higher

Macro Factors - SSBIndustry
is priced at a reasonable,
Analysis affordable
Business Strategy price Marketing Financial Strategy Risk 16
Bargaining Power of Suppliers Moderate
- Low

Suppliers have high market concentration

● Dominated by a few large companies (Martin & Servera - 38%, Menigo - 12%,
Svensk Cater - 12%)
● Higher bargaining power over the less concentrated F&B industry
● However, Nordic region is surrounded by sea and there are many smaller suppliers
in the region

Ingredients from suppliers not differentiated

● Mainly raw fish, rice and ingredients that are widely available
● However, quality of seafood is very important and could differentiate a certain
reputable supplier from others. It also affects SSB’s strategy for quality food

SSB is not especially price sensitive (differentiation strategy) and is well-educated

about the supplies

Low threat of forward integration by suppliers

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 17
Bargaining Power of Buyers Moderate

No bargaining leverage

Low buyer concentration; low buyer volume; low buyer information

Brand identity and product differentiation

Zero switching cost

Price sensitive
- SSB’s food is likely price elastic in demand as it is not a necessity

Many substitutes for buyers

- Refer to high threat of substitute products

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 18
Intensity of Rivalry High

Low exit barriers

Low fixed cost

- Lower capital requirements, lower barriers to entry

Low concentration but high saturation in F&B industry

- Few major players, many little players
- Highly competitive market due to high saturation

Low information complexity

- Do not require high level of skills to set up a F&B business

Moderate growth industry

- Not a high growth industry
- Profit margins are rather low

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 19
Analysis
- With high risks in terms of entry
threat, substitutes and rivalry, we
must brand ourselves well and
differentiate ourselves from
competition.
- Despite moderate buyer and
supplier power, they are important
stakeholders to our company and a
strong relationship has to be built
with them to allow for sustained
profitability.
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 20
 Key Drivers of Change
(Factors which bring change to overall
industry)

Trade
Consumer Governmen Digitalisatio
Liberalisati
Preference t Policies n
on

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 21
Consumer Preferences
● Greater interest and awareness in food
supply chain
● Demand for healthy, convenient and
affordable food
● Strong demand for ethnic food
● High receptiveness to innovation
● Current prices for related food products are
high
● Opportunity: There exists an increasing
market of consumers desiring cheap,
convenient and healthy food that has not
been monopolized yet
● Brand ourselves and provide top quality
service

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 22
Government Policies
● Gradual shift over the decade towards promoting an
open and liberal policy towards complex restrictions in
FDI
● Objective is to encourage competitiveness to build an
efficient market without unnecessary barriers of entry
for new companies
● Sweden ranked 1st by OECD in terms of public
spending, especially for FDI
● Finance of investments, subsidies, loans which create a
favorable environment with low corporate tax rates
● Opportunity: Increased incentive to enter the
market as costs are mitigated by supporting
policies
● We can operate in Sweden as policies favor an
efficient market and
Macro Factors
helps us achieve Business
Industry Analysis
a strong Strategy Marketing Financial Strategy Risk 23
bottom-line
Trade Liberalisation
● Upon becoming a member of the EU in 1995, there
are no longer trade barriers between Sweden and
other EU-countries
● Trade liberalization has become a global
phenomenon with increased connectivity
internationally
● Sweden has seen its imports of food products
increased considerably since joining the EU and
imports now account for ⅓ of total food
consumption, with EU and other neighboring
countries supplying the largest part of imports
● Opportunity: We are able to have alternative and
diversify sources of supply which is helps us in
supply chain management and ensuring top
Macro quality
Factors raw materials and
Industry ingredients Business Strategy
Analysis Marketing Financial Strategy Risk 24
 ● Online ordering and delivery services have seen an increasing proportion
Digitalisation of sales in Consumer Foodservice over the past 5 years (From 0.8% to
4.6% from 2013 - 2017)
● Independent consumer foodservice operators matched the value growth
rates of chained businesses in 2017, reaching out to potential visitors
through social media and various online foodservice rating sites.
● Financial-tech has been dominating in Sweden which values
technological advancements and innovations, with only 20% of payments
in Sweden done with cash

● Opportunity #1: By providing online ordering and delivery options,

we can reach out to more customers
● Work with third-party online delivery services (eg. Foodora)
● Opportunity #2: We can brand ourselves by maintaining a good
social media front (On social networking sites and on review sites)
● Opportunity #3: Methods of Payment will extend beyond traditional
payment methods and expand to financial technology such as
mobile payments

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 25
Competitors
Healthy Food Chains
Descriptio Offers nutritious dishes that are
n affordable, convenient and tasty.
Current Healthy grab-and-go chains like
Strategies Shaka Shaka, serve organic food
featuring more vegetables and
less calories, providing upscale
ambience at affordable prices (but
generally still more expensive
than fast food)
Macro Factors Industry Analysis
Fast Food Restaurants
Offers quick service,
cheap price points.
They often offer limited
menus but are beginning
to introduce lower-calorie
meals, sourcing antibiotic-
free meat and cutting
artificial ingredients.
Business Strategy Marketing
Casual Japanese
Restaurants
Provides Japanese cuisine
with modifications to appeal
to the Swedish diet
Incorporating Japanese
influences in the menu
selection. Providing a front-
stage heritage experience
with authenticity ascribed to
food ingredients and
presentation
Financial Strategy Risk 26
 Competitors
Healthy Food Chains
Possible To continue to drop their prices by
Future working directly with local, regional
Strategie farms and streamlining operations
s and building on brands and
marketing campaigns to increase
exposure
Analysis These chains are seen as the future
of the food industry, especially in
the case of Sweden’s health
conscious consumers. Operating
within this sector, our product must
remain competitive and innovative
Macro Factors Industry Analysis
Fast Food Restaurants
Constantly changing,
upgrading their menus,
working with
dieticians/adding more
salads to menu
However, it is not easy for
fast food restaurants to
shed off their long-
established image as “junk
food”.
Business Strategy Marketing
Casual Japanese
Restaurants
Greater focus on techniques
to produce the delicacies
more healthily (less oil),
localize the food and
presentation
Often serve niche markets
and therefore, no strong
incentive to focus primarily
on reducing prices or
achieving health goals
Financial Strategy Risk 27
Industry Key Success Factors
Relatively higher importance:
● Food Quality Food quality
● Pricing ○ Freshness of food (Especially meat and seafood)
○ Consistency of food quality
● Health-Oriented
○ Food source (Ethical, reliable source)
○ Taste
Moderate importance: Pricing
● Branding ○ Customers are usually price sensitive and see price as an important
● Fast Services consideration in consumption
● Cost Control ○ Cheaper pricing
○ Discounts (eg. Lunch sets)

Health-Oriented
Relatively lower importance: ○ With consumers informed of food choices and well-being, there is trend
● Service Standard towards healthy eating
● Facilities ○ Ingredients
● Strategic Locations ○ Available options to customize
● Innovation

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 28
Industry Key Success Factors
Relatively higher importance:
Branding/Reputation
● Food Quality ■ Induce customers to patronize the restaurant, increasing sales and
● Pricing building brand loyalty
● Health-Oriented ■ Customer loyalty programme
■ Advertising/Campaigns

Moderate importance: Fast Services

■ Busy lifestyles or grabbing quick bites necessitate short delivery and
● Branding
waiting times to satisfy customers’ immediate needs of “fresh” food
● Fast Services ■ Queue management
● Cost Control ■ Time taken to be served food

Cost Control
Relatively lower importance: ■ Important to the success because low cost results in higher profits and
● Service Standard allow for better competition with rivals
● Facilities
● Strategic Locations
● Innovation

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 29
Industry Key Success Factors
Relatively higher importance:
Service standard
● Food Quality ■ Standard of service staff (Friendly, fast to respond, willingness to respond
● Pricing to customer demands)
● Health-Oriented ■ Availability of service (e.g. provision of condiments, water)

Facilities
Moderate importance: ■ Ambiance provides a environment or atmosphere which customers may
grow accustomed to or enjoy, leading to repeat visits
● Branding
■ Cleanliness/Comfort
● Fast Services
● Cost Control Strategic Locations
■ Increase accessibility and market exposure, especially to target segments

Innovation/Customizability
Relatively lower importance:
■ Product innovation capability is required because of the changing tastes of
● Service Standard consumers
● Facilities ■ Offer customisable menu, wide variety
● Strategic Locations ■ Experimentation with new products
● Innovation

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 30
Analysis of IKSF
IKSF Factors Weight Standing Sushi Bar Healthy Food Fast Food Casual Ethnic Chains
(expected) Chains Restaurants
Food Quality 0.20 8/1.60 8/1.6 6/1.2 8/1.6
Pricing 0.15 7/1.05 7/1.05 7/1.05 7/1.05
Health-Oriented 0.15 8/1.2 8/1.2 4/0.6 6/0.9
Branding 0.10 6/0.6 8/0.8 9/0.9 8/0.8
Fast Services 0.10 8/0.8 7/0.7 8/0.8 6/0.6
Cost Control 0.10 6/0.6 6/0.6 8/0.8 6/0.6
Service Standard 0.05 6/0.3 7/0.35 6/0.3 9/0.45
Facilities 0.05 6/0.3 8/0.4 6/0.3 7/0.35
Strategic Locations 0.05 7/0.35 7/0.35 9/0.45 5/0.25
Innovation 0.05 7/0.35 8/0.4 9/0.45 7/0.35
Total 1.0
Overall Strength 7.15 7.45 6.85 6.95
Rating

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 31
SWOT Analysis
Strengths
- Health-oriented
- Fast service standards
- Affordable prices with strong
promotion strategies
Opportunities
- Coincides with change in consumer
preferences towards ethnic and
health-related food
- First-mover advantage in the area of
fast casual chains selling healthy,
affordable, ethnic cuisines
Weaknesses
- Branding is not strong and will be
unfamiliar, especially at the start
- Cost control could be an issue if proper
sourcing is not done
- Brands are able to attain maximum
exposure and we have to expand to
achieve this
Threats
- Established competitors with
certain market share with
potential retaliatory actions

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 32
 SSB will compete based on a
differentiation strategy and thus will

Value Chain Analysis engage in significant value adding

activities in this part

Sourcing for Sales and

Inbound Logistics Operations
suppliers Services

Import key Receiving, storing raw Food preparation Customer service

ingredients from materials process management
Japan - Cooking, slicing
Basic infrastructure fish etc. Promotions and pricing
Local sourcing from (refrigerator and
Sweden or storage) Ordering system (real Advertisements and
neighbouring time) media campaigns
countries Inventory management
system Human resource Partner with delivery
allocation services

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 33
Value Chain Analysis
Sourcing for Sales and
Inbound Logistics Operations
suppliers Services
Costs:
- Use volume of purchase to negotiate better prices
- Engage local suppliers whenever possible
- Shorter transport time and less logistics required
- Fresher ingredients
- Due diligence checks on suppliers for reputation, sustainable practices and
traceability of food to reduce legal risks
Value-adding:
- Building strong supplier relations for better trust and reliability of the ingredients
- Possible linkage with suppliers on inventory management system to facilitate real-
time, automatic ordering of ingredients

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 34
Value Chain Analysis
Sourcing for Sales and
Inbound Logistics Operations
suppliers Services
Costs:
- Complete receipt of all items in good condition in a timely manner
- Prevents delays or stock-out situations where operations will be affected
- Effective storage solutions

Value-adding:
- Inventory management system
- Real time information of stock levels
- Better planning of stock levels that optimises inventory levels
- Predictive function to show amount of future stocks required based on
analytics

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 35
Value Chain Analysis
Sourcing for Sales and
Inbound Logistics Operations
suppliers Services

Costs:
- Develop an efficient preparation process to ensure fast service
during peak hours

Value-adding:
- Creating a close-knit team with effective HR management
strategies (hiring, investing in employees etc.)
- Reduces turnover and absenteeism
- Digital ordering system to ensure efficiency and accuracy
- Professional techniques to be learnt in Singapore under the Head
Chef

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 36
Value Chain Analysis
Sourcing for Sales and
Inbound Logistics Operations
suppliers Services
Value-adding:
- Develop new menu items based off the Swedish diet to supplement the original SSB
dishes
- Create a balance between authenticity of the Japanese cuisine while making
adjustments to suit the taste buds of the Swedish.
- Emphasis on consistency and quality
- Rigorous training of chefs and periodic reviews of performance
- Ensure supplies are fresh and delivery is timely
- Japanese environment of the store
- Japanese service: warm, polite tone and important to greet customers in
Japanese
- Create a calm, aesthetic interior
- Strong brandingIndustry
Macro Factors
by using promotions and
Analysis
marketing campaigns
Business Strategy Marketing Financial Strategy Risk 37
- Focus on the standing feature of the restaurant and that it is authentic
Strategic Issues
ISSUES Significance
Competitive retaliation & Informal Markets Long-term Profitability

High Wages in Sweden

Building brand presence and demand Competitive Advantage

Investment in streamlining operations through technology

and process improvements

Establishing relationships with suppliers Time Horizon

Entry Mode

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 38
Contents
1. Macro-Analysis
a. PESTLE Framework Analysis
2. Industry Analysis
a. Economic Considerations
b. Porter’s Five Forces Analysis
c. Key Drivers of Change
d. Key Competitors
e. Industry Key Success Factors
f. SWOT Analysis
g. Value Chain Analysis
h. Strategic Issues
3. Business Strategy
a. Business Model - Osterwalder's
Framework
b. Entry Mode
c. Strategy (Posture, Business Strategy,
Functional Strategies, Goals and
Initiatives, Stakeholders)
d. Strategic Initiatives
4. Marketing Strategy (Segmentation and
Positioning)
5. Financial Strategy and Forecasts
39
Business Model
Key Partners
- Suppliers (for procurement of
Raw Materials/ingredients
from suppliers)
→ Import from neighboring
countries like Norway (rich in
fish)
→ Purchase from Sweden
suppliers
Key Activities Value Propositions
- Supplier Sourcing
- Inbound Logistics/Inventory We want to become the premier
Management leader in fast-casual dining
- Employee Training experience in serving authentic
- Workforce and Production Japanese food.
Scheduling
- Customer Management This will be accomplished by offering
- Preparation of Food a unique and unprecedented
- Marketing experience coupled with healthy
food at reasonable prices.
Key Resources
- Employees
- Raw Materials/Ingredients
- Machinery and Equipment
- IT Infrastructure
- Organizational Culture

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 40
Business Model
Cost Structure Customer Relationship Customer Segments
Fixed Costs 1. Adopt the Japanese service concepts - Teenagers
● Kitchen equipment - Politeness when speaking to - Young Adults
● Furnishing
customers
● Banking, legal, These are people who are willing to
advisory costs - Greeting customers when they walk spend money to eat out and enjoy
● Rental & Utilities into the store unique experiences offered by SSB.
1. Promotion for customer retention and
Variable Costs appealing to new customers They are well-travelled or are exposed
● Ingredients to the Japanese culture via the Internet.
● Labour - Staff training Channels
costs, overtime - Restaurant(s)
compensation - Delivery option (partnering with food
delivery services)

Revenue Streams
Revenue from selling food and from delivery of food and services

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 41
Entry Mode
● Non-collaboration methods:
○ Green field Investment (parent company builds its operations in a foreign
country from the ground up)
○ Acquisition of a Swedish company
● Collaboration methods:
○ Franchising
○ Joint Venture

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 42
Analysis of Entry Modes
● Franchising
○ lack of recognition overseas
○ SME reputation may not be sufficient for someone to take the risk
● Joint Venture/ Equity Alliances
○ different cultures and values, hard to control
● Acquisition
○ costly and turning around a poorly performing operation is difficult due to ill words
towards products brand, inefficient facilities, potential labor problems
● Greenfield Investment
○ Most suitable since there is no desired company for acquisition
○ SSB already possess adequate know-how of the business in Singapore
○ Consider getting advice from consultants regarding entry into Sweden
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 43
Strategic Posture: Levels of
Uncertainty
High Level of Certainty

- Predictable business environment as discussed

earlier: clear consumer trends for the food
industry
- Availability of market information and research
for transparency
- Applicable know-how from Singapore business
- However, there are certain cultural intricacies of
operating in Sweden that SSB may not
understand.
→ can enlist the help of consultants if needed
In such a business environment, recommended to be
an adaptor
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 44
Strategic Posture
Adapt to the Game

● Characterized by reacting to
opportunities the market
offers
● Risky to be shaping the
future
○ SSB is a SME with
limited capital and
clout in the industry
● Not right to be reserved as it
● Although reacting to the consumer trends towards ethnic,
may be too late to gain
convenient and healthy food, we aim create value through
significant market share at
innovations in our products and services without
that point.
fundamentally changing the industry.
● SSB as a SME is agile due
Macro to its small size.
Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 45
Business-Level Strategy
Differentiation Strategy

● Identifying unexploited opportunities in relatively low-uncertainty environments within the

existing market structure, we will rely on differentiation to build customer loyalty and deter
competitors
● Goal is not to relentlessly reduce cost but rather fixate on being perceived as unique through
design, brand image, technology, customer service, product customization, menu
upgrades
● Provide insulation against competitive rivalry because of brand loyalty by customers
● Differentiation can also help to reduce cost to some extent
○ Technology implemented can help to save man-hours

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 46
Key Functional Strategies
Main Functional Details
Strategy

Production strategy Source for high quality raw materials locally or from neighboring countries
Stringently screen suppliers
Negotiate for bulk purchase

Financial strategy Revenue from direct retail of selling healthy Japanese food to customers
- Mainly funded using existing funds from SSB
- Aim to breakeven in 5 -7years
- Loans from banks, FOKUS Verifiering (grants for commercially viable operations)

Human Resource Employees’ welfare: Basic salaries & bonuses

strategy - Sourcing for experienced Japanese chefs & training in Singapore
- Provide trainings for employees to adopt the Japanese service
- Hire more temporary labors during installation process
- Local Manager planned to station at Sweden outlet for quality control in the short-term
- Source for cheaper foreign labour in a few non-managerial positions

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 47
Key Functional Strategies
Main Functional Details
Strategy

Technical strategy - Proper installation, automation and maintenance of equipments

- Enabling payment methods, self-order technology and receipt-on-display system

Marketing strategy - Mass advertising through various mediums

- Run promotions
- Positioning as quality brand with affordable prices and advertise on our differentiation

Logistics strategy - Consolidate shipping (importing) and bulk purchase to reduce costs

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 48
 Stakeholder Strategies
Key Importance to Stakeholder Communication Strategies
Stakeholder Company
s

Employees - Crucial in daily ❏ Communicate

processes in - Employee welfare and rights (working hours, holidays)
attaining food - Safe working environment
quality and - Importance of ensuring consistency in service and quality to build brand
customer ❏ Open feedback channels for employees for generation of ideas and process
service improvements

Customers - Generates ❏ Communicate

revenue - Everything about the food that they are eating through transparency of the
- Free menu
marketing - Marketing/Promotions and Product Value Proposition, enticing them with our
through word- ability to provide affordable, healthy food
of-mouth ❏ Allow for customer feedback

Suppliers - Vital in ❏ Communicate

provision of - Schedules and required timings to attain the materials
Macro Factors food Industry Analysis - Importance of reliability and top
Business Strategy quality goodsFinancial Strategy
Marketing Risk 49
ingredients ❏ Negotiate for bulk purchase to attain economies of scale
Stakeholder Strategies
Key Importance to Company Stakeholder Communication Strategies
Stakeholders

Food Delivery - Crucial in our ❏ Communicate

Services online food delivery - Importance of punctuality, especially considering the nature of our
services products
- Agreement and aligned objectives

National Food - Oversees our food ❏ Adhering to rules and regulations

Agency and hygiene ❏ Annual facilities visit
- Knowledge transfer ❏ Open to audit checks and surprise food quality checks

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 50
Proposed Time Horizon
Enter the market within the next few years as the new wave of consumer trends are still developing
and our product is able to directly cater to the needs of the people

Apply for business Hiring and Training of

registration and Employees/Purchase of
Feasibility Studies
license for selling Equipments and
(Jan 19- Mar 19)
food (May 19) Technology (Jul-Dec 19)

Begin sourcing and Signing of

Source for store Store Open
screening for agreements with
space and location (1 Jan 20)
suppliers both within suppliers and rental
in CBD (Apr 19)
Sweden and from agreement (June 19)
neighboring
countries (Mar 19)

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 51
Strategic Objectives

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 52
Strategic Initiatives with Target Dates

$320,000

$20,000

$3% of Forecasted
Revenue

Y Y
Y

$10,000

$30,000

$3,000

5% of Forecasted
Revenue

$8,000

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 53
Strategic Initiatives

Domestic Penetration Opening 2 more outlets in Sweden by year 6

Acquire 10% of domestic market share (in fast casual chains)

Price products at a lower price point than competitors

Engage with stakeholders via sustainable comm strategies

Regional Penetration Go into a secondary product line (Tanuki Raw)

Set up an outlet in another part of the region by year 8

Acquire 3% regional market share

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 54
Contents
1. Macro-Analysis
a. PESTLE Framework Analysis
2. Industry Analysis
a. Economic Considerations
b. Porter’s Five Forces Analysis
c. Key Drivers of Change
d. Key Competitors
e. Industry Key Success Factors
f. SWOT Analysis
g. Value Chain Analysis
h. Strategic Issues
3. Business Strategy
a. Business Model - Osterwalder's
Framework
b. Entry Mode
c. Strategy (Posture, Business Strategy,
Functional Strategies, Goals and
Initiatives, Stakeholders)
d. Strategic Initiatives
4. Marketing Strategy (Segmentation and
Positioning)
5. Financial Strategy and Forecasts
55
Segmentation

Firstly, we segment our customer base into 4 groups based on their generation group, as research has
shown that there are wide-ranging dining preferences (foodservice needs, food preferences) amongst these
generation groups. (Technomic)

We then further split the respective age groups into different income groups, as one’s income level
determines the willingness and ability to purchase different types of consumer food services.

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 56
Targeting
After segmentation, we have identified the Millennials and Generation X, who
are of low to middle income, to be our target group of customers.

This group of customers are generally health-conscious and lead fast-paced

lifestyles, thus, they will value the healthy food options and convenience promised
by SSB. In addition, they are more likely to prefer food options that are more
affordable. (Technomic) By targeting this group of teenagers and young working
adults, we hope to present them with such a unique dining experience since they
are open-minded and curious about new concepts.

Approximately 50% of the population are considered Millennials and Generation

X. (CIA World Factbook)
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 57
Positioning
SSB will be positioned to be an establishment that
serves health-oriented and customisable food
POSITIONING
options, has short waiting times, and provides a free
and casual dining experience while maintaining an
upscale and inviting ambience.

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 58
4Ps - PRODUCT
● Food
○ Healthy Japanese food catered to local tastes (focus on fish)
with high quality imports and ingredients
○ Sushi menu identifies calories and ingredients for
transparency and health conscious consumers
○ Customizable health options: for example, brown rice to
replace white rice, sushi wrapped in cucumber
○ Constantly innovate and update sushi menus to consumer
trends
● Service
○ Standing concept with few seats; designed for casual-fast
dining to cater to busy lifestyles → helps in rapid customer
turnover as no incentive to stay in their ‘seat’
○ Self-service concept
○ Delivery services available
○ Enabling fin-tech (mobile, card) payment methods
○ Strong customer relationship with users and continually seek
feedback of customers

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 59
4Ps - PLACE
STOCKHOLM (Norrmalm)

● Highest population density in Sweden

● Most successful city for start-ups
● Central Business District

Opening our outlet in a mall in Stockholm, such as MOOD, increases accessibility to potential customers.
Situated centrally in the business districts and easily accessible, many students and young adults frequent
the place during breaks or after-work activities.

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 60
4Ps - PROMOTION
Online Marketing
● 8 out of 10 Swedes have at least one social media account. A third of our target segment uses social media 1-2 hours daily. In
addition, more than 60% of our target segment engage in daily usage of Facebook, which is the most used social media
platform in Sweden. (Nordicom)
● Thus, social media (eg Facebook, Youtube and Instagram) have proven to be a good platform for us to establish our online
presence and generate awareness of our restaurant
● Through interactions on our own social media accounts, our customers will be able to share and find out about our product
offerings
● We will also set up a Youtube account to advertise our restaurant

Trade Fairs
● We can participate in food fairs
● Through these fairs, we have increased exposure to our target customer base
● From here, customers can get to taste our food, and learn more about our restaurant and its offerings

Traditional Media
● We will be giving out pamphlets and flyers around the office buildings and around our store location during the lunch hour to
attract the lunch crowd
● We will also be distributing them during dinner time to attract the after-work crowd
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 61
4Ps - PRICING
● Pricing Strategy: Less for Less
○ Less for Less Pricing is chosen because compared to other Japanese restaurants, SSB is able to provide the
same quality of food, but in a more casual setting, at a cheaper price
○ Without the need for store space (due to removal of seats), less costs are involved in furniture. In addition,
with our self-service concept, we will be hiring less staff. Thus, we would be able to sell our food at lower and
affordable prices relative to most Japanese restaurants
○ In Sweden, typical sushi in a restaurant cost around 120 SEK (SGD 18) for 8 pieces. We are able to sell a
similar dish at a much cheaper price, SGD 14

● Pricing Deals
○ Lunch sets and dinner sets at a discounted price
○ Promotions during happy hours and on certain occasions (11.11 looks like 2 pairs or leg standing)
○ Penetration strategy to introduce product at a lower price with various promotions

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 62
Contents
1. Macro-Analysis
a. PESTLE Framework Analysis
2. Industry Analysis
a. Economic Considerations
b. Porter’s Five Forces Analysis
c. Key Drivers of Change
d. Key Competitors
e. Industry Key Success Factors
f. SWOT Analysis
g. Value Chain Analysis
h. Strategic Issues
3. Business Strategy
a. Business Model - Osterwalder's
Framework
b. Entry Mode
c. Strategy (Posture, Business Strategy,
Functional Strategies, Goals and
Initiatives, Stakeholders)
d. Strategic Initiatives
4. Marketing Strategy (Segmentation and
Positioning)
5. Financial Strategy and Forecasts
63
 Assumptions
Item Amount Rationale Item Amount Rationale

Exchange Rate SGD/SEK = 0.15 Attained from XE Currency Converter Operating Marketing = 5% of revenue Initial to increase visibility,
Expenses subsequently drop to 3%
Average Sale Price Each Customer= 70 Attained from research of typical spending (3rd yr)
SEK (SGD 10.50) amounts in fast casual healthy restaurants
(compare to Macdonalds combo meal 75 SEK and 1000 Square Feet (SSB in One Raffles= Attained from research
what is considered inexpensive restaurant price is 550 square feet)= 1,000 x 140 SEK x 12 upon rental fees in
100SEK)
months = 1,680,000 SEK (SGD 252,000) restaurant chains in CBD

Cost of Goods Each Customer = 30 Research shows Japanese restaurants often make a
Equipments: Depreciation= 320,000 Attained from JL
SEK (SGD 4.50) profit margin of 60%. We will price it at a
conservative 57% SEK/10= 32,000 SEK (SGD 4,800) Packaging.com

Wages (1 Manager, 4 Managerial = 42,000 41,000 SEK/month (from 1-off Renovations/Furnitures= 100,000 Attained from research on
Chefs, 3 Non-managerial SEK / month (SGD AverageSalarySurveySweden) SEK (SGD 15,000) fast casual restaurants
roles such as cashier, 6,300)
dishwasher and cleaner) R&D = 3% of revenue
Chef=31,000 SEK/ 28,275SEK/month (from lonestatistik)
month (SGD 4,650)
Tax Corporate Tax Rate = 22% Current Rate
Expenses
Non-Managerial = 100 100SEK/H (from AverageSalarySurveySweden)
SEK/H (SGD 15)
Lending Cost of Funds = 0.25% Attained rates from
2 Assistants (in charge of 28,000 SEK/month 27,000 SEK/month (from ChekinPrice) Facility TradingEconomics
inventory, procurement (SGD 4,200)
and marketing)
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 64
Financing Information
Equity Financing (Retained Debt Financing (Bank Loans) Government Incentives Business
Earnings) Angels/Venture Funds

Capital Structure 50% 50% -

Analysis Use of retained earnings from
local businesses, but at the cost
of investing at local interest rate
Credit Rating is AAA
However, banks make overall
evaluation based on
experience, business plan,
financial help, balance
sheets, not realistic to expect
full capital to be loaned by
banks
Active and open to being contacted,
feel urgency and commitment for
enhancing startup ecosystem but
depends on a case-by-case basis and
depends on pitch, grants and priorities

Cost 1.11% (opportunity cost) 0.25%

WACC (0.5 x 0.011) + [0.5 x 0.0025 x (1-0.22)] = 0.006475

Approximately 0.6475%

Initial Outlay 1.0 million SGD

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 65
 Assumptions:
- Have not factored in bulk purchase/supply relationship giving

Profit After Tax -

-
lower COS
Revenue Considers a conservative estimate of 250 customers a
day and 50 delivery orders a day
Government subsidy/aid not considered

Income Statement Unit 0 1 2 3 4 5 6 7 8

Revenue SGD - 1,149,750 1,341,375 1,533,000 1,724,625 1,820,438 1,916,250 2,012,063 2,107,875

Cost of Revenue SGD - (492,759) (574,875) (657,000) (739,125) (780,188)) (821,250) (862,312) (903,375)

Operating Expenses SGD - (924,255) (912,775) (924,255) (935,752) (941,500)) (947,250) (947,250) (947,250)

Finance Cost SGD - (12,950) (12,950) (12,950) (12,950) (12,950) (12,950) (12,950) (12,950)

Depreciation Expense SGD - (4,800) (4,800) (4,800) (4,800) (4,800) (4,800) (4,800) (4,800)

Profit before Tax SGD - (285,014) (164,025) (66,005) 31,988 81,000 130,000 184,751 239,500

Income Tax SGD - - - - Tax C/F-0 Tax C/F-0 Tax C/F-0 Tax C/F-0 (55,539)

Profit after Tax SGD - (285,014) (164,025) (66,005) 31,988 81,000 130,000 184,751 183,961

EBIT (272,064) (151,075) (53,055) 44,948 93,950 142,950 197,701 252,450

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 66
 Cash Flow
With most restaurants (passing 5 years mark) operate for up to 10 years, we calculate:
Project Analysis 0 1 2 3 4 5 6 7 8 9 10

Capital Outlay (Debt + Equity) (500,000)

After-Tax EBIT - (272,064) (151,075) (53,055) 44,948 93,950 142,950 197,701 196,911 196,911 196,911

(+) Depreciation - 4,800 4,800 4,800 4,800 4,800 4,800 4,800 4,800 4,800 4,800

(-) Increase in Net Working - (420) (725) (1,049) (2,945) (3,759) (4,564) (1,724) (1,733) (1,760) (1,791)
Capital

After-Tax Cash Flow (500,000) (267,684) (147,000) (49,304) 46,803 94,991 143,186 200,777 199,978 199,951 199,920

Project Analysis 0 1 2 3 4 5 6 7 8 9 10

Undiscounted Net Cash Flow (500,000) (767,684) (914,684) (963,988) (917,185) (822,194) (679,008) (478,231) (278,253) (78,302) 121,618

Cumulative Undiscounted (500,000) (765,962) (911,075) (959,433) (913,823) (821,844) (684,095) (492,189) (302,273) (113,606) 73,817

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 67
Financial Implications
- Breakeven by 7th year → Healthy considering most restaurants take 5-7 years to breakeven

NPV= 58,404.5

IRR= 1.5%

Payback: Within 10 years

- Positive NPV means project creates value, IRR> Cost of capital means internal rate of return on the
investment is greater than the minimum required rate of return, thus the investment should be
pursued.

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 68
Contents
1. Macro-Analysis
a. PESTLE Framework Analysis
2. Industry Analysis
a. Economic Considerations
b. Porter’s Five Forces Analysis
c. Key Drivers of Change
d. Key Competitors
e. Industry Key Success Factors
f. SWOT Analysis
g. Value Chain Analysis
h. Strategic Issues
3. Business Strategy
a. Business Model - Osterwalder's
Framework
b. Entry Mode
c. Strategy (Posture, Business Strategy,
Functional Strategies, Goals and
Initiatives, Stakeholders)
d. Strategic Initiatives
4. Marketing Strategy (Segmentation and
Positioning)
5. Financial Strategy and Forecasts
69
Risk Assessment
A) Economic Risk → Exposed to economic shocks due to heavy dependence on international
trade (e.g. recessions)
- In times of turbulence, this could mean unemployment, lack of capital, lower spending power and
poor economic outlook for the society.
- Impact of Brexit as UK is one of the most important trading partners of Sweden, may negatively
affect the economy in long run
- SSB may face:
- Lack of capital (unable to borrow from banks due to higher risks, mounting interest rates)
- Low revenue due to poor spending power
- Pressures to cut cost (reduce hours of operations, laying off employees)
- Going concern issues if revenue is unable to keep up with costs

Moderate possibility due to volatility of economy, but experience overall strong growth. Generally high PPP, coupled with
affordable food results in a low to moderate impact.

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 70
Risk Assessment
B) Labour Risk → Tightening labour and immigration policies could spell uncertainty

- “Sweden has been traditionally known for its liberal immigration policies; however, the country has
closed its borders and hardened its immigration stance as it gears up for a general election in
September 2018.”

- This may spell rising costs and potential manpower shortages.

- Labour costs are a significant portion of F&B industry operations and SSB’s bottom line may
be heavily impacted for low-skilled labour such as waitress/cashier. This is exacerbated in
long-term expansion plans
- SSB will likely hire cheaper foreign labour from other EU countries. Tightening labor policies
may lead to a shortage of such workers and contribute to higher costs.

Moderate likelihood and moderate impact as we are able to counter this through providing temporary jobs
Macro
to Factors Industry Analysis
locals/students/unemployed Business Strategy Marketing Financial Strategy Risk 71
Risk Assessment
C) Competition Risk → Sweden is an extremely competitive market due to its openness and ease
of doing business
- Profit margin might be low due to large number of market incumbents in F&B
- There is a risk that profits could be competed away by competitors
- In a Monopolistic Competitive market, there is lower barriers to entry
- Competitors could enter into the Japanese F&B space and decrease our profit margins
- There could be a detrimental price war
High likelihood and high risk due to nature of competition and their ease of entrance

D) Supplier Risk → To achieve bulk purchase, we may be overly reliant on individual suppliers,
which exposes us to significant supplier risk as disruptions to the supplier could affect our entire
supply chain management.

- It would affect our internal flow of resource to enable operations to take place
- May have to find alternative sources of imports/supplies and we may not have bargaining power
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 72
Moderate likelihood and moderate risk due to number of suppliers
Risk Assessment
E) Health Risks → as sushi requires special handling due to perishability issues.
- There are cases of food poisoning where are people falling ill and even dying from eating bad sushi
due to growth of bacteria. Despite regulations imposed, internal controls have to be strong to
mitigate this.
- Any such cases will take a massive hit on our reputation and our bottom-line
Low likelihood as quality control and experienced chefs will deter it and high risk due to its high impact

F) Legal Risks → Extending from health risks, we are susceptible to legal risks if we fail
regulations or experience instances of customers falling sick from consumption of our food
- May be forced to close down the business and could lead to fining and insolvency
- May affect reputation of brand in Singapore and Southeast Asia, reducing overall profits
Low likelihood but high risk as it can destabilize our entire operations

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 73
Risk Assessment
G) Regulation Risks → Change in Legislation or government policies that could result in hiked
taxes or less government incentives
- May make it less advantageous for us to go enter the industry, especially if government decides to
protect their own local companies
Low likelihood due to the direction the government is heading in supporting FDIs but high risk as it
diminishes the advantages we have and gives us poorer economic forecast

H) Currency Risks → Volatility in currencies

- Could affect translation revenue for Singapore
- Import of raw materials from neighbouring countries can potentially increase unpredicted expenses
and costs
Low to Moderate likelihood as currencies in Nordics relatively stable (especially Norway which is the
biggest supplier of fresh foods to Sweden) and high risk due to its impact on costs

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 74
Risk Reporting Matrix
Legend:
A= Economic Risk/Volatility
C B= Labour Risk
C= Competition
A D= Supplier Risk
B D E= Health Risk
H F= Legal Risk
E
G= Regulation Risk
F
H= Currency Risks
G

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 75
Risk Mitigations
Risk Mitigation measures

Exposure to ➔ Ensure sufficient cash on hand to tide over recessions

economic shocks ➔ In line with the affordable branding of SSB, offer new menu items
that are less premium and therefore, cheaper.
➔ Maintain flexibility of operations (e.g. reduce operating hours,
reduce manpower for each shift)

Labour market ➔ Avoid staffing SSB with too many foreigners. Ensure a certain ratio
uncertainties is carefully set and adhered to when hiring.
➔ Reduce turnover in staff using good retention policies such as
worker upgrading opportunities, fair reward system, potential for
advancements

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 76
Risk Mitigations
Risk Mitigation measures

High levels of ➔ Create strong branding and marketing campaigns to capture market
competition share in the food industry. This can be done through social media
presence, promotional offers and loyalty programs.
➔ Innovate to appeal to the locals and differentiate itself from other
competitors such as Japanese restaurants and other fast, casual
eateries.
➔ Ensure consistent, high quality food and service.

Health/Legal Risks ➔ Ensure supplies received are fresh and of good quality
➔ Manager has to ensure quality control through internal controls that
chefs have to follow, conduct proper training and tests to screen chefs
➔ All members have to be cognizant of safety rules and regulations set out
by Sweden’s National Food Agency, especially for handling raw food
➔ Ensure all equipments are in working and functional conditions daily
Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 77
Risk Mitigations
Risk Mitigation measures

Supplier Risks ➔ Screening process when sourcing for supplier must be thorough, ensure
suppliers are have strong reputation
➔ Have a strong relationship with suppliers such that any disruptions
which are foreseeable can be communicated to us so that we can react
accordingly, preventing supply shocks
➔ Invest in an ERP system such that we are well aware of inventory and
stock levels of the suppliers and their ETA

Regulation Risks ➔ Constantly keep abreast of government directions and policies to be well
aware of any changes in policies
➔ Be ready to engage in new financial analysis on profitability

Currency Risks ➔ Negotiate to use SGD/USD (fixed currency) to purchase imports

➔ Hedging (forward contracts) to mitigate currency volatility and losses

Macro Factors Industry Analysis Business Strategy Marketing Financial Strategy Risk 78
79
1)
Wages (SGD)

Manager 42,000 x 0.15 x 12 = 75,600

4 Chefs (shift work, with 3 chefs at any time) 31,000 x 0.15 x 4 x 12 = 223,200

3 Workers (at any time) 100 x 11 x 365 x 0.15 x 3 = 180,675

2 Assistants 28,000 x 0.15 x 2 x 12 = 100,800

Total Wages 75,600 + 223,200 + 180,675 + 100,800= 580,275

Rental Fees 252,000

Marketing + RnD + Renovation 76,650 + 15,000= 91,650

Cost 580,275 + 252,000 + 91,650 = 927,525

80