Feasibility study of establishing a cafe’ in Strait Street, Valletta

Abstract

Purpose: The purpose of this research is to determine whether or not it is feasible to establish a Cafe’ in Strait Street, Valletta. Design: In order to achieve the objective of the study, four steps followed. First, existing literature on the subject was reviewed and split into 5 main areas of concern, namely environment analysis, product/service analysis, financial analysis, investment appraisal, and sensitivity analysis. Secondly, 3 data collection methods were used including semi-structured questionnaires, face-to-face interviews, and personal observation. The findings collected were then used in order to carry out the analysis of 5 areas mentioned above. Lastly, conclusions were drawn and recommendations on the subject matter were provided. Findings: The findings from environment analysis suggest that catering industry in Malta is a very competitive industry however it promotes healthy competition and thus enables business growth. Product / service analysis show that substantial demand exists for the proposed Cafe’. Financial analysis, presented in the form of forecasted financial statements and financial ratios, show, that the business will be profitable from second year of operations. As from investment point of view, the results transpired that the project is a financially viable investment. Conclusions: The overall conclusion reached is that establishing a Cafe’ in Strait Street, Valletta is a feasible project. Implications / Value: The study is of value to potential entrepreneurs who are interested in investing in Valletta. The proposed location enhances the probability of success due to Valletta 2018 project.