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Nutr404 Chemisteafinal
Nutr404 Chemisteafinal
Nutr404 Chemisteafinal
1.
[Company Summary]
1.1.
1.2.
1.3.
1.4.
1.5.
1.6.
Owners/ownership
Business Description
Product/Service Description
Company History
Current Position and Business Objectives
Mission Statement
2.
[Executive Summary]
2.1.
Team/Ownership structure
2.2.
Products/Services
2.3.
Company Facility
2.4.
Marketing Strategy
2.5.
Major Goals
2.6.
Health Repercussions
2.7.
Financial Potential Investments
3.
4.
5.
[Operating Plan]
5.1.
Location, Estimates, Costs
5.2.
Facility, Equipment, Energy Source, Costs
5.3.
Staff Shifts Chart
6.
7.
8.
9.
10.
1.
Company Summary
Chemistea is a one of a kind beverage retailer located in San Diego, California. This company
took the simple idea of concocting a variety of teas and complementing them with fresh
seasonal fruits to encourage consumers to be more health conscious and choosy about what is
in their beverage. This business caters to their customers by providing them the tools and the
choice to experiment and blend multiple ingredients in a cup. Each customized cup is
personalized; tailored to not only quench their taste buds, but to meet the boost of
nourishment an individual needs for the day.
1.1.
Owners/ownership
The business started out as a health conscious idea between six friends who shared a
passion for foods and nutrition. All six owners graduated from San Diego State
University and received their bachelors degree in Foods and Nutrition. The owners
are a mix of dietitians, chefs, and entrepreneurs who are well established in their
careers. With the six combined, their knowledge of the health benefits of the food
items served in the business will greatly help the marketing and sales efforts of
ChemisTea.
1.2.
Business Description
Product/Service Description
ChemisTeas products will have a pre-set menu for consumers who do not desire
to make their own refreshments; however, they will still receive a nutrient dense
beverage. The business will also provide a set menu for the snacks to be accompanied
with the tea. The purpose of the product is to have customers create their own
beverage through self-service. Individuals may choose from different types of teas, hot
or cold including: black, oolong, green/matcha, chai, lavendar/lavendar mint, earl grey,
herbal fruit, and rose tea. In season fruits will accompany the teas for natural flavor if
the customer desires. ChemisTea is aware that not everyone is familiar with different
tea flavors so the company will provide one-ounce samples when necessary. The
company has also partnered with Bread and Cie, a local bakery in downtown San
Diego, who will provide ready-made snacks to sell at the tea shop. This way,
contamination is reduced.
1.4.
Company History
elaborate research, the owners decided it was time to become business partners and
form an organization to participate in the evolving health movement.
1.5.
The partnership based business is equally divided between the six owners.
ChemisTea is currently in the process of becoming a full-fledged establishment. The
owners of ChemisTea have selected an outstanding corner caf location with a large
outdoor patio located directly across the street from the new Waterfront Park.
Numerous residential units surrounding this area include Breeza, Ariel, and Bayside.
This location is of walking distance to the heart of Little Italy. ChemisTea will be the
first tea room of its kind in Little Italy, San Diego.
1.6.
Mission Statement
2.
Executive Summary
2.1.
All six owners have complete equal partnership within the business, yet each
will have a different role in the business ranging from dietitians, chefs, and
entrepreneurs.
2.2.
Products/Services
To keep up with the current health trend, ChemisTeas unique products and
services shine using the traditional idea of drinking tea, accompanied with the
innovative idea of mixing tea with fresh fruits. Customers who are particular about
what they eat or drink now have the healthy option of choosing what they want in
their beverage. ChemisTea aims to be the first tea shop to provide individuals a
healthier dose of caffeine instead of the typical coffee, energy drink, and other sugary
drinks. Instead of consuming processed foods and artificial beverages, ChemisTea
desires to promote healthier food and beverage choices in their customers diets.
2.3.
Company Facility
ChemisTeas 979 square foot facility is located across the popular Waterfront
Park where customers have the option of dining inside or outside on the patio from 9
A.M. - 9 P.M. The caf features granite countertops and stainless steel equipment
throughout its facility and implements plentiful shelving in order to save space. Hot
water heaters will be installed along with a three compartment sink. ChemisTea will
also utilize automatic tea brewers to brew tea at rapid rates.
2.4.
Marketing Strategy
The main strategies ChemisTea will utilize are social media, discounts, and the
favorable business location. Social media trends will not only attract online users, but
give the caf an edge to spread the word about the business. Discounts will be aimed
towards military personnel, college students, and those who use the online check-ins of
social media. In addition, at the start of a new season, ChemisTea will provide a
weekend day devoted to a set amount of lucky customers.
2.5.
Major Goals
ChemisTeas first major short term business goal is to repay start-up bank loans
and equipment expenses within the first year of company existence in order to
eliminate any financial barriers that may block the company from a profitable future.
In addition, ChemisTea aims to have at least 50 positive Yelp reviews within the first
year to help increase customer numbers and to remain a competitive business in the
market. ChemisTeas long term business goals include expanding to a second location
North of Downtown San Diego, and expanding ChemisTea's name in the foodservice
industry by opening up a bakery. The company hopes to achieve these two goals
within five years in order to maintain and expand ChemisTea as a successful company.
2.6.
Health Repercussions
ChemisTea prides itself on the high standards they have set in regards to
providing customers with a nutrient dense beverage with natural flavors and being
able to accommodate all kinds of dietary preferences all while being organic. The caf
has also joined the going green movement by using eco-friendly cups for their
beverages and partnering with Specialty Produce in participating in composting. Due
to the potentially hazardous materials involved while composting, all employees will
be educated and trained thoroughly to follow the Hazard Communication Standard.
2.7.
Financial Potential
Year 2 (2014)
Year 3 (2015)
Gross Profit
$563,500.00
$986,125.00
$1,153,766.00
Operating Expenses
$431,045.20
$454,185.20
$487,325.20
Net Income
$132,454.80
$531,939.80
$696,440.80
3.
Owners/Roles
Jasmine Adamos and Danielle Ballesta are well known registered dietitians who
work part time at Sharp Memorial Hospital. Joana Miraflor and Norman Santos are
business entrepreneurs who formerly worked with illustrious businesses in Las Vegas,
Nevada such as The Bellagio and The Wynn. Ilyn Mendoza and Krysta Landingin are
both co-directors of Point Loma Nazarene Universitys Exercise and Nutritional
Sciences department and have partnered up with local restaurants in downtown as
nutrition counselors and recipe developers. All six owners of ChemisTea will be
distributed into a sub-unit of two. There will be a pair of each of the following:
registered dietitians, recipe developers, and entrepreneurs who will divide all the
responsibilities of ChemisTea. With Danielle Ballesta and Jasmine Adamos being the
registered dietitians on the core team, ChemisTea will be credited as a healthy organic
tea business. The two owners will ensure all ChemisTea consumers are consuming a
healthy dose of antioxidants and nutrients by creating nutrient analyses for all the
products sold in shop. Krysta Landingin and Ilyn Mendoza are the recipe developers in
charge of the different teas and fruits being served to the consumers. These two
owners are also responsible for the labor, employees, and shipment orders for the
business. Having Joana Miraflor and Norman Santos on the core team as
entrepreneurs would benefit the business due to their networking and communication
skills. This sub-unit is responsible for the investments, financial analysis, and the
societys food and health trends.
3.2.
Employees
will be recognized as a team based on how they open or close the store. This tea
business strives to create an atmosphere where both customers and employees feel in
control; hence, ChemisTea emphasizes on the vision and values of the products being
sold. Employees will take customer feedback seriously, make the right decisions based
on the situation, and influence changes to make the company better. Moreover,
ChemisTea is technologically innovative in terms of offering their customers a touch
screen tablet that allows them to input the ingredients and processes the nutrient
analysis of their creation.
3.4.
Corporate Culture
4.
Product Description
The popularity of fruit smoothies with tapioca balls has spread throughout the
city of San Diego and ChemisTea has taken note of such. ChemisTea aims to provide
customers with an alternative beverage by having a set menu where customers make
their own combinations of teas and fruits. Teas will be either hot or cold and year
round fruits as well as seasonal fruits will be provided for natural flavor. Since
ChemisTea acknowledges that not everyone is exposed to different types of teas, the
company will offer one-ounce tea samples if the customer desires. In an effort to move
forward with sustainability, ChemisTea will also have their own line of reusable
tumblers (cups). To support neighboring businesses, ChemisTea has also partnered up
with Bread and Cie, a local bakery in downtown San Diego, in providing pastries to
compliment their teas. Having ready made pastries will reduce the risk of
contamination and ensure the customer is provided a safe product.
4.2.
Type of Service
ChemisTea will be a semi self-serve food company in which the customer will
choose what they want from items displayed on a counter and head to a central point,
the cashier, to pay for their items (Gregoire, 2013, p. 213). A self-service method of
running ChemisTea is ideal for one of our target populations (college students) time
crunch. The limited menu is beneficial to both the company and the consumer since
local food products yield higher quality and are less expensive than produce shipped
from further distances (Gregoire, 2013, p. 59). The company also aims to lessen the
processing of foods since processed foods involve more energy, packaging, and travel
further distances to reach the consumer. In recent times, companies have been moving
toward a start from scratch approach while using locally sourced products, making
companies more sustainable in menu planning and food production.
4.3.
Cost
Cost for 12
ounce drink
Price
Profit
Source
Oolong Tea
$13.00/
2oz
$1.15
$4.00
$2.85
In Pursuit of Tea
Herbal Fruit
Tea
$8.00/
2oz
$0.71
$4.00
$3.29
In Pursuit of Tea
Green/
Matcha Tea
$24.82/
2oz
$2.19
$4.00
$1.81
In Pursuit of Tea
Black Tea
$4.00/
2oz
$0.35
$4.00
$3.65
In Pursuit of Tea
$29.95/
10 items
$3.00
$3.50
$0.50
Apple Danish
The table above shows the costs of a few of the different teas ChemisTea offers
as well as one snack item, the apple danish. Oolong tea, herbal fruit tea, green/matcha
tea, and black tea will be purchased in bulk from In Pursuit of Tea with individually
packaged 2-ounce portions. 2.5 grams of tea leaves will be used for every six ounces of
water. The cost for a 12-ounce drink was calculated by dividing the cost of 2 ounces of
tea leaves by a factor of 11.33984. ChemisTea has decided to price small tea drinks at
$4.00 so profit was calculated by subtracting the actual cost of the tea from the set
price. Apple danishes are bought in bulks of 10 at $29.95, making the cost of each
danish roughly $3.00. Danishes will be sold at $3.50 yielding a profit of $0.50 per
danish.
Figure 4.3A
At ChemisTea, the tea can be bought in three different sizes: small, medium, and
large at 12, 16, and 20 ounce cups, respectively. The small size is priced at four dollars,
medium at six dollars, and large at eight dollars. The fresh fruit will be priced at 50
cents per ounce. In addition, each cup size will potentially include a maximum of four
ounces of fruit. For those who are looking to boost their nutritional needs and
purchase a large drink with the maximum amount of fresh seasonal fruit, ChemisTea
will offer a one dollar discount.
5.
Operating Plan
5.1.
ChemisTea has a core of eight pieces of equipment that are needed for start-up
and business maintenance. A total of $13,022.58 has been invested towards equipment,
and a reserve amount of funds have been saved for potential emergencies, which may
include equipment malfunctions and/or replacements. Equipment specs on usage were
calculated using an energy cost calculator. Energy requirement factors are based on
watts and are counted for total number of hours each piece of equipment will use per
day. These numbers are only estimates since monthly and yearly totals do not factor in
ChemisTeas six day business week rather than seven days.
5.3.
Table 5.3A
Equipment
Size
Quantity
Cost for
Equipment
Energy Requirements
Cost per
day/month/year
Kool-It
KBD-CG-40S
Refrigerated
Bakery Display
Case
10-3/8 in x
53-3/4 in
2.39
72.58
871.48
Kool-It KST-72-2
Salad Table
72 in table
0.92
27.92
335.17
True
Refrigerator;
Reach-in
35 cubic ft.
1.88
57.27
687.6
Chest freezer
19.7 cubic
ft.
1.35
40.93
491.44
Bloomfield
1226-5G Auto Hot
Water Dispenser
5-gallon
Bloomfield
8748-5G Integrity
Auto Tea Brewer
5-gallon
Total
5.4.
The schedule for the team members for ChemisTea will be unique. Each pair of
owners will be working twice a week. One time during the morning and once in the
evening. This will allow team members to learn and gain strengths from two different
perspectives. In addition to the team members of ChemisTea, they will be offering
three spots for interns who are Foods and Nutrition majors at local universities to
learn from the owners who are experts in the major and have plenty of experience in
their careers. These interns will also work closely with the owners twice a week.
ChemisTea is proud to present this opportunity to students in Foods and Nutrition.
Please Refer to Appendix A for Figure 5.4A.
6.
Since ChemisTea is a self serve tea caf, customers can choose which tea to
consume and what fruit to place in their drinks; therefore, this business accommodates
to all dietary needs and preferences. Fruits and sweeteners will be the only additional
options for customers to place in their tea. ChemisTea caters to all types of customers
such as those who have strict diets, those who prefer to count calories, those who need
to replenish energy, and those who prefer to consume organic grown fruits. According
to the Organic Consumers Association (OCA), people prefer to consume organic
products because it contains more nutritional value due to the absence of pesticides
(Why we should all eat more organic food, 2014).
6.2.
Environmental/Global impact
in the facility (Position of the American Dietetic Association: Food and nutrition
professionals can implement practices to conserve natural resources and support
ecological sustainability fortunately for ChemisTea, 2007). The registered dietitians on
the core team strongly support sustainable agriculture and community food systems.
They will educate their employees the bare minimum facts on agricultural basics and
the production methods that help provide ecologically sustainable food choices.
7.
Market Size
The popularity of coffee and bubble tea cafs have dramatically increased for
people of all ages to enjoy. With an abundance of these specific cafs throughout San
Diego, ChemisTea aims to bring forth healthier beverage alternatives to accompany the
booming health movement while providing a relaxing leisure atmosphere for military
families, tourists, students, and other San Diego residents.
San Diego is the second largest city in California. It is well known for its mild
climate, beautiful beaches, strong Naval association, and is home to roughly 3.1 million
residents as of 2013. From 2008-2012, the median household income in San Diego was
$63,373. ("2008-2012 American community survey, 2007).
The location of ChemisTea will attract locals, tourists, and students. Being
located across Waterfront Park, ChemisTea will attract tourists and families while also
attracting college students due to its proximity to San Diego City College. According to
the San Diego Grantmakers Organization, the military-related population in San Diego
as of 2010 was 229,024; an estimated 7.6% out of the 3.1 million residents in San Diego.
(Military families in San Diego County needs assessment, 2010). In 2010, San Diegos
educated population (high school graduate or higher) was about 1,717,414; an
estimated 85.4% of the population. ChemisTea aims to cater to this group, specifically
students at San Diego City College (which is in a close proximity with the college)
("2008-2012 American community survey, 2007). In 2012, more than 32 million
tourists enjoyed their stay in San Diego County. Some of San Diegos popular tourist
attractions are located near San Diego Bay. These attractions include beaches, a large
array of restaurants, the San Diego Convention Center and Waterfront Park.
Because tourists are not permanent residents, they were not included in Figure
7.1A. However, according to San Diego Tourism Research, tourists spend almost $8.4
billion at thousands of San Diego businesses during their visit (San Diego tourism
industry research, 2014). The tourism industry is one of the top revenue generators
and contributors to the San Diego regional economy of $184.3 billion in Gross Regional
Product, making tourists an important aspect of local businesses.
The tea industry in the United States has seen significant growth over the past
two decades and has experienced a prolonged period of innovation, popularity, and
increasing demand (Simrany & Goggi, 2013). In 1990, the total wholesale value of tea
flew around less than $2 billion dollars annually. The total wholesale value of tea now
soars well over $10 billion dollars annually as of 2013. Over the years, the tea industry
has seen an annual growth rate of ~2.5% (Simrany & Goggi, 2013). Forecasters of the
industry predict that growth will carry on this trend if not increase even more, as its
popularity may correlate with the current health movement for its healthy properties.
7.2.
Competitive Advantage
ChemisTea will be the first of its kind in Little Italy. This organization will draw
consumers through its uniqueness and variability within the menu. Consumers will be
able to design their drinks according to their personal taste through self service.
Instead of the typical tapioca pearls offered at boba tea shops, ChemisTea offers carved
pieces of fruit to sweeten and complement their selection of tea naturally. By doing
this, consumers will have an additional advantage of controlling the sugar content in
their drinks. With an assortment of different teas and fruits per season, there exists
many variations within their drinks. Research has shown that consumers are ten times
more likely to purchase if they are offered a decent amount of choices rather than
choosing just one choice or having too many choices (DeAngelis, 2014).
ChemisTea is walking distance from Waterfront Park; an area where many
families, residents, and tourists spend their leisure time. Consumers will be able to go
to ChemisTea after Waterfront Park closes at 7:00 PM. Operating hours at ChemisTea
last two hours after the park closes, which allows consumers to relax and unwind
together.
Registered dietitian practices include keeping up-to-date with the rapidly
changing environment in the health world, which requires skills in finding, evaluating
and sharing the most recent and accurate nutrition information (Nutrition
informatics, 2012). With a registered dietitian on site, consumers will be able to
inquire about the content of their drinks and have confidence that they are getting the
necessary nutrients in their drinks. Consumers will be getting a wholesome beverage
as a result of the knowledge and skills of these health professionals.
Though there are many strengths that puts ChemisTea at a competitive
advantage, there are some weaknesses that may pose as potential barriers. This
organization bases their menu off of seasonal fruit, which may limit the options on the
menu and may not satisfy each consumers preference. Consumers who may have
particular favorite fruits or combinations in their teas would have to wait seasons for
their prefered drink. Though ChemisTea will be the first of its kind in Little Italy, the
location may also put the organization at a disadvantage considering the target
market. It is in proximation with Waterfront Park, but is distant from many other
restaurants in the city. It is important to note that ChemisTea will be in competition
with several other popular coffee shops nearby. All of its competitors are fairly
popular and have a sufficient amount of positive reviews on social media such as Yelp.
Consumers may feel more comfortable opting to these more familiar and already
established sites.
Table 7.2A
Trend/Niche
Location
Hours
Products
Price
Areas to
Improve
The
Mudbar
Coffee
Cart
- Convenience
- Cart
Columbia
St.
7am-3pm
Mon-Fri
Coffee, tea,
baked goods
Inexpensive
Assortment of
coffees, pastries to
complement
beverages, low
prices
Should open on
weekends
Caffe
Italia
- Convenience
- Cozy facility
India St.
9am-6pm
All week
Gelato, coffee,
italian soda,
salads, panini
sandwiches
Less than
$10 per
item
Variety of drinks,
foods to
complement
beverages, cozy
atmosphere, open
all week for long
hours
OH! Juice
- Convenience
- Cart
- Natural
Columbia
St.
9am-6pm
Mon-Fri
Organic juice
(super herbs,
superfoods,
supplements)
About $12 a
bottle
Natural, healthy
and nutritious
connotation,
knowledgeable
consumers
Should open on
weekends,
should decrease
prices
Tonys
Coffee On
Broadway
- Convenience
- Cart
Broadway
St.
Unknown
hours
Coffee, baked
goods
Inexpensive
Unknown
operating hours,
more info
needed online
Table 7.2B
Strengths
Weaknesses
Opportunities
Threats
ChemisTea
Possible limitation
with seasonal produce
and customer
preference. Distant
from other city
attractions.
Health-based
business
Well-established
competitors nearby.
Caffe Italia
Well-established
company
OH! Juice
Limited hours/days.
Expensive.
Health-based
business
7.3.
Competitive Analysis
There are four main competitors with ChemisTea. These competitors all
specialize in serving beverages and are around the area of Little Italy. The Mudbar
Coffee Cart is a refreshment cart that is well-known for their unique caffeinated
beverages. Caffe Italia is a local coffee shop that takes pride in their high quality coffee
and espresso drinks. OH! Juice is a juice bar that consists of all organic, cold-pressed,
and raw juices. Tonys Coffee Cart On Broadway is another refreshment cart that
specializes in coffee and teas.
ChemisTeas main competitive advantage revolves around the companys focus
on consumer choice and customization. Customers have the full power to customize
their beverages and unlike The Mudbar Coffee Cart, Caffe Italia, OH! Juice and Tonys
Coffee On Broadway, ChemisTeas self-serve nature makes customization even more
personalized for the customer. ChemisTeas health and nutrition focus puts the
business at an advantage compared to its nearby competitors. Operating as a
health-based business will be beneficial, especially with the booming health
movement. Although OH! Juice also operates as a health-based business, the credibility
of ChemisTea as an establishment focused on the health movement is heightened due
to the assistance of on-site registered dietitians. With the help of these registered
dietitians, consumers will be more aware of the nutritional benefits that ChemisTea
beverages offer that OH! Juice beverages cannot (for example, ChemisTea beverages
contain more fiber than OH! Juice beverages).
8.
8.2.
Emerging technology
ChemisTea will have two touch-screen monitors that will provide a nutrient
analysis for consumer drinks. Consumers will be able to input the different ingredients
in their beverages and in turn, the program will calculate beverages nutrient content.
With this technology, consumers will be more aware of their nutrient intake, a key
component in ChemisTeas concept.
9.
Short Term
ChemisTeas business goals within the first year are:
-To repay the initial bank loans expenses for equipment for ChemisTea
-To receive at least 50 positive Yelp reviews
A few of ChemisTeas business goals includes repaying initial bank loans and
startup costs. ChemisTea will acquire a small business loan from a local bank. The caf
will be borrowing $10,000 and will repay the amount within one year of operation.
However, if ChemisTea does not receive enough capital, this barrier may hinder them
from achieving their goal. One way ChemisTea will try and alleviate this barrier is
through maximized advertisement. ChemisTea will be advertising to local hotels, on
social media, and to City College, which is only one mile away. Through advertising,
the business forecasts more foot traffic than without.
Another short term goal for ChemisTea is to receive 50 positive Yelp reviews
since they are trying to compete against traditional cafs. Receiving the corresponding
number of positive reviews may convince customers to try a more nutritious approach
to drinking tea. A barrier to this is that reviewing a caf on yelp is completely optional.
Customers may love the concept and enjoy the tastes of the teas and fruits that
ChemisTea offers, but may not have a Yelp account or have forgotten to review the
business. ChemisTea plans to mitigate this issue by reminding customers to review the
caf as they are leaving. In addition, customers that post a review on Yelp will receive
a free pastry to accompany their next drink purchase. Ideally, this incentive will bring
in more customers and gain at least 50 positive Yelp reviews.
9.2.
Long Term
ChemisTeas long term business goals within the next five years are as follows:
-To open a second location north of Downtown San Diego.
-To expand in the foodservice industry by opening up a bakery.
inflating. Competition between other bakeries would be the main obstacle for opening
a bakery. Other bakeries in the nearby area may already have contracts to different
local cafs or stores similar to Trader Joes; however, ChemisTea would be able to pitch
their ideas to these places when other opportunities arise. All in all, the owners of
ChemisTea have a positive outlook on the success of their business.
10.
Amount per
case (if
applicable)
# of cases/mo (if
applicable)
Cost Per
Cost Total
Rent
per month
2, 937.00
Insurance
per quarter
4,000
per month
750.00
Advertising
Section Total
500.00
$8,187.00
Important
Product
Supplies
Clear PLA Cups
+ Lids 12 oz
1000
145.00
725.00
1000
155.00
775.00
1000
165.00
825.00
Qualite Flexible
Drinking Straws
- Ind. Wrapped
1000
20
4.78
95.60
Karat Earth
Stock Print
Eco-Friendly
Paper Hot Cups
12 oz
600
80.50
724.50
Karat Earth
Stock Print
Eco-Friendly
Paper Hot Cups
16 oz
600
84.00
756.00
Karat Earth
Stock Print
Eco-Friendly
Paper Hot Cups
20 oz
600
68.50
616.50
Eco-Friendly
White Sipper
Dome LIds
1000
65.50
327.50
$4,845.10
Restaurant
Equipment
Kool-It
KBD-CG-40S
Refrigerated
Bakery Display
Case
10-3/8 in x
53-3/4 in
4,604.69
4,604.69
Kool-It KST-72-2
Salad Table
72 in table
2,335.18
2,335.18
True
Refrigerator;
Reach-in
35 cubic ft.
2,825.53
2,825.53
Chest freezer
799.00
799.00
Bloomfield
1226-5G Auto
Hot Water
Dispenser
5-gallon
680.88
1261.76
Bloomfield
8748-5G
Integrity Auto
Tea Brewer
5-gallon
598.21
1196.42
$13,022.58
Payable
Accounts
Specialty
Produce
per month
2,400.00
per month
750.00
$3,150.00
Other
Total
$12,000.00
First Month
$41,204.68
Cash
$65,000.00
Remaining
Balance
$23,795.32
Rent
Rental costs for the ChemisTea business location is priced at $3 per square
foot, per month. Total monthly rent is $2,937.00. This location is on a lease agreement
of ten years.
Insurance
Insurance for ChemisTea is priced at $4,000.00 per quarter. Payments
are made in full and at the first month of the quarter. For the first quarter running
from January 2013 through April 2013, $4,000.00 was paid in full.
Gas & Electricity
For the first month of business, ChemisTea paid an estimated total
of $750.00 to cover gas and electric usage of equipment.
Advertising
ChemisTea reserved a total of $500.00 to put towards advertisement.
Some techniques include print fliers, posters, business cards, and frequent customer
cards.
Important Product Supplies
This total cost covers the supplies needed to serve an
estimated amount of drinks to cover the first month of business. More product supplies
will be purchased as needed using the reserve balance discussed in the below section.
Restaurant equipment
This total cost covers the eight pieces of large equipment
needed to start ChemisTea. These pieces of equipment are vital to keeping the
Chemistea operating and in business. The total of $13,022.58 was a one time payment
for the initial purchase of equipment.
Payable accounts
ChemisTea is partnered with Specialty Produce and a local
bakery to help supply the companys fresh produce and baked goods. A total of $300 is
payable to Speciality Produce every Tuesday & Friday to cover inventory for the week.
This amounts to a monthly total of $2,400 and an annual total of $28,800. This price is
negotiable in order to adjust with the demand and availability of seasonal produce. A
total of $750 per month is payable to a local bakery, Bread & Cie, to cover a daily
supply of freshly baked goods to be served at ChemisTea. This amounts to a total of
$9,000 a year. Altogether, ChemisTea has an annual total of $37,800 in payable
accounts.
Other
A reserve balance of $12,000.00 has been set aside for emergencies, supply
needs that were not forecasted, and/or miscellaneous needs.
Cash
ChemisTeas founders and company owners have invested a total of $55,000
towards the start-up and maintenance of the company. An additional $10,000 have
been added from a 7(a) micro-loan which will be paid back within terms set with
lending bank.
10.2.
Year 1 (2013)
Sales
Year 2 (2014)
Year 3 (2015)
563,500.00
986,125.00
1,153,766.00
Beverages/Food Costs
(37,800.00)
(37,800.00)
(37,800.00)
Supply Costs
(58,141.20)
(58,141.20)
(58,141.20)
Energy
(8,400.00)
(8,400.00)
(8,400.00)
(188,260)
(221,400)
(254,540)
Rent
(35,244)
(35,244)
(35,244)
Maintenance
(10,000)
(10,000)
(10,000)
Insurance
(12,000)
(12,000)
(12,000)
Utilities
(68,000)
(68,000)
(68,000)
Micro-Loan
(10,000)
--
--
Amortization
(1,200)
(1,200)
(1,200)
Depreciation
(2,000)
(2,000)
(2,000)
(431,045.20)
(454,185.20)
(487,325.20)
$132,454.80
$531,939.80
$696,440.80
Operating expenses:
Net Income
Sales
Sales figures based on actual sales for YTD 2013 and forecasted thereafter. The
forecast for year two represents a 75% increase compared to the previous year. The
forecast for year three represents a 17% increase from the previous years sales.
Beverages/Food Costs
and food products.
Rent
Maintenance
This is an estimated amount which is reserved to cover potential
restaurant renovations or needed fixings.
Insurance
Utilities
This is the estimated annual energy cost for ChemisTeas operating
Equipment.
Amortization
Depreciation
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Appendix A