“A Healthy Fast Food Shop”
VINCE Business Plan
Table of Contents
1.0 Executive Summary
1.1 Objective
1.2 Mission
1.3 Vision
2.0 Company Summary
2.1 Company Ownership
2.2 Location
2.3 Start-up Summary
3.0 Products/Services
3.1 Products/Services Description
3.2 Competitive Evaluation of Products/Services
3.3 Positioning of Products/Services
3.4 Future Products/Services
4.0 Market Analysis
4.1 Market Survey
4.2 The Overall Market
4.3 Change in the Market
4.4 Marking Segment
4.5 Target Market and customers
4.6 Customers Characteristics and Needs
4.7 Customer Buying Decisions
5.0 Competitive Analysis
5.1 Industry Overview
5.2 Nature of Competition
5.3 Changes in the Industry
5.4 Primary Competitors
5.5 Competitive Products/Services:
5.6 Key Competitive Capabilities
5.7 Key Competitive Weaknesses
5.8 Opportunity
5.9 Threats
6.0 Marketing and Sales Strategy
6.3 Advertising
6.4 Promotion
7.0 Operations
7.1 Personnel Plan
7.2 Organization Structure
7.3 Customer Service/Support
8.0 Financial Plan
8.1 Assumptions and Comments
8.2 Profit and Loss Projection
8.3 Balance Sheet Projection
9.0 Appendix
Appendix 1 – Web Sites List
Appendix 2 – Shareholders
Appendix 3 – Market Survey 1 – Questionnaire (KC ONLY)
Appendix 4 – Market Survey 1 – Result
Appendix 5 – Market Survey 2 – Questionnaire
Appendix 6 – Market Survey 2 – Result
Appendix 7 – The Restaurants in the Kwai Fong Metroplaza
Appendix 8 – Tests for Finding Primary Competitors
Appendix 9 – Customer Service/Support
Appendix 10 – Operating Expenses
Appendix 11 – Break Even Point
1.0 Executive Summary
VINCE[1] unlike a typical fast food shop, will providea unique combination of healthy, fast, environmentally friendly and creative food at value pricing. The food is based on the principle of “Three Low, One High”[2].
VINCE will also provide personal nutrition analysis service from professional nutritionists. Everyone can follow their personal menu to choose the most suitable, nutrient food, suggested by our nutritionist. We would like this service can be popularized.
Increasing in demand today, we believe that these features will ensure our success. We will penetrate the fast food industry with innovative, first to market, high nutrient food. This is a unique service for the area. Hence, there is really an opportunities to start-up this business.
VINCE has assembled a strong management team. Tony Chan will be the chief executive officer. Tony has extensive management experience of organizations ranging from 6 to 50 people. Gary Wong, Alex Wong and Connie Tang will be the manager team of VINCE. Lastly, VINCE has Chef Jack To who will be responsible for the back-end production of the venture. Jack To has over 12 years of experience. Moreover, a nutritionist, Betty Ma, will be responsible for the tailor-made menu and nutrition analysis service.
This plan is prepared to obtain financing for the initial launch of this idea. VINCE requires approximately $5.3 million in start-up. The financing is required to begin work on kitchen design, architectural plans, manuals and recipe books, site selection, equipment purchases, and to cover part of expenses in the first year of business. We project our monthly break-even will by roughly $0.84 million. The attractiveness of our innovative concept will provide us with a sales level far above this break-even point. We expect to generate $1.2 million of net profit on $3.6 million worth of sales in the first year.
1.1 Objective
- Sales of $10million the first year.
- Personnel costs less than $1.5million the first year, less than $1.3million the second year.
- Profitable in year one, better than 7.5% profits on sales by year three.
1.2 Mission
VINCE provides health meal to health-conscious customers. Our aim is to help our customers to attain one of the greatest gifts of all – Health.
1.3 Vision
- To be a market leader in Kwai Fong and fulfill the break even of cost.
- Future development in the other districts.
- In the long run, gain our profit.
2.0 Company Summary
2.1 Company Ownership
The fast food shop will start out as a limited company. The shareholders are Tony Chan, Jack Wong, Connie Tang, Gary Wong, Alex Wong and Mriabell Cheung. (Appendix 2)
2.2 Location
After our survey result we decided to set up our company in the ground floor.(Appendix 4)
2.3 Start-up Summary
3.0 Products/Services
3.1 Products/Services Description
Healthy Meals and Drinks:
Our food is based on the principle of “Three Low, One High”. We will show all the amount of calories of our meals on menu. Moreover, our drinks are tea, fruit juice and some other health drinks. We do not provide any soft drink like Coke.
Membership:
We will establish a Health Eating Club. Customers just pay a reasonable subscription fee to enroll our club and enjoy our special services[3] to members.
Lectures & Workshop:
To widespread the idea of Health Eating, we will organize some workshops for our members and customers to teach them how to cook some health dishes and know more about Health Eating.[4]
Delivery:
We will provide free delivery service to bulk booking from nearby schools and consumption over $50 from other customers in Kwai Fong.
Private Party:
Our valuable customers can organize their memorable private party in our shop. (e.g. Birthday Party).
Ordering Service:
VINCE accepts large ordering of food or drink. It is convenient for customers to prepare their own parties.
3.2 Competitive Evaluation of Products/Services
Product Differentiation
- Health Meals and Drinks:
We will provide a health and fresh meals that is based on our “Three Low, One High”*1. Also the style of our fast food will consist of Various, Innovative and Nutritious. These can also differentiate our fast food shop from another fast food shop.
Service Differentiation
Our company provides following services:
- Membership:
Not much restaurants provide this service; our restaurant provides this services (e.g. Tailor-made menu) for those more concern their health and provide some special offers in the other service.
- Delivery (include School lunch box delivery):
Beside Pizza Hut, there are no restaurants in the plaza provide delivery service, also many interviewees (include Students and White-Tailor workers) of our survey seeking a delivery service, so we provide it to satisfy them.
- Health Eating Workshops:
We will teach our customers to cook some health meals and teach them to the important of Health Eating.
- Private Party (e.g. Birthday Party):
We will provide Health meals to our customers in their party not like McDonalds’ provides juke food.
- Nutritionist consulting service:
We intend to provide that allow customer know how many amount of the calories is need per days in differ situation, and giving professional mean recommendations in their meals and provide a professional tailor made meals list to them.
3.3 Positioning of Products/Services
People Differentiation
Our fast food shop employs a professional nutritionist to design meals for the customers. Also our Company trains ours employees to treat the customers politely, courteous, and friendly to give a grace attendants to the customers.
Image Differentiation
Our company image would projected to customer mind as same as our company, VINCE.
V is Varity kind of food that we provide
I is the most innovation company in the heath food
N is try to make more Nutritious in the meal
C is Creditable quality in service and meal
E is using Environment-friendly equipment such as water-flow-exhauster[5].
Although other restaurants have some factors similar to us, we hope our customer will link this 5 factor if they see our company name.
Through above 4 differentiations, we will position our products and services as “ Real Health Fast Food”
3.4 Future Products/Services
- Delivery Service in other districts:
Customers who are near to our branch shops can enjoy our Health Meals delivery service in nearly future[6].
- Online Ordering:
VINCE will develop a web site for ordering for the members.
- Monthly magazine:
VINCE will publish a monthly magazine about health to the public
4.0 Market Analysis
4.1 Market Survey
Two market survey was conducted in March, 2003. They can help us to analyze and understand the market. (Appendix 3)
4.2 The Overall Market
Because of the founders' connections within the very trendy area of Kwai Chung , we have an excellent feel for the area and its core group of customers is students, workers, the household in Kwai Chung.
4.3 Change in the Market
As our Health fast food shop is settled in the Plaza of Kwai Fong. In the past, there were many blue-collar workers in Kwai Chung, but now is white-collar class. The number of students in Kwai Chung remains unchanged. The housing is going to build in the flowing years, so the potential customer will be increased.
4.4 Marking Segment
High-income customers, Full time student, Dieting customers, Office lady and Other people.
4.5 Target Market and customers
After classify the market our target market will focus on high-income customer, full time student, dieting customer and office lady.
4.6 Customers Characteristics and Needs
High-Income Customers:
usually at high position in their business, most of the times concentrate their work. In fact this type customers are most concerning their meal whether it is health, they just want to order their desired health lunch or dinner by phone in the office no matter the amount expense.
Full Time Student:
include lower form students whom the school not allow they outing for lunch, and higher form students come form plaza surrounding school. The former will be grouped together and purchase same kind of meal ordering the school, the latter just seeking a lower price, delicious, short waiting site period price for their meal.
Dieting Customers:
are those over-weight people or want to keep fit people. Since they are very concerning their meal is health or not. Thus they will strictly to set up their meal in certain amount of calories. Moreover, our company provides those meal is suitable to them; also they will spend more money to having their lunch.
Official Ladies:
are those working in official tower where around our plaza, they as same as dieting customer also want a health meal for their lunch with limited time. Thus they also seek their meal having certain calories, providing the food quickly and reasonable price.
Other People
are those not included in the classification. They come to our restaurant may have not any reason or try to taste our meal. So, in the circumstance we just provide the food is enough.
4.7 Customer Buying Decisions
After our interview we collected 50 interviewees information to the below, for each marketing segment having 10 interviewees. First we list out the criteria customer choice in their healthy lunch also giving top 5 ranking for analyses (higher mark is more preferable).
- Price-the price of the meal
- Food quality-health, fresh, good taste, nutrient of the food
- Service quality-polite, place clearing, good attitude for servicing
- Distance-how far do the people to get the lunch place
- Time-time waiting for the table, food, and how many time for their lunch
High-Income Customers:
In our interview, we used cluster-sampling method to find our specific interviewee. They usually are manager in restaurants and some known their position from random sampling then were classified in this group.
After analysis all the data, we had found that 28% our their put the first considering the time, then 23 % on food quality, after that 20 % were chosen distance and only 15% for the price, 14% for the service quality.
Full time student
In our interview, that easy to classify the student cause they usually to wear school suit for lunch. At the result we analysis the data and found that 26% concern the food quality, then 23% on price, 20 % on the service quality, 17% for time and 14% for distance.
Dieting customers
In our questionnaires, there is a question to ask the interviewee weather check the calories in every meal. We use this method to classify them. The result show that 28% consider the price for meal, 27 for food quality, 19% for service quality, and 15% and 11% for the distance and time represent.
Official lady
In this segment they most important to choice the place 26% is price, then 25% for the food quality, time 21%, 15% for distance and 13 % for service quality.
Other people
In this segment, 26% for food quality, 25% for price, 19% for time, 18% for distance and 12% for service quality.
5.0 Competitive Analysis
5.1 Industry Overview
There are about 130 different types, sized, and styles restaurants ran in Kwai Chung (Kwai Hing & Kwai Fong). They are mainly located at shopping malls, Kong Fang Wei, Hing Fong Road, and public estates.
In the Metroplaza, 27 different styles restaurants operate here. They can be distinguished into 8 main types. (Appendix 7)
Our neighbor restaurants are our competitors.
5.2 Nature of Competition
In the Metroplaza, the nature of restaurants industry competition is monopolistic competition. This is because:
- Number of restaurants:
There are 27 restaurants in the Kwai Fong Metroplaza. It is a large number for a shopping mall.
- Free to entry:
There are not many legal barriers to restrict the entry and exit in restaurants industry[7].
- Differentiation Product:
In monopolistic competition, each firms produce differentiated product[8].This characteristic can be found in the restaurants in the Metroplaza. All of them provide foods and drinks to customers, but they sell food and drinks, which have differences in styled, price and tastes. Also, they compete on price, quality and marketing. For example, Fairwood provides some Combo to students at a lower price.
5.3 Changes in the Industry
In recent decade, there are many changes and development in restaurants industry.
- Changes in Price (From higher price to lower price):
Due to the economic recession in recent years, people’s consumption power (especially middle class) has declined[i]. To attract people dinning out, most of the restaurants reduce their price and offer discounts to their customers. Since the nature of competition of restaurants industry is monopolistic competition, most of the restaurants cut their price will lead to other restaurants to follow. This causes a price war. The price for dinning out thus decreases
- Styles (Chinese Restaurants to Fast Food Shop)
Since almost all restaurants reduce their price to attract customers, many restaurants are forced to follow. But, in fact, some restaurants (Especially Chinese restaurants), which have a relative higher running cost than other styled restaurants and thus they can’t follow to cut price. Therefore, many Chinese restaurants close down. Also, the customers’ eating habit and consumption power both change; people become more accept other eating style (especially the fast food). This makes the lower – priced and variety fast food shop become more popular.
- Application of High-technology:[ii]
To decrease the avoidable faults and work more effectively and efficiency, many restaurants use high-tech equipment to help them. (E.g. an auto-order-placing machine at the cashier and kitchen.)[iii]
5.4 Primary Competitors
We point out our primary competitors by 3 tests: (Appendix 8)
- Survey Results
- Observation
- Same Kinds of Business
Two Periods of Competitors:
Our competitors are our neighbor restaurants inside the Metroplaza. Since our opening hour is from 10:00 a.m. to 10:00 p.m., we thus divide our primary competitors into 2 time periods. They are Primary Competitors in Lunch Hour and Dinner Hour.
Primary Competitors in Lunch Hour:
After these 3 tests, the following restaurants are our primary competitors:
- Maxim Fast Food
- Yoshinoya Fast Food (吉野家)
- Fairwood Fast Food
- McDonalds’Fast Food
- Kentucky Fried Chicken Fast Food
- Rhine Restaurants (維苑餐廳)
- Saints Ape’s Restaurant (仙跡岩)
- Hui Lau Shan (許留山)
Primary Competitors in Dinner Hour (6:00 p.m. to 9:00 p.m.):
After these 3 tests, the following restaurants are our Primary competitors in Dinner Hour:
- Maxim Fast Food
- Yoshinoya Fast Food (吉野家)
- Fairwood Fast Food
- McDonalds’Fast Food
- Rhine Restaurant (維苑餐廳)
- Porto Restaurant (波濤餐廳)
5.5 Competitive Products/Services
We define what are our competitive products and services by 2 ways.
1.Similar Kinds of Products and Services
2.Products and Services Favored by Customers in other restaurants
We find that the followings are our competitive products/services.
Competitive Products:
- Meals & Drinks
Competitive Services:
- Delivery Service
- Private Party (e.g. Birthday Party)
- Customer Services
- Taking out service
5.6 Key Competitive Capabilities
- Quality food — Our fast food shop will serve freshly prepared, high quality, popular cuisine that is targeted to appeal to a variety of tastes and budgets with an emphasis on reasonably and moderately priced signature items of particular appeal to a local market.
- Quality service — In order to maintain its unique image the Company provides attentive and friendly service with a high ratio of service personnel to customers and also invests in the training and supervision of its employees.
- Professional service — Have an expert of nutrition create a health menu for the customers who need to be a members of our fast food shop.
- Provide fresh food — Our fast food shop supply lunch-boxes to the Primary and Secondary School, we provide fresh food not only to the school, but also to the retail sales.
- Short traveling time — We have a good time arrangement to transport the lunch-boxes to the school.
- Protect the environment — We use residue of sugarcane as the lunch box instead of plastics, this base on our company’s Principle, protect the environments
5.7 Key Competitive Weaknesses