Weebly



Introduction

Overview:

Cruising Java Café is a new start-up venture that delivers high quality coffee to customers in the downtown Orlando area. Cruising Java Café’s mission is focused on providing quality coffee and superior customer service without the hassle. This focus, along with the convenience we provide through our delivery service, is what will set our company apart from the rest! We will operate a coffee delivery vehicle, specifically for business personnel ages 25-54, within a fifteen mile radius of Central Boulevard at Orange Avenue in downtown Orlando. Cruising Java Café will be situated in a niche market, filling a gap due to the lack of delivery services within the coffee industry, especially in the Orlando area. As a result of the feedback from a buyer’s intentions survey, Cruising Java Café will offer our customers the following products via our delivery service: drip coffee, espresso based coffee, cold/iced coffee, brewed tea, and chai tea. The purpose of this report is to determine if our business concept, plan, and projected sales are strong enough to turn Cruising Java Café into a franchise in three to five years.

History:

The Cruising Java Café business concept was founded in January 2010. The concept was first brought about by Meghan DiGiacomo, a University of Central Florida business student and avid coffee drinker, when she discovered a missing link in the Coffee-House market—a delivery service. Since the conception of the idea, the Cruising Java Café business concept has undergone a full feasibility analysis, the results of which further propelled our initial idea into a completed business plan. Cruising Java Café is to be operated by five University of Central Florida graduates that make up its management team.

Management Team:

Cruising Java Café’s management team is educated and focused on consistency, creativity, teamwork, and enthusiasm. It is their philosophy that through the use of these things, a strong and rousing business environment will be created which will impact the success of the business and each other. The team is made up of each of the four co-founders along with two others and each position was filled based on the individual’s qualifications, experience, and commitment.

Meghan DiGiacomo, Cofounder and President, Age 21

Responsible for planning, management, and the company’s overall success.

Meghan is a senior at UCF working towards a degree in Business Management Entrepreneurship and a minor in Pure Mathematics. She has experience in self-management, and has helped her father run a successful family business.

Chelsea Duncan, Cofounder and Director of Operations, Age 21

Responsible for the day-to-day operations of the company; the maintenance of the company’s vehicle, equipment, website, and any necessary acquisition of new equipment. Chelsea is a senior at UCF and will be receiving her Business Management Entrepreneurship degree in May 2011. She has two years of management and marketing experience.

Grace Eastman, Cofounder and Director of Sales and Customer Service, Age 21

Responsible for marketing and selling products along with developing relationships with new customers, while ensuring that current customers are completely satisfied. She is qualified for this job due to her current employment as a customer service manager of two years. Previous to her two years of management Grace gained experience in the field of sales by being a sales representative for one year. By attending Chamber of Commerce meetings, Grace has a network of business owners/managers that are prepared to counsel Cruising Java Café. Grace's honest and likeable personality coupled with her desire to see her customers happy and one hundred percent satisfied leaves her completely compatible for this position.

Kelly Garlich, Cofounder and Director of Marketing, Age 21

Responsible for overseeing our product/service development, pricing, and marketing strategies. Kelly is a senior at UCF working towards a degree in Business Management Entrepreneurship. She has multiple contacts that are currently marketing professionals and advising her during our start-up years. She is a quick learner, understands the need to maintain a sensible budget, and is eager to launch a strong yet humble marketing campaign to gain customers.

Ryan Buffington, Director of Franchising Operations, Age 2#

Responsible for developing and maintaining franchisee/franchisor relationships, as well as staying up to date on legal requirements, and all matters regarding the franchising of Cruising Java Café. Ryan is a senior at UCF and will be receiving his jdfoaihgals jg;hdf;ahg

Austin Holmes, Director of Market Research, Age 2#

Responsible for exploring and obtaining information regarding any and all markets pertaining or possibly pertaining to Cruising Java Café. Austin is a senior at UCF and will be receiving his adjf;ljdf;aldjfl;asdj

Résumés of the management team are available in the appendix.

Are We “Franchiseable”?

Is There a Wide Market for the Concept?:

The business concepts that have the potential to achieve the most success as a franchise are those that take something familiar and add a unique twist: Cruising Java Café accomplishes this by offering something familiar—gourmet coffee—and adding a unique twist compared to most competitors—a delivery service. The idea of a coffee delivery service is appealing to end customers, as determined in our original buyer intentions survey, and we believe it is also appealing for prospective franchisees ().

The industry in which Cruising Java Café operates as determined by the NAICS is the Coffee Carts, Mobile industry. According to the Specialty Coffee Association of America, this is a relatively stable 13.63 billion dollar industry that has grown tremendously in the last decade (up from 8.3 billion in 2001). The industry is ready for a shake-up in how it does business and our company, Cruising Java Café, is prepared to lead it. The wide market for the business concept is also exemplified by the increasing amount of gourmet coffee drinkers in the United States, the amount increased from 6% in 2007 to 19% in 2008 just in 25-29 year old adults (2008 Coffee Drinking Trends Summary—NCA). These statistics, the industry trend, and the continual growth in the demand for convenience are all factors that prove clearly there is a wide market for the Cruising Java Café concept and this wide market should help the company grow into a successful franchise.

Do we have a point of differentiation?:

Cruising Java Café is very different from any other coffee business. We are the only coffee delivery service in our target market for business people between the ages of 25-54 in Downtown Orlando. Cruising Java Café offers the customers luxury of us delivering fresh coffee to them. Most businesses in our industry are brick and mortar stores. The other option would be moveable vans in which they are typically ice cream trucks. Cruising Java Café offers a convenient coffee service to our clients. One of the major reasons it is so convenient is the fact that it is on wheels. We travel to our clients and on a route each day. There is no business like this in our region. This makes Cruising Java Café different from any other business.

The convenience of our service is the highest point of differentiation we have. We come to our clients. They are able to either phone or use the internet to place orders. Another option would be to wait at our route at a certain time. You can have your coffee conveniently waiting for you at seven in the morning each day.

We are fully based on customer service. Our customer service makes people want to use our services again. According to a Harvard Business Review, if you prevent 5% of your customers from leaving you can increase your bottom line by 25-95%. We try to retain our customers by making sure our employees treat them with respect. Another very important thing for us is to fully educate our clients on our services and products. Since this is a new business concept they need to know the mediums of contact. By educating the client we are able to give them the tools to make the decision that is most convenient for them. We offer incentives as well for our repeat customers.

Price is also another point of differentiation. We are able to come in lower priced than Starbucks and other leading coffee chains. This is yet another reason for our prospective clients to choose Cruising Java Café.

Can our concept be duplicated?:

For an independent company in an emerging industry intellectual property is extremely important. Cruising Java Café is making sure we take all the necessary precautions in order to prevent any duplication. We plan to implement trademarks for our logo and the name “Cruising Java Café.” Our tag line “Better than your average Joe” will also be trademarked. Our copyrighted material will include our business plan. The team’s trade secrets will include our recipe for the brewed coffee, our unique routing method, and our operations inside the mobile unit. Eventually our concept can be roughly duplicated.

There may come a time that we have coffee competitors on wheels but they will not be able to completely duplicate our success. Cruising Java Café will have the first mover advantage. Our name will have been out on the street longer; therefore, giving us better recognition to the general public. We utilize word of mouth advertising and referrals to gain more clients. After people have tried Cruising Java Café’s quality coffee at the utmost convenience and at a lower price they will want to continue using our brand. By having incentive programs for our clients to come back we will lose less of our customer base.

Our competition would not be able to compete with our customer service staff. We rank customer service very highly in our organization. We treat the customer with respect and try to make this an enjoyable experience so they want to come back. The friendliness of our team is something that cannot be duplicated. The other thing that cannot be duplicated is our management team experience. We each have unique skills we bring to the table

Is this saleable?:

From a potential franchisee stand point this franchise is extremely saleable. The initial investment is very low in scheme of franchises. The initial investment is only $50,000 dollars. The breakeven point is relatively early on as well. This industry has a very broad appeal for our consumers. You can market to any socio-economic group. The hours that are required depends on which market you are trying to target. This franchise can potentially be a secondary income because of the hours necessary.

This is an industry that will not stop being important to our society. Caffeine is very important in our culture and has been for many years. This is not a fad that will go out of style. Caffeine is addictive which is great for our business. Although this is mature fragmented, this industry is still growing. It has grown from $8.3 billion to $13.6 billion in just seven years. There are many good reasons to buy Cruising Java Café.

Current Company Structure

Skill and Profile Gaps in Management Team

| |Executive Leadership |

Management Team Ownership and Compensation

|Name |Position/Affiliation |Base Compensation |Percent Ownership in |Personal Investment in |

| | | |Company |Company |

|Meghan DiGiacomo |Cofounder and President |$0 |20% |$8,000.00 |

|Kelly Garlich |Finance and Accounting |$0 |16% |$6,000.00 |

|Chelsea Duncan |Marketing and Sales |$0 |16% |$6,000.00 |

|Grace Eastman |Operations Manager |$0 |16% |$6,000.00 |

|Ryan Buffington |Franchising |$0 |16% |$6,000.00 |

|Austin Holmes |Market Research |$0 |16% |$6,000.00 |

|Other Pools |Family/Friends |N/A |N/A |$12,000.00 |

| | | | | |

|Total | |$0 |100% |$50,000 |

Board of Directors

Cruising Java Café’s Board of Directors was formed with the progression of the company’s business plan. There is one inside director and five outside directors. Each board member will serve on a volunteer basis. There are no plans to compensate board members as of now. Not all of the board members live in Central Florida so the board will meet every other month during our first year via videoconference.

Outside Directors

Kathie Holland, Business Professor at the University of Central Florida

Kathie Holland has many years of previous experience working as a consultant. She opened her own consulting business in 1997, where she specialized in consulting for entrepreneurs, and first began consulting in 1986. She now teaches business classes at the University of Central Florida’s main campus in Orlando, Florida. Ms. Holland will provide us with professional advice to lead our company to be as successful as possible.

Mike O’Donnell, Business Professor at the University of Central Florida

Mike O’Donnell has ## years experience as a successful entrepreneur. Aldjflaskjfalsjdfla;sjdflasjdfl;asjfd

Laura Lee, Director of Business Development for SCAA

Laura Lee works with Allied & Retail Council. She is SCAA’s primary contact for sponsorship, advertising, and event promotional activities. Ms. Lee will provide us with expert information and insight regarding the coffee industry.

Al Ansari, President, CEO, and Director of Fresh Brew

Al Ansari graduated from St. Cloud State University in 1966 with a B.A. in business. Since then he has founded several businesses, including the Behposh Garment Industry Company, Iran Knitting Textile Manufacturing Company, and Amsaco, Inc. Mr. Ansari will supply our company not only with specialty coffee, but also his experience and knowledge regarding the coffee industry.

John Hugh “Buddy” Dyer, Mayor of Orlando, FL

John Dyer is the elected Mayor of Orlando, Florida since 2003. Previously, he represented Orlando in the Florida State Senate for ten years, including three years when he was the Senate Democratic leader. He is a native of Orlando, Florida. Mayor Dyer will be able to contribute valuable information regarding the city of Orlando as well as its residents and business personnel.

Inside Director

Meghan DiGiacomo, Cofounder, President of Cruising Java Café

Board of Advisors

Jennifer Visentine, Attorney

Mrs. Visentine is an attorney specializing in intellectual property. Her primary role will be to provide legal advice on our business as well as our trademarks, website, and other intellectual property.

Ed Garlich, Insurance Agent

Mr. Ed Garlich has 20 years of Commercial Insurance experience specializing in small businesses. His role is to give us direction in terms of insurance for our business and illustrate what the effects of potentially expanding our business in the future would have on insurance costs and liabilities.

Maria Marthe, CPA

Mrs. Marthe is part owner in an accounting LLC. She has multiple years experience in her field and has many business clients. We will seek advice from her related to the accounting practices of our business.

Kathie Holland, Business Consultant

Ms. Holland has multiple years of experience as a professional business consultant and we believe she will provide us with invaluable advice about our business and how to make it a success from the get-go.

Michael Garlich, Marketing

Mr. Michael Garlich has over 25 years of experience in the marketing industry and will provide for us advice and guidance on the best measures we can take to market our business effectively in order to reach a large customer base.

Other Professionals

Cruising Java Café relies on the advice and encouragement of the professionals in our Board of Directors and Board of Advisors. As the business grows, Cruising Java Café may seek the counsel of the community on an as-needed basis.

Company Structure

Each of the five Directors will report to President, Meghan DiGiacomo. There is a Director of Marketing/Sales, Director of Finance and Accounting, Director of Operations, Director of Franchising Operations, and a Director of Market Research. When Cruising Java Café is able to grow and take on additional employees, all baristas and a customer service representative will report to the Director of Marketing/Sales, and a Webmaster and additional drivers will report to the Director of Operations. See the appendix for a complete look at our Organizational Chart.

Changes to Company Structure

Over a three year period, Cruising Java Café plans to expand within the downtown Orlando area along with two new markets. We plan to add a second truck to our downtown location. This truck will be driving a new route in addition to the original truck driving its designated route. This addition will be financially feasible within our third year of operation.

By the end of year five, we hope have two new locations in Winter Park, Florida, and in the UCF area. We have researched these locations and feel that they are consistent with our needs in terms of a customer base. Our target market for Winter Park is consumers with disposable income. The average household income of Winter Park is $97,529.00. Seventy-one percent of Winter Park’s population makes $35,000.00 or more annually. These households earn enough disposable income to purchase our product on a regular basis (iroffice.ucf.edu).

Our target market for UCF consists of consumers between the ages of seventeen and thirty. There are 56,235 students enrolled at UCF with an average age of 24. We feel that the size and characteristics of the college age market at UCF is conducive to the positive growth of our company. More detailed demographic information can be found in the appendix ().

Expansion will also require taking on several new employees. For the first year, the founders are running all aspects of the company including driving the routes and making the beverages for customers. In order to continue grow, we will need to hire baristas and drivers for all three locations. The baristas and drivers will be paid hourly at the rate of minimum wage in addition to tips received on the route. We will also need to acquire a webmaster. A large portion of our business will be done online, and eventually we will need to bring in a professional to upgrade our system in order to handle the demand. The founders will operate without a salary in order to bootstrap the business and avoid any potential negative cash flows until the business has reached a mature level of growth.

Franchising

In addition to our expansion within central Florida, we are working towards franchising our company. In order to do so, Ryan Buffington, Vice President of Franchising, will be developing a franchising program. His duties will include researching potential franchisees, confirming compliance with legal codes, developing the necessary documentation required for successful franchising along with all other elements of franchising.

Financial Forecast

We have forecasted our company out five years. In this forecast we included the purchase of an additional truck along with the necessary equipment in our third year. By the third year we hope to be averaging two hundred twenty beverages a day with our original truck. This is consistent with the industry average. At the same time, we hope to have our second truck gaining customers at the same rate we have forecasted for our original truck to in the first year. Also included is an expansion into Winter Park and UCF markets. Some of the additional expenses incurred include new trucks and equipment, and new warehouse space. We predict to be bringing in $312,791.07 by the end of year four and up to 526,458.57 by the end of year five. Detailed financial statements and sensitivity analysis can be found in the appendix of this document.

Franchise Information

Federal regulations require a franchisor to develop a Franchise Disclosure Document (FDD) covering 23 items of disclosure. The document must be given to any prospective investors at least 14 days prior to any contract being signed or any money being paid. If a prospective buyer makes a reasonable request for the information earlier than this the franchisor must comply. The 23 items that must be covered are:

1 The Franchisor, Its Predecessors and Affiliates

2 Business Experience

3 Litigation

4 Bankruptcy

5 Initial Franchise Fee

6 Other Fees

7 Initial Investment

8 Restrictions on Sources of Products and Services

9 Franchisee’s Obligations

10 Financing 

11  Franchisor's Obligations

12  Territory

13  Trademarks

14  Patents, Copyrights and Proprietary Information

15  Obligation To Participate In The Actual Operation Of The Franchise Business

16  Restrictions On What The Franchisee May Sell

17  Renewal, Termination, Transfer And Dispute Resolution

18  Public Figures

19  Earnings Claims

20  List Of Outlets

21  Financial Statements

22  Contracts

23  Receipt

The Federal Trade Commission (FTC) amended the Franchise Rule in 2007. As of July, 2007 franchisors may comply by using one of the three formats 1) the original franchise rule 2) the Uniform Franchise Offering Circular or 3) the amended Franchise Rule. However in 2008 this was amended to allow only the amended Franchise Rule. The following are acceptable ways of submitting the FDD: 1) hand-delivered, faxed, emailed, or otherwise delivered to the prospective franchisee a copy of the document by the required date 2) provided directions for accessing the document on the Internet to the prospective franchisee by the required date or 3) sent a paper or tangible electronic copy (for example, a computer disk or CD-ROM) to the address specified by the prospective franchisee by first-class United States mail at least three calendar days before the required date. If electronic disclosure is chosen the franchisor may not include pop-ups, audio, video and links.

There are two principle laws setup for consumer protection: franchise disclosure registration law and business opportunity laws. In case of violation the Florida Franchise Act provides a private right of act to a civil litigant when a person, as defined by the act, in selling or establishing a franchise or distributorship misrepresents: 1) the prospects or chances of success of a proposed or existing franchise or distributorship 2) the known required total investment for such franchise or distributorship or 3) efforts to sell or establish more franchises or distributorships than is reasonable to expect the market or market area for the particular franchise or distributorship to sustain. We are also jointly and severally responsible for sub franchisors violations of the rule. While third party brokers are not considered sub franchisors, if they have post-sale obligations they can be viewed as a sub franchisor.

Franchisee selection

When looking at potential franchisee candidates, Cruising Java Café will use a specific list of selection criteria; these criteria will be evaluated during a selection course. During the process of reviewing a candidate an application will be accepted by the company from the hopeful, pertinent background information will be attained, a personal interview with company executives and the applicant will take place, followed by the training of the franchisee, after which the franchisee will be entitled to open and run a franchise of CJC.

Applicants will not be sought after as we only wish to work with those who have the passion for our company to come to us. Once these individuals approach us the selection course will start. The first step is a basic application by the candidate with all information to determine the validity of the person’s interest. This application while fairly brief will give the CJC executives to get an overview of the applicant and decide if they are qualified to continue in the process.

The second procedure of CJC in franchisee selection is to do background information gathering on each applicant to confirm all information of the initial application. In addition to this validation additional information will be sought to confirm the person is qualified in all aspects required to be a successful CJC franchisee. After all this info is collected and reviewed the process can move forward.

Step three is a formal meeting between the two parties concerned informing the applicant of all that comes with owning a CJC franchise. Specific geographic service areas will be considered at this stage of franchise planning, as well as developing a strong relationship between the executives and the CJC franchisee hopeful. Both parties still retain the right to cease dealing at this point but confidentiality is required at this point of the process.

After all detailed of the individuals contract with the company training will be provided to the franchisee. This training will take place at the corporate offices of CJC and at sales points operated by the company itself. The individual will learn every aspect of the business from the marketing down to pouring the Java. After this process the hopeful is no longer a hopeful but an owner with his/her own franchise of Cruising Java Café.

References:

Specialty Coffee Association (SCAA)

National Coffee Association (NCA) 2008 Coffee Drinking Trends Summary







................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download