5 Boroughs Bagels
KRISTEN SVENCONIS, JULIA ANGELOS,
WILLIAM GERBER, & HARRISON BAKER
Mission Statement
“To bring our customers a convenient, consistent, and
quality-driven New York style bagel experience
outside of the five boroughs. Offering a unique
selection of delicious options catered to a college
student’s hours”
Organization Strategy
 Environmental Scanning:
 Main Bagel/Breakfast Competitors: Bruegger’s Bagels, The
Bagel Factory, and Dunkin’ Donuts
 Wealthy area
 Lots of college students, many of whom are from NY & NJ
Organization Strategy
 Organization Strategy:
 Cater to students with Lunch/Dinner/Late Night hours and
food variety
 Cater to the tri-state area students’ expectations of bagel
quality with an authentic New York style of preparation
 Core Processes:
 Importation of NYC tap water
 Overnight fermentation of dough
 “Poach” bagels in boiling water
Market Analysis
 Location:
 The Corner of Summit Grove and W. Lancaster Avenue
 Nearby Colleges:
 Villanova University, Haverford College, Bryn Mawr
College, & Harcum College
Market Analysis
 Broad Target Market:
 College-Aged Consumers
 Support:
 There are 14,000 college-aged consumers in the
immediate proximity
 A study shows college students spend 36% of their
disposable income on food
 Market Segments:
 “New York Style” segment
 “Late Night” segment
 “Early Crowd” segment
(FactFinder 2010)
(E-Marketer 2013)
Market Analysis
 Competition:
 Direct Breakfast Competition
1) The Bagel Factory
 2) Bruegger’s


Indirect Breakfast Competition
1) Starbuck’s Coffee
 2) Dunkin Donuts

Market Analysis
 Competition:
 Direct Late-Night Competition


1) Main-Line Bistro
Indirect Late-Night Competition
1) Campus Corner
 2) Wingers
 3) Domino’s Pizza

Market Analysis
 Order Winners of College-Aged Consumers:
 1) Accessibility
 2) Wide range of operating hours
 3) Unique product offerings
 5 Boroughs Bagels has aligned it’s
competitive priorities with these order
winners
Product & Service Offerings
 Signature bagels:
Asiago Cheese, Blueberry, Cinnamon Raisin, Chocolate Chip, Everything,
French Toast, Garlic, Gluten-free, Jalapeno Cheddar, Onion, Plain, Potato,
Poppy Seed, Rosemary Olive Oil, Sesame, Sundried Tomato, Vegetable, and
Whole Grain.
 Specialty bagels:
 Pizza Bagels, Bagel Deli Sandwiches, Peanut Butter and Jelly Bagel
Sandwiches, Cheese-steak Bagel Sandwiches, Pretzel Bagels, and Cheese-y
Bagel Knots
 Cream Cheese Spreads:
 Plain, Light Plain, Veggie, Jalapeno, Herb Garlic, Onion and Chive, Smoked
Salmon, Strawberry, Raspberry, Blueberry, Banana, Nutella, Peanut Butter
and Hazelnut.
 For refreshments, various juices, sodas, and teas will be available for
consumers. In addition, fruit smoothies will be available for purchase. Freshly
brewed coffee will also be sold at 5 Boroughs Bagels, both hot and iced.

Operations Strategy
 External Customers:
 5 Boroughs Bagels customers, end product consumers.
 Internal Customers:
 5 Boroughs Bagels bakers.
 Internal Suppliers:
 5 Boroughs Bagels bakers, employees, and equipment.
Operations Strategy
 Process Structure:
Late night/Early morning option
 Seating for customers, however no wait-service

Operations Strategy
 Customer Involvement:
 Cream
Cheese selection
 Mix and Match option
Operations Strategy
 Resource Flexibility:
 Mixture of specialized and enlarged
 Bakers, cooks, cashiers
Operations Strategy
 Capital Intensity
 High Automation
Service Customer-Contact Matrix
17
Topic 2 Presentation: Process Stategy
3008 - Myers
VSB
Quality Strategy
 Six Sigma
 “Bench mark” measurements
 Quality of service, environment, production
 Training of employee
 Quality management skills
Quality Strategy
 Quality Management Skills:
Reporting of customer dissatisfaction incidents
 Immediate attention to fixing issues with equipment
 Elimination of less than “top notch” quality bagels

Quality Strategy
 Top Quality Management:
 Continuous
Improvement
 Efficiency
 Timeliness
 Pricing
 Customer
Satisfaction
 Flat organizational structure
Quality Strategy
 Six Sigma Quality Control
 Bagel quality recording by bagel maker
 Using quality standard guidelines
http://maaw.info/SixSigmaSummary.htm
Quality Strategy
 Loyalty programs
Quality Control
 Imported water from New York
 “Use By” date methods
 Defective bagels will be analyzed
 Service quality – customer surveys & feedback
options
 Employee training
Supply Chain Inventory Management
 Low inventory levels
 Monthly supplies:
 to-go bags, coffee cups, juice cups, straws, lids (both coffee and juice),
plastic utensils, napkins, and paper towels, cleaning supplies, bathroom
supplies, light bulbs, and sweeteners
 Daily/Weekly supplies:
 fruit for the smoothies and cream cheeses (strawberries, raisins, apples,
blueberries, bananas, kiwis, raspberries, mango, oranges), all types of
milk (soy, almond, skim, 1%, 2%, whole, half and half, and buttermilk),
barley malt, kosher salt, eggs, water, unbleached flour, baking soda,
liquid rennet, sea salt, lox, scallions, peppers, carrots, cinnamon,
marinara sauce, shredded cheese, bacon, sausage, ham, peanut butter,
jelly, and butter.
 Primary Suppliers:
 US Food, Foods Galore, Coke, Naked Juice, Metropolitan Bakery, and
New York City Water Board.
Supply Chain Inventory Management
 New Company Goals:
 Keep inventory costs low, but stay up with demand
 EOQ: Economic Order Quantity
Supply Chain Inventory Management
 Lean Inventory Management System
 Assess Inventory Levels:
 each day and on a weekly basis
Demand Management
 Expect 300-400 transactions per day
 Forecasting:
 Early reliance on Judgment methods of forecasting
 Existing and original market research
 Shift to weighted moving avg. with emphasis on recent
demand
 As amount of historical data grows, shift to more complex,
qualitative methods (exponential smoothing, trend regression)
Pricing Decision
 Start up Budget
 Total Capital Equipment:
Furniture: $3,040
 Equipment/Machinery: $34,158
 Non-depreciable equipment: $6,655

 Business License: $200
Pricing Decision
 Annual Fixed Costs:
 Buildings/Real Estate: $2,900 per month ($34,800
annually)
 Legal/Accounting fees: $1,700
 Worker’s Compensation Insurance: $160 per month
($1,920 annually)
 General Business Insurance: $8,000 annually
 Interest expense: $3,600 annually
Pricing Decision
 Relevant Variable Costs (monthly):
Payroll: $1,531
 Supplies: $244
 Repairs/maintenance: $286
 Advertising: $500
 Car delivery/travel: $325
 Utilities: $100
 Taxes: $1,060

Pricing Decision
 Inventory Costs Per Month:
 $231 (coffee/tea)
 $1,260 (bottled juice/soda)
 $348 (signature bagels)
 $450 (specialty bagels)
 $520 (breakfast sides/sandwiches)
 $720 (fruit smoothies)
 $170 (cream cheese)
Pricing Decision
 Approximate Menu Costs:









Breakfast sandwiches (egg on a bagel with either bacon or
sausage): $3.50
Breakfast sides (sausage, bacon, hash browns): $2.00 each
Signature bagels: $0.95 each
Specialty bagels: $1.10 each
Cream cheese: additional $1.10 each
Bottled juice/soda: $1.75 each
Coffee/tea: $1.20 (small), $1.80 (medium), $2.00 (large)
Iced coffee: $1.75 (medium), $2.30 (large)
Fruit Smoothies (one size only): $3.75 each