Group assignment - GYM

1.Introduction

It may be claimed that people's healthcare requirements are becoming more specific. It is a
prospective industry since functional food and healthcare goods are becoming more
interested in it.

According to data from 2019: More than 20 million individuals in Vietnam, or more than 21%
of the country's population, now consume functional foods. By 2022, this figure is projected
to rise by roughly 3-5%. This demonstrates that there is still room for growth in the functional
food sector in the years to come.

On the market today, there are many lines of functional foods supplementing with healthy
nutrients, gym people also have many product options to help increase training efficiency,
toned muscles and development. But still many people wonder, should supplement gym
food or not? Is this functional food good or bad?

What is gym food? Simply put, gym functional foods are also a form of food containing
important nutrients for the body. This is not a medicine, does not have a healing function and
cannot completely replace nutrition from daily supplements. Fitness supplements in
particular and functional foods in general will bring many health benefits if you use them
correctly

2.Market and management plan

*Market situation

Diabetes, heart disease, cancer, bone and joint conditions, allergies, digestive, neurological,
weight gain, respiratory, metabolic, visual disorders, etc. are examples of common
noncommunicable chronic diseases. Vaccines cannot prevent the disease; instead, a diet
rich in essential vitamins and minerals is required. Antioxidants also serve the dual purpose
of preventing disease and promoting good health.

Given the causes of chronic diseases and the advantages of functional foods, demand for
these foods is growing along with society's advancement; urban consumers have larger
consumption needs than farmers. In general, older people will have higher consumption
demands than younger people, and women will have more demand than men due to a focus
on beauty and health for both you and your family. Intellectual professionals will also have
higher demand than physical workers.

*Management plan

Task :
● Orientation of the company's activities
● Manage and make important decisions
● Carry out financial activities such as effective capital mobilization, use and control.
 ● Organize cultural and brand building activities for the company Verify important
information about the activities of employees and the Functional Food market
● Participating in forecasting functional food market fluctuations
● Create good relationships with customers, colleagues and social relationships.

*Target customer
We will give an example to make it easier to illustrate our target market, especially our target
customers.
● Gender: Female or Male
● Age: 22 years old
● Location: Vietnam
● Hobbies: Working out in the gym, Good for health, Eating a lot of functional foods
during the day, Watching healthy content
● Working platform: social network

3.Marketing mix strategies

Product
By locating high-quality products on the market from reliable import companies or reputable
pharmaceutical companies, you can create product distinctiveness. For certification of a
declaration of conformity with food safety rules, these goods must be registered with the
Food Safety and Hygiene Subdepartment. Distributing goods with attractive designs and
packaging requires that the information on the product labels be accurate and thorough in
accordance with established standards.

Pricing
Although the store's product pricing is reasonable and in line with the typical household
income in Hanoi, the product quality is exceptional.

Place
The place can be interpreted as the sites or venues where customers can interact with the
products when referring to the third P in the marketing mix. A direct distribution channel—a
store—might be crucial when it comes to the medical sector. However, the ongoing
pandemic situation has intensified a hot trend —mobile applications and Postmates websites
and apps.
In other words, the business may utilize and maximize both traditional and online distribution
channels. Additionally, the corporation would focus mostly on Ho Chi Minh City, Da Nang,
and Ha Noi during the inaugural stage. Our target market for restaurant opening locations is
persons between the ages of 25 and 40; businesses should set up shop next to other
businesses

Promotion
Last but not least, promotion is a crucial component of the marketing mix that helps to
connect with customers, encourage them to buy products, and maintain those connections.
In the early stages, businesses should focus on increasing brand recognition and developing
a positive customer perception of their brands. The company is leaning toward using Omni
channels in light of the Vietnam market. making a creative and original commercial (music
marketing) to showcase the brand recognition
Additionally, attractive user interfaces and a feedback button will be added to official mobile
apps and websites to allow users to share their thoughts on the company. As a result, we
can hone our weaknesses and maintain our competitive advantages. Loyal consumers can
accrue points through membership cards and mobile apps to subsequently redeem for
discounts. In the future, the business would use a UGC approach in which consumers could
contribute their opinions about the brands via contests on Facebook or Tiktok.

4.Financial plan

*Initial investment

Cost of setting up a company: initial investment capital is the first issue to set up a company.
In out business, we estimate that we need about 84,750,000 VND to start business. In
which, we will rent space for 7 million a month and the rest will be to buy necessary
equipment for store like glass closet, table,... to decor the shop

*Depreciation
Depreciation: total cost of equipment and decorations to our store is 72,000,000 VND.
Assuming the life of the building is 5 years, after this time we will sell the equipment and
decorations to collect money from salvage value. These device will be imported with the best
quality and reasonable prices. For 5 years, we will use and maintain these devices on a
monthly basis.So, after 5 years, we estimate the salvage value is around 5,500,000 VND.

*Cost of capital

All initial investment cost will be contributed by all 6 people and no additional bank loans are
required. The total amount of money we spend to open and operate the shop will be
400,000,000 VND. The rate we estimate is around 7%. We estimate the rate base on the
interest of bank ( 5%).

*Cost of goods sold

COGS: Since our target customers are almost people who want to care about their health.
Besides providing main products to support gym, we also provide some other related
products like Vitamins and minerals or Omega 3 fish oil . So that , we estimate the cogs of
one month is around 244,500,000 VND and we will spend that money to import goods.

*Operating expense
Operating expense: In the first year, many expense will incurred monthly to run our business
such as marketing and selling promotion, total salary (we will hire 2 employees, one morning
and one evening).... So, average operating cost will be about 261,500,000 VND a month.

*Expected earning

We assume that our business has a growth rate is 15%-10%-5% with good condition,
average condition and bad condition respectively. From that rate, we has build our business
with 3 expected growth rate.

*Free cash flow table

According to the 3 cases we expected growth rate to be 15%, 10% and 5% respectively for
good, average and bad.
We will deduct working capital of about 10 million VND. We assume the shop operates well
and does not need this expense. In addition, our depreciated assets are about 13 million a
year. After 5 years, we will sell this property and expect to earn 5 and a half million. This
amount will be added at the end of the 5th year
Overall, our 5-year project has shown positive signs and grown steadily each year.
*Income statement
From the above 3 assumptions, we build an income table for 5 years corresponding to the
above 3 assumptions.
5.Conclusion

First and foremost, based on the forecasts and preparations made above, it is clear that the
project of opening a functional food store for gym goers is entirely doable. When NPV, IRR,
and Payback period calculations are made, positive results in terms of return on investment
and profitability are predicted for the future.

Second, the project uses proper management models, and business and marketing plans, in
addition to good revenue growth, which aids in the project's ability to raise revenue and
lower selling and administrative costs