Business Plan PresentationStephen Leask § Arvind Kumar § Stephanie Hughes

ENGAGING SASKATOON’S ONLINE-SAVVY RESIDENTS & THEIR TASTEBUDS

WHAT IS ?

SOCIAL MEDIA MARKETING

Source: http://www.jerrys.ca/artisanicecreams/icecreams.shtml

UNIQUE PRODUCT

UNIQUE DISTRIBUTION STRATEGY

MOBILE FOOD SERVICES INDUSTRY

• 253 Businesses

• 79.2% Profitable

• Net Profit: 19.2% of Revenue

Sources: Answers Yahoo; 2006 Industry Canada Profile

SOCIAL MEDIA• Facebook, You Tube, Twitter, Flickr

– 48% increase in use– 49% Canadians use daily– 61% turn to social media when researching

potential purchases

Sources: http://www.upi.com/Top_News/2009/04/06/So-called-social-media-soaring-in-Canada/UPI-84441239050428/ ; cnet News Article

• “. . . it’s not just a registration system, it’s a marketing channel.”

• Businesses exploiting 2-way channel

SOCIAL MEDIA MARKETING

• “Utilizes social networking and user-generated content platforms to promote a product”

Sources: http://www.yoursearchadvisor.com/glossary.php

• “Involves creating and participating in a dialogue with the target audience, rather than forcing an advertisement upon them”

• “Social networks can be extremely effective channels for building product evangelism”

TARGET MARKET

• Ages 16 – 50• Actively engaged in social media

Source: http://weblogs.hitwise.com/heather-dougherty/2009/01/twitter_catches_up_to_digg.html

Source: http://www.facebook.com/ads/create/

MARKETING MIX

• $3.75 / serving• Mobile by name, mobile by nature

– High traffic areas– Major events– Social media channels

• Delectable treat uniquely distributed through customer engagement

• Facebook, Twitter, Signage

NAME: GELATO MOBILE

Message

Nudge

GELATO MOBILE WILL BE AT THE CENTRE MALL TODAY! FIRST 2 PEEPS TO FIND US AND SAY “GELATO” GET A FREE SCOOP!

OPERATIONS• Location: Mobile by name, mobile by nature

• Average Business Cycle

• Supply Analysis– Jerry’s Gelato– Mr Cool Ice Cream Truck Rental

• Capital Budget

• Operational Expenses

OPERATIONS(Expenses)

• Variable Overhead Costs– Maintenance for Truck $ 1,000– Fuel for Truck $ 3,511– Power for Cold Plates $ 250– TOTAL$4,761

• Fixed Overhead Costs– Rental of Truck $ 3,250– Insurance $ 1,000– Business License $ 100– Business Incorporation $ 265– Telephone/Internet $ 450– TOTAL$5,065

HUMAN RESOURCES

• Job Description– Owners– Coop Student (Supervisor)– High School Student

• Scheduling• Training• Labour Costs: $12.50/hr Average

FINANCIALS• Startup Capital: $6,000 ($2,000/owner)• No Borrowing Required• Positive Net Income Year 1 of Operations• Income and NPV highly sensitive to sales

• Estimated Customers (2009): 844 hrs of Ops x 20 customers/hr = 16,880

• Revenue = 16,880 x $3.75 = $63,300

FINANCIALSYear 2009 2010 2011 2012 2013

Sales Revenue 63,300 68,127 71,371 74,615 77,859

Cost of Goods Sold 25,257 25,888 26,535 27,199 27,879

Gross Margin 38,043 42,239 44,835 47,416 49,980

Total Expenses 29,279 29,739 35,382 36,266 37,977

Net Income Before Taxes 8,765 12,499 9,454 11,150 12,003

Income Taxes 1,632 2,265 1,713 2,020 2,175

Net Income(Loss) 7,133 10,234 7,741 9,129 9,828

Net Present Value (NPV) 30,612

IRR N/A

FINANCIALSScenario Analysis

Scenario NPV IRR Avg Annual Net Income

Base Case $30,612 N/A $8,813

Worst Case ($35,889) N/A ($6,990)

Best Case $91,668 N/A $23,342

  Worst Best

Change in Sales -25% 25%

Change in NPV $66,501.00 $61,056

CONCLUSION• Gelato Mobile is a unique and innovative

concept

• Based on financial projections, a small profit is possible

• Sales is the key critical success variable

• Delivery and marketing of the concept is crucial for success

Q & A