Dine N’ Dash
Executive Summary
Get the door – it’s Dine N’ Dash
Company Background
Business Description:
Dine N’ Dash is a fast, efficient and consumer friendly food delivery service for the Santa Ynez Valley. Dine N’ Dash is structured as a partnership with 5 people. We have each
invested $10,000 in Dine N’ Dash and are all bound by a legal contract.
Contact Information
Nina Beyer
Claudia R. Hundegger
Emma A. Jønbech
Jonas Rømer
Kresten K. Jakobsen
Business Model:
The customer orders meals from local restaurants on our website or through the App. Phone: 805-111-333
If they don’t have cash we provide the possibility to pay online or through the App too. E-mail:
dinendash@gmail.com
Dine N’ Dash
Mission Statement:
Dine N’ Dash wishes to bring meals with nutritional value right to the customers door. 2975 East Highway 246
We partner with the Santa Ynez Valley’s best restaurants and cafes to give our custom- Santa Ynez, California
93463
ers the ultimate home dinning experience. Our ambitious workforce aims to provide a
fast and high quality food delivery to the customer’s door.
Year Founded
2013
Market Opportunity
_____________
Opportunity:
The American lifestyle is hectic and constant and Americans often tend to eat fast food. Investment Opportunity
$72,600
Instead, we will deliver healthier local meals cheap, easy and quick.
AnnualOperating Costs*
Target Market:
Dine N’ Dash targets the busy and hardworking middle and upper class American of age $20,400
25-55 in the Santa Ynez Valley who don’t like to cook every day but still value good
Annual Sales*
nutritious meals over fast food.
$87,490.50
Industry Overview:
Dine N’ Dash is in the Express Delivery Service Industry1 as we deliver food from restau- Annual Profit*
rants to busy families in the local area. The industry includes about 7,500 companies $3,508.8
with a combined annual revenue of about 80 billion.
Return on Sales*
Market Research:
$0.04
Approximately 20,000 people live in the Santa Ynez Valley. 36,4%2 of the Valley’s population is between the ages of 25-55, which gives us 7280 potential costumers. Based on Return on Investment*
our survey 90% of the people we asked would be interested in buying our service.
4.8%
Leadership
All 5 partners in Dine N’ Dash attend the Niels Brock Business College and have differ- Breakeven
Units/Month*
ent qualifications creating a great team.
759
*Projected
1
2
http://firstresearch.com/industry-profiles.aspx
http://www.usa.com/school-district-0635850-population-and-races.htm#PopulationbyAge
Dine N’ Dash
Business Plan
Get the door – it’s Dine N’ Dash
1.
1.1
OPPORTUNITY RECOGNITION & BUSINESS STRUCTURE
Business Opportunity
We provide a food delivery service for the Santa Ynez Valley. We provide an efficient
food service delivery targeting the middle class consumer group in the Valley. The average household income in the Santa Ynez Valley3 is an estimated $71,133 anually,
which gives a considerable disposable income. The American lifestyle is hectic and
constant and therefore Americans often tend to order take-away.
The American lifestyle is hectic and constant. The towns in the valley are relatively
spread which makes it more time consuming for families to achieve everything in an
increasingly busy schedule. When families come home late everyday it’s easier to go
and pick up unhealthy food from the nearest fast food chain, than first going to the grocery store and after that come home and prepare a meal.
We provide a fast and efficient food service delivery with a large selection of healthy
meal choices for the busy American consumer.
1.2
Type of Business
Our business is a service. It is a food providing service. We saw a need in the Santa
Ynez Valley, which can be solved by a service business. We saw an opportunity in
bringing this idea/service to life.
1.3
Type of Business Ownership.
We are a partnership of 5 people, making an idea and bringing it to life. We have each
invested the same amount in our company. We are all bound by a legal contract. We
chose a partnership because we are 5 people
3
http://www.city-data.com/city/Santa-Ynez-Valley-California.html
2
1.4
Mission Statement
Dine N’ Dash wishes to bring meals with nutritional value right to the customers door.
We partner with the Santa Ynez Valley’s best restaurants and cafes to give our customers the ultimate home dinning experience. Our ambitious workforce aims to provide a
fast and high quality food delivery to the customer’s door.
1.5
Social Responsibility
We will try to be environmentally friendly by driving cars that are eco-efficient and have
lower fuel consumption. Our marketing will by mostly online based, which saves paper
materials. When our company starts earning profit we will like to donate 1% of our annual revenue to charity.
1.6
Qualifications
We’re all attending a business college, where we learn about how to set up and run a
business. If we were all American we would have a driver’s license and a car each at
this point. Another strength is that we only have indirect competitors. We need to have
more background knowledge on marketing and how to manage our business’s economy.
2.
2.1
MARKET RESEARCH
Market Research
Our business is in the Express Delivery Service Industry4 as we deliver food from restaurants to busy families in the local area. The industry includes about 7,500 companies
with a combined annual revenue of about 80 billion.
Approximately 20,000 people live in the Santa Ynez Valley. 36,4%5 of the Valley’s
population is between the ages of 25-55, which gives us 7280 potential costumers.
Based on our survey 90% of the people we asked would be interested in buying our
service
4
5
http://firstresearch.com/industry-profiles.aspx
http://www.usa.com/school-district-0635850-population-and-races.htm#PopulationbyAge
3
2.2
Target Market
Demographics:
We target people with a relatively high disposable income. We target families who live a
busy everyday life with time-consuming jobs. Our target market is based on our market
research. We target customers between the ages of 25-55 years old.
Geographics: The citizens of the Santa Ynez Valley are our main target group. We
don’t want to go beyond the limit of the valley because it would lower the quality of our
service unless we expand with new departments.
Psychographics: Our target market is health conscious. They appreciate fresh food
and healthier alternatives. They don’t like to cook. They live busy lives and welcomes an
easily accessible healthy meal, after a long day of work.
Buying patterns:
Our target market is willing to spend money on food and having it delivered. They don’t
like to cook everyday. They like when their dinner is easily accessible.
2.3
Competitors
Our business doesn’t have any direct competitors in The Valley because the service is
not provided by anyone else the moment.
Domino’s is our indirect competitor, as they sell and deliver pizza. Domino’s is our competitor because we deliver food as well. We distinguish ourselves from Domino’s by targeting a different market segment and by delivering a larger selection of food from local
restaurants and cafes.
2.4
Competitive Advantage
Dine & Dash
Domino’s Pizza
Business model
Larger selection and Only sells fast food
more varieties of
food.
Food ordering form
App
No App
4
1. We have more varieties of different types of food, which gives our costumers a
larger selection to choose from.
2. Our costumers can order food deliveries from our Dine & Dash App.
3. We transport food in environmentally friendly vehicles.
2.5
Business Growth
In the modern society today more women work than back in the days, which gives us a
great opportunity to provide food, as the mom in the families are no longer home to
cook dinner every night. Also the increasing obesity there’s been over the last 15 years
has started a trend of people wanting to eat healthier which makes fast-food restaurants
less popular (as they are unhealthy) and gives a business like ours great opportunities.
We plan to expand our market from the Valley to all of Santa Barbara County with several headquarters in the county creating more collaboration with more restaurants and
more jobs for teenagers. Also we’d like to have hybrid cars (for instance Toyota Prius)
as our transportation as it’s better for the environment.
2.6
Challenges
If gas prices go further up it would increase our costs making it difficult to keep the business going, as gas is one of our major costs. A change in customer tastes and preferences can change the demand of certain restaurants.
If family dynamics in general started to change, for instance parents working less so
that they had more time to cook, it would take away some costumers from our business
as we generally target busy families.
5
3.
3.1
FINANCIAL INFORMATION & OPERATIONS
Definition of One Unit
One unit of sale is the delivery of food from a local restaurant to the home of a busy
American family.
3.2
Delivery of Service
Description of Process Steps
1. The customer orders the wanted meal from our app or website.
2. The order goes to the restaurant and they make the meal.
3. As the meal is being made at the restaurant one of the DineN’Dash employees
arrives at the restaurant to take the meal to the customer.
4. When the meal is made the DineN’Dash employee drives the food from the restaurant to the customer.
5. The meal is delivered to the customer and the customer pays the employee
unless they did it online or through our app already.
3.3
Variable Expenses
Materials
Material Description
Gas
Bulk
Quantity
Quantity
per Unit
$3.50
1 gallon
1 gallon
Total Material Costs per Unit
Bulk Price
Cost per
Unit
$1.75
$1.75
$8
Labor
Time (in hrs) to make one
unit
0.5 hours
Total Labor Costs per
Unit
$4
Material Costs
$1.75
EOU
Labor Costs
$4
TOTAL EOU
$5.75
Cost of Labor per Hour
6
3.4
Economics of One Unit
$7.99 but a $3
extra fee if not
within city limits
Selling Price per Unit
Variable Expenses per Unit
Costs of Goods Sold
Materials
Labor
$1.75
$4
Total Cost of Goods Sold
$5.75
Contribution margin per unit
3.5
$2.24
Fixed Expenses for One Month
Expense Type
Insurance
Salary
Advertising
Monthly Cost
$200
Explanation
This covers car insurance for the cars that we
deliver our service in.
$0
As we pay ourselves by the hour ($8) the
salary s not a fixed monthly expense.
$500
Mainly web-advertising, flyers and brochures
for the restaurants on our website.
Interest
$300
As we want to take a loan of $18,400 and pay
it off over 5 years.
Utilities
$200
Phone bills and internet-connection
Rent
$500
Total Fixed Expenses
As we do the business out of our homes the
cost for rent is minimal.
$1,700
7
3.6
A
B
C
Income Statement for First Year of Operations
REVENUE
Gross Sales
Sales Returns
selling price × units sold
selling price × units sold
selling price x units returned
30 units per
day is
10,950
units a year
$87,490.5
0
$87,490.5
B–C
L
Net Sales
VARIABLE EXPENSES
Costs of Goods Sold
Materials
Labor
Total Cost of Goods Sold
Other Variable Expenses
Commission
Packaging
Other
Total Other Variable Expenses
Total Variable Expenses
G+L
$62,962.5
M
CONTRIBUTION MARGIN
D–L
$24,528
D
E
F
G
H
I
J
K
N
P
Q
S
T
V
FIXED OPERATING EXPENSES
Insurance
Advertising
Interest
Utilities
Rent
Total Expenses
PRE-TAX PROFIT
X
Taxes (15%)
W
Y
NET PROFIT
$87,490.5
cost of materials × units sold
cost of labor × units sold
$19,162.5
$43,800
$62,962.5
E+F
cost of commission × units sold
cost of packaging × units sold
cost of other costs × units sold
$0
$0
$0
$0
H+I+J
cost of insurance × 12 months
cost of advertising × 12 months
cost of interest × 12 months
cost of utilities × 12 months
cost of rent × 12 months
N+O+P+Q+R+S+T+U
$2,400
$6,000
$3,600
$2,400
$6000
$20,400
$4,128
$619,2
M–V
W × 0.15
$3,508.8
W–X
8
3.7
Start-up Investment
Item
Website domain
Why Needed
Online business
IT guy
Vendor
Cost
$15,000
App
Customer demand
IT guy
$30,000
Total Start-up Expenditures
Emergency Fund (1/2 of startup expenditures)
Reserve for Fixed Expenses (covers 3 months of fixed expenses)
Total Start-up Investment
$45,000
$22,500
$5,100
$72,600
How much of this start-up investment can you afford to pay yourself?
$55,000 as we plan to save up $11,000 each before starting the business.
How much of the start-up investment will you need to finance?
We would need the bank to finance $17,600 for our business and would like to have it
paid off after 5 years.
3.8
Financial Ratios
Return on Sales (ROS):
Annual Net Profit
Total Annual Sales
$3,508.8
$87,490.5
=
4.0%
≈
$0.04
5.1%
≈
$0.05
758.93
≈
759 units
Return on Investment (ROI):
Annual Net Profit
Total Startup Investment
$3,508.8
$68,400
=
Breakeven Units (Monthly):
Fixed Monthly Expenses
Contribution Margin
$1700
$2.24
9
=
4.
4.1
MARKETING & SALES
Marketing Plan
Our service depends heavily on advertising and a good reputation.
The purpose of our advertising campaign is to increase brand awareness of Dine N’
Dash. Our advertising campaign includes our website, a Facebook page, ads in local
newspapers, flyers and brochures, our app, and radio commercials at local radio stations.
We can provide a quality meal within a short time range everyday. It’s accessible and
just as easy to order as fast food but the food will be a lot healthier and of better quality.
We will ensure our members with a membership where you can collect points per order.
Within our membership it is possible to pre-order a meal for a certain day and time.
We will use different factors to determine our price. The determinants are; gas per mile,
salaries, and time range from order-to-delivery. We will use current customers to tell
and recommend our business to other potential customers by providing good service.
4.2
Promotion
At first we will try to do as much free advertising as possible. For instance, we would
make a Facebook page, where potential costumers can read about our business and
stay updated on news and discounts.
We are going to hand out flyers with our name, website, logo and app on it on the local
high school and in the community for instance on the restaurants you can order food
from on our website as it shows the customers that they can still get food from that restaurant but they don’t have to go there to get, which is a great deal for the restaurants
as that promotes them too. Later on we would like to have adds in the local newspaper,
billboards on the roads to/from/in the Valley (as people usually work out of town and
drive to and from work).
We will occasionally give out promotion codes for discounts, through our Facebook
page and when people order from us. We will through our collaborations with cafes and
restaurants promote ourselves through them by having brochures at their location.
4.3
Sales Methods
We want to differentiate ourselves from our competitors by offering favorable deals and
offer a bigger selection of food.
10
Steps a customer follows to purchase our service:
1.
2.
3.
4.
5.
Customer learns about Dine N’ Dash through our advertising and promotion
Customer checks our website or app
Customer chooses food
Customer places an order and gives payment
We pick up the food and deliver it to the customer
To get the customer to buy our service we plan to have flyers and brochures at the
restaurants and cafes that are a part of our website, with offers and deals such as
10% off your first order, if you sign up as a member. We want our website to look
good and be customer friendly so people don’t get lost on the website and choose
not to use our service.
4.4
Sales Estimates
Maximum Capacity: We have estimated our business to receive an order every 30
minutes on average. Dine N’ Dash is open 7 days a week from 10 am to 10 pm. Dine N’
Dash is estimated to have roughly 800 deliveries a month. Our maximum capacity will
be able to deliver 4 orders within an hour based on the geographical location of the customer.
Break-Even units: The estimated earning after expenses are paid off per delivery the
profit will be $2,24. To break-even with our $780 monthly fixed expenses without calculating the salary, we need to sell 348 units.
Market analysis: In 2007 the Santa Ynez Valley had a population of 21,898 people.
The median age is 40.6. We estimate the population has grown slightly and approximately 50% is an adult and will most likely use our service. The segment of our target
market is 10,949 according to the numbers of 2007. We estimate every customer will
use our service 1-2 times a week. That is a potential order volume of 10,949 order to
the 21,898 orders a month.
Seasonality: Our business will be affected of the holiday seasons as adults becomes
more stressed during the holiday seasons and is more likely to use our service. The
restaurants we deliver from will receive a greater amount of orders and their capacity to
produce will be a determinant of our ability to deliver during holidays. The food price is
very inelastic and will not be affected by sales.
11
Month
Units
Revenue
January
950
$7,590.5
February
900
$7,191
March
800
$6,392
April
1000
$7,990
May
900
$7,191
June
800
$6,392
July
800
$6,392
August
800
$6,392
September
900
$7,191
October
900
$7,191
November
950
$7,590.5
December
1200
$9,588
Annual Total
10,950
$87,490.5
SWOT-Analysis
Strengths:
Our strengths are that we are the only food delivery service in The Valley that delivers different
kind of foods from local restaurants, café’s, and fast food chains. Because we’re in a partnership, we have a bigger capital investment than if it was a sole proprietor company. Also we
have a lot of different qualifications, especially in financing and marketing.
Weaknesses:
We are dependent on the gas prices in the area, as that is our second highest cost, right after
salaries.
Opportunities:
We plan to expand our market from the Valley to all of Santa Barbara County with several
headquarters in the county creating more collaboration with more restaurants and more jobs
for teenagers. Also we’d like to have hybrid cars (for instance Toyota Prius) as our transportation as it’s better for the environment.
Threats:
The only threat, is Domino’s pizza, as they’re the only food delivering service in The Valley (excluding catering firms), delivering pizza from their local restaurant.
12
6 month agreements
1 dollar pr. Delivery: 1.99 for being on top of our advertising and promote them at top
put the cost on the consumer
we want them exclusively and we want them to promote us in their store and on their menu.
We can afford to give a discount on 1 dollar to the costumer if they order from the health bar
13