Soft Drink Industry - Research Proposal Example

BUBBLE TEA SHOP BUSINESS PROPOSAL Table of Contents PRODUCT AND SERVICE 2 The product 2 The industry 3 The location 3 The legal structure 3 Objectives of the Product 3 MARKET ANALYSIS 4 PEST (EL) Analysis 4 Political Factors 4 Economic Factors 4 Social Factors 4 Technological Factors 5 Target market 5 Students of University 5 Shoppers and tourists 5 Coventry residents and sports enthusiasts 6 Competitors in the Market 6 Barriers to Entry in the Market 6 USP of the Product 7 MARKETING PLAN 8 Marketing Strategy 8 Product 8 Promotion 8 Pricing 9 Place 9 CONCLUSION 9 RECOMMENDATIONS 10 Bibliography 11 Appendix 12 PRODUCT AND SERVICE The product The products of our chat time shop is Bubble teas which are typically diverted to types: a fruit-flavored package and a package. Additionally, a special package of hybrid- combination of fruit and milk base will be offered. The industry Soft drink industry is dominated by carbonated drinks that are known to have a low nutrition significance. The factor creates a perfect niche in the market industry which can be exploited optimally owing to the fact there exists few providers of bubble teas in the soft drink industry. The location The Phoenix Initiative in Coventry, driving the regeneration of the city attracts individuals from all over the world. The massive influx of people creates a perfect market to be serviced. The legal structure The business will be a partnership business with four members. Each partner will contribute equally to the starting capital. The profits will be shared equally, and active partners will earn salaries as designated by their roles in the business (Casadesus and Ricart 2011). Objectives of the Product Arguably, the booming line of business in the food industry is that of the soft drink industry. There are many indications to demonstrate that fact. The current trend that the world economy is experiencing is one vital factor signifying the concept. With this positive trends in the economy, people are willing to spend more on food commodities, creating a demand for the proposed product (bubble tea). Innovation is crucial in creating a unique product that can compete against the well-established brands. MARKET ANALYSIS PEST (EL) Analysis Political Factors The Government has implemented significant policies that encourage entrepreneurship culture. Some of the measures include low tax rates on local businesses, elimination of complex business registration bureaucracies, zero rating taxes on locally produced agricultural products such as dairy products. Agricultural products form the basis of bubble tea raw material. The low taxes implemented on them translate to cheap available raw material for the business. Economic Factors With the recent trends surrounding the world economy and particularly the England economy, the economy has experienced an increase in GDP. A suggestion that consumers are willing and able to spend more. This is a positive attribute that plays a crucial role in the soft drink industry as consumers can now spend more on luxury food items such as bubble tea (Casadesus and Ricart 2011). The economic growth also experienced boosts the growth of other industries in the Coventry locality. With this boost, employment opportunities increase in the area translating to a broad consumer base for local soft drinks. Social Factors Coventry is a town largely dominated by sporting activities such as football, rugby, hockey and cricket. When fans attend this sporting activities in masses, it typically results in a substantial market presence. The calendars of this sporting activities in Coventry can be studied, and strategies placed to exploit the massive market presence caused by the influx of people. Technological Factors The basis of existence of the firm is largely depends on technology. All stages of consumer satisfaction rely heavily on the best exploitation of technology to achieve its goals. The equipment applicable to the production of bubble tea ensures timely production saving time. Technology can also facilitate consumer awareness of our brand and its launching into the market. Such kind of technological advancements that facilitate customer communication include the internet platform (Casadesus and Ricart 2011). Target market Population growth trends in Coventry YEAR Total Population 2009 309,800 2010 310,500 2011 316,960 2013 329,000 Table 1 Students of University There are two universities dominating Coventry’s population (University of Coventry and Warwick University). This market segment contains consumers of youth age and early adulthood. Their spending patterns are largely influenced by social activities that they partake in and peer influence. Hence, the ideal marketing platform for this group is the social media. Shoppers and tourists The businesses aim to attract the domestic and foreign tourists who visit the locality. The focus is more productive during high tourist seasons. Families and shoppers spend more during festive seasons. The influx of this group benefits the local economy significantly elevating its consumer base. The group does not exhibit any loyalty characteristic to any particular brand of product. The group covers all gender group with a primary family set up as its definitive look. Coventry residents and sports enthusiasts The population of Coventry is approximately 300,000 and the firm’s strive to attract as many consumers as possible. The success of any business in the environment is largely dependent on this group. The group comprises of city’s resident, fans of local sporting activities whose principal occupational commitments fall in the locality. The average income level of the group is high backed by the thriving local economy. Competitors in the Market The direct competitor in the market is Sunny-D Soft Drink Company. The company’s soft drink is fruit flavored. The major strength of Sunny-D Soft Drink Company is its established brand in the Coventry market. The brand dominates the largest market share. The company’s weakness is evident in its limitation of variety. The range of choice is limited to fruit flavored drinks. The indirect competitor in the market is Coca-Cola Company. The company’s market share is limited. The greatest strength of Coca-Cola Company lies in the variety of choices offered in their drinks. The limitation of the brand is raised by the increased consumer awareness of the adverse impacts of carbonated drinks (Casadesus and Ricart 2011). Barriers to Entry in the Market 1. Supplier Power: the number of suppliers of dairy products and fruit products in Coventry city is minimal because of distance from agricultural farms. Because of this supplier choice is limited and shifting from one supply to another is minimized. 2. Buyer Power: the ease of customers dictating prices is easy because of large number of buyers 9present in the market. Customers can easily change to other products if they are unsatisfied with our products. 3. Competitive Rivalry: there are many competitors in the market, but their limitations lie in the variety of choices they provide to consumers. The aspect creates a positive attribute for our firm since our product range is wide, and there is no limitation of choice. 4. The threat of Substitution: the threat of substitution of our product is limited by the fact that our product’s entry into the market will be a substitute to the already established expensive brands. 5. The threat of New Entry: the ease of entry of other firms in the market is easy since the governmental policies encourage the growth of entrepreneurial culture in the industry. The key to protecting the business against new entry domination lies in investing in new efficient technologies in producing our bubble tea. USP of the Product The unique selling position of our bubble tea based on differentiation from other brands and competing products. The product will be differentiated in quality and packaging. Emphasis on the significance of healthy soft drink consumptions ensuring dominance and superiority of our bubble tea package quality over other firms offering soft drink products in the Coventry market. The brand description will be varied to provide choice variety – milk based, fruit based and mixed milk based and fruit flavored bubble tea- the perspective will create a unique selling platform for our product in the market. MARKETING PLAN Marketing Strategy In line with the Marketing strategy, the firm will employ varied marketing tactics to capture new consumers and increase customer awareness of chat time bubble tea shop. In-Restaurant Marketing, Public Relations Marketing, and Media Marketing. Coventry city is highly social society, and the best strategy to appeal to the market segment will be a socially driven approach. Social platforms to be considered include word of mouth awareness campaign, laying billboards in social gatherings and social media platforms. The strategies will be cost effective in implementing the marketing plan (Casadesus and Ricart 2011). Product The bubble tea shop products will seek to satisfy the vibrant demand for the soft drink that exists in the local market. The products will be varied in three basic customized packages: a fruit flavored cup mixed an assortment of fruits according to the customer’s request, a milk-based cup of bubble tea spiced in different flavors of vanilla and strawberry according to the customer’s request and fruit milk mixture that comprise the two flavors. The packaging will be done on a dome shaped 500 milliliter cup with an extra provision of a sucking straw. A lot of stress on consumption, healthy soft drinks is stressed on the firm’s slogan “drink health, choose us”. Promotion The firm will participate in promotional and advertisements events that span three years of the pre-launching of the bubble tea, launching and post-launching phases of expanding our product. Owing to a market segment that largely depend on social platforms to get information, a lot of promotion activities will be focused on social platforms such as the internet Facebook, Twitter and social gatherings such as football matches billboards. The concept will be efficient in targeting a wide reach of potential consumers of soft drinks. Pricing The firm will differentiate its pricing practices from other competing firms to initiate a price war as means of capturing loyal consumers of other brands. The pricing will also be flexible to adjust to prevailing market trends and cost of production raw materials. Each package will have a distinct price corresponding to the flavor addition used in the package. No charges will be imposed on the consumer for after sale services such as drinking stands and packing fees(Casadesus and Ricart 2011). Place The bubble tea shop will be located in the city center because of the convenience of retailing directly to consumers without involving intermediary channels that are not cost effective. Since the target market segments are widely present in the city, locating the bubble shop in the city center will be ideal to maximize the advantages associated with market proximity to the product. PRODUCT DESCRIPTION PRICE RANGE ESTIMATION FRUIT FLAVORED BUBBLE CUP £ 2 VANILLA FLAVORED BUBBLE CUP £ 1 STRAWBERRY FLAVORED BUBBLE CUP £ 1 FRUIT-MILK MIXTURE BUBBLE CUP £ 3 Table: Pricing estimates CONCLUSION The report proposal has primarily focused on market factors and social factors that influence the operations of the firm in relation to creating a competitive advantage and establishing a brand that is identifiable in the market as a leading brand. The successful exploitation of positive market elements forms the basis that guides its success probability. Some positive market features that are evident in the Coventry soft drink market are identified as: the high demand for soft refreshing drinks backed by the large population that is constantly on the increase, favorable governmental policies that facilitate and drive entrepreneurship and limitations experienced by rival consumer products in terms of choice. Optimal exploitation of this prevailing market factors guarantees the success of the business both in the short run and long run. Social factors such as the prevailing favorable economic climate prove to be a critical issue that is significant to the success of the business proposal. A critical evaluation of the social facilitators and market facilitators is vital in the report proposal, outlining a clear market strategy that inspires the achievement of the set objectives and goals of Chat time Bubble tea shop. RECOMMENDATIONS The short term recommendations that should be implemented to ensure success encompasses launching of the business. It is recommended to launch the business during the High Holiday seasons of the year. The preferable month is November since it is the inception of the holiday season and characterized with a lot of social sporting activities in the towns calendar. It is predictable that the business will be able to earn maximum revenue in this outline timetable of operations. The response would be a motivating factor for the company- substantial revenue income during inception. The plan is feasible for starting the business and establishing a brand image (Casadesus and Ricart 2011). The long term action plans are based on a strategy to expand the business over the period of three years and establish a brand that effectively dominates the local market in terms of soft drinks. As the business expands, strategies that help meet challenges associated with expansion should also put in place. Establishing other distribution channels that can facilitate meeting of the projected consumer demand. Bibliography Casadesus-Masanell, R., & Ricart, J. E. (2011). How to design a winning business model. Harvard Business Review, 89(1/2), 100-107. Appendix Table 1: population growth trends in Coventry Table 2: product pricing estimates Read More