Learners Guide

C:\DOCUME~1\LEIGH~1.PEM\LOCALS~1\Temp\SanDisk SecureAccessV2\BSBMKG515A - Assessment Task - 01 - mod.docAssessment Task Assessment Task 1BSBMKG515A Conduct a marketing audit

CRICOS Provider no. 01718J (VIC) 01459A (WA)

Marketing Audit PlanSubmission details

Candidates NamePhone No.

Assessors NamePhone No.

Assessment Site

Assessment Date/sTime/s

The Assessment Task is due on the date specified by your assessor. Any variations to this arrangement must be approved in writing by your assessor.

Submit this document with any required evidence attached. See specifications below for details.

Performance objective

For this assessment candidates are required to review a provided case study marketing plan and design a plan to audit the marketing activities of the organisation.Assessment description

In this Assessment Task, you are required to prepare for a marketing audit by developing a plan outlining how an internal and external audit can be conducted within the case study organisation. You will need to review the case study marketing plan provided with this assessment, and describe a plan that outlines the scope, approaches, and timelines for the audits. You will need to clearly identify the type of marketing audit and format to be used in conducting the audit and collecting information.Procedure

1. Using the case study information provided to you, complete the following steps by providing dot-point written information to describe:

a. the purpose of the marketing audit, as it applies to the organisation in the case study

b. the scope of the marketing audit that is required

c. the methodology required to be used in conducting the audit and the appropriate time it should occur

d. the participants to be involved in the conduct of the audit and what their involvement would require (their role)

e. the main characteristics of the marketing audit and how they meet the audit priorities for the organisationf. the format of and the main elements to be included in the marketing audit

g. the form of marketing audit that best meets the requirements of the marketing plan.

Specifications

You must provide:

a completed marketing audit plan, with written dot point information as outlined above. Make sure all information provided is in the context of the attached case study. Points will be lost for irrelevant information. Your assessor will be looking for:

evidence that you analysed and identified the needs of the case study evidence that you have analysed the marketing activities of the organisation.Distance-based learners Complete assessment as per instructions.

Case study information Excerpt from letter of appointment

Ready-made marketing engages you to conduct a marketing audit on their client, Sartos Gourmet Pasta.

The audit is to cover macro and micro environmental factors, and the internal marketing operations including the marketing organisation, systems and productivity.

Sartos will make available existing research data, internal sales data and details of their supply chain logistics. Your audit is to research the Graceville trading area and its place in the wider Australian community, while specifically targeting the pasta restaurant trade.

Priority of the audit is to uncover the key factors that have inhibited the clients ability to achieve the objectives of the market plan. The audit is to make findings in relation to the marketing plan, culminating in a report that compares the marketing plan assumptions with actual findings. It is expected that the report will follow the outline of the marketing plan.

Meeting with Rose Ready of Ready-Made Marketing

You met with the owner of Ready-Made Marketing, Rose Ready, who explained that their client had agreed to the marketing audit but wanted an external person, like you, to conduct it, so that all points of view could be canvassed from an independent perspective to minimise the chance for subjectivity.

Rose explained that Sartos has not achieved the anticipated business objectives, and the hope is that your audit will uncover why this has happened by investigating the macro and micro environmental factors affecting the business, as well as the internal and external influences. The timing of the audit is right in fitting in with the planning cycle and the availability of relevant data.

Rose stressed that they were looking for a variety of methodologies to be used in the marketing audit including one-on-one interviews with the key participants, use of customer focus groups that she could facilitate and research of data available for market research firms and government agencies.

To assist you with the marketing audit, Rose gave you a copy of the marketing plan and provided the following research data for you to use in your report: Australian Bureau of Statistics data

IBSA World market research

Australian Treasury reports.Rose also outlined the key participants, apart from herself, that could be involved in the audit process. These included:

Mario Sarto owner, who could provide reasons behind the decisions and directions given

Eric Yeung accountant, who could provide financial data on costings and profitability

Adriana Como sales and promotions, who could help with the internal operational problems with the marketing process.Marketing PlanSartos Gourmet Pasta December 2008

Table of Contents61.0 Executive Summary

82.0 Situation Analysis

82.1 Market Summary

102.2 SWOT Analysis

112.3 Competition

132.4 Service Offering

142.5 Keys to Success

163.0 Marketing Strategy

163.1 Mission

163.2 Marketing Objectives

163.3 Financial Objectives

163.4 Target Marketing

173.5 Positioning

173.6 Strategy Pyramids

183.7 Marketing Mix

193.8 Marketing Research

214.0 Financials, Budgets, and Forecasts

214.1 Break-even Analysis

214.2 Sales Forecast

224.3 Expense Forecast

255.0 Controls

255.1 Implementation Kmstones

265.2 Marketing Organisation

265.3 Contingency Planning

1.0 Executive Summary

Sartos Gourmet Pasta will be the leading gourmet pasta restaurant in Graceville, leveraging the rapidly developing consumer demand for pasta and a growing customer base. The signature line of innovative, premium, pasta dishes include pesto with smoked salmon, pancetta and peas linguini in an alfredo sauce, and fresh mussels and clams in a marinara sauce. Sartos Gourmet Pasta also serves distinct desserts and beverages including alcohol.

Sartos Gourmet Pasta will reinvent the sit-down and home-delivery pasta experience for individuals and families, with high discretionary income by selling high quality, innovative exotic products at a reasonable price, designing tasteful, convenient locations, and providing industry-benchmark customer service.

In order to grow at a rate consistent with our objectives, Sartos is offering an additional $500,000 in equity. Existing members will be given the first option to subscribe to the additional equity to allow each of them to maintain their percentage of ownership. The portion not subscribed by existing members will be available for prospective new investors.

Note: This marketing plan has been prepared for Trans-Australian Financiers by M. Sarto in conjunction with Ready-Made Marketing, as part of an application for finance. Ready-Made Marketing have recommended a marketing audit be done each year to assess the effectiveness and achievements of the plan, and make adjustments where required.

2.0 Situation Analysis

Sartos Gourmet Pasta is close to entering their third year of operation. The restaurant has been well received, and marketing is now critical to its continued success and future profitability. The store offers an extensive offering of gourmet pastas. The basic market need is to offer individuals, families, and take away customers fresh, creative, exotic, attractive, pasta dishes and desserts. Sartos uses homemade pasta, organic vegetables, and premium meats and cheeses.

2.1 Market Summary

Sartos Gourmet Pasta possess good information about the market and know a great deal about the common attributes of our most prized and loyal customers. Sartos Gourmet Pasta will leverage this information to better understand who is served, their specific needs, and how Sartos can better communicate with them.

Market Analysis

2.1.1 Market Demographics

The profile for Sartos Gourmet Pasta's customer consists of the following geographic, demographic, and behaviour factors based on a local Chamber of Commerce report:

Overview Graceville: Large % of families. Area growing at 10% per year. Household income increasing steadily.

Regional distribution Graceville growing faster that the city and state at 7%.

Geographic: Our immediate geographic target is the area of Graceville with a population of 130,000.

A 30 km geographic area is in need of our services.

The total targeted population is estimated at 46,000.

Demographics: Male and female.

Ages 25-50, this is the segment that makes up 53% of the Graceville market according to the Graceville Chamber of Commerce.

Young professionals who live close to the location.

Have attended secondary and have further education. An income over $60,000.

Eat out several times a week.

Tend to patronise higher quality restaurants.

Behaviour factors: Enjoy a high quality meal without the mess of making it themselves.

There is value attributed to the appearance or presentation of food.

2.1.2 Market Needs

Sartos Gourmet Pasta is providing its customers with a wide selection of high-quality pasta dishes that are unique and pleasing in presentation and utilises top-shelf ingredients. Sartos Gourmet Pasta seeks to fulfil the following benefits that are important to their customers.

Selection A wide choice of pasta options.

Accessibility The patron can gain access to the restaurant with minimal waits and can choose the option of dine in or take out away. There is a planned Park n Ride to be built adjacent to the property providing parking for patrons at night.

Customer service The patron will be impressed with the level of attention that they receive.

Competitive pricing All products/services will be competitively priced relative to comparable high-end pasta/Italian restaurants.

Above all, Sartos believes that quality tasting food, an exotic assortment and range of pastas, in a family-based dine-in environment is the key to our customers needs and wants.

2.1.3 Market Trends

The market trend for restaurants is headed toward a more sophisticated customer. The restaurant patron today relative to yesterday is more sophisticated in a number of different ways.

Food quality The preference for high-quality ingredients is increasing as customers are learning to appreciate the qualitative differences.

Presentation/appearance As presentation of an element of the culinary experience becomes more pervasive, patrons are learning to appreciate this aspect of the industry.

Selection People are demanding a larger selection of foods, they are no longer accepting a limited menu.

The reason for this trend is that within the last couple of years the restaurant offerings have increased, providing customers with new choices. Restaurant patrons no longer need to accept a limited number of options. With more choices, patrons have become more sophisticated. This trend is intuitive as you can observe a more sophisticated restaurant patron in larger city markets such as Sydney or Melbourne where there are more choices available.

Sartos strongly believe that customers are more interested in exotic taste than any other issue. This will be why they shop with us and become loyal patrons.

2.1.4 Market Growth

In 2008, the global pasta market reached $10 billion dollars. Pasta sales are estimated to grow by at least 10% for the next few years. This growth can be attributed to several different factors. While not all pasta is good for you, particularly the cream-based sauces, pasta can be very tasty. Sartos sees no real substitute for what it provides Impossible to substitute this taste and offer, according to Sartos owner and founder, M. Sarto.

Another variable that is contributing to market growth is an increase in the number of hours our demographic is working. Over the last five years the number of hours spent at work of our archetype customer has significantly increased. As the number of work hours increases, there is a high correlation of people that eat out at restaurants. This is intuitively explained by the fact that with a limited number of hours available each day, people have less time to prepare their meals and eating out is one way to maximise their time.

2.1.5 Economy

Based on economic forecasts, Sartos Gourmet Pasta assume that interest rates are coming down and that this reduction will create more disposable income and more money available for families to eat out. In terms of available credit, Sartos assumes that this will not change in the foreseeable future and will not be a threat to the potential sales. The same assumption is made about employment levels, where Sartos assumes that unemployment levels remain the same at 5.1%.

2.1.6 Political

From research carried out, Sartos identify that the government focus and emphasis in future legislative direction will be about work/life balance, which Sartos see a positive for their business model. Sartos, as a business operating in Australia, will abide by the law in all its dealings and comply with legislation that impacts on its business activities.

2.2 SWOT AnalysisThe following SWOT analysis captures the key strengths and weaknesses within the company, and describes the opportunities and threats facing Sartos Gourmet Pasta.

2.2.1 Strengths

Strong relationships with vendors that offer high-quality ingredients and fast/frequent delivery schedules.

Excellent staff who are highly skilled at food preparation.

Great retail space that is bright, clean, and located in an upscale mall, suburban neighbourhood, or urban retail district.

High customer loyalty among repeat customers.

High-quality food offerings that exceed competitors offerings in quality, creativity and presentation.

Ready supply of organic food in the area not like other states.

2.2.2 Weaknesses

Sartos name lacks brand equity.

A limited marketing budget to develop brand awareness.

The struggle to continually appear to be cutting edge.

2.2.3 Opportunities

Growing market with a significant percentage of the target market still not aware that Sartos Gourmet Pasta exists.

Increasing sales opportunities in family business.

In the expansion, Sartos will have the ability to spread overhead over multiple revenue centres. Sartos will be able to spread the management overhead costs among the multiple stores, decreasing the fixed costs per store.

2.2.4 Threats

Competition from local restaurants that respond to Sartos Gourmet Pastas exotic offerings.

Gourmet pasta restaurant chains found in other markets coming to Graceville.

A slump in the economy reducing customers disposable income spent on eating out.

2.3 CompetitionNational Competition

Pasta Buzz: offers consumers their choice of noodles, sauces, and ingredients, allowing the customer to assemble their dish as they wish. Food quality is average.

Pasta Bite: has a limited selection but the dishes are assembled with high-quality ingredients. The price point is high, but the food is quite good.

Pasta Mia: offers pasta that is reasonably fresh, reasonably innovative and at a lower price point. The company was sold a few years ago, and consequently the direction of management has been stagnant lately and has resulted in excessive employee turnover.

Verdi Pasta: has medium-priced pasta dishes that use average ingredients, no creativity, and less than average store atmosphere. Sartos is not sure how this company has been able to grow in size as their whole product is mediocre at best.

It is Sartos belief that the existing unwritten code of business activity, where each chain stays within their founding geographic market place, will remain in the foreseeable future.

Local Competition

Stellas: This is an upscale Italian restaurant that has a limited selection of pasta dishes. Although the selection is limited and pricey, the dishes are quite good.

Peri Pasta: An Italian restaurant with a decent pasta selection, however quality is inconsistent.

Niccolo: An upscale restaurant with a large wine selection and good salads. Everything else is mediocre at best and over-priced. Service can often be poor.

Sartos do not see the competitors changing their marketing strategy or product offer in the foreseeable future.

Growth and Share Analysis

2.4 Service OfferingSartos has created gourmet pastas that are differentiated and superior to competitors. Customers can taste the quality and freshness of the product in every bite. The following are characteristics of the product. Sartos dough for the pasta is made with Italian semolina flour.

Cheeses are all imported.

Vegetables are organic and fresh with three shipments a week.

Meats are all top-shelf varieties, organic when possible.

At Sartos, food is not a product; the experience of dining is a service. Sartos prides themselves on providing service that is on par with fine dining.

Sartos will ensure that all aspects that are involved in the delivery of satisfaction to the customer will work using an integrated approach.

At a Glance The Prototype Sartos Store:

Location: an upscale mall, suburban neighbourhood, or urban retail district.

Design: bright and clean.

Size: 110160 m2.

Employees: 710 full-time plus casuals

Seating: 3545.

Types of transactions: 80% dine in, 20% take away.

2.5 Keys to SuccessLocation, Location, Location.

Sartos site selection criteria are critical to success. Jeff Hardy, former director of Real Estate, Coffee Club, helped us identify the following site selection criteria. Daytime and evening populations.

Shopping patterns.

Car counts.

Household income levels.

2.6 Critical Issues

Sartos Gourmet Pasta is still in the speculative stage as a franchise concept with one store starting as the prototype. Its critical issues are the following. Continue to take a modest fiscal approach; expand at a reasonable rate, not for the sake of expansion in itself, but because it is economically wise to.

Use of the phone ordering system to underpin the direct selling activities in take away food.

3.0 Marketing Strategy

Sartos advertising budget is very limited, so the advertising program is simple. Sartos will do direct mail and local advertising, with inserts in the BMag likely to be the most successful of the campaigns.

Lastly, Sartos will leverage personal relationships to get articles of Sartos in the BMag. Previous friends who have had their restaurant featured in the BMag have seen a dramatic increase of sales immediately after the article was published in the BMag.

3.1 MissionSartos Gourmet Pastas mission is to provide families with the finest pasta meal and dining experience. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers.

3.2 Marketing Objectives1. Maintain positive, steady, growth each month.

2. Generate at least $45,000 in sales per month.

3. Experience an increase in new customers who are turned into long-term customers.

4. Realise a growth strategy of one store per year.

3.3 Financial Objectives1. A double-digit growth rate for each future year.

2. Reduce the overhead per store through disciplined growth.

3. Continue to decrease the variable costs associated with food production.

3.4 Target MarketingThe market can be segmented into three target populations:

Individuals: people that dine in by themselves.

Families: a group of people, either friends or a group of nuclear relatives dining together.

Take out: people that prefer to eat Sartos food in their home or at a different location than the actual restaurant.

The Sartos customers are hungry individuals between the ages of 25 and 50, making up 53% of Graceville (Graceville Chamber of Commerce). Age is not the most defined demographic of this customer base; all age groups enjoy pasta. The most defined characteristic of the target market is income. Gourmet pasta stores have been very successful in high rent, mixed-use urban areas. These areas have a large day and night population consisting of business people and families who have household disposable incomes over $40,000.

Combining several key demographic factors, Sartos arrives at a profile of the primary customer as follows:

Sophisticated families who live nearby.

Young professionals who work close to the location.

Shoppers who patronise the high rent stores.

3.5 PositioningSartos Gourmet Pasta will position itself as a reasonably priced, upscale, gourmet pasta restaurant. Graceville consumers who appreciate high-quality food will recognise the value and unique offerings of Sartos Gourmet Pasta. Patrons will include singles and families, ages 2550.

Sartos Gourmet Pasta positioning will leverage their competitive edge:

Product. The product will have the freshest ingredients including homemade pasta, imported cheeses, organic vegetables, and top-shelf meats. The product will also be developed to enhance presentation, everything will be aesthetically pleasing.

Service. Santos will only employ experienced cooking staff who can create meals that customers will find outstanding to the taste.

By offering a superior product, Sartos will excel relative to the competition.

3.6 Strategy PyramidsThe single objective is to position Sartos as the premier gourmet pasta restaurant in the Graceville area, commanding a majority of the market share within five years. The marketing strategy will seek to first create customer awareness regarding their services offered, develop that customer base, and work toward building customer loyalty and referrals.

The message that Sartos will seek to communicate is that Sartos offers the freshest, most creative, reasonably priced, gourmet pasta in Graceville. This message will be communicated through a variety of methods. The first will be direct mail. The direct mail campaign will be a way to communicate directly with the consumer. Sartos will also use ads and inserts in the BMag. This will be particularly effective because the BMag is a popular local paper that is consulted when people are looking for things to do in Graceville.

The last method for communicating Sartos message is through a grassroots PR campaign. This campaign will leverage networking relationships with people on staff of the BMag to get a couple of articles written about Sartos. One will be from the business point of view, talking about the opening of the restaurant and the people behind the venture. This is likely to be run in the business section. The second article will be a food review. In speaking with many different retailers and restaurateurs, significant increases of traffic followed articles in the BMag. Because of this level of effectiveness and low/zero cost, Sartos will work hard to get press in the BMag.

Sartos also believe that the local patrons far prefer to receive information from the restaurant via flyers in the letterbox.

3.7 Marketing MixSartos marketing mix is comprised of these following approaches to pricing, distribution, advertising and promotion, and customer service.

Pricing Sartos pricing scheme is that the product cost is 35% of the total retail price.

Distribution Sartos food will be distributed through a take away model where customers can phone in their order and come to the restaurant to pick it up, come into the restaurant, place the take out order and wait for it to be completed, or come in and dine at the restaurant.

Advertising and promotion The most successful advertising will be adverts and inserts in the BMag as well as a PR campaign of informational articles and reviews also within the BMag. Promotions will take the form of in restaurant entertainment and free meal giveaways. Heavy emphasis on promoting the brand and not just advertising products.

Customer service Sartos philosophy is that whatever needs to be done to make the customer happy must occur, this investment will pay off with a fiercely loyal customer base who is extremely vocal to their friends with referrals.

3.8 Product developmentIt is envisaged that new products will be developed on a regular basis in thine with menu changes which is targeted at every three months. The plan for product testing is to offer free meals to regular customers, staff and their families. By getting feedback from these people, changes can be made or products canned so that only tested and proven products make it onto the menu list.

3.9 Marketing ResearchDuring the initial phases of the marketing plan development, several focus groups were held to gain insight into a variety of patrons of restaurants. These focus groups provided useful insight into the decisions, and decision making processes, of consumers.

An additional source of market research that is dynamic is a feedback mechanism based on a suggestion card system. The suggestion card system has several statements that patrons are asked to rate in terms of a given scale. There are also several open ended questions that allow the customer to freely offer constructive criticism or praise. Sartos will work hard to implement reasonable suggestions in order to improve their service offerings as well as show their commitment to the customer that their suggestions are valued.

The last source of market research is competitive analysis/appreciation. Sartos will continually patronise local restaurants for two reasons. The first is for competitive analysis, providing Sartos with timely information regarding other restaurant's service offering. The second reason is that local business owners, particularly restaurant owners, are often part of an informal fraternal organisation where they support each other's business.

Access to ongoing market research will be achieved via the publications from the Restaurant Association which Sartos has become a member of recently.

4.0 Financials, Budgets, and Forecasts

This section will offer a financial overview of Sartos Gourmet Pasta as it relates to the marketing activities. Sartos will address Break-even Analysis, sales forecasts, expense forecasts, and how those link to the marketing strategy.

4.1 Break-even AnalysisThe break-even analysis indicates that $45,000 will be needed in monthly revenue to reach the break-even point.

4.2 Sales ForecastThe first year will be used to get the restaurant up and running. By year two things will get busier. Sales will gradually increase with profitability being reached by the beginning of year two.

Sales Forecast

4.3 Expense ForecastMarketing expenses are to be budgeted so that they are ramped up in the first year. Restaurants typically have increased business in Autumn. This generally occurs because during the summer, when the weather is nice and it does not get dark until late, people tend to eat out less.

Marketing Expense Budget

Ongoing sales forecasting will be to use the services of Ready-Made Marketing who will advise on all aspects of the marketing function that Sartos will be engaged with. Ready-Made Marketing will also be given access to the marketing cost data so that they can periodically examine and validate marketing costs in line with industry benchmarks.

Profitability outcomes budget

5.0 ControlsThe purpose of Sartos Gourmet Pastas marketing plan is to serve as a guide for the organisation.

5.1 Implementation Milestones

The following milestones identify the key marketing programs. It is important to accomplish each one on time, and on budget.

Milestones

AdvertisingStart DateEnd DateBudgetManagerDepartment

Marketing plan completion1/01/20092/01/2009$0MarioDepartment

Banner ad campaign #11/02/20094/01/2009$3,754MarioDepartment

Banner ad campaign #21/10/20091/01/2009$4,900MarioDepartment

Total Advertising Budget$8,654

PRStart DateEnd DateBudgetManagerDepartment

Other$0

Other$0

Total PR Budget$0

Direct MarketingStart DateEnd DateBudgetManagerDepartment

Direct mail campaign #11/10/20091/04/2009$1,689MarioDepartment

Insert campaign #11/10/20091/04/2009$2,252MarioDepartment

Direct mail campaign #21/10/20091/01/2010$2,205MarioDepartment

Insert campaign #21/10/20091/01/2010$2,940MarioDepartment

Total Direct Marketing Budget$9,086

Totals$17,740

5.2 Marketing OrganisationMario Sarto, the owner, is primarily responsible for marketing activities and has the authority and responsibility over all company activities that affect customers satisfaction. This is in addition to his other responsibilities. Ready-made marketing have been engaged to provide marketing services as required, and some outside resources for graphic design work, and creativity are also to be utilised.

Feedback will come from in-store feedback forms and local customer surveys

5.3 Contingency PlanningDifficulties and risks:

Problems generating visibility.

Overly aggressive and debilitating actions by competitors.

An entry into the Graceville market of an already existing, franchised gourmet pasta restaurant.

Worst case risks may include:

Determining that the business cannot support itself on an ongoing basis.

Having to liquidate equipment or intellectual property to cover liabilities.Cambridge International College

V29/10/14 RTO No. 2325 CRICOS Provider No.01459A

Created By: Leigh Pember 17/05/2015Page 1 of 26