Ireland: Healthy Breakfast Delivery

Prepared by Ksenia Udovitskaya and HSE MIB team

The product

WHAT WE OFFERWe offer a range of products either in standard sets or customized sets suitable for breakfast. All the products are healthy and with a high nutritional content that will provide with the right amount of energies and a good taste to start the day at the best.

Beans, Eggs, Potatoes, Mushrooms, Ham, Sandwiches, Cereals, Oatmeal, Mixed Nuts, Greek Yogurt, Eggs, Waffles, Protein Pancakes, Fruit, Honey, Croissant.

1) Choose your meal plan: standard or customizeda. 1 mealb. 4 meals per weekc. 7 meals per week2) Order and receive it at your address3) Eat and Enjoy!

Service Description: How it works

Uniqueness of the service:• Fresh, healthy and comes to your house on time• We serve only breakfasts and snacks• Very high quality foodCompetitive advantage: time delivery and fresh products at competitive prices

Service in a nutshell

Business model

Picking, that is sale of related goods or services together. This model is characteristic of the institutions of a fast food selling several separate dishes as lunches, our model gives the chance to order not only products of local preparation, but also fresh products from other countries (for example fruit)

OUR MARKET

Incidence of having Breakfast in the morning

Monday Tuesday Wednesday Thursday Friday Saturday Sunday

82% 89% 86% 86% 90% 87% 90%

statista.com. Incidence of having breakfast in the morning in Ireland in 2016, by days of the week

87%

13%

Consumer Trends and Needs: healthy food• Healthy breakfast items are of primary

importance when shopping for breakfast items, with consumers looking to enhance their own health through food choices

• 23% of people have changed what they eat for breakfast recently, 60% of them making a healthier choice, 15% having a bigger breakfast.

Consumer preferences have changed towards healthy eating

Healthier choice

Having hot or cooked breakfast

Eating instead of tea/coffee

Bigger breakfasts

Breakfasts on the go

Breakfasts out of home

0% 10% 20% 30% 40% 50% 60% 70%

65%

26%

22%

15%

12%

10%

statista.com. Share of changes made by individuals in Ireland and Great Britain, 2016

Nutrition FactsPer 100g of product; all the figures are expressed in grams

Product Calories Fat Protien Carbohydrate

Almonds 575 49 21 22

Greek Yogurt

87 5 7 3

Oatmeal 307 5 11 56

Waffle 312 10 7 49

Trending food in Ireland (% of growth)

Gluten free bread

Protein shakes

Homemade sauces

Porridge Smoothies Yoghurt Honey0%

5%

10%

15%

20%

25%

30%

35%

40%37%

35%

31%

28%26%

24%

6%

Type of distribution 2010 2011 2012 2013 2014 2015

Store-Based Retailing  98,2 98,1 97,9 97,9 97,7 97,6- Modern Grocery Retailers  80,9 80,4 80,3 80,3 80,4 80,4

- Hypermarkets  2,8 2,8 3,7 3,7 4,4 4,6

- Supermarkets  64,6 63,9 62,9 62,7 62 61,4- Independent Small Grocers  6,5 6,4 6,4 6,3 6,2 6,2Non-Store Retailing  1,8 1,9 2,1 2,1 2,2 2,4

- Internet Retailing 1,4 1,5 1,6 1,7 1,8 1,9

Distribution of Health and Wellness by Format in Ireland Value 2010-2015

Consumer Profile• Demographic: male and female, any age, cities, any ethnicity

• Socioeconomic: students, workers, middle/high income

• Brand affinity: identify themselves as people who enjoy life, still keeping a balance.

• Psychographics: healthy and satisfactory lifestyle, active and sporty personality

• Generation: baby boomers, generation x and y, Millenium.

• Geography: main Irish cities (Dublin, Cork, Limerick, Galway, Waterford)

• Benefits sought: healthy food, time saved.

Internet retailing in Ireland by category

Apparel and

Footwear

Beauty and Personal

Care

Food and Drink

Consumer Electronics

Home Care Consumer Appliances

Media Products

Toys and Games

0100200300400500600700800

2010

2015

Forecast (2020)

euromonitor.com. Internet retailing in Ireland, Jan. 2016

Market size

• Almost 20% of the land is devoted to farming. • The staples of the Irish diet have traditionally been

potatoes, grains (especially oats), and dairy products.• €26bn turnover in the sector• €10.5bn worth of exports in 2014 to 120 countries• Half of exports by indigenous Irish companies• Destinations – UK 40%, rest of Europe 31%,

international markets 29%

Marketing Plan

Marketing budget Jan-17 feb-17 mar-17 apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 nov-17 Dec-17 Total

Branding € 3.600 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 3.600

Website € 4.010 € 10 € 10 € 10 € 10 € 10 € 10 € 10 € 10 € 10 € 10 € 10 € 4.120

Social media ads € 1.500 € 1.500 € 0 € 0 € 1.500 € 1.500 € 1.500 € 0 € 1.500 € 0 € 0 € 1.500 € 10.500

Content marketing € 2.000 € 1.000 € 0 € 1.000 € 0 € 1.000 € 0 € 1.000 € 0 € 1.000 € 0 € 1.000 € 8.000

Traditional marketing € 2.700 € 0 € 2.700 € 0 € 2.700 € 0 € 2.700 € 0 € 2.700 € 0 € 2.700 € 0 € 16.200

Events € 4.500 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 4.500

Total€

18.310 € 2.510 € 2.710 € 1.010 € 4.210 € 2.510 € 4.210 € 1.010 € 4.210 € 1.010 € 2.710 € 2.510 € 46.920

Marketing Channels

Local press

Social media

Online (display and contextual)POSM

Sponsorship

Services that exist in London and Vancouver

Benchmark Analysis of Prices

Product Vancouver London

Smoothies C$ 8 = € 5.5 £3 = € 3.3

Pancakes C$ 12.5 = € 8.6 £ 8.5 = € 9.4

The classic set C$ 12 = € 8.2 £ 6.25 = € 6.9

The French burger C$ 14.3 = € 9.8 £ 6.5 = € 7.2

Fruit plate C$ 12 = € 8.2 -

Our PricesProduct Price

Smoothies €4

Protein Pancakes (4 pieces) €3.50

The Classic Set €7.50

The French Burger € 7

Fruit Plate €5

Protein brownie € 3.50

Mixed nuts (50 gr) € 2

Greek yoghurt (150 gr) € 2

Porridge € 3

English breakfast: Low-fat sausage, 2 boiled eggs, beans, 2 whole bread slices, 1 tomato

€ 7

OUR SET

Porridge at choice• Porridge with cacao• Porridge with Greek

yoghurt• Porridge with honey• Porridge with milk• Porridge with fruit

Smoothie at choice• Energizing• Low-calories• Anti-oxidant

Sweet at choice• Protein brownies• Protein pancakes

€10

Operational Plan

Manufacturing Operations

Manufacturing is partially on us, but we are going to lease a restaurant’s kitchen when it will not be used, i.e. nights and early mornings, subcontracting the cooks.

We will entirely provide: • packaging• online order in website• punctual delivery

We are going to establish partnerships with local farmers and producers to provide our clients with genuine and natural products.

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New Materials Usage and PackagingSuppliers of new materials (Ireland)Scallan's Food Packaging, Du Pont, Paptic, Fispak (nnovative food solutions), Greenman Packaging

Key purposes of packaging• Protection in relation with tampering resistance, special physical, chemical,

or biological needs• Preservation of food temperature • Purchasing a large volume of materials for cost efficiency • Placing a logo on packages

Types of materials Aseptic processing (Greek yogurt, whole eggs), boxes (cereals, sandwiches, ham), bags (potato chips, mixed nuts), hot food carton (Noodle Box Style) (potatoes, scrambled eggs), square clamshell box (burgers, waffles), flexible package (mushrooms, beans, fruits, honey, croissant), pallets (package of the order-delivery)

Environmental new material replacing paper and plastic, recyclable and resource efficient

Material originating from sustainably managed forests. These products include our coffee cups, kraft take-away boxes, bakery bags and sandwich wedges.

Cost of Manufacturing the Product

Manufacturing cost Burger cost price (per product)

Direct material cost (products price, packaging)

Product price. Retail prices. Meat (100G) €1.0 + bread €0.3 + sauce €0.3, salad €0.2, tomatoes €0.2 = €2 (1)Packaging. Sugarcane square clamshell box €42 (200 units) = €0.21, carry bag (200 units) €18 = €0.09 per unit

Direct labor cost (salary, food preparation space rent)

Salary. Kitchen Chef €10.20 per hour (2)15 min. per dish = €2.5Newmarket Kitchen space rent €22 per week, €4.4 per day, €1 per hour = €0.4 (3)

Manufacturing overhead (wash-up, taking out the trash)

5% from a sum = €5.2 * 1.05 = €5.46Total (burger cost) = €5.46

(1)Tesco stores average prices(2) Payscale, currency converter(3) http://www.newmarketkitchen.com

Inventory usage. All unused products in the cooking process will be sent to underprivileged citizens.

Partnership

• Partnership contract with a delivery company (Delivery)• Partnership

contract with restaurants (Food Preparation)

Sharp Decrease in Costs•No investments and maintaince of equipment•Avoidance of the minumum required amount of working hours per employee

Raw Materials and Suppliers

• Farms• Large vegetable

warehouses• International

suppliers of fruit• Dairy farms

• Porridges• Fruit• Dairy products• Vegetables

Transportation

• Needs: on-time delivery

• Demand coverage from 6:00 to 11:00

• Partnerahip with Ubereats (average delivery time 34 min.)

• Semi-variable cost

LocationOperational Location: 3 restaurants respectively located

at South, North, and West of DublinThe restaurants will be rented from 5:30 to 11:00, 7 days

a week.

Administrative Location: in any office of DublinThe office will be rented as well all the hoursOffice Equipment will be bought (computers and

techological devices) and the rest will be a part of the rent (office furniture)

Costs

Fixed Costs• Rent office = 500€ per month• Utility = included• Internet & Telephone = 40€ per

month• Salaries = Freelance Lawyer 900€

per month, Data Analyst 900€ per month

• Asset Depreciation = straight-line depr. 10% per year

• Chef = 2000€ per month x 3• Kitchen space rent = 90 € per month

x 3• Office Equipment = 80€ per month

Variable Costs

•Cost of Good Sold = 35% of Revenues

•Taxes = 12.5% of EBT

Semi-variable Costs

•Delivery = fixed part and variable part (to negotiate)

Organizational Plan

Our business will be a private limited company (Ltd), the business is a separate legal entity than the owners. The owners and managers are only liable for the business up to the amount they have invested in the company and are not liable for the debts incurred by the company unless they have signed a personal guarantee.

The company must be registered with the Companies Registration Office (CRO) and the company reports and accounts must be returned to the CRO each year. The shareholders' liability, should the company fail, is limited to the amount, if any, remaining unpaid on the shares held by them.

http://www.citizensinformation.ie/en/employment/types_of_employment/self_employment/setting_up_a_business_in_ireland.htmlhttps://www.cro.ie/Registration/Company

BUSINESS FORMAT

EEA and Swiss nationals do not require a business permission to establish a business in Ireland and they do not require a visa to visit, travel to, live or work in Ireland. Non-EEA nationals can establish a business in Ireland but they require permission to do so.

If you are not from EU, you should apply for a business permission. This is a written permission from the Minister for Justice and Equality that allows you to establish and engage in a business in Ireland for a certain period. If you are applying for a business permission to start a business in Ireland, you must meet the following strict criteria:• You must have at least €300,000 of your own money to invest in business in Ireland.• Your business must create employment for at least 2 Irish or EEA or Swiss nationals or at least

maintain employment in an existing business• Your business must add to the commercial activity and competitiveness of the State• Your business must be a viable trading concern and provide you with sufficient income to

maintain and accommodate yourself and any dependants without resorting to social assistance or paid employment for which a General Employment Permit would be required

NON-RESIDENT IN IRELAND

Source:http://www.citizensinformation.ie/en/employment/types_of_employment/self_employment/coming_to_set_up_a_business_in_ireland.html

How much statutory redundancy pay you get

The amount of statutory redundancy pay you can get depends on several things:• how long you've worked for your employer• your age• your weekly payYou have the right to:• half a week’s pay for each complete year of employment when

you were below the age of 22• a full week’s pay for each complete year of employment when

you were between the ages of 22 and 40 inclusive• a week and a half’s pay for each complete year of employment

when you were aged 41 or above

Salaries in Ireland

Minimum salaries:• Experienced adult worker €9.15 per hour• Over 18 and less than 2 years since first job €8.24 • Over 18 and less than 1 years since began first job

€7.32 • Aged under 18 €6.41

Average salary:• Individuals in the Republic of Ireland have an annual

gross income of €26,800

Salaries for our employees

Freelance Lawyer = €900 Data Analyst = €900

Chef = €2000

+1 Chef from October

In Ireland there is an income tax, a value added tax (VAT), and various other taxes. Employees pay pay-as-you-earn (PAYE) taxes based on their income, less certain allowances. The taxation of earnings is progressive, with little or no income tax paid by low earners and a high rate applied to middle to top earners, the top marginal rate of tax (including USC and PRSI) is 52%. However a large proportion of central government tax revenue is also derived from VAT, excise duties and other taxes on consumption. The standard rate of corporation tax is among the lowest in the world at 12.5%.

TAXES

Which taxes must the business pay?Where an individual carries on business as a sole trader, he or she is

obliged – under the self-assessment Pay & File system – to pay Income Tax, PRSI and USC on the profits of the business (as adjusted for tax purposes).

In addition, the sole trader must submit to the Revenue Commissioners monies due under the PAYE system, the VAT system and the Relevant Contracts Tax system (as appropriate).

Where two or more individuals carry on business in partnership, then each partner is obliged – under the self-assessment Pay & File system – to pay Income Tax, PRSI and USC on his or her shares of the profits of the business (as adjusted for tax purposes). In addition, the partnership must submit to the Revenue Commissioners monies due under the PAYE system, the VAT system and the Relevant Contracts Tax system

Where the business is carried on via a company structure, then the company is obliged – under the self-assessment Pay & File system – to pay Corporation Tax on the profits of the business (as adjusted for tax purposes). In addition, the company must submit to the Revenue Commissioners monies due under the PAYE system, the VAT system and the Relevant Contracts Tax system

Financial Plan

Year 1 January February March April May June July August Sept Oct Nov Dec Total

No of orders 300 600 700 800 900 900 900 900 1000 1000 1000 1000 10000

Total Income €3000 €6000 €7000 €8000 €9000 €9000 €9000 €9000 €10000 €10000 €10000 €10000 €100000

INCOME EXPECTATIONS 2017

• Cost of 1 meal = €10 • We expect 300 orders first month and 1000 orders per last month of a

year as we will have a massive promotion on the website and in social networks.

• From February the amount of clients will increase constantly

PROFIT AND LOSS STATEMENT (2017)

• Manufacturing cost per product = €2.2• We plan to purchase packaging wholesale (3000 items once) and the rest as required. Price per meal

= 0.09. • Delivery driver wage = €10 per hour. He can handle 2.5 orders per hour. 1 order = €4. One order can

include 3 meals. • Salaries and Wages = Freelance Lawyer €900, Data Analyst €900, Chef €2000. (+1 Chef from October)• Marketing (1th month): website creation, branding, social media, content marketing, traditional

marketing), support in the subsequent months

PROFIT AND LOSS STATEMENT 2017-2020

No of sold items: 2018 = 20000, 2019 = 30000, 2020 = 40000Marketing budget from volume of sales = 46% (first year), 27%, 20% and 18% in the next yearsBreakeven point in 2019

Bank Loan

€100,000.00

7 years

Bank of Ireland

Business Loan

6%

1 2 3 4 5 6 7Tot.5,000 7,000 18,000 19,000 19,000 19,000 19,000 106,000

Bank Loan

2017 2018 2019 2020 2021 Operations

Profit (loss) (64,801.00)

(724.04) 42,317.00 68,797.00 70,860.91

Add-back deprecitaion 204.00 204.00 204.00 204.00 204.00

Inventory (3,000.00) (5,000.00) (9,000.00) 10,000.00 11,000.00

Changes in AR - - - - -

Changes in AP (2,000.00) (5,000.00) (8,000.00) (8,800.00) (9,680.00)

Interest (5,000.00) (5,000.00) (18,000.00) (19,000.00) (19,000.00)

Net Cash from Operations (74,597.00) (15,520.04) 7,521.00 60,001.00 63,064.91 Investing

Sale of equipment - - - - -

Purchase of equipment (1,500.00) - - - -

Net Cash from Investing (1,500.00) - - - -

Financing

Dividends - - - - -

Borrowing 80,000.00 20,000.00 - - -

Net Cash from Financing 100,000.00 - - - -

NET CASH 3,903.00 4,479.96 7,521.00 60,001.00 63,064.91

Cash Beg (64,801.00) (724.04) 42,317.00 68,797.00 70,860.91

Cash End. (60,898.00) 3,755.92 49,838.00 128,798.00 133,925.82

Monthly Cash Flow 2017

DCF €891,103.70

Discount Factor (1/1+0.02)

TV

€7,195,236.36

Total Value €8,086,340.05

Discounted Cash Flow 2017-2027

Executive Summary

Healthy Breakfast delivery is a service based in Ireland.

Consumers in Ireland are getting more aware of the importance of a healthy breakfast but don’t have time to prepare it or to go to a cafè.

We will provide a quick delivery of healthy products and fresh fruit at competitive prices

Healthy Breakfast delivery is a service that will provide clients with healthy and ready-to-eat breakfast, which is one of the most important meals of the day. Our service will help people stay healthy and fit.

Nowadays 65% of Irish population is switching to healthier choices for breakfast, the most trending food are the healthy ones (gluten-free bread, porridge, smoothies, etc.)

We are five business students passioned about healthy lifestyle and we aim to make people’s lives better

Executive Summary

The company plans to build a strong market position in Dublin, due to the mild competitive climate in the area and the arising interest in healthy and organic food among the citizens of Dublin

Our primary strategy is to develop a strong and sustainable healthy breakfast delivery service as a convenient and cost-effective alternative for a restaurant or home cooking.

Exit Strategy: to sell for amount > tot. value

The breakeven will be reached after 2 year

Thank you for your attention!

If you have any questions please contact me: kudovitskaya@gmail.com