Describe your company’s target market in detail and explain how you plan to market your company’s product or service to the defined target market. Remember, you must be able to prove that your target

CONFIDENTIAL Describe your company’s target market in detail and explain how you plan to market your company’s product or service to the defined target market. Remember, you must be able to prove that your target 1

[Dave and Jacky Delicious Incorporation]

Your tagline

Business Plan

Prepared May 19th, 2020

Table of Contents

Executive Summary 1

Opportunity 1

Expectations 1

Opportunity 3

Problem & Solution 3

Target Market 3

Competition 3

Execution 4

Marketing &Sales 4

Operations 4

Milestones &Metrics 5

Company 6

Overview 6

Team 6

Financial Plan 7

Forecast 7

Financing 9

Statements 10

Appendix 13

Profit and Loss Statement 13

Balance Sheet 15

Cash Flow Statement 17

Executive Summary Opportunity Problem Summary
Solution Summary

Market
Competition
Why Us?

Expectations Forecast

Financial Highlights by Year

Financing Needed Opportunity Problem & Solution Problem worth Solving Our Solution Dave and Jacky Incorporation will primarily produce and sell a variety of hamburgers. It will also offer sauces, coffee, tea, desserts, and juice fruits. The company will produce meat burgers (To Yuma Deluxe) and vegetable burgers (Saddles deluxe). The company’s signature dish will be a 4 oz of locally 100 percent grass fed beef meat burgers. These flame-kissed products will be smothered in nacho cheese for mouthwatering flavor and accompanied by ripe slice of fresh tomatoes from local farmers. The hamburger will be gently caressed within pretzel bread. For vegetarians, Dave and Jacky will offer them with saddles deluxe, a 100 percent vegetable hamburger. This 5 Oz bean patty will be infused with seasonal vegetables and dusted with paprika. Saddle deluxe is a slab of vegetable pepper jack cheese and a slice of local fresh tomato that is penetrated by golden pretzel bread. Currently, the nearest specialized hamburger restaurant is nearly one and a half mile away from Dave and Jacky Incorporation intended location in the Cambridge area, Massachusetts. Nonetheless, there are other corporate run franchises located near the company’s intended location that also include hamburger among other products or menu items. Even so, the quality of their products does not match Dave and Jacky’s product offerings. Nonetheless, the company considers them as its rivals because they offer low prices for lower quality hamburgers and are located within a one and a half mile radius from its location. For competitive advantage, Dave and Jacky Incorporation will rely on better quality and specialized products, state of the art equipment, better location, faster service, skilled manpower, and better recipes. The company will offer high quality products at an affordable price and will serve it hot on time to a customer’s door. In essence, Dave and Jacky is a concept developed out of the desire for an alternative to corporate based fast food franchises. It focuses on convenience, availability, and sustainability. The aim is to serve a simple menu made of fresh, local ingredients. The company will source the best ingredients from local suppliers and make everyone a happy customer. Target Market Market Size Cambridge City, Massachusetts is a growing middle class area comprising more than 100,000 residents. Data from the United States Census Bureau show that there were more than 118,977 people in Cambridge City in 2018, representing a 13.1 percent increase from the 105,162 people in April 2010. Of the 118,977 people, persons under 5 years accounted for 4.4 percent, while persons under 18 percent and persons aged 65 years and above accounted for 12.4 percent and 11.3 percent, respectively. Females accounted for 50.6 percent and males 49.4 percent. From the racial perspective, Whites alone contributed 60.8 percent of the total population followed by Asian at 16.0 percent, African Americans at 11.0 percent and Hispanics at 9.2 percent. Native Americans, Native Hawaiian, and people of mixed races constituted 0.2 percent, 0.1 percent, and 4.1 percent, respectively (U.S. Census Bureau, 2020). More than 95.1 percent of persons aged 25 years and above have at least a high school degree and at least 77.4 percent of persons in the same age bracket have at least a Bachelor’s degree. From an economic perspective, more than 69.6 percent of persons aged 16 years and above are in the civilian labor force. In 2012, total accommodation and food sales, merchant wholesale sales, and retail sales stood at $784.162 million, $1.696 billion, and $1.36 billion, respectively. Median household income between 2014 and 2018 was $95,404 and per capital income over the same period was $54,685. Persons in poverty account for 13.2 percent of the total population (U.S. Census Bureau, 2020). Market Segment Based on the market size, Dave and Jacky Delicious Incorporation will pursue geographical market segmentation by focusing on Cambridge City, Massachusetts. Geographic segmentation is a suitable approach for Dave and Jacky Delicious Incorporation because it is a small organization with limited budget. The company can focus on its defined area rather than expending unnecessary marketing money on approaches not suited for its target geographic segment. Kotler and Armstrong (2017) indicate that geographic segmentation happens when a business decides to divide its market on geographic basis. A business can geographically segment its market according to city, state, country, region, or international. An organization can also divide its market according to rural, suburban, or urban segments. Dave and Jacky Delicious Incorporation will target low to middle income earners and businesses located inside and outside the area. In essence, the organization will sell to individuals and accept occasional catering events to individuals and organizations in the area. The main target markets in the area include: individuals or retail customers, who are expected to account for more than 95 percent of the company’s revenues; and businesses or corporate customers. With continued growth in Cambridge City, opportunities to serve the area will increase. Industry Analysis A higher number of Americans consider eating out as fun. The restaurant’s industry portion of food dollars has more than doubled from 25 percent in 1955 to at least 51 percent in 2019 (Khandelwal, 2019). The National Restaurant Association (2019) projected sales to hit more than $860 billion in 2019, representing 4 percent of the United States gross domestic product. The association also expected the industry to employ more than 15 million individuals in 2019, which accounted for nearly 10 percent of the country’s working population. The National Restaurant Association (2019) associates several factors with the growth of the United States restaurant industry, including better hospitality, variety of cuisines, as well as rising income. Restaurants have become an integral component of people’s lifestyles. Khandelwal (2019) posits that data from the United States Bureau of Labor Statistics found that households with yearly income of more than $70,000 contributed to more than 60 percent of revenue spending in the year 2018. Nearly 40 percent of households in the country had annual income of at least $70,000, which implies that 40 percent of households were responsible for more than 60 percent of restaurant spending. The number of higher income households has increased over the years, which has partially contributed to the significant growth of the restaurant industry’s revenues. While people have been eating in restaurants for many years, the industry continues to experience significant changes. Home deliveries and take-out services have grown significantly in the recent years. Majority of restaurants have recorded massive growth in delivery sales since 2017. Thus, many operators are providing delivery options in order to capture the growth trend. For instance, McDonald has decided to expand the number of outlets offering food delivery. Technology has also changed the way customers order and pay for goods and services. The use of self order kiosks and mobile applications provide customers ease of ordering. Thus, restaurant operators are increasingly embracing technological innovations to drive sales growth (Khandelwal, 2019). The shift in customer preferences for healthy foods has also impacted the restaurant industry. The National Restaurant Association survey of 2019 found that 61 percent of consumers order more healthy foods than before. In addition, a rising interest in vegetarian food has led to an increase in plant related packaged food providers. For instance, Beyond Meat uses food outlets or restaurants as some of the channels for selling its products (NRA, 2019). Between 2015 and 2020, the quick service restaurants or fast food restaurants industry has witnessed shifting consumer preferences as well as a saturated food service environment that has low prices. Nonetheless, compared with other accommodation sector’s operators, quick service restaurants have performed better from 2015 to 2020 due to low prices as well as convenience they offer. The popularity of quick service restaurants has also boded very well for the fast food restaurants industry, enabling the industry to have high revenue growth despite decreasing profitability. However, intense competition has forced operators in the industry to emphasize low price in order to attract consumers. Industry growth will slow down over the next five years up to 2025 even as the United States economy continues to grow. Competition will remain high, which will contribute much of the fast food restaurant industry’s expected tepid growth. Even though no severe revenue decreases are expected, operators will operate in a slow growth business environment as many of the industry's segments have hit saturation point. Therefore, successful restaurant operators will have to adapt to ever changing consumer preferences as the fast food concept continues to evolve to include a variety of options (IBISWorld, 2020). Competition Current Alternatives Dave and Jacky Delicious Incorporation has many competitors, each scrambling for a share of the market. The company is aware that it is up against large burger chains and independently owned fast food restaurants in the area. Among its competitors include McDonalds, KFC, Burger King, Subway, Pizza Hut. McDonald’s Incorporation is one of the world’s most favorite fast food chains. There is no doubt that it has revolutionized and transformed the fast food industry. The company deals with various products such as hamburgers, cheeseburgers, French fries, and milkshakes. The entity has served fish, fruits, and smoothies, as well as salads (Bhasin, 2018). KFC is one of Dave and Jacky Delicious Incorporation direct competitors as it specializes in fried chicken and hamburgers. In addition to fried chicken and hamburgers, the organization also offers French fries, chicken fillet burgers, salads, and soft drinks. Its fried chicken is considered as one of the best in the world and the company’s slogan “Finger Lickin’ Good” demonstrates how good it is in what it does. Burger King, a subsidiary of Restaurant Brands International, is one of the world’s largest fast food joints. Headquartered in Florida, the company’s menu of hot dogs, hamburgers, French fries, desserts, and soft drinks, as well as chicken are loved worldwide. With its massive revenue stream, the company is a force to reckon with in the industry (Bhasin, 2018). Subway Company is among the fastest growing brands in the fast food restaurant industry. As at 2017, the company had approximately 45,000 outlets in more than 110 countries. The organization primarily offers a submarine sandwich referred to as the sub. However, it also offers paninis, doughnuts, salad, muffins, and wraps, as well as cookies. It also sells gluten-free bread and brownies. Subways focus on offering health conscious products. Pizza Hut is known for its Italian-American cuisine. Its menu also includes desserts, Buffalo wings, pizza, plus pasta. The company generates the majority of the company sales through pizza sales with the organization considered as the world’s best pizza chain. Its pizza varieties comprise of thin and crispy, stuffed crust, hand tossed, Sicilian, as well as pan pizza (Bhasin, 2018). Our Advantages Clearly, Dave and Jacky Delicious must have competitive strategies that differentiate it from its rivals in order to make sure that what it offers and does matches customer expectations. The company recognizes the need to become the best place for hamburgers in Cambridge City and its environs. The company is not in the rush to offer cheap hamburgers, but in growing recognition that caring services and high quality ingredients are essential for competitive advantage. In this regard, the company will produce its products from antibiotic, hormone free natural Angus beef produced locally. The company will emphasize on sustainability made locally produced grass fed beef. The company will also strive toward delivering desirable experiences for consumers through its product packaging, cooking process, and staff uniform that reflects a modern way of food service. Overall, Dave and Jacky Delicious recognizes the need to add value through innovation, make the process of visiting the restaurant less routine, enhance in-house experience, and lead on social media platforms for competitive advantage. Marketing & Sales Marketing Plan Sales Plan Operations Locations & Facilities The company will lease a commercial property in Cambridge Area, Massachusetts in September 2020 for five years, with the option of extending the lease period for another five years. Since the company will leverage supplier’s logistics, it will not acquire delivery vans for distribution purposes. Nonetheless, it will require office supplies such as desks, chairs, and office stationery. Technology
Equipment & Tools After taking six months looking for a convenient area, the owners decided to rent a commercial space in Cambridge, Massachusetts. The capital will be used to acquire kitchen equipment, inventory, legal fees, packaging and other materials, rent, advertisement, inventory on hand, and legal expenses as indicated in table 1. Kitchen inventory will consist of necessary tools and accessories required for hamburger production and service facility. They include:

Utensils such as cooking utensils, cutting guide, and rocker knives as well as wheel cutters
Food preparation attire and equipment such as aprons, gloves, blender, trays, mixers, and storage containers, condiment bottles, tableware, glassware, pans, and cleaning equipment and supplies.
Burger tools such as hamburger press burger maker, meat tenderizer pounder, meat grinder, burger cookbook, salt and pepper mill duo, pocket thermometer, burger seasoning, BBQ spatula, and griddle pan.

Kitchen equipment comprises a hamburger oven, burger bun machine, hamburger display equipment, cooler package, and refrigerators. Seventy five thousand worth of long term assets will be bought over the next three years, using a straight line method of depreciation. A list of equipment to be bought, including prices and terms of acquisition, will be availed for investor’s consideration. Dave and Jacky Incorporation’s policy is to buy state of the art equipment from reliable dealers in the food industry. Other equipment consists of neon hamburger signs, juice dispensers, dish machines, coffee makers and filters, and tea dispensers as well as cleaning equipment. Inventory on hand during the start up phase include key ingredients for preparing hamburger, wheat flour, spices and burger condiments, juices, coffee, tea, and sauces. Others include cookie dough, meat, bread, and dessert items. Inventory on hand also includes supplies used during packaging, delivery processes, and sales. There are several United States based producers and suppliers of hamburger equipment. The company will choose specific suppliers through a competitive bidding process. The selected manufacturers must be able to produce and supply quality, energy efficient equipment at an affordable price. Insurance premium for risk coverage is established at $2,000 for the first 6 months, and will be negotiated with the insurer. The company will pay monthly premiums through direct debits. Advertising expenses are estimated at $2,000 per annum and will be used for marketing information materials. Legal expenses will include business formation, contract reviews, and business advice. Most importantly businesses must have permits in order to operate legally in the Cambridge area, Massachusetts. Milestones & Metrics Milestones

Key Metrics

Company Overview Dave and Jacky Delicious Incorporation is a privately held limited liability focused on fast food production and delivery service. Based in the Cambridge area, Massachusetts, this is a family owned business, managed by Dave Simpson (myself) and my sister Jacky Simpson. Dave and Jacky Incorporation is a take away restaurant where clients order food at the counter. It is not a sit down restaurant that offers table service. The company aims to meet customer expectations for exceptional quality hamburgers delivered in a friendly manner. The entity will serve a 20 mile area with at least 1 million residents, and one of the fastest growing populations. The business’ location provides high visibility and large traffic of customers. Dave and Jacky are aware that it cannot rely on price alone for competitive advantage, thus the need to focus on customer expectation. The company will also focus on its core competencies to determine expectations it can reasonably meet and ensure that it exceeds such expectations wholeheartedly. Hence, Dave and Jacky will rely on maintaining and increasing customer satisfaction levels for future growth and development. The delivery process will be carried out through various food catering online services with excellent references in the Cambridge area. The business can opt to be one of their major suppliers. By doing so, the company will not only leverage its partner’s high internet connectivity and exposure, but also save on logistics cost. Moreover, the business will not buy delivery vehicles because delivery entities will use their own delivery vans. During its formation Jacky and I plan to contribute $40,000 each and raise $20,000 from an investor. In total, the contributed capital would amount to $100,000. In return for investing $30,000, the investor would control 20 percent of the company ownership. The investor would take part in significant decision making such as management, production, and dividend policy before the company’s begins operation. Other issues worth discussing include: investor’s interest, investor entry, and investor exit strategy before beginning operations. Team Management Team

Jacky Simpson

Jacky Simpson will be the chief executive officer of Dave and Jacky Delicious Inc. Jacky has successfully owned and managed a similar business in Los Angeles, California. She holds a Masters degree in hospitality management and has more than 10 years working experience in the industry. She worked as a food production manager at Saussy Restaurants for 5 years before becoming the organization’s chief executive officer for 2 years. He has, during the last 3 years, operated a take-out food outlet in Los Angeles, California.

Dave Simpson

I will act as the company’s human resource manager. I have more than 6 years working experience as a human resource manager in different industries including hospitality industry and telecommunication industry. I have a post graduate degree in human resource management. The company will hire an accountant to oversee the organization’s financial responsibilities and performance. The management is expected to utilize the company’s resources effectively, operate profitably, and abide by relevant state laws and regulations. The management philosophy is anchored on team work, integrity, responsibility, as well as mutual respect. Individuals would want to work at Dave and Jacky Incorporation because the company encourages creativity and innovation, embraces diversity, employee growth, and performance.
Advisors

Investor

It is pertinent to ensure that before incorporation the company must raise adequate capital. Thus, an investor is essentially an important aspect for the company. The investor has a significant role to play as he or she will generate capital for the company. Specifically, the investor will provide $20,000 needed to build and grow the business. These funds will cover various expenses including marketing, overhead costs, product development, as well as other resources needed to increase revenue.

Legal Advisor

The legal advisor will help the owners establish a clear relationship with one another. It is important to make clear deals with co-owners, contractually, in order to avoid future conflicts. A legal advisor can help establish roles and responsibilities of owners and investors, remuneration, percentage of ownership in a company, and cash contributed by owners. A legal advisor will also play a major role in establishing the business structure or model. Getting legal advice can help owners understand the benefits and shortcomings of a private limited liability company and align their goals with the company. In Addition, the legal advisor will offer advice about intellectual property protection, developing a standard contract document, and tax issues.

Accountant

For organizations, finances are complex and confusing. In this regard, Dave and Jacky Delicious Incorporation will seek the services of an accountant to manage the company’s financial records, transactions, and accounts. Taxes present significant pain for start-ups, especially due to ever changing taxation laws. There are many variables from business registration to the type of deductions that an organization makes. As the company’s financial strategy becomes more complicated, it will be important to employ an accountant to align the organization’s taxation process. An accountant will also prepare payroll, ensure accuracy of financial documents, prepare and maintain financial reports, provide guidance on cost reduction, offer guidance on revenue growth and profit maximization. The accountant will also conduct forecasts and risk analysis assessments.

Start-Up Summary

It is estimated that the company will require $135,000 in start-up cost, out of which owners and investors will contribute $100,000. Jacky and I will provide more than 50 percent of total start up cost. In particular, we will contribute $80,000, each contributing $40,000. An investor is welcome to take part in the organization’s capital by contributing $20,000 and would be offered 20 percent ownership of the company capital. The investor’s fund will be used to purchase equipment and cater for part of start up costs. For the remaining $35,000 additional funding required to cover the start-up cost, Dave and Jacky plan to apply for a five year loan to meet cash flow requirements. The company will use the borrowed money to purchase equipment based on a list that the company will supply to the lending organization. The loan will be repaid in equal monthly installments for a five year period. For conservative reasons, the company estimates its annual interest to be 12 percent. Nonetheless, it will negotiate actual interest rate and borrowing terms with the lending institution.

Start-Up Funding

Start-Up Cost

Expenditure	Amount
Kitchen inventory	$7,000
Packaging material	$2,000
Kitchen equipment	$25,000
Insurance	$2,000
Legal fees	$1,500
Rent	$5,000
Promotion	$2,000
Other equipment	$4,000
Business sign	$2,000
Permits	$1,000
Office supplies	$1,500
Renovations	$2,0 00
Total Expenses	$55,000
Assets
Cash	$15,000
Start up inventory	$15,000
Current assets	$10,000
Long term assets	$40,000
Total start-up cost	$135,000

Financial Plan Forecast Key Assumptions

Revenue by Month

Expenses by Month

Net Profit (or Loss) by Year

Financing Use of Funds

Sources of Funds

Statements Projected Profit & Loss

Projected Balance Sheet

Projected Cash Flow Statement
References

Bhasin, H. (2018, September 3). Top 13 McDonald’s competitors. Marketing91. Retrieved from https://www.marketing91.com/mcdonalds-competitors/

IBISWorld. (2020, April). Fast food restaurants industry in the US-market research report. Retrieved from https://www.ibisworld.com/united-states/market-research-reports/fast- food-restaurants-industry/

Khandelwal, R. (2019, September 26). The restaurant industry: An overview. Market Realist. Retrieved from https://marketrealist.com/2019/09/the-restaurant-industry-an-overview/

Kotler, P., & Armstrong, G. (2017). Principles of marketing (17th ed.). Upper Saddle River, NJ: Pearson education.

National Restaurant Association. (2019). Growth in higher-income households bolsters restaurant sales. Washington, D.C.: Author. Retrieved from https://restaurant.org/Articles/News/Growth-in-higher-income-households

United States Census Bureau. (2020). Quick facts: Cambridge city, Massachusetts. Retrieved from https://www.census.gov/quickfacts/cambridgecitymassachusetts

Appendix Profit and Loss Statement (With Monthly Detail)

Profit and Loss Statement (Annual Detail)

Balance Sheet (With Monthly Detail)

Balance Sheet (Annual Detail)

Cash Flow Statement (With Monthly Detail)

Cash Flow Statement (Annual Detail)