“Healthy Fruit Shack” is the organic fruit juice business that is designed to provide organic fruit juice at the reasonable price and establish a relaxed communal atmosphere for the fresh fruit juice consumers. The target market would be consumer of all ages that would include the children as well. The “Healthy Fruit Shack” has numerous factors make success viable and some of which include the location of the stores. “Healthy Fruit Shack” would be strategically placed in the close proximity to central marketing of Melbourne and downtown shopping region. The central product of “Healthy Fruit Shack” would be organic fruit juice that would provide consumer with natural blend of fruits and vegetables.
The mission of “Healthy Fruit Shack” is to offer its customers with something quick and tasty that would hydrate them before and after their daily working life whereas supporting the community with the donation to the worthy cause. The mission is to create a strong base of enthusiastic regular consumer (Scarborough 2016). Estimating the customer count of around 125 per day on the average. The mission of the “Healthy Fruit Shack” is to continue the unique marketing and advertising scheme so that it can tap into the wider market share and drawing the new consumers.
“Healthy Fruit Shack” products would be made from the domestically produced fruits which would be free from any artificial preservatives and additives. The product would not contain any added sugar since the fruits contain the natural sugars. Fruits that are available during the particular season would be harvested. A part of materials would be used and the remaining amount of raw materials would be dried or frozen in the deep freezer for out of season usage.
Figure 1: Figure depicting creating of fruit juice:
(Source: As Created by Author)
Types of food products that would be offered;
Considering the self-analysis, it can be stated that the level of education that is gathered would be helpful in starting the venture. It is believed that I have the necessary level of creative mind and the skills of teamwork that would help me in successful establishment of venture.
The geographical data collected suggest that 325 respondents within the target market are students, office-goers, sports enthusiast that enjoy eating the fruits and products relate to fruits which is presented readily (Kirzner 2015). The geographical data suggest among these respondents that they are eager and willing to purchase the products that offer nourishment services. The geographical data suggest that 80% of the consumers would patronize the products of organic fruits while 65% of the consumers visits such stores daily (Drucker 2014).
The demographic data for “Healthy Fruit Shack” customers is stated below;
The marketing research was carried out by using the survey method as well as the focus group. A group of 325 respondents from several focus group were considered in the survey (Hitt and Duane 2017). This comprised of the students, daily office-goers, sports enthusiast and domestic household families. The research sources were gathered from the data of Ministry of Health that also included the intake of healthy vitamins and nutritious among the different age group children.
The direct competitors for “Healthy Fruit Shack” are the Jamba Juice and Jenney’s Juice Hut located in Melbourne. Both these competitors have the long standing quality and market reputation as well. Jenney’s Juice Hut is directly located in the Melbourne market and offers fresh fruit made from both fruits and flavours (Kuratko 2016). It is purchase and go form of store. While Jamba Juice is the largest competitor for “Healthy Fruit Shack” as it is located next to the Broulim’s Market in the local grocery store. However, the products at Jamba Juice are very expensive and appeal to the highly health-conscious customers in Melbourne.
“Healthy Fruit Shack” also faces indirect competition from locally owned and operated protein drink retail outlets. It also faces competition from the locally owned cafes that provide flavour and sugar contained beverages to the customers.
Market Segments Analysis:
“Healthy Fruit Shack” has identified certain metro location in Melbourne where it would be reaching its targeted set of customers;
With around 8 million population in Melbourne the target market for “Healthy Fruit Shack” would be perceptibly large (Storey 2016). Nonetheless, “Healthy Fruit Shack” would only be needing a small market to obtain the business profitability. The products of “Healthy Fruit Shack” would potentially appeal the younger and health-conscious customers. Hence, the business would target probable customers from the young set of populations. There are around 2 million higher education children living in Melbourne therefore, “Healthy Fruit Shack” products would be appealing the adult that have the awareness in health and in families that places value of health for their children.
Figures obtained from the market survey demonstrates the probable customers that the business would aim to target the market (Schaper et al. 2014). The figure also reflects that the probable repeat customers however the rest of the population may act as the significant contributor of “Healthy Fruit Shack” revenues and should be held as the element of target market.
The business would be located in the central business districts of Melbourne which would have less distance with the target city where the business intends to market its products. Since the operating capital at the initial level would be low the business would look to rent the property in the mall (Carland et al. 2017). The hours of operations would include 10 am in the morning 10 pm in the night. The location would have access to parking facilities for both the customers as well as the staff. The store would be located in the mall that would also have the customer parking facility with access to mass transit. The business would be near to at least one complimentary business.
The choice of ownership for “Healthy Fruit Shack” would be in the form of partnership. The partnership for of business has been selected is because business partners would form an important part of organization expansion. The partnership form of business of business would be helpful as much needed working capital would be bought in by the new partner and delegation of business activities can also be assigned as and when the business requires.
The owners of “Healthy Fruit Shack” would be engaged in active management of day to day business functions. The management team would be consisting of personnel that would have experience in the natural food stores (Solomon et al. 2014). The business would have production manager that would shoulder the accountability of production and procession of products to stores. The sales manager would be lending support in selling and distribution activities.
Production supervisor:
Following the successful business establishment there would be managers at each particular level. The owners would primarily be engaged in day to day production process (Baker 2014). The production supervisor would be accountable for submitting the Bi-weekly reports for the progress made by business in specific areas.
Chief Financial Officer:
The management team would consist of CFO that would be hired in terms of experience in accounting and recording relative business transactions. The CFO would be helping out the owners in matters related to taxation and ensuring that “Healthy Fruit Shack” covers the required business outlay.
Marketing Officer:
“Healthy Fruit Shack” in its team of management would have the marketing officer that would solely accountable for marketing, advertising and building strong relations with the customers. According to management the marketing officer would help in designing advertisement in order to attract more customers in the outlets of “Healthy Fruit Shack”.
The recruitment strategy for “Healthy Fruit Shack” would be conducted externally through the advertisement of job openings in the local newspaper (Armstrong and Taylor 2014). Openings for jobs would be advertised through the physical and electronic job posting in the newspaper. This process is not only cost effective but would also implement control on the external recruitment process that are in accordance with the business mission and goals.
“Healthy Fruit Shack” would be providing declicisious and nutritious fruit juices that would made from the fresh produce. The produce would be bought two weeks in advance from the domestic producers and to make sure that the freshness of the product is maintained. The company intends to run both the organic and the non-organic fruit juice that would provide its customers with the options of both product and price. The organic menu would be comprising of organic fruit juice from the organic produce (Hartline and Ferrell 2014). The non-organic menu would be comprising of the traditional produce and frozen yogurt based on the customer demand. The pricing would be directly in correlation with the menu. All the product ingredients of “Healthy Fruit Shack” would be generously supplied by the locally grown producers and any form of further equipment or supplies would be purchased through using the start-up budget.
The pricing strategy for “Healthy Fruit Shack” would be based on the competitive offerings, convenience and feasibility. The “Healthy Fruit Shack” pricing strategy would be comparable to that of its competitors in the geographical region. The business proposes a 50% mark up to cover the costs of its raw materials (Kiseleva 2017). “Healthy Fruit Shack” would offer volume promotion to its customers as the sales discount when the consumers would purchase the two bottles of “Healthy Fruit Shack” organic fruit products. Customers would be encouraged to purchase a minimum of two bottles of fruit juices in order to provide the customer with sales discount for the purchase of second bottle (Wensley 2016). Another aspect of pricing strategy is that the owners would look to improve cost and derive profits to surpass the breakeven point.
Personal Selling:
At the initial stages the owners of “Healthy Fruit Shack” would look to devise the strategy of personal selling in order to create community awareness and support (Lantos 2015). The company would look to create public relations through media outlets in order to announce the availability of the products.
Non-Personal Promotion:
The business would look use the “Word of Mouth” as the mode of non-personal promotion techniques. This would be highly valued as the medium of communication since the personal level of communication among the individuals would allow more credibility of the product (Erevelles, Fukawa and Swayne 2016). The business would also use newspaper advertisement, radio and television advertisement as the other non-personal medium of promoting its product.
In order to assure immediate profit “Healthy Fruit Shack” requires immediate exposure of its product in the target customer base. The location would be convenient to the customers. As the business intends to open its outlets in shopping malls the consumer would have easy access to the products (Baker and Saren 2016). The demographic and the physical requirements for “Healthy Fruit Shack” location is stated below;
|
(4) PROFIT AND LOSS FORECAST |
||||
|
Preop |
||||
|
Year |
0 |
1 |
2 |
3 |
|
Revenue |
0 |
3,50,000 |
4,37,500 |
5,46,875 |
|
Cost of sales |
0 |
1,25,000 |
1,56,250 |
1,95,313 |
|
Gross profit |
0 |
2,25,000 |
2,81,250 |
3,51,563 |
|
Gross Margin |
3,03,013 |
3,61,349 |
4,38,354 |
|
|
Expenses/overheads |
||||
|
Leased Premises Rent |
22,500 |
24,750 |
28,463 |
|
|
Wages |
42,250 |
46,475 |
53,446 |
|
|
Administrative Expenses |
3,250 |
3,575 |
4,111 |
|
|
Communication Expenses |
19,500 |
21,450 |
24,668 |
|
|
Marketing Expenses |
13,275 |
14,603 |
16,793 |
|
|
Rates |
11,450 |
12,595 |
14,484 |
|
|
Insurance |
7,250 |
7,975 |
9,171 |
|
|
Other general expenses |
6,250 |
6,875 |
7,906 |
|
|
Interest |
5,500 |
6,050 |
6,958 |
|
|
Web Hosting Expenses |
12,000 |
12,000 |
12,000 |
|
|
Prelim expenses |
8,250 |
9,075 |
10,436 |
|
|
Lease payments |
6,400 |
7,040 |
8,096 |
|
|
Total expenses/overheads |
1,57,875 |
1,72,463 |
1,96,532 |
|
|
Profit before tax |
67,125 |
1,08,788 |
1,55,031 |
|
|
Tax @ 30% |
20,138 |
32,636 |
46,509 |
|
|
Profit after tax |
46,988 |
76,151 |
1,08,521 |
|
|
Transfer to reserves |
46,988 |
76,151 |
1,08,521 |
|
|
ROC |
47% |
30% |
39% |
Figure 2: Figure representing Sales
(Source: As Created by Author)
Figure 3: Figure representing Gross Margin
(Source: As Created by Author)
Figure 4: Figure representing ROC
(Source: As Created by Author)
References:
Armstrong, M. and Taylor, S., 2014. Armstrong’s handbook of human resource management practice. Kogan Page Publishers.
Baker, M.J. and Saren, M. eds., 2016. Marketing theory: a student text. Sage.
Baker, M.J., 2014. Marketing strategy and management. Macmillan International Higher Education.
Carland, J.W., Hoy, F., Boulton, W.R. and Carland, J.A.C., 2017. Differentiating entrepreneurs from small business owners: A conceptualization. In Entrepreneurship (pp. 73-81). Springer, Berlin, Heidelberg.
Drucker, P., 2014. Innovation and entrepreneurship. Routledge.
Erevelles, S., Fukawa, N. and Swayne, L., 2016. Big Data consumer analytics and the transformation of marketing. Journal of Business Research, 69(2), pp.897-904.
Hartline, M.D. and Ferrell, O.C., 2014. Marketing Strategy: Text and Cases.
Hitt, M. and Duane Ireland, R., 2017. The intersection of entrepreneurship and strategic management research. The Blackwell handbook of entrepreneurship, pp.45-63.
Kirzner, I.M., 2015. Competition and entrepreneurship. University of Chicago press.
Kiseleva, A.M., 2017. Marketing strategy of the territory in the investment policy of the city. Strategic Management, 22(1), pp.22-29.
Kuratko, D.F., 2016. Entrepreneurship: Theory, process, and practice. Cengage Learning.
Lantos, G.P., 2015. Consumer behavior in action: Real-life applications for marketing managers. Routledge.
Scarborough, N.M., 2016. Essentials of entrepreneurship and small business management. Pearson.
Schaper, M.T., Volery, T., Weber, P.C. and Gibson, B., 2014. Entrepreneurship and small business.
Solomon, M.R., Dahl, D.W., White, K., Zaichkowsky, J.L. and Polegato, R., 2014. Consumer behavior: Buying, having, and being (Vol. 10). London: Pearson.
Storey, D.J., 2016. Entrepreneurship and new firm. Routledge.
Wensley, R., 2016. The basics of marketing strategy. In The marketing book (pp. 75-107). Routledge.
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