ChefOnline is seeking to raise funds via crowd funding to expand services to clients and customers. The proposal has received Enterprise Investment Scheme (EIS) approval from the HMRC for £2 million. The Chief Executive of ChefOnline M A Munim unveiled this information at a press conference on Tuesday in East London. Business Consultant Charles Brooks and Corporate Tax advisor Jeff Parr also spoke in the press conference about the business model of ChefOnline. They also responded to the questions from journalists.
Chief Executive M A Munim said: “We arranged today’s press conference to celebrate the HMRC’s approval of £2.m Enterprise Investment Scheme and changed its status to a Public Limited Company (PLC) from Private Limited Company (LTD). I thank members of the community for their continuous co-operation and help towards ChefOnline”.
Business Consultant Charles Brooks Said: “Only 2.1% of restaurants actually have their own e-commerce websites. Currently, in excess of 40% of all orders for takeaways are placed online. A vast majority of small takeaways and entrepreneurial restaurants cannot afford their own e-commerce websites; hence have little choice but to go with third party intermediaries at a cost of some 14% in commissions plus other associated costs. This provides a tremendous opportunity for ChefOnline”.
Tax Advisor Jeff Parr said: “Achieving ‘EIS’ approval from HMRC is a great success of ChefOnline, after all thorough checks by HMRC over 6 months, finally the approval was issued. No doubt ChefOnline management will comply with EIS rules as they have shown throughout the application process”.
During the press conference, journalists were informed that ChefOnline had completed full preparation to start raising funds through city’s corporate funding and crowdfunding. ChefOnline had recently changed its status to a PLC, journalists were told.
ChefOnline’s Technical Director Hafizur Rahman, finance controller Syed Umor Ali and Marketing Director Aktaruz Zaman were also present in the press conference.
ChefOnline currently provide its unique services to over 500 restaurants and, unlike similar providers, they host individual websites for their clients. So when customers want to order a meal or book a table, they can do so through the chefonline.co.uk national portal or an individual caterer’s website which is developed and hosted by ChefOnline. ChefOnline’s clients are able to update the content on their individual websites and add a range of marketing and analysis tools to help them attract and keep track of existing and potential customers.
Chief Executive of ChefOnline, Mohammed Munim said: “Most small businesses cannot afford to develop their own ecommerce ordering system and thus rely on web based organisations to act as an intermediary. However, that does not allow them to promote their services on an individual basis”.
“Therefore often the only way they can grow their business is by word of mouth. We are offering a value for money alternative to others in the market which allows restaurants to have a direct route to customers via an individual website”.
He said many outlets are paying up to 14 per cent commission on each takeaway meal ordered, which on a turnover of £5,000 equates to £700, whereas ChefOnline charge a fixed monthly fee of £62.83. It also offers a no obligation six month trial.
The company is initially targeting the UK’s 18,000 or so Indian restaurants and takeaway outlets. “But our business model can be applied to any restaurant or takeaway business so there is a £10 billion a year market for us to aim at”, added Mr Munim.
The Financial Times reports: “In 2012-2013, the latest year for which official figures are available, almost 20,000 taxpayers invested a total of £881m via EISs. A further 5,000 people allocated a total of £117m in seed EIS projects, which offer even larger tax breaks — including income tax relief of 50 per cent on a maximum investment of £100,000 — for investments in very early-stage companies. Since the launch of EISs in 1993-94, more than £10.7bn has been invested in over 21,000 companies, according to HMRC figures”.