The Introdution To Food Industry Marketing Essay

The Introdution To Food Industry Marketing Essay Food is a basic need and food service industry will always continue in demand. This industry includes restaurants, fast foods, and cafeterias, catering opportunities, food carts, food trunks and the like. Filipinos love to eat. This love for food and eating is the major reason why the food industry has flourished well in the Philippines and why you will see a lot of restaurants and fast foods scattered all over the country. These fast foods and restaurants can be local or international. Filipino food is considered as a unique mixture of Eastern and Western cuisines that mirrors the history of the country. It includes plates and cooking procedures from countries like China, Spain, Mexico and the United States. Even although Filipino food has been influenced by Eastern and Western countries, what makes it unique is the history, the society that introduced and adapted it and the people who accepted it into their homes and restaurants. Filipinos are not just into good food but the total dining experience, good food is just a part of it. It is the way we feel when we are within a fast food or restaurant. How it feels to dinner out with family or friends or even when youre by yourself. When choosing a restaurant or a fast food, customers usually check for the cleanliness of the place, freshness of the food, watched over premises, enough parking area, the mood, design and land of the place, and for some restaurants, even the music. The physical and emotional response is a result of all these factors. These can make the whole dining experience level better. A recent study shows that due to economic crisis, customers or consumers think that when it comes to food shopping, preparing and dining. They are not for weight loss or just eating out at fancy restaurants but they choose what they eat for wellness. They want more nutrition for their money and are more conscious of it. INTRODUCTION OF FAST FOOD Fast food is food, which is ready and served quickly at outlets called fast-food restaurants. A restaurant is an organization that serves ready food and beverages on tables set for individuals, pair or bigger groups, to be consumed primarily on the location. Restaurants serve a wide variety of food at a particular cost given on its menu card for on or off the place consumption. These include eating establishments where consumers are served at walkup or make away ordering counters for either on or off building consumption. However, most good restaurant serve food at tables to their consumers for on-premises consumption. Many of the restaurant chains, have improved their annual sales many times over, well away from the limits of the tables they can served each day, by contribution hot well packed meals through free home delivery service on orders placed through a telephone call. It is multi-billion peso businesses that continue to grow up quickly in many countries. A fast-food restaurant is a restaurant characterized both by food which is supplied quickly after ordering, and by smallest service. The food in these restaurants is often cooked in mass in advance and reserved hot, or reheated to order. Many fast-food restaurants are part of restaurant chains or license operations, and standardized food are shipped to each restaurant from central locations. In todays world, going to a restaurant has more to do with socialize then to just having a snack. Only a few decades reverse restaurants were specially target families, which situation does not hold true today. Nowadays, even children; regularly eat out with their friends, on their own. Therefore, restaurants are not just about food of ambience. On a worldwide level, they are an important supplier to the economy while on personal levels it provides us with a place to easily connect with others. OBJECTIVES To set up an existence as  a successful local fast food outlets and get a market share in Philippiness fast food industry. To make FRHANP Fries  a destination spot for malls. To expand into a number of outlets by near years, and sell the franchise to neighboring metropolitan cities. Mission : Our main goal is to be one of the most successful fast food outlets in Philippines, starting with one retail outlet located inside a major shopping mall as a market tester. Our main focus will be serving high-quality food at a great value. COMPANY SUMMARY What is FRHANP Fries? FRHANP Fries sells  foodie fries in a cone  with a  choice of paste. We use the concept of Belgian Fries, where the fries are all made from fresh potatoes and fried twice. Our outlet also provides excellent and friendly customer service to support the ambience of fun, energetic and youthful lifestyle.   Youthful and fresh surroundings We will imitate  successful establishments, such as Jamba Juice and Starbucks, which represent the majority of our core target market, between 18 to 35 years of age. Our store will feature display cooking of our featured Fries from cutting to frying. Our customers will also be able to read our in-house brochures in regards to all knowledge about Fries and our featured sauces as well as other products like burgers and shakes. Our store will be decorated with fast food setting, such as a bright counter and display menu on the wall. Quality Food Each  store will  offer nothing but freshly fried Belgian fries, sandwiches, Burgers, Shakes and variety of unique blend sauces, all served with old-fashioned home-style care. Open Everyday Our store is open everyday from 10 am to 9 pm. Variety, variety, variety A different selection of burgers and sandwiches will be featured every three months and we will also change our Indian soda flavors and shakes to accompany our fries. Start-up Summary The retail outlet will be rented at one of the target location shopping malls. Our preference is Space A, for the main reason of reaching larger traffic. Startup requirements will be financed through owner investments. http://www.bplans.com/fast_food_restaurant_business_plan/images/3ea7e45235fa4bd5ad6f924765b00e74.png Start-up Requirements Start-up Expenses Rs. Kitchen and Fixtures 1144800 Furniture and Interior 874500 Legal 159000 Rent 795000 Packaging and Stationary 450500 Contingencies 222600 Total Start-up Expenses 3646400 Start-up Assets 0 Cash Required 2650000 Other Current Assets 0 Long-term Assets 0 Total Assets 2650000 Total Requirements 6296400 Products We want to focus only on selling fries. Alcoholic drinks will not be sold in our outlet, as FRHANP Fries promotes a healthy and positive Philippino lifestyle. Instead, we will offer Idian Soda and Sandwiches  to complement the fries. The dips for Belgian style fries can also be served with sandwiches, they  are available in more than 20 flavors: Pesto Mayo Traditional Sambal Satay pulp Korean BBQ Teriyaki pulp Hot Chili pulp Thai Chili Ketchup Garlic Dip Creamy Wasabi Mayo Roasted Pepper Mayo Lava Cheese Black Pepper pulp Curry Ketchup Barbecue Jalapeno Ketchup Caribbean Islands Competitive Comparison FARHANP Fries has several advantages over its leading competitors: We expect a high degree of enthusiasm and offer a fun store with friendly staff that reflects the companys youthful and energetic culture. Supporting merchandise items that support the companys brand building. Our fried potato is made 100% fresh, compared to most fast food outlets that use frozen fries. Our dipping pulp is also made fresh without preservatives. Our innovative packaging will be more entertaining than our competitors. Company Clean Value Merchandising Hang Out Simple Fresh Cool Pop Culture FAHANP yes yes yes yes yes Yes yes yes McDonalds Yes Yes Yes Yes Yes No Yes Yes KFC Yes Yes No Yes No No Yes No SubWay Yes Yes Yes No Yes Yes No No Sales Literature FARHANP Fries will use advertising and sales programs to get the word out to customers. 1500 color brochures to be distributed throughout destination shopping mall and facilities: in-store, cinemas, area eateries, information during the grand opening. Half page magazine reviews in Philippiness lifestyle magazines that advertise the presence of the outlet. Sourcing Fresh potatoes will be delivered weekly by our distributor directly from the India . We also have an agreement with  Company to exclusively manufacture our Shakes and signature sauces. Future Products For now, we will focus on selling fries and signature shakes, burgers and sauces. However, as we grow further, we will add new categories to our menu, such as Belgian Sandwiches and Buffalo wings. In the future, our growth strategy will be offering the franchise of our brand to food entrepreneurs in the Philippine region. Value Meal Sales of FRHANP Fries will not only generated from the selling of its famous Belgian Fries, but also will be generated by the conception of an innovative package menu called the value meal. It primarily consists of a combination of our featured Belgian Fries, sandwiches and Indian soda at greater value than selling at individual items. Further customization could be done by selling a bigger size of fries called Uber FRHANP to attract price sensitive customers. Market Analysis Summary Consumer expenditures for fast food in Philippines rise during the end of the year 2012, followed by the recovery of Philippiness economy. The increasing number of new establishments such as fast food franchises, fancy restaurants and foodie bakeries around Philippines has shown a significant growth in this sector. Food spending is around 56% of total consumer expenditures in Philippines, and consumer  spending on leisure and recreation made up of 13% of total consumer spending. A  much broader appeal exists for weekend slots because those are the days when most of our core target market enjoys the mall going activities. Age   Youngsters, single, currently enrolled in college and high school. Family unit   We will also appeal to families (young families) with children. Gender   We will target both sexes, with a slight skew for males due to their lower attention  to dietary concerns. Income   We will appeal to the medium income individuals and to all in the lower medium income bracket. According to a recent public survey of people 15 45 years old, 80% of those interviewed like fast food. 90% of them like fast food on a regular basis, and 10% of them claimed that they like fast food very much, or love fast food. The survey also provided the following particular reasons for the increasing popularity of fast food: People have 52 weekends and three long holidays a year. Most of Philipino love to window shop, and when they do strolling around the shopping district, they need a quick bite to accommodate their activities. White-collar workers in offices have stopped bring lunch, and enjoy chicken, hamburger, pizza or other fast food joints in the vicinity. Parents give more money to kids and students to buy lunch. Fast food is naturally their first choice, because of the brand building effort that heavily targets their age group. Eating out still remains as Philippinos common habit of life. They do not perceive fast food is a luxury,  and they enjoy it by bringing their family, especially if they have smaller kids, in the environment of the western-style fast food outlets. Marketing Strategy Our strategy is based on serving our markets well. We will start our first outlet as a market tester that could become a model of the expanding number of outlets in the future. Concentration will be on maintaining quality and establishing a strong identity in the local market. A combination of local media and local store marketing programs will be utilized at each location. Local store marketing is most effective, followed by print advertising. As soon as a concentration of stores is established in a market, then broader media will be explored. By providing a fun and energetic environment, with unbeatable quality at an acceptable price in a clean and friendly outlet, we will be the talk of the town. Therefore, the execution of our concept is the most critical element of our plan. Pricing Strategy Our pricing strategy is positioned as generic, meaning that 200 INR is the average consumer spending for a snack or light lunch in Philippines. Leveraging the volume of fries, Indian Soda, Sandwiches, Burgers and signature style sauces to be sold, we are serving the majority of Philippino. Management Summary The initial management team depends on the founders, with little back-up. As we grow, we will take on additional help in certain key areas. Part of our basic philosophy will be able to run our executive management as a knowledge sharing fellowship. We will not add additional overhead until absolutely necessary. This will mean that the initial staff support team will have to work extra. By doing this, we will keep our overhead as low as possible, allowing us to adequately staff our outlets. This will also allow us and future business partners to recoup investments as quickly as possible and enjoy a higher return. At present time, FRHANP Fries is being owned by its 6 founders. Management Team FRHANP Fries is currently the creative idea of its six founders. As the company is small in nature, it only requires a simple organizational structure. Implementation of this organization form calls for all four individuals to make all major management decisions in addition to monitoring all other business activities. As we expand into multiple locations, each location will have a primary site manager. Organizational Structure Future organizational structure will include a director of store operations when the store locations exceed four units. We hope that this individual will come out of the ranks of our stores management. This will provide a supervisory level between the executive level and the store management level. Possible positions might be added at a later date include marketing manager, purchasing manager, controller, human resources, RD and administrative support team. Personnel Plan Our initial employees will  include two  cashiers, two cooks and two bike boys per location, with one of each on the premises during open hours. This is considered an ideal personnel number for a food outlet the size of our own. Each employee will work for 38-40 hours per week. Personnel Plan (Approx.) Personnel plan Year-1 Site manager 0 cashiers 1,90,800 Cook 1,52,640 Bus boy 1,24,020 Total people 12 Total payroll 4,67,460 Start-up Funding Currently, the company is owned by the original 6 founders, who each will contribute Rs.30,60,000 for the same amount of share, 25%. This will more than cover start-up requirements, and provide the business with a cash pillow to use for expansion over the first year. Start-up Funding Start-up Expenses to Fund 36,46,400 Rs. Start-up Assets to Fund 26,50,000 Total Funding Required 62,96,400 Assets Non-cash Assets from Start-up 15,90,000 Cash Requirements from Start-up 26,50,000 Cash Balance on Starting Date 37,53,600 Total Assets 79,93,600 Liabilities and Capital Liabilities Current Borrowing 0 Long-term Liabilities 0 Accounts Payable (Outstanding Bills) 0 Other Current Liabilities (interest-free) 0 Total Liabilities 0 Capital Total Planned Investment 42,40,000 Loss at Start-up (Start-up Expenses) (36,56,400) Total Capital 1,83,60,000 Total Capital and Liabilities 37,53,600 Total Funding 44,00,000 Projected Profit and Loss As the Profit and Loss shows,  FRHANP Fries will run at a profit or loss for the first year, using up some of the cash reserves initially invested by the founders. As sales increase, we will expand into new locations to aggressively spread brand recognition. This increase in visibility will allow us to take up less expensive locations off of Orchard Road, while maintaining our flagship operation, the first store, in a  prime spot. http://www.bplans.com/fast_food_restaurant_business_plan/images/ae0e382ef4e34aa6b836c9db8ae7becb.png We recommend using Business Plan Pro as the easiest way to create graphs for your own business plan. Year-1 (Rs.) Sales 1,47,95,639 Direct Cost of Sales 32,83,721 Other Costs of Sales 0 Total Cost of Sales 32,83,721 Gross Margin 1,15,11,971 Gross Margin % 77.81% Expenses Payroll 46,74,600 Marketing/Promotion 5,30,000 Depreciation 0 Rent 92,22,000 Utilities 1,35,150 New location setup 13,25,000 Total Operating Expenses 1,58,86,750 Expenses Profit Before Interest and Taxes (4374779) EBITDA (4374779) Taxes Incurred 0 Net Profit (4374779) Net Profit/Sales -29.57% Projected Cash Flow The following chart and table show the Projected Cash Flow for FRHANP Fries. http://www.bplans.com/fast_food_restaurant_business_plan/images/bb9ce2d1db1244898fee2612c6fa41d6.png Year-1 (Rs.) Cash Received Cash from Operations Cash Sales 14,795,639 Subtotal Cash from Operations 14,795,639 Additional Cash Received Sales Tax, VAT, HST/GST Received 0 New Current Borrowing 0 New Other Liabilities (interest-free) 0 New Long-term Liabilities 0 Sales of Other Current Assets 0 Sales of Long-term Assets 0 New Investment Received Subtotal Cash Received 14,795,639 Expenditures Year-1 Expenditures from Operations Cash Spending 4,674,600 Bill Payments 12,946,045 Subtotal Spent on Operations 17,620,645 Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out 0 Principal Repayment of Current Borrowing 0 Other Liabilities Principal Repayment 0 Long-term Liabilities Principal Repayment 0 Purchase Other Current Assets 0 Purchase Long-term Assets 0 Dividends 0 Subtotal Cash Spent 17,620,645 Net Cash Flow (2,824,953) Cash Balance 35,928,647 Projected Balance Sheet FRHANPs projected company balance sheet follows. Assets Year 1 (Rs.) Current Assets Cash 35,928,647 Other Current Assets 0 Total Current Assets 35,928,647 Long-term Assets Long-term Assets 0 Accumulated Depreciation 0 Total Long-term Assets 0 Total Assets 35,928,647 Liabilities and Capital Current Liabilities Accounts Payable 1,549,826 Current Borrowing 0 Other Current Liabilities Subtotal Current Liabilities 1,549,826 Long-term Liabilities 0 Total Liabilities 1,549,826 Paid-in Capital 42,400,00 Retained Earnings (36,46,400) Earnings (4,374,779) Total Capital 34,378,821 Total Liabilities and Capital 35,928,647 Net Worth 34,378,821