Hookah Shop Business Plan

The Habibi Hookah Shop is an upscale hookah smoking bar that combines the features of hookah tradition, experience of Eastern culture, and fine cuisine. It is a great place to get together with friends, relax after a difficult day in the comfortable atmosphere of colorful decor, authentic music, and, of course, pleasant service. The shop is going to be located in a commercial rental building on the main street of Newtown. The building is 1500 square feet, which allows the owners to set the tables comfortably for their customers, allowing some personal space but also stimulating communication. Moreover, the location on the main street adds to the marketing effort, as potential consumers will see the hookah shop on their way to and from the city.

The mission of Habibi Hookah Shop is to invite the customers to a comfortable environment of the Arab culture, become a place to meet other people, who also love hookah smoking. The company aims to introduce the Newtown residents to the Arab world, share the culture though trying the Middle East food, listening to the music and enjoying hookah smoking. The goal of this bar is to unite people, who search for new experiences and comfortable place to spend time at.

The product mix of Habibi Hookah Shop consists of food, hookah smoking, and entertainment. The business offers different flavors of tobacco to smoke. The tobacco will be locally purchased and ordered from the suppliers in Middle East. Thus, the imported tobacco will be charged a premium price. Moreover, the bar will offer the Middle Eastern cuisine, consisting of appetizers, main courses, and custom-made finger food. The exquisite alcoholic drinks, top-class liquors, will be available in the shop. Also, Habibi will offer the variety of freshly brewed teas and coffee to support the Arab culture in the shop. Entertainment will take place during the weekends and holidays, and will include belly dancing, tribal dancing, music evenings, and master classes of Arabic tradition.

The target market of Habibi Hookah Shop are men and women, who are 21 years and older, have a stable job, secure position in the community, who enjoy travelling and discovering new things. These people prefer to eat out, get together with the friends, and spend weekends away from home. The management expects major percentage of consumers to be men of 30-40 years old, career-oriented, single or married and without kids. However, the active females, either single or married without kids, who have a career in high power jobs and enjoy travelling, will comprise a significant percentage of the general target market.

The business will stand out in Newton restaurant and catering market. The Newtown community members are not very well aware of the hookah culture yet. They are familiar with the concept, but have not experienced the treasures of hookah smoking. Thus, Habibi Hookah Shop will stand out as the first authentic hookah bar in the area. It will not only offer smoking experience, but cultural learning of the Arabic world, be the place to meet new friends, and unwind after a long day.

The business owners are the team of 4 people, who each have equal parts in the company. They share the financial obligations through investing the equal parts ($8025.00 each). The owners have the relevant business experience. One of the co-owners has managed the restaurant before; thus, she will be in charge of the administration and hosting. The second co-owner is pursuing business degree, and will be executing the role of CEO. Two other co-owners have been travelling abroad, know the Arabic culture, and are hookah-enthusiasts. Therefore, they take the position of art-director and head of purchasing. In the first six months of operations, the four owners will also take part in daily Habibi activities, sharing the duties of hookah servers and waitresses.

The future prospects for Habibi Hookah Shop include the potential clientele growth starting from the fourth month of operations (September). The word-of-mouth marketing will contribute to the increase in sales. Thus, it is crucial to organize the Arabic weekends in the beginning of operations and invite customers through booklets to attract the initial sales. As Habibi is the first authentic Arabic hookah shop, it requires advertisement and promotions to increase the market awareness.

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Habibi Hookah Shop mostly relies on equity financing through equal contribution of each partner ($8025.00 per person). The total equity is $32,100. The start-up equipment and inventory is acquired on zero-interest credit from local suppliers. Thus, short-term liabilities increase by $8,800. The business does not plan to attract credits in the first years of operations to reinvest the extra cash into events and promotions. However, the business aspires for expansion in the second year of operations to include community events and extensive promotion campaign. Also, the managers have plans to invite the Arab chef in the second year to present the new authentic menu to the community. In order to meet the two-year goals, Habibi Hookah Shop will apply for the credit in a local bank towards the end of the first fiscal year.

The following section presents the key financials for the first year of operations of Habibi Hookah Shop.

The Business Financials

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Balance Sheet

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