Wobbly Otter Bar and
Restaurant
T h e :James T.
K.
Wobbly :Nick
:Stephan B.
Otter
Thewobble@gmail.com
Facebook.com/thewobble
Twiiter.com/thewobble
YouTube.com/thewobble
4/25/2013
Wobbly Otter Bar and Restaurant
April 25, 2013
Table of Contents
Executive Summary
4
Market Analysis
5
Situation Analysis
5
Market Summary
5
Product
6
Market Needs
8
Market Trends
8
Market Growth
8
Geographical
9
Demographics
9
Behavior Factors/Psychographics
10
SWOT Analysis
12
Competition
14
Competitor’s product description
15
Keys to Success
15
Critical Issues
16
Marketing Strategy
16
Marketing Strategy
16
Value Proposition
16
Mission
17
Marketing Objectives
17
Financial Objectives
17
Target Markets
17
Positioning
18
Strategies
19
Marketing Mix
19
Pricing
19
Distribution
19
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Marketing Communications
20
Marketing Research
20
Financials
21
Break-even Analysis
21
Sales Forecast
22
Expense Forecast
23
Controls
23
Implementation
24
Marketing Organization
25
Contingency Planning
25
References
27
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Table of Figures
Figure 1 (Thomas Jr., Bertelsen & Kimbler, 2013) ...................................................................... 9
Figure 2 (Thomas Jr., Bertelsen & Kimbler, 2013) .................................................................... 10
Table 1………………………………………………………………………………………….10
Table 2………………………………………………………………………………………….10
Table 3………………………………………………………………………………………….13
Table 4………………………………………………………………………………………….20
Figure 3………………………………………………………………………………………….21
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Executive Summary
The Wobbly Otter will be a bar & grill restaurant located in Marina California. This restaurant
will offer a delivery service and a welcoming environment to the community of Marina. In order
to be successful, it will offer a variety of menu options that can be delivered or purchased over
the counter. This diverse menu will differentiate The Wobbly Otter from its competitions that
also offer a delivery service. Also this delivery service will benefit the individuals that are
incapable of driving to a restaurant because of intoxication. It will offer them a safer and more
convenient option to acquire food.
There will be two target markets that apply to amenities that The Wobbly Otter provides. The
first target market will be students, ages 17-21 years old, at California State University Monterey
Bay (CSUMB) that live on campus and will be utilizing the delivery service. Members of the
Marina community and CSUMB students who are 21 years old or older will be the second target
market. This second target market will be attending the bar inside The Wobbly Otter. These
residents are considered a mixture of New Beginnings and Boomtown Singles. The value and
convenience The Wobbly Otter offers with the delivery service will attract the younger audience
on the CSUMB campus and even some of the surrounding residents, while the bar area inside
will appeal to the 21 year olds from CSUMB and Marina that want to go watch a game and have
a few drinks with some friends. The primary data collected from the online survey showed that
over 80% of the respondents would use a delivery service. Further data showed that the
respondents would be willing to pay around $4-$5 for a delivery fee. The demand for a good
delivery restaurant is there and The Wobbly Otter’s target markets will be satisfied.
The restaurant market is highly competitive and The Wobbly Otter must compete with both fullservice and fast-food restaurants. The main competitors of The Wobbly Otter are McDonalds,
Dominos and Chilies Bar & Grill. These competitors all compete with our product in different
ways. McDonalds offers cheaper food, Chilies offers better quality food, and Dominos also
offers a delivery service.
The Wobbly Otter would like to break even in the first quarter of year two. To accomplish this
The Wobbly Otter must average a per month unit sell of: 5480 for in house meals, 1070 for
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meals delivered, 2660 for liquor drinks, and 2750 for beers sold. The Wobbly Otter will take
weekly inventories to ensure that it is meeting projections and can adjust its marketing strategies
accordingly.
There are many factors that The Wobbly Otter has to contend with in order to succeed. Our
primary concern is that The Wobbly Otter is a new small business that has yet to establish a loyal
customer base. This can be especially difficult because restaurants’ have very low profit margins
and their products are often able to be substituted for one another. Additionally, The Wobbly
Otter has to compete with numerous other restaurants that have thousands of loyal customers and
spend millions of dollars each year on marketing. To be profitable we need to satisfy the need of
our target market. To ensure that our target market is satisfied we will create an environment
suitable for our target market and guarantee that our customer service is superior to our
competitors. These solutions will ensure that we obtain repeat customers and maximize customer
equity.
Market Analysis
Situation Analysis
Consumers in The Wobbly Otter s target market desire quality food, with healthy choices, that is
affordable and convenient. The only establishments that currently deliver in the Marina area are
Ho-Wah Restaurant, a Chinese restaurant and two pizza places. This offers little variety to what
consumers can order to be delivered to their dorm, apartment or house. Creating an establishment
that offers a wide variety of food will attract college students, people under the influence and
incapable of driving, and individuals who do not want to cook.
Market Summary
Consumers need an establishment that offers a variety of quality food, which can be delivered
late and offers healthy alternatives to the common fast food choices. Pizza has been available for
delivery since the 1960’s. It is time to offer consumers variety in their food delivery experience.
To meet this need, our service offering must be able to compete with competitors delivery times,
offer a variety of quality food with healthy alternatives and be affordable to our target market.
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There are currently only two places that offer a service similar to this establishment in the
Marina area.
The first is Ho-Wah Restaurant. This restaurant does deliver but does not offer a variety of food
options only Chinese food. They also have a twenty dollar purchasing minimum in order for the
consumer to even be able to have food delivered. The next competitor in this market is Domino’s
pizza. Domino’s would be The Wobbly Otters biggest competition. This is because it does offer
a small variety of options beside pizza. Domino’s also offers sandwiches, pasta bowls, wings, a
variety of breadsticks and desserts. Dominos also stops delivering at 12am which would be at
least two hours earlier than The Wobbly Otters delivery hours (Fast Food, 2013) .
Since there is no service establishment for the need of a variety of quality food, which can be
delivered and offers healthy alternatives, consumers settle for: pizza, Chinese food or fast food.
There are currently over ten establishments in Marina that would fill this gap in the market need.
There are also dozens of establishments in a twenty mile radius that would also fill this gap in the
need. These alternatives to the market need will cause more competition since they are already
positioned with a recognizable name in the market. They do not offer the convenience of our
establishment which will give our establishment a differentiating advantage.
The Wobbly Otter’s target market will be concentrating on are California State University,
Monterey Bay (CSUMB) students. Their role is crucial in our service’s market success. Not all
students have transportation so going to get food isn’t an option. Also campus food can become
repetitive and tiring. Students also have the tendency to become under the influence and
incapable of driving. These factors will increase the convenience of having an establishment that
will deliver a variety of quality food, which can be delivered late and offers healthy alternatives
to fast food and pizza (Vork, L, 2013).
Product
The Wobbly Otter is a Bar and Grill that offers late night food delivery. Since The Wobbly Otter
is offering a late night delivery The Wobbly Otter would not open until lunch hours, between 12
and 2pm. We will offer delivery all day and will have a specific menu for delivery to ensure
orders can be made quickly for a speedy arrival to our consumers. The Wobbly Otter will also
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offer a lunch and dinner menu for consumers to eat in as well. The Wobbly Otter will be open
until 2am which is also when the last delivery orders will be accepted.
The Wobbly Otter will offer a variety of fried foods, sandwiches and classic snack food items
such as nachos with a variety of toppings, customizable burgers and fries, tacos and wings. We
will also offer healthy alternatives such as; salads, lettuce wrapped vegan or turkey burgers and
grilled chicken wraps. The Wobbly Otter will source as much as its inventory as possible from
local establishments and farmers market to ensure fresh high quality food. The Wobbly Otter
will also have to order some items but it will be kept to a minimum.
The Wobbly Otter needs to acquire a liquor license, have a fully functioning bar, kitchen with
ovens, deep fryers, a broil and sauté station, room for prep work, space for a dishwashing
machine and sinks. The front of The Wobbly Otter will need space for tables and chairs, stage
for live events, and a game area for billiards, darts, beer pong and other activities.
The Wobbly Otter would like to invest in hybrid cars for our delivery system. This will be costly
at first but will save The Wobbly Otter money in the long run as gas prices continue to rise. Also
by purchasing hybrids it will give The Wobbly Otter a nice first impression when orders are
delivered.
The Wobbly Otter would like to hire as many college students as possible. The Wobbly Otter
wants to create a fun working atmosphere that will attract consumers. Also by hiring college
students the chances of marketing through “word of mouth” and social media to our target
market is great. We also want to offer a student discount that could be used for in restaurant
purchases.
Overall The Wobbly Otter wants to offer a variety of quality food that is convenient, affordable
and offers healthy alternatives. There is no service in the Marina area that meets this market
need. A late night delivery option with a variety of food will be our differentiating advantage in
our marketplace. The Wobbly Otter wants to offer its consumers an average in house meal of
nine dollars and an average delivery meal price of eleven dollars. This will include entrée, side
and non-alcoholic beverage.
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Market Needs
People are looking to find easier and more convenient ways to eat their meals. This is because
people are too busy working or going to school to cook at home. This has contributed to the
rising number of fast food restaurants. Today there are over 200,000 fast food establishments in
America (Statistic Brain, 2012). The majority of these restaurants are successful because of the
low prices and convenience they offer their customers. Unlike our competitors, we will focus on
customer service and providing our customers with the most convenient way to get their food.
The delivery service will attract our target market and separate us from the majority of our
competitors that require their customers to come to their establishment. Other markets we will
draw are those that are attracted to cheap prices and a comfortable environment that is open late.
Market Trends
In recent years, restaurants have made healthier options available on their menu. Another trend in
the restaurant market is the use of social media and web sites to market and attract new
consumers. The economy also has a huge role in market trends, while in recession consumers
cook more and stretch their dollar. Now that the economy is leaving the recession consumers are
beginning to spend more on outings and dinners. Consumers are still in a hard time, which does
not leave extra money so fast food restaurants are in the optimal price range of what consumers
are willing to spend (Bhuyan, 2004).
Market Growth
In 1970, money spent on foods eaten away from home accounted for 25% of total food spending;
by 1999 it had reached a record 47% of total food spending. Due to the recent recession the fast
food industries value sales grew by 4% in 2011, which is more than double the previous year’s
growth rate (Fast Food, 2013). Fast food is now served in various kinds of establishments
including stadiums, airports, zoos, schools, universities, shopping centers, cruise ships, trains,
Wal-Marts, and even gas stations.
The convenience factor of fast food has swept our nation. Consumers spend more on fast food
than they do on; movies, books, magazines, newspapers, videos, and music all combined. The
Wobbly Otter has the potential to make this market grow. It will have comparable prices to other
fast food restaurants, offer more convenience than any competitor due to the late night delivery
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aspect, and will be more customer centered rather than any competitors who rush consumers in
and out.
Geographical
As a restaurant in a college town, we will be located close to the California State University,
Monterey Bay campus, while still being accessible to the surrounding community. To balance
these two objectives, the ideal location for Wobbly Otter is in the Save Mart and CVS Pharmacy
shopping center on Reservation Road in Marina, CA. Being in a major shopping center will raise
awareness and interest in Wobbly Otter. Also, the location gives our delivery drivers a good
starting point and efficient routes to CSUMB’s main campus, East Campus, and surrounding
residential areas where we believe a majority of customer base will live.
Demographics
We distributed a survey online with eight questions and received 35 complete responses. A copy
of the survey is attached in Appendix 1. Figure 1 shows the age of the respondents to the survey.
Figure 1: Age Ranges of Respondents
14%
20%
18-20
21-23
24-26
27 or older
29%
37%
Figure 1 (Thomas Jr., Bertelsen & Kimbler, 2013)
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As shown by Figure 1, the largest number of the respondents were between the ages of 21 and 23
years old. This data supports our theory that marketing toward college students will provide us
with a good following and good business.
One of the questions on the survey asked if the respondent would use a delivery service at their
current favorite restaurant to get food late at night. This will help determine whether or not a late
night delivery system will be beneficiary to The Wobbly Otter. Figure 2 on the next page will
show the responses.
Figure 2: Delivery Service
25%
Yes
No
75%
Figure 2 (Thomas Jr., Bertelsen & Kimbler, 2013)
Figure 2 illustrates that 75% of the respondents want a delivery service of their favorite late night
foods. This data validates our reasoning for wanting to have a delivery service to reach as many
customers as possible and cater to their needs.
Behavior Factors/Psychographics
With The Wobbly Otters location in Marina, CA, it is important to focus on Marina’s
demographics. Using the PRIZM Market Segmentation Tool, we found that the demographics
living in the zip code 93933 are Middleburg Managers, New Beginnings, Up-and-Comers, White
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Picket Fences, and Young Influentials. Table 1 on the next page will describe these
demographics.
PRIZM Demographic Classifications for Zip Codes 93933
Title
Age
Education Levels
Median Household Income
Middleburg Managers
45-64
Some College
$51,769
New Beginnings
<55
Some College
$31,226
Up-And-Comers
25-44
College Graduate
$50,556
White Picket Fences
25-44
Some College
$51,800
Young Influentials
<55
College Graduate
$49,182
Table 1 (Claritas, 2013)
Most of the household residents in this area are younger than 55, with some recent college
graduates. The households surrounding where Wobbly Otter will be established have a higher
median income than the area average. Combining those two attributes, age and income, the bar
will be a success with the residents of Marina and become the new “watering hole” in town.
Since the restaurant will be located in Marina, the delivery service will not be used as much in
that zip code. However, the CSUMB campus, zip code 93955, and its students will use the
delivery service much more. The demographics in the 93955 zip code are Boomtown Singles,
Family Thrifts, Middleburg Managers, Upward Bound, and White Picket Fences.
PRIZM Demographic Classifications for Zip Codes 93955
Title
Age
Education Levels
Median Household Income
Boomtown Singles
<55
College Graduate
$39,838
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Family Thrifts
25-44
Some College
$30,290
Middleburg Managers
45-64
Some College
$51,769
Upward Bound
35-54
College Graduate
$83,651
White Picket Fences
25-44
Some College
$51,800
Table 2 (Claritas, 2013)
With college students and recent college graduates as our main target for our delivery service,
the Boomtown Singles fall right into our marketing approach. They love inexpensive and
convenient food. Being able to deliver that food to them after a night of parties, or just because
they are hungry and have no car, is what would help us stand out as a restaurant. That is what we
see as our target, and Boomtown Singles encompasses that market. The quality of the food will
be decent, but the convenience will be our main focus.
SWOT Analysis
This SWOT Analysis will reveal the strengths, weaknesses, opportunities, and threats of our
restaurant.
Strengths
The primary advantage of The Wobbly Otter is that it has the ability to deliver meals to our
customers. This option helps separate The Wobbly Otter from the majority of other restaurants
and fast food establishments that require people to drive to their location. It also helps to target
customers who may not have time for a full-service meal or do not have a way of getting to a
restaurant. Another one of The Wobbly Otters’ strengths is that it will provide the environment
of a full-service restaurant, but will not have the overhead of having servers.
The Wobbly Otter will offer a full bar and will be open past midnight which competitors don’t
offer. This will help to further differentiate The Wobbly Otter from competitors and attract
consumers. Furthermore, the building and supplies will be brand new and the fresh service style
of the restaurant will help to attract customers. Finally, the restaurant is located near CSUMB
which contains our restaurant’s target audience. The restaurant’s location, as well as its other
strengths, will help us to maximize our profits and ensure that we can pay off our debts and
expenses.
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Weaknesses
The main weakness of our restaurant is that it is a new small business that has yet to establish a
loyal customer base. In addition, it has to compete with a multitude of chain restaurants that have
thousands of loyal customers and spend millions of dollars each year on marketing. Since the
products we serve will be very similar to the chain restaurants, people may feel inclined to eat at
the familiar places. Our restaurant also has very few investors; as a result, our methods for
marketing the restaurant will be limited. Also there are many startup costs. These include a
security deposit, rent, utilities, customized construction, furniture and supplies, a liquor license,
initial food and beverage, marketing and other miscellaneous opening costs (Inc., 2011). These
costs on average are between $450,000 and $525,000 and with our limited funds we will need to
be successful each quarter in order to stay in business (Inc., 2011).
Opportunity
In today’s down economy, people are working longer hours and are looking to spend less time
and money on meals. This means people are cooking less at home and are eating out to save
time. People are willing to sacrifice food quality by buying fast food, The Wobbly Otter food
quality will beat that of fast food restaurants. Even though fast food is faster, The Wobbly Otter
delivery service will attract individuals who want to save time and appreciate the convenience of
not leaving their home.
As a startup business The Wobbly Otter will contain some of the latest technology. This includes
cooking appliances that allow chefs to cook meals faster and more efficiently. This can help get
customers in and out as quick as possible. This will also prevent long lines from forming at the
counter and will enable The Wobbly Otter to maintain its delivery schedule.
To gain customer loyalty, The Wobbly Otter will apply a code of ethics that will emphasize
customer relationship. If the restaurant is perceived to have poor customer relations, we will not
get repeat customers. The Wobbly Otter does not want to get single purchase customers; we want
lifetime customers and maximize customer equity.
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Threats
The immediate threat for our restaurant is the heavy competition from service restaurants and
fast food chains. The Wobbly Otter needs to ensure loyalty from its target market in order to get
a share of a very competitive market. This will be difficult since restaurants have very low profit
margins and many of them have closely related products that can be substituted with one another.
Another threat to our restaurant is the rising cost of raw materials. Some of the issues are the
“rising global demand for protein, unfriendly weather in key growing regions, government
mandates to turn corn into ethanol, speculative investors that have helped boost the price of
many food commodities in recent months” (Jargon, 2011). These price increases may cause us to
increase the price of our products in order to maintain a profit. If we increase the price too much,
we will lose our customers’ loyalty.
Restaurants are very vulnerable to new laws and regulations. For instance, a new law states that
calorie and nutritional information must be displayed on menus. Today, many Americans are
more health conscious, and as a result, “many restaurant retailers now face potentially significant
market changes due to legislation proposed by the federal, state and local divisions that would
mandate the provision of calorie and nutritional information on restaurant menus and menu
boards” (Burton, 2009). Some customers will feel inclined to find a healthier option regardless of
cost.
Competition
Some of our restaurants main competitors are McDonalds, Dominos and Chili’s Bar & Grill. The
table 3 below indicates our competitors’ place, price and promotion, relative to the students at
CSUMB.
Competitor
Place
Price (meal
Promotion
with soda)
McDonalds
Local
$3 - $5
Cheap fast meal in a friendly environment.
Dominos
Local
$8 - $15
Quality pizza at reasonable price. They
deliver and have a product guarantee.
Chili’s Bar &
Grill
Table 3
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Local
$12- $22
Service restaurants that offers decent quality
food at affordable prices (Chilies, 2013).
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Competitor’s product description
McDonalds: McDonalds is the market leader in the fast food industry despite the dozens of
other major players present. McDonalds has continually improved it’s menu over the years, and
consistently remains ahead of major fast food trends. The Big Mac hamburger and French fries
remain the core of the company’s menu strategy, but its menu is complemented by an everevolving selection of items that appeal to current trends. McDonalds continues to set these trends
by creating new items like the McCafé, fruit smoothies, and premium burger lines to further
increase its dining experience (McDonalds, n.d.).
Dominos: This restaurant has recently changed its menu and target market. They originally
served low quality pizza at cheap prices. However, along with a reconstructed menu they offer a
money-back guarantee and have embraced social media and e-commerce to engage consumers.
Additionally, Dominos now not only offers delivery services but customers can make orders
online and through social media (Vork, n.d.).
Chili’s: Chili’s Bar and Grill, operates within the casual dining industry and is primarily a full
service restaurants that offers decent food at affordable prices. It is not considered a fast food
restaurant, but it does offer lower prices and takeout food. Chili’s also has a bar and televisions
that usually show popular sporting events. Chili’s targets a broad audience but is increasingly
popular among families with children (Chilies, 2013).
Keys to Success
In order to be successful in the late night food market, Wobbly Otter is dependent on some
factors. These factors include our hours of availability and our delivery service. Being open from
12pm to 2am are prime hours for business, especially when most other restaurants in the area
close before midnight. During the weekends with parties, most people will want food but may be
unable to drive and get it, but The Wobbly Otter will be open and delivering. The Wobbly Otter
is where these people will order from or go to in order to satisfy their late night cravings. With
customers possibly incapacitated and unable to drive, but still feeling the hungry, the delivery
service can bring them food will only a slight charge. These factors separate and differentiate
The Wobbly Otter from fast food competition in the Marina area.
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Critical Issues
Wobbly Otter faces some possible issues to go with its successes. With rising gas prices, the cost
to transport food will go up and in turn be passed to the customer in the price of the food. This
has the potential to push customers away to competitors for cheaper food. The Wobbly Otters
hours are late so it might have to make labor changes during the end of the night when it slows
down. The last critical issue is underage drinking. If managers start to feel this is becoming an
issue then between 11 p.m. and 2 a.m. will become 21 and up. If all else goes well, these issues
become minimized in value and Wobbly Otter will thrive.
Marketing Strategy
Marketing Strategy
The value that we will offer our target market is the value of being convenient. Our
distinguishing feature is our delivery service and this will be the focus of our marketing strategy.
We will strive to make our customer service impeccable, and give each of our customers a
lasting impression of our restaurant when they receive a delivery. This will ensure that we have
repeat customers and that a good reputation will pass through word of mouth. We will also have
a heavy presence on social media outlets such as Facebook and Twitter. The description of our
restaurant and it services will be provided on these sites and can easily be distributed to other
individuals through the web. Lastly, we will create a fun atmosphere in our restaurant that will be
desirable to college students. This atmosphere can be attained by hiring college students to work
at the restaurant and by having The Wobbly Otter be open late.
Value Proposition
The value proposition on which we will position our product is that of the “more-for-the-same”
value proposition. The Wobbly Otter will provide food that is comparable to other fast-food and
full-service restaurants, but it offers more by offering a delivery service. A delivery service is
only provided by a limited number of competitors and these mostly consist of pizza places. The
Wobbly Otter will give consumers who frequently use delivery services a variety in their food.
This value proposition will not apply to all consumers. If a customer does not use the delivery
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service then they are getting any added value to their meal. Therefore, the value proposition will
only apply to consumers that don’t have the time or the ability to prepare a meal or drive to a
restaurant.
Mission
The Wobbly Otter offers simple great quality food at the convenience of our place or yours.
Marketing Objectives
In our survey, it was shown that 75% of people would want a delivery service for their favorite
late night food. The survey also showed that people eat at restaurant on average three times a
week. This reveals that 75% of our target market buys a meal three times a week at a restaurant
and would want a delivery service available. If the knowledge of The Wobbly Otter’s delivery
service can reach our target market they can be persuaded to prefer our food because of the
convenience they are offered. Therefore, the goal of our marketing plan is to make our
customers aware of all the services our restaurant provides.
Financial Objectives
The Wobbly Otter would like to break even in the first quarter of year two. To accomplish this
The Wobbly Otter must average a per month unit sell of: 5480 for in house meals, 1070 for
meals delivered, 2660 for liquor drinks, and 2750 for beers sold. These 15 month averages will
ensure that The Wobbly Otter breaks even by the second quarter of year two. This will not
include the remainder of our loan payments that are evenly spread over three years.
Target Markets
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College students and recent college graduates are the target market selected for The Wobbly
Otter to reach. The students at California State University Monterey Bay (CSUMB) are the main
target for the delivery service provided by the restaurant. This market does not have
transportation to get food in the evening and late night hours or because of the college party
environment, has transportation but is unable to utilize it to get food after a night of parties. The
delivery service and late hours will also attract business away from competitors such as Jack ‘n
the Box and the local Papa Chevos, based purely off of convenience. Not only are the reasonable
prices for the food appealing to this younger audience, but the anti-drunk driving message that it
preaches will hopefully gain the support of the university and the surrounding community, and it
keeps the target market alive and well and full of food.
The bar area in The Wobbly Otter is catered towards a bit different target market. The target is
college students 21 years old and includes members of the Marina community that want to grab
some friends to go watch the game and have a few drinks. In order to build a reputation as a
place where grab drinks and enjoy the big game locally in Marina, this target market is important
to reach. An important technique that can be utilized to attract this older and more mature target
is the conducting of special promotions for sporting events such as the playoffs for all the major
sports or for the opening weekend of an athletic season. Once a solid grip on the sports loving,
21 years old and up target market is achieved, customers will be choosing The Wobbly Otter
over competition such as Buffalo Wild Wings and Chili’s.
Positioning
Using service differentiation and people differentiation, we are positioning The Wobbly Otter to
have the best customer service and to be the most convenient restaurant. Among our unique
services are The Wobbly Otters late hours, open bar, and delivery service. Also our hiring
process will try and hire as many local college students as possible to make our target market
feel welcome. Our competitors may offer one of these services, but they will not provide all of
them. Therefore, the combined services we offer will differentiate us from our competitors.
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Strategies
The marketing strategy of The Wobbly Otter is to have the target market be aware of the
conveniences that the restaurants services provide. The target market of the restaurant is the
college students and recent college graduates in the Sea Side and Marina area. The restaurant
will appeal to the target market because our survey showed that 75% would want their favorite
meal available for delivery. The pricing, distribution, and marketing communication will permit
The Wobbly Otter to influence our customers and help us achieve our marketing objectives.
Marketing Mix
Pricing
The Wobbly Otter will be targeting a lower income market so the pricing must be right. For The
Wobbly Otters average meal the price will be $8.00 this will include an entrée and one large side
or two small sides and a drink. The Wobbly Otter decided on this because it wants to offer
variety which is why it offers one large or two small sides. This price is affordable by most in the
target market , slightly more expensive then fast food depending on where one goes but
guaranteed to of greater quality. The delivery average meal must cost more than in house so The
Wobbly Otter averaged it at about $11.00 for the same meal but with added convenience fee.
Distribution
The Wobbly Otter’s distribution channel supports the just-in-time inventory system. Our
distribution channel will contain one intermediary level. This intermediary is our warehouse and
it will transport supplies to the restaurant just before they are needed. This will ensure that less
space is devoted to food storage, and that waste from food spoiling or food not being ordered by
patrons will be reduced. This has to be accomplished without running out of food and losing the
opportunity for a sale.
In Addition, because The Wobbly Otter has a single location it can afford to contract with food
manufacturers near its location. It can do this without having to worry about making deliveries to
separate locations.
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Marketing Communications
The Wobbly Otter will use a specific blend of advertising, public relations, personal selling, sales
promotion, and direct-marketing. Advertising will not consist of television, radio and newspaper
ads. Instead it will focus on advertising and direct marketing through our web page and social
media. These sites will describe The Wobbly Otter and describe the foods and services available
at the restaurant. Our target market has a heavy presence in social media and they will advertise
our restaurant through word of mouth. Sales promotions will emphasis coupons, specials and a
happy hour. Everyone likes a deal, and offering coupons and specials that pay for a percent of a
meal or for a free drink or desert, is a great way to reach out to customers. Also a happy hour
will promote the restaurant’s full bar service and will bring in customers that will also buy food.
The public relations we will employ will consist of ensuring that our restaurant has good
publicity. Therefore, we will have to work hard to maintain our superior customer service and
make sure our reputation stays respectable. Personal selling is not present in our marketing plan.
Our restaurant doesn’t have sales representatives that sell our product. Instead we will rely on
our competitors to purchase our products from the restaurant.
Marketing Research
The primary research that was conducted was collected randomly via an online survey. The
survey was first available on March 4, 2013 at 5:29pm PST on www.surveymonkey.com from a
link that was posted on social networking sites such as Facebook and Twitter as well as being
sent out in e-mails to students attending CSUMB. There was also a printed version that included
the same eight-questions that was handed out to twelve students. There were 28 respondents who
completed the survey online. Combined with the twelve printed surveys, a total of forty
respondents’ surveys were analyzed. The data gathered was used to determine pricing for the
food, a reasonable delivery charge, the main competition in the Marina area, and if the delivery
service would be profitable and popular amenity.
Secondary market research was performed on the internet, visiting competitor websites,
examining potential delivery routes to customers, viewing information on the demographics in
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the zip codes surrounding The Wobbly Otter. All the sources can be seen in the References
section.
Future marketing research will be done online as well, where new target market demographics
will be examined. In addition to the internet, using data taken from the restaurant about popular
food items and drinks, menu expansion can be looked into. Also, as popularity grows, expansion
opportunities to surrounding cities can be assessed by going to different college campuses and
speaking with students and residents of those communities and gathering data using personal
connections.
Financials
The next three sections of this report will illustrate The Wobbly Otters Financial Analyses for a
three year period, which can all be seen in appendix 1.
Break-even Analysis
Figure 3 shows illustrates when The Wobbly Otter will break even. This graph is a breakdown of
our expenses and net income. These figures can be found in appendix 1. Net income is The
Wobbly Otters total revenue with cost of goods sold, payroll and expenses subtracted. The graph
shows that The Wobbly Otter will break even in its 15th month of business.
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Break Even
$300,000.00
$250,000.00
$200,000.00
$150,000.00
$100,000.00
Expenses
$50,000.00
Net Profit
$$(50,000.00)
1
2
3
4
$(100,000.00)
5
6
7
8
9
10 11 12 13 14 15
Months
$(150,000.00)
Table 4 (appendix 1, Income statement yr 2)
In order for The Wobbly Otter to break even in month 15 of business we must average: $49,320
revenue form in house meals, $11,770 in delivery revenue, $31,920 in liquor sales, and $16,500
in beer sales each month.(appendix 1, Sales Forecast Year 1). The 15 month averages shown on
Sales Forecast Year one are gathered by taking the 15 month total revenue combined and divided
by 15 to show how much The Wobbly Otter must make each month in the four categories of
revenue for The Wobbly Otter.
Sales Forecast
Figure 4 shows The Wobbly Otter first year sales forecast broken up into four main categories,
Eat in, Delivery, Liquor and Beer. These forecast are estimated by taking information from our
surveys, accounting for how often our target market is eating out or calling for delivery and
accounting for having college students nearby who are often under the influence and unable to
drive. The Wobbly Otter has taken not having any recognition in our first months which will
show in Figure 4 that the projections are very low and increase overtime. In Appendix 1 under
Sales Forecast Year 2 projections have increased and will continue too through to year three
where sales forecast will start to level out (Appendix 1).
Figure 3 (Appendix 1, Sales Forecast Year 1)
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12-m onth Sales Forecast
Eat in
Sale price @
unit
Eat in
TOTAL
Annual
Totals
55200
Jul-12
2250
Aug-12
2700
Sep-12
3300
Oct-12
3600
Nov-12
3600
Dec-12
4350
Jan-13
3900
Feb-13
4800
Mar-13
5700
Apr-13
6750
May-13
6750
Jun-13
7500
9.00
9.00
9.00
9.00
9.00
9.00
9.00
9.00
9.00
9.00
9.00
9.00
20,250
24,300
29,700
32,400
32,400
39,150
35,100
43,200
51,300
60,750
60,750
67,500
496,800
750
750
750
750
750
900
750
750
1200
1350
1350
1500
11550
11.00
11.00
11.00
11.00
11.00
11.00
11.00
11.00
11.00
11.00
11.00
11.00
8,250
8,250
8,250
8,250
8,250
9,900
8,250
8,250
13,200
14,850
14,850
16,500
127,050
1500
2100
2700
2100
2100
2250
2250
2100
2250
2400
3000
3000
27750
12.00
12.00
12.00
12.00
12.00
12.00
12.00
12.00
12.00
12.00
12.00
12.00
18,000
25,200
32,400
25,200
25,200
27,000
27,000
25,200
27,000
28,800
36,000
36,000
333,000
1800
2250
2550
2100
2100
2250
1800
2250
2250
2400
3000
3000
27750
6.00
10,800
6.00
13,500
6.00
15,300
6.00
12,600
6.00
12,600
6.00
13,500
6.00
10,800
6.00
13,500
6.00
13,500
6.00
14,400
6.00
18,000
6.00
18,000
166,500
Delivery
Sale price @
unit
Delivery
TOTAL
Liquor
Sale price @
unit
Liquor
TOTAL
Beer units
sold
Sale price @
unit
Beer TOTAL
Expense Forecast
The Wobbly Otter will have many expenses that will occur in future years. The Wobbly Otter
has listed a few that are not in the Expense Forecast(Appendix 1) but should be considered.
Fixed Costs:

Web page creation by professional

Grand opening event

Delivery car normal up-keep
Variable Costs:

Social media maintenance

Broken kitchen equipment

Broken delivery car maintenance
Controls
The Wobbly Otter will be keeping track of how many units are sold of its four categories of
revenue to measure its success. These categories are in house meals, delivery meals, liquor and
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April 25, 2013
beer. The Wobbly Otter will take a weekly inventory of liquor and beer to measure if it is
meeting projections to ensure it will break even on time. In house meals and delivery meals will
be counted and compared to food cost each week. This will ensure The Wobbly Otter is not
wasting food, which will increase expenses and that meal projections are met.
Taking a weekly inventory will also let The Wobbly Otter see if it is marketing correctly. If
meals per day are low The Wobbly Otter will be able to see this and change its marketing
strategy slightly as needed. Marketing trends change, that is why they are called trends. This is
why The Wobbly Otter will be doing weekly inventories to ensure that it has not missed a
changing trend. Doing this will allow The Wobbly Otter to promote drink specials, or delivery
specials if it feels they are losing their target market.
Implementation
To implement The Wobbly Otter, we must first find a building that has a suitable location for a
restaurant. Then we must renovate the building and make sure the restaurant has a proper layout.
Thus, the restaurant should have certain areas designate to the kitchen, a dining area, and a bar.
Also it is important to realize that restaurants are strictly regulated and subject to inspection.
Therefore, the kitchen must be up to code and the restaurant must have all permits and licenses
required to operate a restaurant. After this the employees must be hired, the menu must be
created and the delivery system must be established. Then the trained and informed of The
Wobbly Otter’s customer service requirement. This will ensure that our restaurant has a superior
customer service.
Once The Wobbly Otter is open we can begin to market the restaurant. We will maintain our
customer service to ensure repeat customers. We will have a heavy presence on social media and
the internet. These websites will display the restaurant’s menu and services. Then we will have
an atmosphere in our restaurant that is welcoming to our target market. These marketing
strategies will all cause repeat customers, but it is word of mouth that will bring in the newer
customers.
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Marketing Organization
To effectively market The Wobbly Otter, someone that can create and consistently update the
restaurant’s social media sites such as Facebook, Twitter, Instagram, and The Wobbly Otter
website will need to be contracted. With such young and tech-savvy target markets, using social
media to announce promotions, specials, and hold contests is going to be the most efficient way
to connect. Having the website will open up the online ordering of food for the delivery service,
so having the website constructed professionally is a necessity to ensure complete customer
satisfaction. Contracting out the social media presence will enable the target markets to be
constantly connected with The Wobbly Otter without interfering with the interworking of the
restaurant.
Contingency Planning
When starting a restaurant, there can be many difficulties and risks associated with it; especially
if there is a bar area emphasized. Add a delivery service to the mix and there are even more risks.
Because the quality of the food is not the main focus or selling point, finding ingredients at
appropriate costs should not be a big issue, but the chefs preparing the food could potentially
cause an issue if they become unhappy with their pay or late hours. Incentives such as tickets to a
sporting event, gift cards, or a raise in pay may have to be offered so we can keep the same chefs
that are available during the late hours The Wobbly Otter operates at and still give them an
opportunity to sleep and rest during the day and not have to work another job during the day to
support themselves and potentially a family. An issue with the late hours may be slow business
at times. If this becomes a continuous problem and the busy nights do not make up for the lost
revenue on slower nights, a shift in the operating hours may have to occur. One solution to the
worry about the hours is to open earlier in the evening, or maybe adopt a breakfast menu and be
open during the late night hours till the earlier afternoon. If that solution is implemented, a
second shift of chefs will be needed so the previous night’s chefs could go home and rest.
With the bar area in The Wobbly Otter, the risks include minors sneaking into the bar, rowdy
customers, and drunk drivers leaving the bar. The way to avoid an issue with minors being
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served at the bar is have a strict policy on carding younger looking customers, especially because
of the proximity to the CSUMB campus. The penalty for serving a minor is harsh and it also
gives the restaurant/bar a bad name, and that cost is not worth the cost of rejecting minors at the
bar ordering alcohol. With sports on the TV’s in the bar area, and a possible mix of fans
watching the game and drinking, the threat of fights and other violent or troublesome behavior is
going to be a possibility. If any customers become rowdy in the bar area of The Wobbly Otter,
there will be security to stop the behavior and make sure it does not continue. The main point of
the security however is not to act after the fact, but is instead to discourage the thought of trouble
in the bar. With regards to the possibility of drunk drivers leaving the bar and getting into
accidents and threatening lives in the community, the possibility of a contract with a taxi service
in the Marina area should be looked into so patrons can arrive home safely. Another option to
thwart the drunk driving threat is to have a branch off of the delivery service for The Wobbly
Otter become a shuttle service to take customers well over the legal limit back to their homes. To
add to the shuttle service and the partnering with a local taxi service, all customers who order an
alcoholic drink that drove to The Wobbly Otter will be required to hand over the keys to their
vehicle to the bartender and will have to go through a breathalyzer test before the keys are
returned and that patron can leave. The message of social responsibility with alcohol will be
taken very seriously at The Wobbly Otter to keep the customer and the community alive and
well.
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Pace, G. (2011, November 10). The Cost of Starting Up a Restaurant.
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Appendix 1 Excel Spread Sheet (Nick Kimbler 2013)
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