Intro To Business Coffee Truck Project

1. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
1


Business Plan
By: Preston Hall


“Better Brew, Better Taste”

The Sleepy Armadillo Coffee House strives to create a welcoming
environment to both customer and employee. Our goal is to provide quality
products and services to our local coffee drinking community while doing it
in a genuine friendly manor.

2. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
2
BUSINESS PLAN OUTLINE

COVER PAGE ......................................................................................................................... 1
TABLE OF CONTENTS............................................................................................................. 2
EXECUTIVE SUMMARY ........................................................................................................... 3
GENERAL COMPANY DESCRIPTION ......................................................................................... 4
Business Philosophy ..............................................................................................................................................4
Business Form ...........................................................................................................................................................4
Mission Statement ..................................................................................................................................................4
Company Goals and Objectives .......................................................................................................................5
Management Philosophy ....................................................................................................................................5
PRODUCTS AND SERVICES ...................................................................................................... 6
Competitive Edge.....................................................................................................................................................6
Barriers to entry.......................................................................................................................................................6
MARKET ANALYSIS................................................................................................................ 7
Industry Description ............................................................................................................................................7
Marketing Preview .................................................................................................................................................7
Distinguishing Characteristics ........................................................................................................................8
Size of the Primary Target Market................................................................................................................8
Industry .........................................................................................................................................................................8
Market Share ..............................................................................................................................................................8
Competition ................................................................................................................................................................9
MARKETING PLAN............................................................................................................... 10
Marketing Objectives .........................................................................................................................................10
Brand management.............................................................................................................................................10
Distribution ..............................................................................................................................................................10
Pricing .........................................................................................................................................................................10
Management Plan.................................................................................................................................................10
Labor Force ..............................................................................................................................................................10
Management Philosophy .................................................................................................................................10
OPERATION PLAN ............................................................................................................... 11
Production Methods and Control ..............................................................................................................11
Location ......................................................................................................................................................................11
Licensing and Permits .......................................................................................................................................11
Risk Management .................................................................................................................................................12
Personnel...................................................................................................................................................................12
FINANCIAL REPORTS ........................................................................................................... 13

3. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
3
EXECUTIVE SUMMARY
Coffee isn’t just a drink, it's a way of life!

Mission Statement:
The Sleepy Armadillo Coffee House strives to create a welcoming environment to
both customer and employee. Our goal is to provide quality products and services to
our local coffee drinking community while doing it in a genuine friendly manor.

Our Vision
The Sleepy Armadillo Coffee Truck will be in association with our existing
coffee shop, Sleepy Armadillo Coffee House. The coffee house and coffee truck are
mock businesses, but for the purpose of this assignment I will base the numbers and
decisions I make about Sleepy Armadillo Coffee Truck as if the shop was real and in
my ownership. The Sleepy Armadillo Coffee Truck is in fact a start-up business, thus
my executive summary will focus on my experience, background, and why I chose
this venture, rather than giving company, product, and financial information.
My expertise is in the coffee making business. I own the Sleepy Armadillo
Coffee shop and have been managing it for 1 year now. During my time running this
shop I have made over 1200 cups of coffee and have had feedback from thousands
of customers. Our first year has been a profitable year and we are seeking to expand.
This is why we are venturing out into a coffee truck business. Our customers have
been adamant about how much they love our coffee and think that we should
expand to more locations. Since we are a new company we thought that a food truck
would be the perfect fit for us since it is less expensive than starting up another
store. In our area of Ashland Oregon there are currently no coffee food trucks. This
means that there is a need for a service like this in our area. The biggest buyers of
foods from mobile vendors are young adults and parents with children at home.
Those aged 25 to 34 are the largest consumers of snacks from mobile vendors,
spending an average of $ 44 a month. We will mainly focus on catering to street
locations, which take up 55% of market revenue according to Theresa Ehrlich at
SBDC.Net. This segment sees a large number of pedestrian traffic during peak
business hours. Our Coffee truck would stop at bust street corners, business
locations, parks, bus stops and other busy morning locations. We would make a
number of stops in a day starting at 5:30a.m.-12:00p.m. and also at 4:00p.m.-
7:00p.m. These are the most profitable times for coffee shops in our area where
most sales are made.

Our Hopes and Goals
Sleepy Armadillo Coffee Truck’s future plans consist of creating a multiplatform
reaching brand that would sell merchandise such as jackets, shirts, mugs, stickers,
and many other goods. We want to create not just good coffee but also a name for
ourselves. We also wish to expand our coffee truck business considering it becomes

4. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
4
profitable. Realistically we would like to have 5 trucks running in Oregon in 3 years
time.

GENERAL COMPANY DESCRIPTION

Sleepy Armadillo Coffee Truck
I am creating a food truck branch off of my existing Coffee Shop that will be called
the Sleepy Armadillo Coffee Truck. This business is still in the beginning stages of
being developed but I plan to get it up and running by June 2016. Initially I plan to
serve just coffee in two forms, French press and siphoned. The Sleepy Armadillo
Coffee truck satisfies a gap in the local market place. Currently there are no coffee
trucks in Ashland, Oregon. This gives my food truck a great advantage because we
are the only ones offering mobile coffee. The Ashland community is a mobile
community that would benefit greatly from our services. Our food truck will serve
mainly on busy street corners to young adults and parents with children at home.
Those aged 25 to 34 are the largest consumers of snacks from mobile vendors,
spending an average of $ 44 a month. Our products will be specifically 2 styles of
brewed black coffee. The two styles will be French Press, and Syphon. Syphon is an
uncommon type of brewing that will attract coffee enthusiasts and all other
costumers who have an interest of coffee. We will also provide creamer and sugar
free of charge to our customers. Currently we need to be financed to be able to have
our coffee truck up and running in a year’s time. We are planning on buying used
equipment, and having low start up costs. We are going to need roughly 20,000 for
start up costs in order to get this business started. I will explain later in detail where
I came up with this number. We will be attracting most of our customers by
promoting the truck in our coffee shop and also on social media. We have a
Facebook page set up that gives information on where our truck will be on given
dates and times along with information about the company. We will soon be making
a twitter to tweet out locations of where our truck will be in real time.

Business Philosophy:
The philosophy of The Sleepy Armadillo Coffee truck can be summed up in three
words: Product, Service and Atmosphere.

Business Form:
Sole proprietorship – I am the sole entrepreneur in this venture.

Mission Statement:
The Sleepy Armadillo Coffee House strives to create a welcoming environment to
both customer and employee. Our goal is to provide quality products and services to
our local coffee drinking community while doing it in a genuine friendly manor.

Company Goals and Objectives:

5. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
5
My goal is for my food truck to be up and running in the streets of Ashland, Oregon
by June 2016. Our goal is too be ahead of other competing coffee trucks in the area
of customer service and quality of product.
My company objectives are to:
1. Make distinctly great tasting coffee, at a reasonable price
2. Build up the community by giving back by hosting free social events
3. Create a welcoming environment where people can talk and mingle
4. Treat my employees and customers with the upmost respect
5. Turn a profit from the business but not at the expense of quality or moral.
Labor Force

How many employees will we have? 3

Management
The Sleepy Armadillo Coffee Truck will be primarily run by myself. I will be taking
all responsibilities that come from running a coffee truck business.

A full-time manager will be hired to oversee the daily operations at the Sleepy
Armadillo. I will want this candidate to have had three years of managerial
experience. This person's responsibilities will include managing the staff, ordering
inventory, dealing with suppliers, developing a marketing strategy and perform
other daily managerial duties.

Management Philosophy

Excellence in products and services to The Sleepy Armadillo Coffee Shops customers
is the top priority for the management. We believe that high-quality production and
service from staff is facilitated by a healthy workplace. A work environment that is
flexible, encourages open communication, prizes fairness, recognizes good work
performance and respects the differences and rights of individuals optimizes our
staff's health and performance. Motivation to achieve excellence is maximized when
staff is treated with decency, trust and respect.

6. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
6



PRODUCTS AND SERVICES

Products and Services

As a coffee truck, the Sleepy Armadillo will provide two different brews of coffee,
one siphoned and one French pressed. We want to provide the customers with an
environment that is relaxing where they can come in and get what they want quickly
and effectively, or even just hang around and socialize. The difference between
French press and siphon is the way the coffee is brewed. One is siphoned though a
vacuum and released again by cooling. The other is simply pressed through a filter.
Siphon typically has more caffeine due to its higher concentration of caffeine
because of the water to ground ratio.

Competitive Edge

There will be a few factors that will make our business stand out from the rest. For
one as I previously stated, we would be host events on Wednesday and Friday
nights. This will bring a huge draw to our business. We also will offer free Wi-Fi
Internet access so that our costumers will feel like they are at home. We will have
comfortable furniture to encourage a laid back atmosphere. A disadvantage that we
will have to face is the fact that we are a new starting up business that needs to build
customer relations. We will overcome this by advertising our business and having
excellent customer satisfaction.

Barriers to Entry

The barriers that my coffee truck will face are first and for most cost expenses to
become up and running. I will need to raise funds via my coffee shop in order to
have this business become a reality. I will also have to be the first in my area to
establish a customer base that is willing to buy coffee from a food truck. I will over
come this obstacle by promoting my company though my existing coffee shop and
also through social media.

7. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
7




MARKET ANALYSIS
Industry Description
The current state of the food truck industry is as stated by ibisworld.com, “The Food
Trucks industry has experienced a remarkable rise over the past five years, as
consumers have increasingly favored unique, gourmet cuisine at budget-conscious
prices. Despite strong performance, however, high competition and unfavorable
regulatory conditions in some cities have limited the growth of industry vendors.
Nevertheless, the industry has outperformed the broader food-service sector over
the period in terms of revenue expansion. In the five years to 2020, favorable
consumer trends will continue to underpin moderate revenue growth, but the
industry will need to work with municipal governments to resolve the remaining
legal challenges to food truck operations. The Food Trucks industry has experienced
a boom over the past five years, primarily as a result of the surge in gastronomy in
the United States. The industry, which is composed of operators preparing and
serving a broad range of cuisine from mobile food trucks on city sidewalks, in parks
and at events, has outpaced the broader food-service sector over the past five years.
Additionally, the industry has evolved quickly, as entrepreneurial food truck
operators have entered the market to cater to changing consumer preferences in
favor of gourmet offerings and unique food concepts. As a result of these trends,
industry revenue is expected to grow 9.3% per year on average over the five years
to 2015. The industry is projected to expand 3.5% in 2015, bringing revenue to
$856.7 million.”

Marketing Preview:
As previously stated, our target audience consists of young adults and parents with
children at home. Those aged 25 to 34 are the largest consumers of snacks from
mobile vendors, spending an average of $ 44 a month.

8. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
8


Distinguishing Characteristics
My potential customers desire to have hot and readily available coffee that they can
buy at a fair price. They also need the coffee to be conveniently located for purchase
and to be on the go like they are. The demographics of my target audience are
diverse, but mainly consist of males from the ages of 25-34. The only trends that will
affect my business is if it rains it will be difficult to sell to customers due o their
unwillingness to go outside to our truck.

Size of the Primary Target Market:

9. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
9


Industry:
This industry is a growing industry and we see changes in the industry’s future as
far as its’ supply and demand. Potential issues or changes would be mostly long-
term changes over the global scale, such as prices rising and falling due to natural
disaster and or lack of supplies. My company will take advantage of these
occurrences by being aware of when they will be taking place. It is important to
know when the market is going to fluctuate or change so that you can be ahead of
the game.

Market Share:
Sleepy armadillo will have a considerable amount of the market share due to its lack
of competition. Since there are no other coffee trucks in the area, really we will just
be competing with other coffee shops that are nearby. Because of our unique set up
we will have a huge advantage over the local coffee shops due to our mobility and
niche market.

Competition
There are ten coffee shops in a mile radius of where my shop will be located. All of
them offer some sort of coffee service but most of them are not primarily coffee
shops, but rather a side operation. I don't think this will be an issue for me to gain

10. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
10
attention from the community because my shop will be so different from those
others in the area.































MARKETING PLAN

Marketing Objectives

Increase Sales

11. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
11
One of the most important goals of marketing for-profit entities is driving business
and increasing sales. Marketing needs a good return on investment

Improve Product Awareness
A marketing effort can be focused at reviving or invigorating interest in a product
that has been on the market for a long time or about which people have
longstanding attitudes. We will be offering this via our unique variety of ways of
brewing our coffee that is readably and easily accessible.

Establish Yourself in the Industry
A new organization will find it extremely difficult to be heard above the noise in a
crowded marketplace, but in our case we will be the only food truck in our vicinity
that sells coffee, leaving us a huge share of the untapped market.

Brand Management
Maintaining a place in the mind of the public takes work, and some marketing
efforts are simply aimed to maintain a prominence in the public space. That is why
my branding of the sleepy armadillo will eventually be on coffee mugs and stickers
available for the public to purchase.

Distribution
We will be a self-distributing business meaning that we will only be selling locally.
Eventually we will look into spreading the company if it flourishes and does well in
our location. We will look into possibly selling merchandise online in the future.

Pricing
For my companies pricing I will be using a market segment pricing strategy. The
strategy works by hitting multiple markets by having pricing that each societal class
would appreciate. Here is an example of this style of pricing.

MKT 1 MKT2 MKT3
Premium $7 $7.50 $8
Market $5.00 $5.25 $5.50
Penetration $4.50 $4.75 $5.00

Our social media page is on Facebook where you will be able to find out where and
when the coffee truck will be available to cater your needs.

12. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
12
OPERATION PLAN
Oregon Licensing and Permits

• Tax identification number: All businesses in Oregon with employees must register
for state and federal tax identification numbers.
• Insurance: Before opening your food business, Oregon law requires you to
purchase a worker's compensation insurance policy through a certified agent
authorized to do business in the state.
• Food service license: In addition to a business license, you must apply for a food
service license, which requires two basic steps. First, you must obtain a plan
review from your local health department. Provide the health department with a
copy of your proposed menu and a detailed floor plan of your coffee shop that
illustrates the location of your electrical, plumbing and ventilation systems. Once
your plan is approved, you may apply for a separate food service license
• Business license: Before you can begin doing business in the state of Oregon, you
must obtain a business license. If you plan to operate as a limited liability company
or corporation, you must register with the Secretary of State. If you're operating as
a sole proprietorship or partnership, you are only required to file for an Assumed
Business Name certificate. At the time of publication, the fee for filing an assumed
name is $50. The fee to register a corporation or limited liability company is $100

Production Methods and Control
French Press I will be making the coffee myself. The process is quite simple.
Basically for the French Press I will be using an Aero Press coffee maker. First the
beans need to be ground to a nice consistency. Then I will take a paper filter and put
it into the Aero Press and ad the beans. Then the boiling water will be added and
stirred for a few seconds. Then you take the rubber seal press and push the water
down through the filter into the cup.

Siphon Coffee First in the siphon we will need to add water to the lower pot and
turn on the heater. Then we will need to grind the beans to a lighter consistency
then the French Press. Next we add the beans to the upper glass area with the cloth
filter installed. Eventually the water on the bottom will become hot enough to create
a vacuum and the water will be sucked up into the upper chamber. At that point we
will stir the grounds and water for a few seconds and then pull the pot off of the
heater. Finally the coffee will cool off enough to sink back down from the upper
chamber to the pot below and it is ready to be served.

Controll
All food carts must be “mobile”, meaning they need to be on wheels at all times and
ready to move in case of an emergency.
food carts that have unpackaged foods must have a way to wash hands.

13. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
13
food carts need to have a base of operation, often referred to as a commissary,
(or warehouse if you only serve packaged foods). There is an exception, you do not
need a commissary if:
 The food cart has all of the equipment on board to ensure foods can be kept
out of the temperature danger zone (41°F – 140°F).
 You can adequately wash your hands with warm water.
 You can do all ware washing with hot water onboard and have a way to store
them.
 The food cart contains both freshwater and wastewater.
 You can dispose wastewater via an approved sewage system.


Location
The Sleepy Armadillo Coffee House will be located on Main Street in Ashland,
Oregon. The storefront is appealing and inviting, and the street is full of bustling
businesses. We will use the coffee house as a place to store our truck and coffee
materials.

Risk Management
Food Safety and Recall Risk -- An estimated 48 million illnesses are borne by
food in the U.S. each year, resulting in 128,000 hospitalizations and 3,000 deaths,
according to the Centers for Disease Control.

To prevent this risk we will be making sure that our vehicle is cleaned daily and that
our product is safely packaged and stored.

Spoilage and Contamination Coverage -- Power outages and other issues beyond
your control can result in costly spoilage or contamination of food, which could
result in costly damage to your business and lost income.

We will be sure to order in manageable quantities so that we do not over buy and
end up with expired beans.

Equipment Risk Management -- All food businesses depend heavily on their
equipment, much of which is highly automated. Imagine what would happen to a
food business if the refrigeration were not working properly. When a mechanical
failure takes place, the business often must close and face a loss of income.

We will be sure to have back up equipment and a mechanic to call in case out truck
breaks down.

Coverage for Supply-Chain Risk -- The food industry is heavily dependent on its
suppliers. Yet supply delivery can be interrupted by many factors, including adverse
weather, infrastructure issues, price increases or damage to a supplier location. Loss

14. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
14
of even one dependable supplier can lead to a loss of income, and can affect the
quality, consistency and service of a foodservice provider.

We will be ordering directly from the store through the internet so there will be no
middle mas, thus this will lower the chances of something going wrong in the
transfer of goods. We will still have to deal with the possibility of normal random
accidents.
Personnel
Crew Members
Three part time employees will be hired on to our barista team at the Sleepy
Armadillo. Their responsibilities will consist of opening the shop along with closing.
They will need training that we will provide. Candidates will need to have some
experience in a coffee shop, preferably a year of experience.

Equipment List:
Used Food truck
Coffee Brewers w/Airports
Bean Grinder
Upright Freezer
Upright Refrigerator
Under counter Refrigerator
Siphons x(4)
Aero Press x(4)
Cremer
Eight O’Clock coffee beans
Sugar
Square for credit cards
Cups x(200)
Lids x(200)
Storage space: racks or shelves
Sinks
Wares (mugs, silverware, plates, and
other serving utensils.)

15. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
15
Supply Chain
Our supplier of Coffee for now will be Amazon who sells Eight O Clock Coffee beans
in large quantities. Our Siphons and Aero Press coffee makers will also be purchased
on amazon along with cups and lids.

Credit Policies
This is a relatively low budget business so we will be self-financed.

Accounting Systems
We will be tracking all of our sales via the app quick books.

16. Hall

Sleepy Armadillo Coffee House
370 E. Main Street, Ashland, OR 97520 | 970.631.3911
[email protected]
16


FINANCIAL PLAN
Sales Forecast

Income Statement

Cash Flow

Balance Sheet

Break Even Analysis