PowerPoint Presentation

CHICKEN TEAMKristina M. KasicPatrick JohnsonBernard KanjomaErik LarsonRob KilliusRaghad KhamouDragan Kosanovic

AgendaOverview Kristina KasicSituation Analysis Raghad Khamou / Dragan KosanovicMarketing Strategy Rob KilliusMarketing Mix Bernard KanjomaFinancials Erik LarsonControls Patrick JohnsonOverviewCompany OverviewFounded in 1946 by S. Cathy TruettPrivately held companyExpands through franchisingCurrently operates:1700 + locations39 states, including 1 in Michigan

Product MixBreakfastChicken biscuitsChicken, egg and cheese bagelChicken breakfast burritoLunch / DinnerChicken sandwichChargrilled chicken sandwichChicken strips

Product Mix (cont.)SidesWaffle potato friesFruit cupBreast of chicken soupSalads and WrapsGrilled chicken wrapAsian saladGrilled market salad

Healthy AlternativeMost entrees under 500 caloriesLean frying oilsWheat buns grilled sandwichesLight dressingsFranchise Layout OptionsCompany offers various optionsExpressStand-aloneDrive through onlyAvailable in unique locations:High traffic business buildingsCollege campusesHospitals

ProposalOpen 10 Chick-fil-A locations in Southeast Michigan over 5 yearsYear 1 University of Michigan and Birch RunYear 2 Michigan State and Genesys Hospital (Grand Blanc)Year 3 Detroit Metro Airport and Detroit Medical CenterYear 4 Ikea (Canton) and Lakeside Mall (Sterling Heights)Year 5 Cabelas (Dundee) and Great Lakes Crossing (Auburn Hills)Situational AnalysisChick CompetitorsIndirect CompetitionDirect CompetitionPossible ThreatsNational Coney IslandMcDonaldsLocal restaurantsSubwayBurger KingPizza SpecialtiesJimmy JohnsWendysLocal Grocery StoresSonicChipotleDennysQdobaWhite CastleBaja FreshTim HortonsKentucky Fried Chicken (KFC)Taco-BellPopeyesCompetitor Graph

Market Growth

Market Growth

Macro Environment

Trends and situations impact the successChristian beliefs integrated in businessCompetitive fast food environmentChanges in demographics

SWOTStrengthsIndustry recognitionSteady revenue growthOver 1700 locations in 39 statesHealthy alternative to beef and other meatsEstablished online presenceStrong brandWeaknessesFewer locations in Michigan than competitorsWeak presence in MichiganClosed on SundaysSWOT (cont.)OpportunitiesExpansion of menu offeringsFurther expansion of locations throughout MichiganLeadership Scholarship ProgramsThreatsCompetitors with similar menu offeringsBird related diseasesRising costs of raw materials

Marketing StrategyValue PropositionHealthy alternative to beef and other meatsTreat every customer with utmost respectOffer a good value

Financial ObjectivesFinancial ObjectivesFirst year sales In-line / mall $1.1MStand-alone $2.1MGross margin of 35%

Marketing ObjectivesMaintain a gross margin of at least 35%Generate a sales average of $4,500 each business dayRealize an annual growth of approximately 10% for each year after the opening year of each storeTarget MarketTeens 14 to 18 years of ageHave part-time jobsLooking for good valueYoung Adults 19 to 25 years of ageUsually in collegeHave full or part time jobsChoose to not cook for themselvesLooking for good valueTarget Market (cont.)Adults 25 to 55 years of ageIn careersWorking long hoursChoose not to cook for themselves due to time challengesLooking for healthy alternatives to beef and other meatsSeniors 55 + years of ageFixed incomesLooking for healthy alternatives to beef and other meatsTarget Market (cont.)Travelers all agesFamilies with childrenTraveling through MichiganLooking for good valueCritical IssuesClosed on SundaysCompetitive chicken productsStrong display of Christian values and beliefsMarketing MixMarketing the Chick Overview4 Ps: (product, price, place, and promotion)3 Ps: (people, physical evidence, and process)4 Cs: (customer value, cost, convenience, and communication)

Chick MenuProduct Marketing: The restaurant only serves chicken no beef or steakSpecial Menus: Build Your Own MealBeing a ChickenSatellite/Lunch-Counter

Getting the Chick-fil-A Word OutPricingPromotionAdvertising channels (various counties)Public relationsDirect marketing

Print (Direct Mailing) MagazineRadioTelevision Public relations and online campaigning (Facebook, Tweeter, and Groupon).Public Relations: Mass community events: annual fairs, parades and farmers markets etc.Food FestivalsSampling of our food at various locations (pairing up with big food industry companies and those that we do business with like Coca-Cola etc)Partnering up with Christian organizations (since our foundation is based on Christian values)Offering promotional materials at local Christian CollegesAttending annual Christian events with promotional materials or offering to cater their meals for the eventAttending events with large community crowds (motorcycle and bicycle clubs)Direct Marketing: Print (Direct Mailing) MagazineCoupon handouts at (schools, local grocery stores, and various events)

30More Chicken MarketingWeb planningWebsite goalsService

Website Goals: show the meal calorie calculator and various categoriesService: discuss about customers being referred to by name31Marketing StrategyIntroduce healthy menu offerings through:Social mediaCouponsLoyalty programsBasic cable advertising

FinancialsIncome Statement

Forecasted Annual Revenue Stand Alone Store: $2,150,000Mall / In-line: $1,107,800Forecasted Net Income Per Year2014: $444,640 or 13.65% of Revenue2018: $6,543,343 or 35.13% of Revenue

34Balance Sheet

Upfront Capital investment to purchase property, stores, equipmentMinimal accounts receivableDebt will be mortgaged at a 5% APR%

35Sales Forecast

Estimated growth is at 10% a yearNot factoring new growth of storesAll sales occur within the storesOverwhelming majority direct salesSales growing from $3.2M to over $18M36Break-Even Analysis

Break-even pointStand Alone Store$1,708,923 Annual Cost$142,410 Monthly CostRevenue exceeds break-even by 25%Mall / In-Line Store$683,077 Annual Cost$56,923 Monthly CostRevenue exceeds break-even by 62%37ControlsKeys to SuccessCreate repeat customersGenerate new customersAnnual sales of $1.1 million at public locationsUphold the values and traditionsPhilanthropic contributor in the communityHost and sponsor community eventsIncrease profits at each location by 8% annuallyControlsSell each item at a profit margin of at least 5.1%Annual income for stand alone restaurants of $2.1 millionAnnual income for mall/in line restaurants of $1.1 millionContinue to pay down the lines of credit by $40,000 per yearProvide at least 3 $1,000 scholarships per year per location for employees to further educationEmployees participation in profit sharing at each locationLocations will be closed on Sundays to allow staff to spend time with their families and observe Christian SabbathImplementationMeet daily goalsMonthly meetings with managers and assistant managers Quarterly ownership and management business plan reviews RisksNegative feedback from customersNontraditional franchise locations too exclusive for general publicScholarships and donations are given at a rate that significantly reduce profitsManagement does not comply with corporate valuesRisk MitigationChange management leadershipLessen donations and scholarships for eligible individuals/organizations.Close non-revenue generating locationsMarketing Research/CRMHow did you hear about Chick-fil-A?How frequently do you/your family eat out in a month?On a scale of 1-10 (1 lowest, 10 highest):How was your overall experience at Chick-fil-A?How would you rate the cleanliness of the restaurant?How was the service provided at Chick-fil-A?Do you have any suggestions for improvements that can be made to Chick-fil-A?

SummaryChick-fil-A:Healthy optionGood valueProfitable companyInvest in their people and the community

ReferencesChick-Fil-A 2013524 Company Fact Sheet)Chick-fil-A. (n.d.). Company Fact Sheet. Retrieved May 24, 2013, from http://www.Chick-fil-A.com/Company/Highlights-Fact-SheetsFolgate, E. (n.d.). Eating Healthy for Cheap at Chick-fil-A. Retrieved June 8, 2013, from Money Crashers Web site: http://www.moneycrashers.com/eating-healthy-for-cheap-at-chick-fil-a/Grantham R 28 Chick-fil-A model helps it lead)Grantham, R. (28). Chick-fil-A model helps it lead. Retrieved May 24, 2013, from http://www.ajc.com/news/business/Chick-fil-A-model-helps-itlead/nQPpn/Hayden Stewart. (2012, May 26). United States Department of Agriculture. Retrieved June 7, 2013, from United States Department of Agriculture: http://www.ers.usda.gov/topics/food-markets-prices/food-service-industry/market-segments.aspx#.UbIv8Pm7KBINational Health Council. (2012, June 28). Retrieved May 7, 2013, from American Heart Association: http://www.heart.org/HEARTORG/GettingHealthy/WeightManagement/LosingWeight/EatMore-Chicken-Fish-and-Beans-than-Red-Meat_UCM_320278_Article.jspSDIinvest 31 Chick-Fil-A Owner/Operator Model)SDIinvest. (31). The Chick-fil-A Owner/Operator Model. Retrieved May 24, 2013, from http://compoundingmachines.wordpress.com/2009/01/31/theChick-fil-A-owneroperator-model/