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TABLE OF CONTENTS

1.EXECUTIVE SUMMARY
2.BACKGROUND OF THE COMPANY/CORPORATION
3.MISSION, GOALS & OBJECTIVES
4.INDUSTRY ANALYSIS
5.ORGANIZATIONAL STRUCTURE & MANAGEMENT
6.PRODUCTION OR OPERATIONS
7.MARKETING PLAN
8.FINANCIAL PLAN
9.RISKASSESSMENT

Executive Summary
Tea is the most popular beverage in the world as well as one of the healthiest. The north
American tea market is growing rapidly. Tea sales have increased 165% over the last fifteen
years, with the number of tea rooms offering sit down service rising about 15% to about 1,500
shops. People in north American interest in tea certainly owes some of its increase to the
proliferation of gourmet coffee shops around the country in this same period. Most of working
people has accepted the idea of expensive hot beverages as affordable luxuries.consumers are
looking for new, more unique treats to enjoy. As we can see, Starbucks estimates that 7% of its
$12 billion annual sales currently come from tea.
LEGAL FORM OF OPERATION
Tea party was formed as a partnership in 2014/08/09 in St.catherines in response to the following
market conditions:growth opportunities exist in Product
Our company started by tea lovers who envisioned a comfortable, friendly, casual environment
for all people. We value community and we wanted people to feel that tea should be relaxing and
personalmake it anything you want it to be. no expectation or pretentiousness with our way of
doing business. We want you feel welcomed. We invite you to share your most cherish event life
with us.
BRIEF EXPLAINATION
Our purpose is develop as a chain businessand selling high quality specialty tea and products
that enhance the tea drinking experience
Become selected as the best new tea store in the St.Catherines area.
Turn in profits from the first month of operations.
Maintain a 65% gross margin.
creating top quality products with 100% natural ingredients that are healthy and great tasting
Providing superior customer service
Providing excellent value and competitive price in the marketplace
Keeping our products exciting; in delighting our customers and consumers

Pushing profitable growth


Fostering team spirit and building an environment which is a rewarding and enjoyable place to
work
High ethical standards, integrity and fairness in all our dealings with supplies, customers, and
employees
Hiring people with a commitment to excellence
Training our employees and rewarding above average performance
Work/life balance
PRODUCT/SERVICE OFFERING HOW IT IS UNIQUE
Tea party is a place to dream of as you try to escape the daily stresses of life and just
a comfortable place to meet your friends or to read a book, all in one. With the growing demand
for high-quality gourmet tea and great service, we will also offer its customers the best prepared
tea in the area that will be complimented with pastries, as well as free books that its patrons can
read to enjoy their visit. For attracting different age and background people, there is many
different choices for consumers. Tea Party will offer a full range of teas (hot and iced), as well as
pastries, premium chocolates, tea accessories.
ENVIRONMENT FRIENDLY
We reuse and recycle packaging materials, office supplies, printer cartridges, scrap paper and
newspaper. In fact, we began using recycled paper for packing material in our shipping
department more than 12 years ago when bubble wrap and foam peanuts were still the industry
standard. We also use recycled paper and paper from sustainably managed forests for our
packaging and other printing projects. We will always continue to look for a greener option. In
an effort to create more sustainable packaging, we have eliminated our package overwrap. Our
all-new packaging is 100% recyclable.
DESCRIPTION OF TARGET MARKET
Our potential clientele is divided between local residents and tourists. We expect to easily
generate sales to existing committed tea drinkers, who will immediately recognize the quality of
our products and services. Marketing to the much larger local groups who are not yet familiar

with premium teas will emphasize our atmosphere (cozy, intimate, luxurious), our prestige-value
( the sophistication of having a favorite "exotic" tea type), and our wide array of potential gifts
(gift baskets, chocolates, loose teas and tea accessories). Sales to tourists depend on a highlyvisible location, association with the quaint charm of our town, and promotional efforts in
cooperation with other local businesses..
THE KEYS TO SUCCESS
Store design that will be both visually attractive to customers, and designed for fast and efficient
operations.
Employee training to insure the best tea preparation techniques.
Marketing strategies aimed to build a solid base of loyal customers, as well as maximizing the
sales of high margin products, such as tea drinks.
Product Quality. We sell only the finest whole-leaf loose teas, pastries, and chocolates.
No direct competition. We are the only tea store in 20 miles.
Broad cross-seasonal offerings. In addition to hot teas, we offer iced teas, chocolates, and gift
baskets to cover seasonal variations in customer demand.
BACKGROUND OF THE COMPANY/CORPORATION
A) BUSINESS FORM
SOLE PROPRIETORSHIPS
Business Registrations are the simplest form of operating a business. A sole proprietorship is an
unincorporated business that is owned by one individual. Our business has no existence apart
from the owner. Only one owner is responsible for making all of the business decisions and,
therefore, earns all the profits, but also assumes all of the risks and obligations. The owner
includes the income and expenses of the business on his or her personal tax return.
Most sole proprietorships tend to be small and localized. The advantages commonly associated
with carrying on a sole proprietorship are the following: (1) ease in which to start and dissolve
the business (through a simple business registration); and (2) modest start up expenses (see
below for business registration fees). There is, however, a significant disadvantage which may

lead we decide against choosing this business form, namely, unlimited liability. The owner is
personally responsible for all of the debts and obligations incurred by the business. The owner is
thus liable to the full extent of his/her personal assets for all of the liabilities and losses which are
incurred by the business. Also, the owner is liable for the actions of employees in the course of
their employment.
Most jurisdictions require that sole proprietorships register with the relevant government
department or authority under the trade name it is operating under. This is sometimes referred to
as a Business Registration, Business Name Registration Of course, we have to get the same
business licenses and permits as any other company that goes into the same business.
Moreover, when we register our business with the governments registration division, we still
have to register with the tax department. We may be required to apply for GST and PST and
payroll tax numbers (if you have employees) and Import/Export tax numbers.
PARTNERSHIPS
The Uniform Partnership Act provides the basic rules for the formation and operation of
partnerships in more than 90 percent of the states. This act defines a partnership as an
association of two or more persons to carry on as co-owners of a business for profit. The
partnership form of business organization is not restricted to any particular type of business, but
it is most often used in relatively small shop and in professional fields.
MISSION, GOALS & OBJECTIVES
A) Mission Statement
Our mission is to provide the premium teas to resident Niagara area in a relaxed and fun
atmosphere. Moreover Our Company will support for Niagara College Students as the new
generation, recently premise to provide continuous institutional support for younger people in the
seeking to launch their own startups in the knowledge-based sector.
B) Goals & Objectives

* To operate a successful tea store in Welland, employing four to five employees the first year.
* To obtain a minimum of 200 regular customers in the Ontario Canada market the first
year operation.
* Achieve first year sales of $50,000.
* Maintain an average gross margin 30%.
* To produce a reasonable net profit by the end of the third year of operation.

Industry Analysis
INDUSTRY STRUCTURE AND ATTRACTIVENESS
We will be competing directly with places such as Tim Hortons and Starbucks and indirectly
with places like McDonalds and Grocery stores in what is known as a very monopolistic
industry. The tea and coffee industry make up 1.1% of the total value of sales of food and
beverage goods.
An external factor we would face in this industry would be the social factor. For the most part,
humans are creatures of habit and are easily influenced by what is popular at that given time.
Also, a lot of people do not like to try new things and once we find something we like, we tend
to stick with it. So the biggest challenge we will face as a small upstart tea shop is convincing the
people that our product is superior to that of our competitors.
Per capita consumption of tea continues to be on the rise. From 2000-2008, tea consumption has
increased from 59.12 litres to 79.37 litres, which represents a 34.3|% increase. These numbers
can be influenced by any number of reasons. From the introduction of various new tea flavors
and options on how to take your tea (Tim Hortons offers tea lattes now) to the simple fact that
more people from the 18-25 age demographic are drinking more tea than ever before. We were
enticed to the industry mainly due to the numbers. Tea makes up 12% of the total sales of non-

alcoholic beverages and, seeing as there is no true giant in the industry that strictly only sells tea
and tea products, we saw that as an opportunity to take our piece of that 12%.
The market for Coffee and Tea products totaled $1.5 billion in 2008, with that number
continuing to rise.
COMPETITIVE ENVIRONMENT
By exclusively selling tea and tea products, it allows us to fit in with these massive corporations
in the market place by giving the ever-growing tea drinking population more variety of options
in what tea they can consume. With all the products that places like Tim Hortons sell, they
simply do not have the space on the menu to sell dozens of types of tea and tea products.
We have to expect in such a monopolistic industry that we will not be greeted into the industry
with open arms from our direct competitors. Tim Hortons has put their drink prices as low as a
dollar at some points in the year, just like McDonalds gives away free small coffees during
points in the year to entice people to drink their coffee instead of Tim Hortons or other
locations. We have to ready ourselves to open with as low of costs as possible to be able to
compete with the giants of the industry that certainly are not going anywhere.
KEY SUCCESS FACTORS
A great product Our business will not be around very long if we do not have a product the
people enjoy
A great location We could have a great product, but without research done to find proper
locations, we would never sell the tea products to their full potential
A knowledgeable staff Our staff will have to be educated on all our products in order to sell the
proper tea or tea product to a first time customer in order for them to want to come back
An excellent marketing strategy Without properly advertising the new business, the potential
customer base will have no idea that our product even exists

A friendly environment We want to invite the people in to sit down and enjoy their tea in our
facilities. In order to do that, we will have to offer such luxuries as free Wi-Fi, a more
comfortable place to sit and an uniquely designed layout to the facility
Proper assessment of the market If we have misread the projections of the need for a strictly tea
based store, we will have a tough time in turning any type of profit
ORGANIZATIONAL STRUCTURE & MANAGEMENT
To establish a company, it has to have an organization structure to give our firm value and to
execute it appropriately for the team to run it successfully. All our firm decisions would be
handled by the teams manager However, All of our members have the right to speak their
opinion and accordingly the decision will be made. The owner also has a broad spectrum of
challenging positions to make an impact on the growth of our organization. Our goal is to be the
teahouse of choice for the local Niagara on the Lake community, downtown business workers,
tourists who visit the city, and students, by providing a higher quality experience than any
competitor. As a result, we intend to create coffeehouses that quickly achieve profitability and
sustain an attractive rate of return (20% or more annually) for our investors.
We also want to make our contribution to the welfare of the local community by supporting
charitable and civic activities. We will support the farmers who grow our herbs by using Fair
Trade, Sustainable Production and Organic products whenever possible.

Certain departments that are ought to be created are:Human resource: Although our organization is a start-up, we would like our associate to focus
on activities relation to employees, which includes recruiting and training them. Our staff would
be extremely professional with each other to avoid any personal relations between work and it is
strictly against our policy.

Operations: This team is responsible for our managing issues, training staff personnel and also
to support the launch of the new products. Research and development would be responsible with
collaborating and coordinating in bring something new to the table (new products)
Research and development: One of the main aspects of the organization to keep the product
(Tea) fresh by innovating and enhance the existing product. This group works closely with our
operations, marketing and purchasing teams, especially when launching new products
Marketing: The group diligently works to endorse our brand characteristics in everything that
our product values and offers. It is their duty to advertise our product through national
advertising campaigns, local sponsorships, radio, social network to market it as much as possible
since it is important to let as many people know about our brand and what we represent, which is
mainly well-being and to encourage personal growth
Guest service department: This department helps customers who have specific health problems
and would also guide as to what tea is suitable for their health. Generally, 2 people would
manage this department who would deal with clients with their expertise.

PRODUCTION OR OPERATIONS
The production process is not that complicated since its only a beverage that we offer. However,
our beverage offers a lot of benefits. We uses a lot of herbs to provide our customers with a lot
of health benefits such as rose petals, nettle, ginger, red clover just to name a few.

Our product offers a variety of different herbs, each having its own benefit. We just require a
few tea makers to start our production and we make the product fresh right when the customer
wants it. This way the customer are relieved by what goes on in our product and what goes in it,
at the same time. Production and distribution occurs at the same time.

The place will feature dining room seating for approximately 100 patrons and flexible
indoor/outdoor patio seating for an additional 40 patrons. The tea house will provide a full-

service and carry-out tea-based beverages. The tea house portion of the business will also contain
a small entertainment stage, and niche magazines and newspapers available for purchase.
Our design style is different from all other coffeehouses, an upscale look. It features stained glass
decorations, art glasswork, style furnishings and outdoor dining.

We also provide Bulk teas which is oftenly called loose leaf or whole leaf teas offer the best
flavor and value. Whole tea leaves maintain constituents of Camilla sinensis that are reduced
with the cutting, grinding and filtering that prepares tea for tea bags. Loose-leaf teas develop
while soaking and release their maximum scent, taste and goodness which gives a complete tea
experience. Drinking teas that are sustainably farmed and socially beneficial adds to that
experience. We're also committed to offering teas from farmers who practice sustainability and
provide support for their communities.

We provide a wide array of familiar and exotic loose leaf teas of the highest quality for
pleasurable, socially responsible tea sipping. Our plan is to also buy tea in bulks as it will give us
an opportunity to buy wider selection of different loose leaf teas especially higher quality teas
than those found in tea bags, which often use the lower quality "fines" that are left behind from
the handling of whole leaf tea.
Making a delicious cup of tea isn't hard, but following a few simple tea brewing tips can bring
out the full potential of your loose leaf teas. By taking a little time and care in brewing to bring
out the flavor of the whole leaves of a bulk tea, you can make the most of your cup of tea.
In addition to true teas, which all come from the Camilla sinensis plant, many of us enjoy herbal
teas (technically tisanes) brewed from one of a wide variety of tea herbs. These many different
botanicals offer many different effects from the energizing South American sensation yerba
mate. Our selection of herbal teas offers a number of tea blends that combine several herbs or
herbs and fruit for unique and enjoyable taste experiences.

Work shifts include from 7:00 am to 6:00 in the evening. These hours of operation include 2
shifts, morning and evening and will be open seven days a week. For our equipment use, we only
require a tea maker and tea itself, raw materials for production would be soy milk. We will take
helps of the farmers to grow herbs. Direct labor cost would include people who are constructing
our organizations design and people who help us in selling our product. There are material costs
involved as well such as wood, tiles to construct the store.

For construction site, we need about 6000 square feet to build. The building will have its own
departmental stores within the plant site. The place chosen for our site is Niagara on the lake,
being a tourist location, we would get much more exposure to people who are from different
parts around the world. This would give us bigger exposure not just to national citizens but from
people all over the globe as well. We have analyzed the location and there are not many
competitors other than Tim Hortons who are only a few blocks away. Tim hortons is
unattractive, small and lacks outside eating.
The location chosen has its transit system so people travelling to work would not be a problem,
being in a tourist location would be exciting to work. Moreover our Company will support for
Niagara College Students as the new generation to provide continuous institutional support for
younger people in the seeking to launch their own startups in the knowledge-based sector. We
have also looked at the demographics stating 58% of the population is above 32 years of age
which is more than half of our target market. This only adds to our advantage in running our
business. Moreover, Niagara on the lake has a friendly farming town of relatively low
population, low crime rate and has really an open space for the place to be constructed as well as
relaxed pace of life. A busy population of college professionals, intent upon working hard and
playing hard, has fewer and fewer opportunities to drink tea at home. These people drink tea out
often and do so with friends. Because this population tends to be out far more than the typical
population, they look for value and quality.
Since the new generation is so conscious about their health, billions of dollars are poured onto
making multi-vitamins. Our product actually encourages and provides nutrition that customers
want, at a reasonable price. Looking at the demographics and the obesity rate in the city, our
product will help customers lose weight.

Only factor that might slow us down is the cold weather in winter, we would not be able to grow
herbs however the organization would have the facility for an ingrown garden inside the building
to continue our business. Since Niagara on the lake is an upscale are and also being a tourist
location, the cost is a little higher than expected and with all the aspects that has been included in
constructing the site come about $2 million.
The product is a tea company. The company focuses on helping people make better choices with
their diet and health. Tea party will be able to produce almost any kind of tea there is. Since
consumers drink tea for different reasons we have traditional tea, tea for pleasure, tea to improve
your health if ill etc. White tea is the purest and least processed of all teas. This loose leaf tea
brews a light colour and flavour. Green Teas, Oolong Teas, Black Teas, Herbal Teas, Rooibos
Teas, Mate Teas, Blooming Teas and Tea Blends will be the main teas that the company will
produce. The products will be beneficial for people in the winter, considering Canada is viewed
as a country of a minus temperature, and the minus temperature occurs more than half the year,
also beneficial for consumers seeking natural medicine.
The competitive advantage is that the tea company specializes in tea, therefore there is no direct
competitors in the area that offer same product and strategy produced to consumers. Similar
competitors will be Tim Hortons and Starbuck. The product Tea Party offers are different from
these companies. Green Teas, Oolong Teas, Black Teas, Herbal Teas, Rooibos Teas and Mate
Teas are Teas you will only find at Tea party. One of the company's growth strategies is customer
relationship management, tailoring each service to their customers and providing a quality
experience.Tea party only focuses on tea, and there are thousand types of teas for consumers, so
customers can narrow down to a specific tea which is desired. There will be an option of iced or
hot teas of the same kind of tea.
There are still more research to be done. Find out why people will people will choose tea party
over direct or indirect parties in the market. Research on target market.
There are no warranties for the product. Also no refunds after you leave the shop.
All the ingredients that are used in the teas will be all natural, like miraculin (miracle fruit from
west africa), monellin (serendipity berry from central and west africa), pentadin (oubli climbing
plant - native to west africa), stevia (stevia is a plant native to south America) agave syrup (agave
plant), barley malt syrup (barley malt), brown rice syrup (brown rice), blackstrap molasses (cane

sugar), cane juice (cane sugar), coconut palm sugar (coconut palm), honey (honey bees), maple
syrup (maple trees), palm sugar (palm trees), sorghum syrup (sorghum cane)and yacon syrup
(yacon root). Since tea partys focus is tea and healthy choices, there will be no use of chemicals,
artificial sweeteners nor unnatural foods like aspartame-acesulfame salt, cyclamate, calcium
cyclamate, sucaryl, sugar alcohol, zerose, zsweet, glycerin, glycerine, licorice, sugar alcohol,
isomalt ,sugar alcohol, clearcut isomalt, decomalt, diabetisweet (also contains acesulfame-k),
hydrogenated isomaltulose, isomaltitol, lactitol, sugar alcohol e.t.c. at tea party unlike other
similar competitors.
One group of teas that will be available are traditional teas; therefore customers that have desire
for their home countrys traditional tea will be able to purchase it without any complications at
Tea Party.
Customers will prefer Tea Party because they can find various teas that the customers wouldnt
find elsewhere ready to go. Customers will be willing to spend over a reasonable amount of
money on Tea Partys medical teas because health comes before wealth. Doctors recommend
various types of teas for various types of illness. For centuries, tea has been used in alternative
medicine to treat everything from cancer to constipation. Recent research supports these claims:
Studies have shown that tea may protect against heart disease, Alzheimer's and many types of
cancer.
Potential and current customers include young, hip urbanities, traditional and nontraditional tea
drinkers, baby boomers, and the health conscious.
Hot beverages are a daily for routine for the majority of Canadian adults according to the 2008
beverage consumption of Canadian adults. The research indicated that at least 64% of adults
drink tea daily. The market size is about 13 thousand. Market growth is estimated to 16 thousand
customers by involving and targeting youths and teens in the community to the market.
The industry anticipates strong, continuous growth over the next five years. This growth will
come from all segments driven by convenience, interest in the healthy properties of tea, and
through the continued discovery and appreciation of unique, flavourful and high-end Specialty
Tea.On any giving day, over 158 million Americans are drinking tea. In 2012, Americans

consumed well over 79 billion servings of tea, or over 3.60 billion gallons. About 84% of all tea
consumed was Black Tea, 15% was Green Tea, and a small remaining amount was Oolong and
White Tea. Approximately 85% of tea consumed in America is iced.

The American tea market is growing rapidly. Tea sales have increased 165% over the last fifteen
years, with the number of tea rooms offering sit down service rising about 15% to about 1,500
shops. American interest in tea certainly owes some of its increase to the proliferation of gourmet
coffee shops around the country in this same period. Most of working America has accepted the
idea of expensive hot beverages as affordable luxuries, thanks to the marketing efforts of
Starbucks, Seattle's Best, and so on. At the same time, fashion is always on the move - now that
fancy coffee drinks are so widely accepted, savvy consumers are looking for new, more unique
treats to enjoy. Starbucks estimates that 7% of its $12 billion annual sales currently come from
tea.
More facts indicate that over the last ten years, Ready-To-Drink Tea has grown more than 15
fold. In 2012, Ready-To-Drink sales were conservatively estimated at $4.8 billion and this trend
continues in 2013.
Prices at Tea Party will depend on Cup size and the type of tea. There will be three cup sizes.
Depending on the type of tea the customer will be purchasing will depend the price. Green tea or
black tea doesnt require much ingredients; therefore theyll be amongst the cheapest at the store.
A medium sized cup would be $2.50
There will be a commercial on three different radio stations for a month. Consumers will have
free teas from 6 a.m to 11 a.m every first of the month. Also coupons will be distributed by mail.
The packing only requires a cup. The cup will come in three different sizes. Java packaging will
be suppling the cups, with the Tea Party logo designed on it. Biodegradable paper cups and lids
for hot beverages, and biodegradable plastic cups for cold beverages. Also Java packing will
supply cup carriers.

Financial statement report


From the data we can see the sales increase 15% in the second year and 20% in the third year.
But the increase rate of gross profit is slow. We found that the transport expense in the second
year and third increased rapidly, because the material purchase is going up. In the second year,
Tea Party decreases their adverting expense because the company focus on publicity and
advertise in the first year. It put more than 30000 into adverting which makes Tea party is
popular. In the meantime, the sales increase. Even though the adverting expense goes down, the
total expense increases. The main reason is a high transport fee has been charged. In the second
year, 25% of the total expense is transport expense. So the first problem Tea party should solve
is reduce the transport expense. In the fourth year, Tea party plans buy 2 motor vehicles. It is
going to cost 60000 dollars, but it will reduce the transport fee by 50%.
In these two years, we can see the sales of the Tea party are increase which means the
product of Tea party has accepted by most of Canadian. We estimate the sales will increase by
18% next year, and the transport fee is going down because of the two more cars. Next year, Tea
party is expected to increase the material purchase so that the cost of good sold is going to
increase. Because of the good sales, company plans to employ more employees, which will
makes the salaries expense increase.
In conclusion, according to analyse the data we estimate the sales is still going to increase
next year and the expenses are also going increase. The net income, the different between gross
profit and the total expenses, will increase 8%.
Risk Assessment
After doing a bunch of survey, our team found some potential risks of Tea Party. It is divided
into 5 level depends on the importance to the company (Level 5 is the most important one). We
also list the descriptions and the possibility of each risk to let Tea party easily know the potential
risk and how important is. We also make a plan to help Tea party avoid or solve these risk. First,
the brief introduction table will be showed follow, and the specific plan will be mentioned in the
rest of the article.

Appendix:

Level

Description of risks

Prob. of risks

The inventory overdue and cannot be used.

Low

People may dont like the tea in summer.

Low

Does all the favor of the tea will be accepted by Canadian Medium
customer

Employees management

Medium

Competitors and substitute

High

The inventory overdue


Tea party is a company that is selling tea, so the main inventory will be tea. As we know, any
food has shelf life. If the inventory over duo, it is going to make a huge lose to the company. So
prevent this problem is important. But comparing with other food, the shelf life of tea is much
longer. So we define it is a low risk. To avoid this risk, the employees of tea party should know
something about how to store tea. Tea party has a lesson to train the employees. The lesson helps
them know how to keep food well. On the other hand, tea also will go bad in the process of
transport. So Tea party has to make sure the way of transport is suitable for tea. The vehicle that
uses for transfer the tea has a special equipment to keep the temperature and wet, so that the tea
will be kept well. For the tea which is transferred by other company, Tea party need to pack it
with some special material to make sure it will not go bad in any environment. One of the ways
is make it vacuum and the company is still finding a better way.

Seasonal impact

People chose different drinks in different seasons. As we know the traditional tea is hot tea, so
Tea party might face a risk that people may dont like tea in summer. In a high temperature
environment, people will prefer some cold drinks. Tea party has crated few kinds of cold drinks
but it is no enough so this problem is still a risk. In summer, tea party has some cold drinks like
lemon tea. Also, the marketing team of Tea party is planning to make some combo to attract
customer. In summer time, Tea party will also sell some ice cream which is a green tea flavor or
black tea flavor. Customer will be attracted by these kind of ice cream.

Does tea will be accepted by Canadian


Tea is not a traditional drink for Canada, so Tea party should think about the risk of the favor.
Tea party is selling the tea from different countries. But for most Canadians, they wont spend
lots of money on tea. They usually buy a cup of tea but not much. So Tea party targets the people
who walk on the street but not a man who is going to buy lots of tea. Tea party has many kinds
of tea and favor, which brings a risk. If the owner sells too many kinds of tea, only the few will
be accepted by Canadian, and also it is increase the cost. Also the owner put the money inside
and he cant get the money back, which is going to make the business slow down. For a business,
for an owner it is not good news. Facing this problem, Tea party needs to do a survey. Wed
survey is the most effective and easily way. The survey let customer do some choice of the kind
of the tea and the favor. Also Tea party is happy to get any suggestion. After the survey, the data
is going to be collected. The owner can know what kind of tea is most popular in Canada from
the conclusion, so that the owner can decide stock lots of tea which is popular and stock a small
amount of others.

Employee management
This problem is a common problem in every company. Owner decides how to run the business
and issue an instruction. Employees are responsible for finishing it. A united team will finish the
work fast and nice. So motivate the employees and management them well in Tea part is a big
problem. The owner want to all the employees are hardworking but does not want pay them a

high salary. That is the reason of the risk. Tea party shops are mainly located in shopping malls.
Different from restaurant, employees cannot get tips from customer. Owner always pays them
the minimum salary which is not a good way to motivate employees. On the other hand, Tea
party also needs someone to be a manager. It is not suggested that owner manages employee by
himself. 70 percent of owners think the profit is the most important thing, and 20 percent of them
think customers are most important which means 90 percent of them forgot employees. So it is
better hire a manager for Tea party. A professorial manager can solve the problem between
owner and employees well. About the salary, owner can make a rule of reward, so that the
employee who is working really hard can get more.

Competitors or substitute
As a competitors and a substitute as well, coffee is the biggest competitors. As we know, coffee
is more popular than tea in Canada. People only spend 2 dollars on a cup of coffee; it is almost a
same price as cup of tea. So here is a contradiction, if Tea party decreases the price of tea, then
the profit will decrease. If not, people would choose coffee rather than tea. What should Tea
party do is let people love this drink which is the most difficult problem. Same as point 3, Tea
party need to do some survey and create some new kind of tea which can attack people. Also,
advertising is necessary. Let people know it and let them try it, and then let them love it.

In conclusion, these risks are divided into 5 levels, so that we can clearly know which risk
might bring a huge loss. Tea party can decide which risk should be solved first depends on the
risk level.