Final Business Discussion Plan

Final Business Discussion Plan

Running head: BUSINESS PLAN

15

BUSINESS PLAN

Assignment 2 – Feasibility & Marketing

Part 1: The Business Model

• Introduction

Oh-Qui food truck is a food truck restaurant dedicated to improving customer’s happiness and comfort by providing high-quality services. The food truck intends to provide excellent services and delectable food offerings well known in the city. the target customers for the food truck are individuals residing, working in the city and the surrounding areas. The food trucks will be situated in several locations throughout the week on a rotating schedule, and the plan will be adjusted based on the high traffic and the demand. The food truck also aims to provide food at lower prices than its competitors, accompanied by high-quality food offerings and services. The main food products offered by the food truck comprises fresh, made-to-order pizzas, French fries, hamburgers and tacos. The food truck intends to be using locally m sourced ingredients grown in the private and publicly owned organic garden. Oh-Qui food truck will use several marketing techniques, including flyers, coupons, and social media. It also aims to partners with local vendors to inform them concerning the food truck products. for instance, the food truck is planning to give samples at the various joints to increases its primary customer base and create awareness concerning the business.

Due to measures implemented to curb the spread of the covid 19 that restricting people movement, the food trucks will be driven into the neighborhood residential areas and the organizational parking is peddling the dishes. Therefore, the food truck will mainly focus on the neighborhood areas, the pool parking lots, and the clubhouses. The food truck’s purposes for dealing with essential business permit them to park at their lots and pivot to provide mobile groceries in lockdown areas. The truck also parks along with the rest stops and highways as restaurants in those areas have been shut down, and most of the truck drivers are struggling to get places where they can grab a hot meal. This is a bit too detailed. It reads more like your executive summary than the introduction should. Try and keep it a little shorter and to the point. I have a couple thoughts about your plan already from reading this however. It is VERY difficult to sell a product that is of a typically higher quality than your competition for a lower price, at least in the long term. If you are going to buy local organic product your input costs will be higher, much higher in some cases. If you sell for lower prices you won’t last very long. The other thing is that your target market description is a bit too vague. We’ll see as we get further in the plan.

• Products And Services

Food Truck will offer a wide range of food options, including different burgers, hamburgers, cheeseburgers and veggie burgers, pizza, pepperoni, cheese, Hawaiian and supreme tacos, tortilla chips, French fries and beverages such as coke products, lemonade and bottled water. Oh-Qui food truck plan to the food ingredients from the local farmers in the surrounding market markets and from the small businesses Victoria, BC, Canada (Schifeling & Demetry, 2021). The food truck restaurant will make sure the ingredients used are of high quality to deliver delicious food offerings.

• The Customers

The target buyers are individuals residing, shopping, and working in Victoria, BC, and the surrounding areas. The food truck will be moving in those various locations every day depending on the demand for the products (Roy et al.,2020). Individuals aged between 19 and 35 years, both males and females, are the main target customers and will make an estimated 85% revenue. According to a survey, these people usually spend an approximate amount of $400 monthly o purchasing food from the local food vendors. This needs a citation. What survey? Your target market will be specific to the areas where you are parking for the day (or a few hours). People won’t drive around town looking for you, they’ll walk up if you are there. They might drive to your location if you are in the same spot every day though. For instance, I’ve had food from Taco Justice several times and don’t live or work anywhere near there, but when I knew I would be running errands near that location I planned to stop and pick up lunch.

• The Opportunity

The COVID 19 has resulted in the closure of restaurants, and thus, most people depend on the food trucks to purchase the food This sounds like it needs a citation?. The food truck industry can effectively operate despite social distancing guidelines and no indoor seating orders for restaurants. The food truck can even deliver food to people’s doorstep This isn’t really feasible. Imagine the truck packing up in the middle of service to make a delivery.. In Victoria, food trucks are an emerging business, and the market has not been fully overcrowded with the competition citation?. The food truck has a sufficient share in the market to enjoy its operation (Holmes et al.,2018). The food truck has an opportunity to partner with local vendors providing complementary products, and it can get ingredients at a cheaper cost how?. Additionally, the food truck has the capability of leveraging existing interactions with local farmers.how do you see this happening? What would food truck operators need to do to leverage local farmers? I assume what you mean is that they can buy from farmers for cheaper, but why would farmers sell for cheaper?

• The Owners

XYZ, Founder and Owner You need to at least make up a name.

He is the head chef and the co-founder and head chef at banh mi food truck restaurant. He has a degree in Culinary Arts, and he is currently the assistant head chef at an upscale restaurant in Toronto, Canada. Sorry, he is going to run a food truck in Victoria and be the assistant chef in Toronto? That’s a bit of a commute.

UVW, Owner and Co-Founder name please

He is the sous chef and co-founder, and sous chef at banh mi food truck. He has a master’s degree in culinary arts and has worked with the Intercontinental hotel group for the last three years in a similar position. Ok, how is ownership split? What are the roles and responsibilities of each partner within this business?

• The Legal Organization

The Oh-Qui food truck has obtained a public liability insurance policy from the Victoria Food Premises Regulation under the Health Promotion and Protection Act that indicates the food safety requirements for food trucks. The trucks operating in a city also carry a written consent from the manager of the Parks department. Those working in private property also have written permission from the property owner. These are Operational licenses, they would be part of your Operations Plan (Assignment 3). What you need here is to outline the legal entity for the business. Is it a partnership or a corporation and why would you choose one over the other? Have you considered dispute resolution, profit distribution, exit strategies?

Part 2: Feasibility Analysis please use a page or section break to start all new sections on a new page.

• Location

Oh-Qui food truck will be situated in Victoria, BC, Canada. The food trucks more than one truck? will be located at different points in the town and in the surrounding areas.

• Site

Victoria is the capital of British Columbia, situated in a rocky southern end of Vancouver Island. Oh-Qui food truck will be located in its abundant parkland, widely known due to its wide range of outdoor activities. You need to discuss where the truck(s) will locate. You can’t just park a food truck anywhere and start selling. In downtown you typically need a special permit for the location, and there are already a lot of trucks that are permanently parked around the city. I’m not sure what other municipalities require, but I bet it’s similar. So choose the locations where you would want to set up and in your operations plan you will need to discuss your schedule – when you will be where. If your customers can’t count on you sticking to a schedule they will never know when to find you.

• Site Expenses

The establishment of the commercial kitchen rental will cost approximately $114,000; the permit and legislation will cost $400, the initial food bill will be $500, and $300 will be paid on the parking fees. Other $300 is expected to be used on the miscellaneous costs (Yoon& Chung,2018). The equipment will cost about $30,000, and the remaining charges and the investors intend to have about $10,150 for cash-on-hand on the starting date.

• Market Potential

The food truck business has been in existence since the beginning of the mid-1990s, and its popularity has significantly increased over time. In 2018 there was more than 30,000 food truck countrywide, and the number is expected to rise by about 20% in the next five years. This looks like you need a citation?According to the market statistics, the food industry will be worth more than $2.2 billion in the next six years. There are about seven food trucks in operation in Victoria, and those operating in the surrounding cities are about eight (Yoon& Chung,2018). However, these food trucks provide limited food products at high prices and are only in operation at little business hours.

According to a market survey, according to market survey, consumers in Victoria BC needs less costly food varieties, lager portion, and a wide range of food offering at a single establishment. Therefore, it intends and is highly prepared to satisfy these factors in conjunction with the flexibility to the business hour that will separate the food truck from the existing competition (Yoon& Chung,2018). Further, the highly increased demand for snacks and fast food in urban centers establishes a food truck business that might likely be a successful opportunity. Street food usually has an emotional connection with almost every person. The majority of urban areas have a great love for street foods, especially the working people. Therefore, the food truck has obtained great customer attention in metropolitan towns. So market potential should yield you with how large the market is. What is the size of the opportunity you are entering into? You say that the “food industry will be worth more than $2.2 billion in the next six years”, is that specific to food trucks, or the entire food industry? If this is where it will be in six years, where is it now? Is this for Canada, North America, Victoria, British Columbia? If you could specify this market more accurately then you can draw some conclusions about the Victoria Market. If the number is $2.2bn for Canada, and there are 35,000,000 million Canadians then you can suggest that the value of the food truck market is roughly $62.86 per person. Greater Victoria has roughly 380,000 people, so the entire market for greater Victoria could be considered to be $23,885,714. Or you mentioned earlier that adults between 19 and 35 spend $400 on food truck goods per month (I’m not sure I believe this number, it seems very high to me), so if you knew how many people there were in the population in this group you could multiply that by $400 to get the potential market number.

• Competition

There are several local food trucks in the town which selling similar food products. Though the food portion is smaller, and their prices are slightly higher. Some of the competitors include Taco Justice, Deadbeetz Burgers and etc try and avoid things like etc and such as. Tell the reader exactly who the competition is. You should be able to select at least three direct competitors and two indirect competitors for your business. A good way to organize a summary of that information is in a competitor analysis grid – a table showing the qualities you are talking about. Oh-Qui food truck has employed fundamental technological processes in food preparation; hence, it provides quality food and brilliant service, which will likely give the food truck an added competitive advantage (Roy et al.,2018) I don’t know what this means. How has technology changed the way your food truck operates? You are going to have to be more specific. Oh-Qui food truck upholds a high level of consistency in its recipes for all products indicated in the menu. Oh-Qui food truck also maintains high standards for food portion and presentation. Ok, these are things you will want to address in your Operations Plan. What are your SOP’s for food handling, portion control and presentation?

• Sales Forecast

Oh-Qui food truck estimates to make a monthly profit ranging from $20,000 and $50,000. According to the market analysis, the current food trucks that are smaller in size make considerably $5,000 to $16,000 every month (Okumus et al.,2018). The highest business performance is expected at the start of the business due to the prevailing pandemic that has restricted the operation of hotels, increasing the demand for food trucks. The annual profit estimated is more than $100,000 in annual gross revenue. You are going to have to be careful with your language. Profit and Revenue are NOT the same thing. Revenue is the money you bring in from the sale of goods/services. Profit is what is left over after pay for all the expenses you incurred to generate that revenue. If you are making a profit of $100,000 per year from a food truck then you must be doing about $1.1million in sales. That’s just over $3000 per day, or about 300 meals at an average of $10/meal. Does this sound reasonable? I can’t check your references because you didn’t supply the hyperlinks. Lastly, you need to actually forecast your first years sales. There are several methods you could use (see the example in the text book for Pie in the Sky), but you need to settle on one method and then forecast your sales based on that method.

• Protecting The Business

One technique used by the Oh-Qui food truck to safeguard its equipment from theft is parking the truck in open areas to discourage individuals with evil intentions from getting near the truck. The truck is situated at a location where there is immediate traffic and lots of people passing by ok, where is this?. Oh-Qui food truck has regularly inspected by police or a security company police won’t provide this service – you will have to pay for a security company. Although the space is minimal in the truck, the Oh-Qui food truck has a commercial kitchen that has occupied minimal space. All the staff are trained on observing safety rules to prevent them from injury and reduce the loss of contaminated food. Probably need insurance both as a vehicle and as a business.

Part 3: Marketing new section, new page

• Image

In enhancing the business image, the Oh-Qui food truck uses the social media platform for marketing its products. It also delivers quality products to customers to improve and maintain its business image. Image is what you portray to your customers. It’s the way you want them to feel about you. Try and choose three adjectives that describe your business. Like, tasty or good value. Your image is reflected by things like your business name, your logo or imagery, your pricing strategy, distribution strategy and yes, your promotional strategy. But this section is meant to describe what the image you are going for is, and then in the next sections you will describe how you will reinforce that image through promotions etc.

• Business Name

Oh-Qui food truck is the business name of the food truck, which is usually designed in cohesive design for it to be a reputable brand and an exclusive offering. I don’t really understand what that means. How does your business name support your brand image? What does the name say to your customers? When they read the name, what do they think of?

• Product Mix

Oh-Qui food truck employs the 4Ps marketing model, which enables to determine when to launch the truck and find the new market of operation. 4Ps are also used to assess the current marketing strategy. One of the 4Ps is the Product: the products represent the menu items and services provided by the food truck for sale to the local market. The products are developed based on improved design, quality packaging, features, customer service and another successive after-sales service (Auad et al.,2018). The second P represents the Place: the distribution areas, location, and approaches used for food truck products to the customer. It also includes the food truck stops points; the third P is the Price, representing the amount of money that customers must pay to buy the food truck products. The fourth P is Promotion refers to adverting the products to the target customers. It entails communicating the value and benefits of the products, which is mainly done through social media platforms and flyers. None of this address the topic, which is product mix. You don’t need to explain to me what the 4 P’s are. Nor to anyone reading your business plan. You do, however, need to describe the product mix in the section called “product mix”. You mentioned burgers and fries and house baked pizza I think earlier. Here’s a good place to list your core menu items and the prices you will charge. You don’t need to list every type of soft drink for example, but that you offer them.

• Pricing

Food truck catering expenses range between $10 and $35 for every customer. Therefore, the cost of catering to 100 customers is about $1,000 to $3,500. This section is meant to discuss your pricing strategy. There were three options discussed in class 1) penetration pricing 2) price skimming and 3) status quo pricing. There are also two other factors to consider, 1) cost based pricing and 2) value based pricing. Cost based pricing means that you take the cost of all of the ingredients in the recipe to make an item and then you mark it up by a certain %. If your business model is to apply cost based pricing, and your budget for food cost is 35%, and it costs you $3.41 to produce a burger then the price you charge your customers for that burger will be $9.75 ($3.41/0.35). If you apply value based pricing, it means that you try and charge as much as you can to the point where customers don’t see value anymore. If you know that customers are generally willing to pay $10 for a burger, then you will charge $10 for all your burgers, even though some of them might cost you $5.50 to make and others might only cost you $2.50 to make. Penetration pricing is charging less than competitors to try and gain market share. This is a risky strategy as customers can think of you as a discount producer and won’t be willing to pay a higher price if you try to raise them later. So if you are thinking about being a low cost leader you need to be prepared to always be the lowest price. Price skimming is the opposite, it’s charging a higher price than competitors by going after the premium part of the market. This means having exclusive items, higher quality or service etc. Status Quo means pricing your items similar to the competition, and this is typically the way cost based pricing businesses work, as the cost of ingredients are pretty standards, and most people try and operate around the industry average COGS. So if industry average food cost is 35%, then you should probably work out your pricing through cost based method.

• Distribution

Presently, the distribution of the food products is done through two food trucks ok, this is the first time you have mentioned two trucks, you should probably note this earlier in your plan., which will be situated at several locations to meet high demand two trucks can only be located at two locations. In the first week, the food trucks will be positioned in the central business center (Schifeling & Demetry, 2021). So both trucks downtown during the week and then both trucks out of town on the weekend? During the weekend, the food trucks will be located at farmer’s markets and events.What if there are no events or farmers markets? However, if the increased demand outperforms supply, the Oh-Qui food truck will open food trucks. Sorry, you will buy more trucks? I am not sure I know what this means.

Distribution means how will you get your product to your customers. The answer is you will locate your business (because it is mobile) in close proximity to your target markets and they will come to you. The key here is to firmly establish who your target market(s) is/are, and where they are, so you know where to put your food truck.

• Promotion

Oh-Qui food truck has partnered with local market vendors to control a large customer base I don’t know what this means. What is a local market vendor and how does this relate to the customer base?. The food truck aims (remember, not what you might do, tell the reader what you will do) to provide discounts and samples and hand out tickets to clients who buy drinks at the Oh-Qui food truck what kind of tickets?. Moreover, the food truck hands out and hangs up leaflets in high-traffic zones throughout the first few months of operation. Oh-Qui food truck also plans to use traditional social media podiums to hold competitions and market publicity events of the business ok, which social media platforms and why (if you know who your customers are you can target them by using the medias that they use). Also, what will you do on social media? Pay for targeted ads, hire a social media influencer to review your product, just post pictures of the truck? Remember that to be effective on social media you either need to pay, or you need to have tens of thousands of followers.

• Promotion Evaluation

The food truck intends to increase its social influence and use three leading social media platforms for promotion evaluation. On its Instagram page, the marketing manager often posts food images. This has made the Oh-Qui food truck a perfect fit for sharing eye-catching and food on Instagram. Oh-Qui food truck invites people to like its pages to build a community. On Facebook, the marketing manager share tips, recipes, tips and inform people on the upcoming plans for the Oh-Qui food truck. Oh-Qui food truck also aims to run targeted adverts on Facebook telling people about the specific location where the food will be served. Oh-Qui food truck has built a community on Twitter and creates hashtags informing customers of the upcoming plans for the food truck. Ok, these are more suitable for the section above in promotion. Evaluation is “How will you know if your promotional tactics are working”? So, how will you know if your hashtag campaign has attracted any new customers? Or how will you know if your images on Instagram generated any new sales? If you can’t tell if your promotions are generating new/more business for you then you are likely wasting your money and time.

Overall Presentation (10): 6.9

Section 1 (25): 17.5

Section 2 (25): 16.0

Section 3 (25): 17.0

Mechanics (15): 12.0

Total (100): 69.4

References

Auad, L. I., Ginani, V. C., dos Santos Leandro, E., Nunes, A. C. S., Domingues Junior, L. R. P., & Zandonadi, R. P. (2018). Who is serving us? Food safety rules compliance among Brazilian food truck vendors. International journal of environmental research and public health, 15(12), 2807.

Holmes, M. R., Dodds, R., Deen, G., Lubana, A., Munson, J., & Quigley, S. (2018). Local and organic food on wheels: exploring the use of local and organic food in the food truck industry. Journal of Foodservice Business Research, 21(5), 493-510.

Okumus, B., Sönmez, S., Moore, S., Auvil, D. P., & Parks, G. D. (2019). Exploring safety of food truck products in a developed country. International Journal of Hospitality Management, 81, 150-158.

Roy, H., Aboukinane, C., & Das, S. (2020). Climate Change and the Response of Food Truck Industry: A Study on Vancouver Visitors’ Destination.

Schifeling, T., & Demetry, D. (2021). The new food truck in town: Geographic communities and authenticity-based entrepreneurship. Organization Science, 32(1), 133-155.

Yoon, B., & Chung, Y. (2018). Consumer attitude and visit intention toward food-trucks: Targeting Millennials. Journal of Foodservice Business Research, 21(2), 187-199.

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