Study is about company that is perceived to be opened is a “Coffee & Bakery” joint names Noah’s Coffee & Bakery Outlet

Business Proposal

The company that is perceived to be opened is a “Coffee & Bakery” joint names Noah’s Coffee & Bakery Outlet (NCB). The first outlet of this brand will be located in the downtown Washington area and will be first of its kind of Speciality shops in that region serving both coffee & baked products under the same brand.

Rationale behind Opening a Coffee & Bakery Joint

The US Coffee market is a thriving industry which has seen unprecedented growth in the recent years. The growth rate of coffee consumption in US has been approximately around 15% in the year 2015-2016 with a total market valuation of approximately $20 Billion for the same year. Along with the increase valuation, the number of Speciality coffee shops have also increased manifold in the recent years. 

If the bakery retail sales are considered the total market valuation is around $30 Billion with a constant CAGR of 5-6%. If both the markets are combined, the actual market valuation of the coffee-bakery joint industry could be found which is somewhere around $50 Billion with an average CAGR of 10%. Thus NCB wants to operate in this particular hybrid industry and thereby leverage upon the unprecedented growth. As per the market research study by Mintel, the top 10 to 15 players in each industry makes up almost 75% of the total market valuation with the rest of the players taking up the rest of the market. By applying the concept of equal distribution of the market among atleast 25,000 players in the remaining market (from the above estimation of 31,490 Speciality shops)  (Stratton & Werner, 2013), the predicted market share of the outlet in the first year is predicted to be $500,000 in the first year which will increase as per the Industry CAGR of 10%. The income statement calculations will be based out of this prediction only. The rationale behind opening the shop in the Washington downtown area is that, the area is strategically located in between different universities & corporate offices where people like to get themselves involved in daily indulgences. Thus the first outlet will be strategically placed to leverage upon the taste of the consumers.

Sales & Marketing Strategy

Marketing Strategy

Major points on which the marketing strategy of the company will be based are:

• Differentiated Products

• Product(s) Customization facility for the customers

• Quality of the coffee & baked products being served

• Minimum pricing in order to make the products affordable to most of the social classes

Targeting Strategy

The target market of the company would comprise of people from the age of 15 to 45. The outlet will try to attract the students from the universities along with the young adults working in the corporates. However the products would not be differentiated on the basis of class or social outlook but of course the pricing will be made intelligently to make different products available for different income groups (Xi, 2016).. 

Stakeholder(s) of the Business

For a business to be successful & sustainable, the business owner must give equal importance to all the important stakeholders who form a major part of the company ecosystem. As per the perceived coffee & bakery joint under consideration, the important stakeholders are:

Stakeholder(s) Analysis

As per the list generated above, the stakeholders could be analyzed under two categories of Power & Interest and suitable steps could be taken to manage them accordingly. 

Assumptions:

• The company opens its first store on 1st January, 2018

• The company has not made plans for further expansion in the recent future

• The Sales & Advertising costs comprises of the costs from the Sales & Advertising costs table

• The Payroll Costs & COGS are estimated as per standard figures & margins

• Interest rates estimated as per average rate in the industry on a particular loan amount

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