Executive Summary
The westside of
South Gate has experienced explosive growth the past three years. Over 3,000
new residents live in the westside area. Area businesses are slowly
catching up with this new opportunity. Tsunami Pizza is opening a new
pizza delivery service that will focus on the westside area.
Currently, the
area's closest pizza restaurant takes up to 45 minutes to deliver a
pizza. Tsunami will cut the delivery time to no more than 20
minutes.
Tsunami will
offer a better pizza, at a lower price, and will deliver it hot to the
customer's door faster than the closest competitor.
1.1 Objectives
·
Capture the majority of the pizza
delivery business in the westside area.
·
Offer our customers a superior
product, at a low price, and provide customer service that is second to none.
1.2 Mission
Tsunami Pizza's
mission is to offer residents of the westside the best pizza delivery service
in the city.
1.3 Keys to Success
·
A superior product that will
promote customer loyalty.
·
A business location that will assure
that the pizza will be delivered quickly.
·
Delivery people that have great
customer skills.
Company
Summary
Tsunami Pizza
is a new pizza delivery service started in the city's westside area. John
Lindsay, owner of Tsunami Pizza, has seven years experience in the restaurant
industry. His focus is to satisfy the customer's demand for a quality pizza
that is delivered quickly with a smile. Tsunami Pizza will serve a seven
mile area with over 25,000 residents. Overhead will be kept low so that Tsunami
Pizza's prices will beat the competition. Delivery people will use their own
vehicles so the business will not have to purchase delivery vehicles.
2.1 Start-up Summary
The start-up cost of Tsunami Pizza will consist primarily of kitchen equipment. John Lindsay will invest $50,000.
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2.1.1 Company Ownership
Tsunami Pizza
is owned by John Lindsay.
Start-up Requirements
|
|
Start-up Expenses
|
|
Legal
|
$1,000
|
Kitchen Inventory
|
$5,000
|
Delivery Paper Products
|
$3,000
|
Leased Kitchen Equipment
|
$20,000
|
Insurance
|
$1,000
|
Rent
|
$1,000
|
Promotional Signs for Delivery
Cars
|
$2,000
|
Expensed Equipment
|
$0
|
Business Sign
|
$4,000
|
Other
|
$0
|
Total Start-up Expenses
|
$37,000
|
Start-up Assets
|
|
Cash Required
|
$5,000
|
Other Current Assets
|
$0
|
Long-term Assets
|
$8,000
|
Total Assets
|
$13,000
|
Total Requirements
|
$50,000
|
Start-up Funding
|
|
Start-up Expenses to Fund
|
$37,000
|
Start-up Assets to Fund
|
$13,000
|
Total Funding Required
|
$50,000
|
Assets
|
|
Non-cash Assets from Start-up
|
$8,000
|
Cash Requirements from Start-up
|
$5,000
|
Additional Cash Raised
|
$0
|
Cash Balance on Starting Date
|
$5,000
|
Total Assets
|
$13,000
|
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
|
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Capital
|
|
Planned Investment
|
|
John Lindsey
|
$50,000
|
Other
|
$0
|
Additional Investment
Requirement
|
$0
|
Total Planned Investment
|
$50,000
|
Loss at Start-up (Start-up
Expenses)
|
($37,000)
|
Total Capital
|
$13,000
|
Total Capital and
Liabilities
|
$13,000
|
Total Funding
|
$50,000
|
2.2 Company Locations and Facilities
Tsunami Pizza
will be located at the corner of 11th and Tyler. These two streets are
the area's busiest and provide easy access to our service area.
3.0
Products
Tsunami Pizza will offer a wide
variety of New York style pizzas, as well as sodas and fruit juices.
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4.0 Market Analysis Summary
The westside is a growing
middle-class area with 25,000 residents. A majority of these
residents are families of four or more. The average income for the
area is $38,000. The boom in the area is primarily in response to
new employment opportunities in the city's Westside Industrial Park.
Businesses that traditionally do well with this population have demonstrated
the potential for Tsunami Pizza. A neighbor of Tsunami Pizza, Magic
Videos, has been in operation in the area for a little over a year. Magic
Videos is the closest video store serving the westside area. Their sales have
grown by 40% due to its location and the absence of direct competition in
the westside.
With continued growth in the area,
opportunities to serve the westside residents will
increase. The company will sell predominantly to
individuals, but it will also accept some catering jobs to individual parties
and company functions in the westside.
5.0
Strategy and Implementation Summary
Tsunami Pizza
will use advertising to promote the business. We will use the local
westside flyer to advertise. In addition, we will hire people to hold
signs at the corner of 11th and Tyler. We will also use door handle flyer
promotion throughout the westside neighborhoods.
Our most important promotion will done in conjunction with Magic
Video. We will offer a two for price of one video coupon with each
purchase at Tsunami Pizza that can be used at Magic Video. Magic Video
will offer its customers a $2 off coupon that can be used at Tsunami Pizza.-->
5.1 Competitive Edge
Tsunami
Pizza's competitive edge is:
·
Location: Tsunami Pizza is
located in the heart of the westside area on the corners of 11th and
Tyler. These two streets are the area's busiest. The closest pizza
restaurant to the westside area is a fifteen minute drive. Tsunami Pizza can
deliver in half the time of its competitors.
·
Low Overhead/Lower Prices: Since
Tsunami Pizza only delivers pizza, its prices don't reflect overhead demands of
a traditional pizza restaurant.
5.2 Sales Strategy
The sales
strategy of Tsunami Pizza is simple. First, offer the customer a superior pizza
at a low price. Second, make sure that pizza is delivered quickly. Third, the
delivery people must work to create customer loyalty.
5.2.1 Sales Forecast
The following is the sales forecast for three years.
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Sales Forecast
|
|||
Year 1
|
Year 2
|
Year 3
|
|
Sales
|
|||
Pizza/Drinks
|
$162,500
|
$178,000
|
$195,000
|
Catering Income
|
$14,000
|
$18,000
|
$24,000
|
Other
|
$0
|
$0
|
$0
|
Total Sales
|
$176,500
|
$196,000
|
$219,000
|
Direct Cost of Sales
|
Year 1
|
Year 2
|
Year 3
|
Pizza/Drinks
|
$24,500
|
$30,000
|
$36,000
|
Catering Income
|
$1,400
|
$1,800
|
$2,400
|
Other
|
$0
|
$0
|
$0
|
Subtotal Direct Cost of
Sales
|
$25,900
|
$31,800
|
$38,400
|
6.0
Management Summary
John Lindsay will be the manager of Tsunami Pizza. John started as a
waiter at the city's famous Sweetwater restaurant. At the time, John was in his
junior year at Robertson University. He graduated in 1995 with a BA in history.
Soon after graduation, John was offered the position of shift manager at the
Sweetwater. He has held that position for five years.-->
6.1 Personnel Plan
The Tsunami
will have the following staff:
·
Manager.
·
One kitchen staff.
·
Two delivery staff.
Personnel Plan
|
|||
Year 1
|
Year 2
|
Year 3
|
|
Manager
|
$30,000
|
$34,000
|
$38,000
|
Kitchen Staff Member
|
$24,000
|
$25,000
|
$29,000
|
Delivery Staff (2)
|
$36,000
|
$37,000
|
$38,000
|
Other
|
$0
|
$0
|
$0
|
Total People
|
4
|
4
|
4
|
Total Payroll
|
$90,000
|
$96,000
|
$105,000
|
7.0 Financial Plan
The following is the financial plan for Tsunami Pizza
7.1 Break-even analysis
The following table and chart show the break-even analysis
Break-even Analysis
|
|
Monthly Revenue Break-even
|
$12,803
|
Assumptions:
|
|
Average Percent Variable Cost
|
15%
|
Estimated Monthly Fixed
Cost
|
$10,925
|
7.2 Projected Profit and Loss
The following table and charts show the projected profit and loss for three years.
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