Business Plan Smoothie and Juice Bar

Smoothie Bar Business PlanSmoothie and Juice Bar Business Plan Copyright © 2012 Smoothie Bar-celona. All Rights Reserved. Smoothie Bar Business Plan Executive Summary Business The business being proposed is that of a Smoothie-bar, named Smoothie Barcelona, selling a variety of mixed and instantly prepared natural fruit juices to take away. The target group is composed of health conscious consumers looking for convenient fast-food alternatives. Our main location, the Barcelona Gotic District is ideal for high pedestrian traffic of tourists and business people. A quick service juice bar will mean less start-up capital and lower costs of running the business. A downside might be the seasonality of demand since we expect the demand to decrease in the colder winter months. Business Opportunity Despite reduced spending power due to the current economic downturn, the demand for “easy health” in the shape of functional foods and drinks does not seem to go away. A widespread consumer interest in products positioned as “health-boosting” closely linked to the trend of preventive health care, rises the market demand for healthy products that bring added-value to the consumers. Due to our research results and most recent market trends, we believe there is a high opportunity for Smoothie Bar-celona to be successful in that growing market. Strategy Primary research results indicated the main reasons for not consuming more Smoothies are usually its perceived high price and the unavailability of freshly prepared fruit juices to take away. Therefore we decided to strategically increase the number of locations within a short time-frame to take advantage of economies of scale, to strengthen the brand awareness and to expand the reach to make the products more available to the consumers. In comparison to the first store, the following kiosks are small in size, investment and running costs, and are flexible and easy to set-up. Copyright © 2012 Smoothie Bar-celona. All Rights Reserved. Smoothie Bar Business Plan Competitors The Smoothie-bar concept is still relatively new in Spain and even in the bustling city of Barcelona, there is little direct competition. There are only few bars that have a similar professional-, healthy lifestyle concept and exclusively sell Smoothies. The closest competitor is Smudy, which pursues a very professional and high quality strategy in that sector. Competitive Advantage The main competitive advantage the concept brings is the excellent value-formoney we offer to our customers. Superior product quality and positioning combined with a price lower than that of the competition achieved through cost control and economies of scale will define the business. A diversified menu, a high traffic unique location and a clear shaped image and brand experience clearly aligned to healthy lifestyle concept will complement the proposal of competitive advantage. Capital Structure As a company with limited liability (S.L.), 43% of the company’s equity will raised by the three shareholders, whereby each of them will contribute to the business with a capital of 10,000 EUR. Each will have the same participation of ownership (33.3%) in the venture. The other 57% of the capital structure of Smoothie Bar-celona will be a long-term loan amounting to 40,000 EUR. The initial investment has been calculated in EUR 41,780 EUR. In order to have the liquidity to run the business, we are considering a working capital of 28,220 EUR. As a result, the total amount of initial investment necessary to set up the firm will be 70,000 EUR divided in equity and loan. The policy of the company will be to pay 50% of its benefits as dividends to the shareholders. The other 50% will be accounted as retained earnings which will finance the future growth of the venture. Proposed Exit Strategy In case Smoothie Barcelona will not achieve profitability after two years of operations, the second store will not be opened as planned and instead the business will be sold. If no interested investor will be found, the business is Copyright © 2012 Smoothie Bar-celona. All Rights Reserved. Smoothie Bar Business Plan going to be liquidated and the assets sold to repay the outstanding debt (loan, suppliers) and to reimburse the investors. Financial Projections It is planned to open three stores within the following five years. The first store will be financed with equity and a long term loan, the second store will be financed totally with another long term loan and for the third store the company will used its accumulated retained earnings. The average cost of goods sold of Smoothie Bar-celona products are 0.75 EUR and we will have an average margin of 78.5% over the selling prices. The annual operational expenses for the first year of Smoothie Bar-celona are estimated to be 101,162 EUR. To reach a positive cash flow in a monthly basis, Smoohie Bar-celona will need to sell at least 3,136 units (105 a day). 300,000 250,000 200,000 150,000 115,103 100,000 50,000 -8,370 0 2011 -50,000 2012 2013 2014 2015 5,118 25,962 Smoothie Barcelona Earnings Before Taxes 252,775 The business will have a positive earnings in the second year of operation, has a positive net present value and the payback period will be reached at the beginning of the fourth year. Copyright © 2012 Smoothie Bar-celona. All Rights Reserved. Smoothie Bar Business Plan Table of Content 1. External & Internal analysis 1.1 PESTEL Analysis …………………………………………………..……………3 1.2 Porters Five forces.…………………………………………..………………….13 1.2.1 Competition in the industry……………………………………….…..15 1.3 SWOT Analysis.………………..………………………….….………………... 16 1.4 Key Success factors …………………………………………….…..…………17 2. Marketing Plan 2.1 Secondary Research – External Analysis…………………………………….20 2.2 Primary Research………………………………………………………………..24 2.3 Analysis results…………………………………………………………………..30 2.4 Competitors Analysis……………………………………………………………32 2.5 Segmentation…………………………………………………………….……....35 2.6 Targeting…………..……………………………………………………………...36 2.7 Positioning………………………………………………………………..……....37 2.8 Implementation…………………………………………………………………..38 2.9 Brand Strategy…………………………………………………………..…….....44 2.10 Customer Relationship Management……………………………………….49 2.11 Marketing for the kiosks ……………………………………………………...50 3. Operations Plan 3.1 Location…………………………………………………………………………...53 3.2 Porter’s Value Chain……………………………………………………….……56 3.3 Resources 3.3.1 Investment….…………………………………....……………………..57 3.3.2 Materials………………………………….…………………………….59 3.3.3 Operational expenses………………….………………………...……62 3.3.4 Management - Entrepreneurs….……………………………….........64 3.3.5 Labour & Knowledge….……….….……………..…………...............66 Copyright © 2012 Smoothie Bar-celona. All Rights Reserved. Smoothie Bar Business Plan 3.4 Experience 3.4.1 Layout.……………………………...…...……………… …...………..67 3.4.2 Path Diagram……… ………………….………………...……….……70 3.4.3 Processes…………….…………….………………...…………..……71 3.4.4 Menu…………….…………….……………….……...…………..……75 3.4.5 Quality Control…….……….……………………………..……………76 3.3.5 Safety and Health Management……………………………………..77 3.3.6 First Aid Procedure Flowchart…………………………………..……78 3.5 Output………………………………………….…………………………….……79 3.6 Project Management…………………...…………………….…….……………80 4. Human Resources Plan 4.1 Labour Market Analysis…………………..….………………………………….86 4.2 Human Resources Objective……………..….…………………………………88 4.3 Vision and Mission Statement for Human Resources……………….………89 4.4 Legal requirements………………………………………………………………90 4.5 Human Resources Strategy……………………………………….……………91 4.6 Organizational structure…………………………………………..…………….92 4.7 Job description…………………………………………..……….………………94 4.8 Outsourcing Functions………………………………..……….………………..99 4.9 Working hours…………………………………………..……….……………..101 4.10 Vacation Policy…………………………………..……….…………….……..102 4.11 Safety and Health……………………………….…..…..……………………102 4.12 Hiring Policy……………………….…..………………....……………………103 4.13 Recruitment & Selection……………………….…..…...……………………103 4.14 Training……………………………………………..…..……………………..104 4.15 Employee Compensation………………………………..……….………….105 4.16 Internal Communication………………………………………..….…………106 4.17 Employee’s Objectives………………………………………....….…………106 4.18 Evaluation System…………………………………………..…..……………107 Copyright © 2012 Smoothie Bar-celona. All Rights Reserved. Smoothie Bar Business Plan 5. Financial Plan 5.1 Objectives……………………..…………………………..……………….……111 5.2 One time Investments……………..……………………..……………………111 5.3 Depreciation…………………….……………..………..………………………112 5.4 Equity and Capital Structure……………………………..…………...………113 5.5 Loan & Payments…………………………….………………………..………114 5.6 Annuities…………………………..………………………………….…………116 5.7 Purchase of goods (Costs of Goods Sold, COGS………………………….117 5.8 Expenses (fixed and variable)………...………..………………….…………117 5.9 Breakeven Analysis……………………………………………………………119 5.10 Sales Forecast ...………………..…………….……………….…………..…120 5.10.1 Seasonality.……………….…………..…………………………….128 5.11 Profit and lost accounts…………………..…………….……………….……129 5.12 Cash flow Statements……………………...……..…………….……………129 5.13 Balance Sheets…………………..…………………..….……………………130 5.14 Cost of Capital – WACC……………………………………………………..131 5.15 Risk Analysis………………………..…..…………….………………………132 5.16 Contingency Plan…………………..……………..….…………………….…135 5.17 Ratio Analysis..………..…………………..………….………………………137 Bibliography..………..…………………..……….……………………………..139 Appendix..………..…………………..………….……………………….………140 Copyright © 2012 Smoothie Bar-celona. All Rights Reserved. Smoothie Bar Business Plan Smoothie Bar-celona Vision “To be perceived as the provider of the most delicious, convenient and healthy grab and go alternative in Barcelona”. Mission In order to achieve the vision, we are going to focus our daily activities on our: • • • Customers: people that are following the healthy conscious trend. Product: 100% natural fruit juices and smoothies. Self concept: Grab and go drinks The healthy benefits and tastes of our juices are the core of our organization and will be transmitted through our efficient service. Therefore, the mission statement is: “To provide a healthy, tasty and refreshing experience with our 100% natural fruit juices and smoothies to take away. To serve and satisfy the nutrition needs of health conscious consumers through the high quality of our products. We contribute to make Barcelona a healthier city.” 7 Smoothie Bar Business Plan To continue reading, please visit SmoothieBarBusinessPlan.com 8