New Fast Food Company Business Strategies - Case Study Example

A Business Plan for a New Fast Food Company Name Professor Institution Course Date A Business Plan for a New Fast Food Company Table of Contents A Business Plan for a New Fast Food Company 2 Table of Contents 2 1.2 Business Philosophy / Mission Statement 3 1.3 Product/Service Description 4 1.4 Self Analysis 4 2.0 Part Two: Marketing Research 4 2.1Conduct Secondary Research in the following areas 4 2.1.1Geographic Data 5 2.1.2 Demographic Data 5 2.2 Primary Research 5 2.2.1 Questionnaire questions 6 2.3 Competition 6 2.3.1 Direct Competitors 7 2.3.2 Indirect Competitors 7 2.4 Market Segment Analysis – Target Customer 7 2.5 Analysis of Potential Location 7 3.0 Part 3: Organization and Personnel Plan 8 3.1 Ownership Choices 8 3.2 Personnel Needs 8 3.2.1 Organizational Structure 10 3.3 Hiring Strategy 10 4.0 Part 4: Marketing Plan 11 4.1 Proposed Product or Service Plan 11 4.2 Proposed Pricing Policy 11 4.3 Proposed Promotional Plan 12 4.4 Place 12 5.0 Part 5: Financial Plan 12 5.1 Income Statement 12 6.0 References 14 1.0 Part One: Introduction 1.1 Executive Summary The Frepaz is an Australia new fast food company located in capital city Canberra and positioned as fair-priced and healthy eatery in the city. The Frepaz will offer variety of excellent fast food at value and fair pricing together with interesting atmosphere and packaging. The fast food company will provide the answer to ever growing demand for cheap but healthy fast food which can be consumed during shopping, window shopping and outings in Canberra. Our marketing strategies will highly be dependent on location (distribution), segmentation, pricing and product development. The Frepaz major focus at the moment is set up one restaurant in one of the most crowded mall in Canberra. Later, the company intends to develop more outlets within the surrounding. The company starts as partnership where each of the four members will be required to contribute $100,000 to fund the operations. Additional funds for operations will be attained from loans from banks. A team of 17 individuals will run the operations of The Frepaz until the company reaches a point of expansion. The top management will comprise of the founders with middle and lower level management comprising of the thirteen people will work as restaurant manager, cashier, cooks and servers. 1.2 Business Philosophy / Mission Statement The Frepaz’s mission is to serve high-quality food which value for the customer at a fair price. The company strives to make tits customer get the best experience when they pay a visit to the outlet. 1.3 Product/Service Description The Frepaz will offer a variety of fast food and beverages which offers customers a chance to choose from. The outlet has set up three modes which customer can purchase it products including table service within the outlet, take away and home or office delivery. The major products offered by The Frepaz will consist of beef and chicken burger, hamburger, sandwich, French fry, pizza, chicken fry, desserts coffee, pastry chocolate, juices and salads. The fast food will be served with the company’s famous sauces. 1.4 Self Analysis The Frepaz is being opened by people a shared goal of offering fair-priced fast food to Australians. I believe I am the best to start this business due to mind wealth of experience in fast food industry particularly in Australia. Having worked in local and international restaurant for more than seven years I have gained knowledge, skills and experienced valuable to run a fast food company. In the process, I have also learnt that creativity and teamwork skills are highly needed if we are to compete with other established outlets. 2.0 Part Two: Marketing Research 2.1 Conduct Secondary Research in the following areas 2.1.1Geographic Data As stated earlier, The Frepaz will fast be opened at Majura Park Shopping Centre in Canberra. The population of Canberra has grown over the years and now stands at 381,488. Other activities also happen in the city which draws a lot of tourists both locally and internationally. The population growth is good for The Frepaz since it marks increase in number of customers. 2.1.2 Demographic Data Based on age, statistics shows that residents of Canberra are comparatively young. The same statistic showed that median age being 34 years, with young people between age of zero and fourteen representing 18.5 percent (Australia Bureau of Statistics 2016). Majority of people of up to 71.1 percent are in the age between fifteen to sixty four years. The research has also shown that older people of more than sixty five year are only 10.7 percent of the total population. Fast food is often appealing to the young people hence such population may massively influence The Frepaz’s growth. In gender front, Canberra has almost equally male to female distribution (Leigh 2010). However, number of females is slightly higher than that of male. The statistics shows that in Canberra, there are ninety males for hundred females. Statistics demonstrate that have high income and high disposable income which they contribute to charity and spend on luxury. Australia Bureau of Statistics (2016) claimed Canberra family size has been estimated to be 2.6. In actual sense, the family mostly contains between 3 to six people. The major marital status in Canberra is married as most people tend to marry at age of 26.6 years (Australia Bureau of Statistics 2016). The research has also found that that are many young families who like outings hence The Frepaz could benefit from this culture. 2.2 Primary Research The primary marketing research The Frepaz will use is survey particular through use of questionnaires due to the fact that it’s quick, easy and cost efficient (Singer & Tourangeau 2009, p. 34). Drummond and Ensor (2014, p. 89) opine that survey method is an efficient way to obtain information needed to describe opinions, characteristics and views of customers on factors that influence them to buy fast food. 2.2.1 Questionnaire questions Kindly respond to the questions by ticking the appropriate one. *General information* 1. Please specify your gender. (a) Male (b) Female 2. Are employed? (a) Yes (b) No 3. How many times in a week do you consume fast foods? 4. Have you heard about The Frepaz, and where? 5. What influences the amount of money you spends in fast food? Thank you for taking time to respond to our questionnaire. 2.3 Competition 2.3.1 Direct Competitors The Frepaz’s direct competitors include five main fast food companies in Canberra including and McDonald’s, Subway, Hungry Jack’s, Red Rooster and KFC who sell similar products. 2.3.2 Indirect Competitors In direct competitors are ones which offer different product but scramble for the same customers. In The Frepaz’s case, there are bars, boutiques, Canberra Museum and Big Splash (theme park) (Leigh 2010). 2.4 Market Segment Analysis – Target Customer The Frepaz views it key market segment to be the urban dwellers in Canberra. The company further segments its market based on demographic (age, income family size and gender) as shown below. Age – The Company target young people between the age of 8 and 35 who are the majority in Canberra. These people can either be single, in high school or college and entry to middle level management level at an organization. Family unit - The Frepaz appeal to all families but with marketing concentrated to young families with children. Gender - The Frepaz target both the sexes with much emphasis given to female who prefer fast foods with low fat content or have higher diet concerns. Income – With our fair prices, with target medium income customers. 2.5 Analysis of Potential Location A thorough analysis concluded that Majura Park Shopping Centre in Canberra is the best location for the new fast food company, The Frepaz. Majura Park Shopping Centre is a shopping mall which built in a place with high population and people with high income which is beneficial to a new company (Leigh 2010). Most inhabitant of this location is family household which have an average family size of 3-5 people which can a large part of the customer. Euromonitor (2013) contended that Canberra has low unemployment rates hence people in this region have busy schedule which necessitate for the prepared meals for families. In addition, as capital city, Canberra experiences high movements to and from work or schools and tourism. As a result, fast food as a high demand in this location (IBISWorld 2014). We have a reserved and safe parking for our client which they use to park their cars while eating. The Frepaz will operate between 9 A.M to 12 midnight. 3.0 Part 3: Organization and Personnel Plan 3.1 Ownership Choices The Frepaz is a partnership business owned wholly by Jordan Milligan, William Thomson, Mile Robinson and Oliver Jones. We settle for partnership because it would enable us to quickly start the business through contribution on funds (Cadden & Lueder 2012). Similarly, having worked in fast food related jobs, the founders saw it advantageous to bring our skills and labor together. 3.2 Personnel Needs The organization will comprise of flat structure with no middle level managers. Under this management structure, Jodan Milligan will be the CEO. William Thomson, will be the operations and HR manager charged with overseeing daily operations of The Frepaz. Oliver Jones will be the marketing manager. Mile Robinson will be responsible for accounting and finance of the organization. The company will also have a position for cashier, 3 cooks and 10 servers. 3.2.1 Organizational Structure The Organizational Structure of The Frepaz is shown in figure 1 below. Figure 1: The Frepaz’s organizational structure 3.3 Hiring Strategy William Thomson is qualified in human resource management and will be responsible for hiring qualified personnel. The staffs will be recruited online through company’s website. Job adverts will be posted on the website and also on the social media pages with email address which the candidates can use to contact The Frepaz. The company will require people with degree in food science and minimum two years of experience in fast food industry with previous work being in busy fast food companies. In this way, The Frepaz will get qualified individuals. 4.0 Part 4: Marketing Plan 4.1 Proposed Product or Service Plan The Frepaz will offer a variety of products ranging from fast food to beverages. In this way, the company will enable the customer to have alternatives to choose from. The company will people who are qualified in food science and can develop new products and differentiate them from the competitors. Ferrell & Hartline (2011, p. 127) posited that product packaging will be critical to marketing products hence uniqueness and branding will highly be valued. As stated earlier, our products will be offered in three way including serving within the outlet, take away and home or office to cut across both who enjoys their meals at home and busy ones at the office. The company will also be offering health products to health conscious customer who wants foods with low fat content. 4.2 Proposed Pricing Policy Pricing strategies is important to a fast food company because it determine the value of your service (Williams et al., 2010, p. 28) The Frepaz pricing strategy will be positioned as fair and will target middle class and upper lower class consumers. The company will work with inexpensive suppliers to ensure it does not incur losses even with low prices. The Frepaz use penetration pricing to attract the customer that it actually offer low price. However, such prices might be increased later when it has gathered large customer base. The company will offer discounts in some products and services like home delivery to boost its sales. 4.3 Proposed Promotional Plan The Frepaz has a marketing manager who will discharge all marketing activities. Majorly the marketing will be done on website, social media and short term promotion activities in Canberra that will be use to attract customers. Ads will be designed and posted the online platforms providing information on menu discounts and location. 4.4 Place Place is defined as the means of getting products via distribution channel to where customers can access your product or service (Kapferer, 2012). The Frepaz will implement placement strategy using direct method. The company will have physical outlet at Majura Park Shopping Centre in Canberra which can be accessible to most people visit this shopping mall. The company will also deliver products to customer who request but at a small fee. In addition, the company will sell products in their website and social media where customer can buy and request for home delivery or individual pick up at physical outlet. 5.0 Part 5: Financial Plan 5.1 Income Statement This income statement is created based on the market research and projected growth that will be resulted by high demand for fair-priced fast food. The projected income for the first year in displayed below in figure 2. Operations USD ($) USD ($) Sales: Food products--------------------------------------------------- Beverage--------------------------------------------------------- Total Sales: Cost of goods sold (COGS)----------------------------------- Gross Profit or Revenue ------------------------------------ Operating Expenses: Wages and Salary---------------------------------------------- Depreciation---------------------------------------------------- Utilities ---------------------------------------------------- Rent expense --------------------------------------------------- Advertising ------------------------------------------- Total operating expenses------------------------------------ Earnings before interest and tax Interest expense----------------- Earnings before tax Tax (20%) Net profit------------------------------------------------------- $80000 $20000 $100000 ($35000) $50000 $1000 $5000 $5000 $5000 ($650000) ($160000) $190000 ($20000) $17000 ($5100 ) $3400 Figure 2: Income statement of the first 6.0 References Australia Bureau of Statistics 2016, Household Projections: Number of Households, Viewed on 21st July 2015, http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/3236.0Main%20Features42011%20to%202036 Cadden, D & Lueder, S 2012, Small Business Management in the 21st Century, Southern CT State University Drummond, G & Ensor, J 2014, Introduction to marketing concepts, Oxford University Press, Oxford Euromonitor 2013, Fast Food in Australia, viewed on 21st July 2016 http://www.euromonitor.com/fast-food-in-australia/report Ferrell, O., & Hartline, M 2011, Marketing strategy, South-Western Cengage Learning. IBISWorld 2014, IBISWorld Industry Report H4512: Fast Food Services in Australia, Viewed on 21st November 2016 http://clients1.ibisworld.com.au.ezproxy.lib.uts.edu.au/reports/au/industry/default.aspx?entid=2005 Kapferer, J.N 2012, Strategic Brand Management, 5th ed, Kogan Page, London Leigh, A 2010, Canberra is the Best City in Australia (Speech), Festival of Dangerous Ideas, Sydney Opera Singer, J.M & Tourangeau, R 2009, Survey Methodology, John Wiley & Sons, New Jersey Williams, K.C, Petrosky, A.R, Hernandez, E.H & Page, R.A 2010, Multi-generational marketing: descriptions, characteristics, lifestyles, and attitudes, Journal of Applied Business and Economics, Vol.11, No.2, pp.25-39 Read More