Rebeca Harbert: Toast Bartending

Entrepreneurship Case Study
Rebeca Harbert: Toast Bartending
Decision Time!
It was mid June and Rebecca Harbert
(Becky) was coming to the end of her
Honours degree in Hotel and Catering
Management. It was great to have time to
chill out after all the hard work and pressure
of exams, deadlines and completing
assignments. However, Becky was finding it
difficult to relax. She knew that there was a
difficult decision to be made. Just over a year
ago, with her fiancé Justin, she had taken out
a loan of £7,000. Together with their £3,000
savings, this had enabled them to start Toast
Bartending. In many ways the venture had
been everything that they had hoped for, but
the truth of the matter was that it had
struggled to generate the revenue they
expected. She had agreed with Justin that
once all her assignments were out of the way
they would sit down together and decide
where to go next with Toast.
Justin would be arriving soon and Becky was
trying to gather her thoughts together. In
some ways it was tempting to get a job. The
labour market for Hospitality Management
graduates was very strong and many of her
friends were about to join graduate trainee
schemes with exciting companies and good
salaries. Yet, Becky was reluctant to join
them. She went to pick up the two
assignments that she had completed during
the Entrepreneurship module that she had
taken as part of her degree course. One had
required her to reflect on her own
entrepreneurial potential in the light of what
was known about entrepreneurs. The other
had involved working on an outline feasibility
study for a new entrepreneurial venture and
Becky had used this opportunity to analyse
the experience of operating Toast, and to
undertake a reality check on its future
potential. She reflected on the two
assignments and what she had written.
Becky as an Entrepreneur
In her reflective essay, Becky had taken the
opportunity to take an in-depth look at
whether she really had what it takes to be an
entrepreneur. She had remembered her early
upbringing and how she had had the
opportunity to witness her parents working
together to create their own business. In the
early days they had struggled, but had
persevered to establish and sustain a
successful wood flooring business.
From an early age, they had always insisted
that Becky earn her own money and she
believed that this had been one of the
reasons that she was now so independent
and self-reliant. As an only child, far from
being spoilt, she had always believed that
she must strive to achieve and become
someone that her parents would be proud of.
She had realised very early on in life that she
had no desire to work for someone else in
the long term. However, this didn’t stop her
from entering into paid work and she had
soon found herself gravitating towards work
in restaurants and bars in and around her
home town of Oxford. She had worked part-
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time and during holidays variously as a
waitress, receptionist, host and bartender.
During the work experience year of her
course she worked as the manager of a
student oriented café bar. Despite all her
work commitments Becky always found time
to keep fit. She frequented the gym on a
regular basis, setting herself exercise goals
and was careful about what she ate.
Becky had originally known Justin at school.
They had met up again six years ago and hit
it off immediately, developing a shared
dream of eventually owning their own
restaurant. They had decided that they
should work towards it sooner rather than
later. Justin was a fully trained Cocktail
Mixologist, with distinction passes awarded
by the Training School, London. He had also
been a finalist in the 2005 Millers Gin ‘Invent
a Cocktail’ competition. Justin had been
involved in the opening of two of the new
generation of bars in Oxford and had
managed one of them. Currently he was
manager of one of the best ‘style’ bars in
Oxford. Justin and Becky had set up Toast
as a partnership, with the idea that they
would manage it together, each bringing their
own particular skills to the venture. In terms
of technical expertise, Becky believed that
even at the young age of 23 they had both
gained lots of technical expertise relevant to
running their own venture. This had given
them the confidence to start their own
events-focussed bar based business.
Becky considered that she was creative up to
a point, but that she was best at building on
her eye for detail; spotting opportunities to do
things better and think through how to put
them into practice. This is how she had
developed Toast. Becky had been to many
social events where the bar had been purely
functional and boring; she had also come
across several London operators that were
specialising in making the bar a notable
event feature, both visually and operationally.
She had talked things through with Justin
about the idea of making a different type of
bar available for events in and around
Oxford, which is how the idea of Toast had
come about. They had wanted it to be a truly
fast growing and expanding business, but it
hadn’t happened that way yet.
This didn’t cause Becky too much concern.
She had been impressed by the David Levin
(founder of the Capital Group) case study
that they had used on the course. He had
never been worried about taking a risk
because he never thought about failure. She
felt like that too. Although taking on debt to
start Toast could be viewed as a risk, she
had been very confident that although the
idea of such a service was new to the Oxford
market, she would be able to persuade
people that they wanted what she had to
offer. She still believed this, even though the
business was yet to take off. Overall, Becky
concluded that she definitely did have what it
takes to be an entrepreneur and,
furthermore, she thought that Toast had real
potential.
Toast: The Concept
The customer proposition is that Toast
provides a complete cocktail bar service for
any type of event, celebration or social
gathering. Toast’s brochure points out that
while people pay great attention to food at
parties, the range of drinks offered is often
limited and unexciting. Toast promotes the
bar as being the heart and soul of any social
gathering, providing the ‘fuel’ for enjoyment
and a central meeting place focus. The aim
of the Toast service is to provide each and
every guest with a memorable quality drink
every time. Becky and Justin therefore insist
on using reputable premium brand spirits and
freshly squeezed or additive free juices.
The Business Model
The ‘look’ and style of service is tailored to
suit the event. Toast asks for a 30% deposit
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to confirm a booking. To date, the events that
they have covered have generated between
£400 and £800 each in revenue.
Clients have the option of a prepaid bar,
where the host pays for bar stocks and drinks
are free to the guests. Licensing laws do not
apply to this kind of event and hours of
service are unrestricted. The alternative is a
paying bar service, whereby guests pay for
their drinks, perhaps following on from an
initial period of a free guest bar. Here a
license is required for the venue and
licensing laws apply. At the moment, this has
to be applied for by the licensee of licensed
premises, but this requirement will change
under the new 2005 licensing arrangements.
The initial investment of around £10,000 had
been used to cover start up costs and
provide some working capital (Appendix I).
As a new, small business, it has not been
registered for VAT. The simplified Profit and
Loss Account for the first 9 months of trading
(Appendix II) has been slightly disappointing
with only three event bookings being taken.
Marketing during the first year had focussed
on advertising in an Oxfordshire Weddings
publication, attending wedding fairs and an
advert in Yell.com that had resulted in a
booking for an event in one of the university
colleges. Becky and Justin have also
distributed their brochure around several
Oxford bars and marquee hire companies.
Becky feels that putting more time and
resources into effective marketing is
important for Toast’s future, given the
outcome of the PEST analysis (Appendix III)
and the ongoing competition (Appendix IV).
The Future
The question that needs to be addressed
now is whether either Justin, Becky or both
together should go full-time with Toast.
Becky is absolutely convinced that there is
much more business to be had in a university
city such as Oxford, particularly given the
wealth in the surrounding county. She
believes that if either she or Justin devote
themselves full-time to Toast then they could
really begin to build the business. If they take
the decision to both continue in their current
jobs it will be much more difficult to find the
time and energy to devote to it. Alternatively,
it’s possible that they need to increase their
prices. If business does pick up significantly
they will need to purchase a vehicle for
transporting equipment and stocks.
Currently, costs already exceed income by a
good margin.
The ring of the doorbell interrupted Becky’s
thoughts. Justin had arrived and she still
hadn’t decided on the best course of action
for proceeding with Toast!
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