Milestone 5Draft of Financial, Pricing & Funding Plans Adam Parmer, Daniel Wendt, Fred Behnke, Peter Warren
Pricing Model
Cost-plus pricing- costs of running business plus operating expenses adding a percentage to the final cost. Cost of food, truck, insurance, fuel, payroll,
permits and licensesPercentage added according to market
price of produce, price of fuel, other variables
Competitive Alternative Pricing Considerations
What are the competitive alternative prices you considered from “organic” chain fast casual restaurants? Average
PriceEntrees Sides Shakes/
SmoothiesPanera $7.05 $4.79 $3.99
Chipotle $6.45 $2.55 ---
Elevation Burger
$4.50 $2.15 $3.89
Competitive Alternative Pricing Considerations
What are the competitive alternative prices you considered from chain organic fast food trucks?
Average Price
Entrees Sides Shakes/Smoothies
Cinnamon Snail
$8.25 $4.79 ---
Green Truck $8.45 $4.05 ---
BON ME $6 $2 ---
Green Pirate Juice
--- --- $6
Value Differentiation vs. Competing Products
Value DifferentiationSourced by local farmsFresh organic ingredientsQuick but quality food preparation Education about healthy eating in packaging and truck info graphicsSeasonal specials and creative menu options
How competitor prices impact our pricing
Entrée Prices and Menu Options Gives benchmark, but don’t have to compete
with lowest if value differentiation is high Variability of options gives weight to pricing
Local farm pricing Able to see costs of raw products to food trucks
Location/Cost of Living Dictates prices and market
Price Model Considerations
Mark-up pricing
Penetration pricing
Skimming pricing
Follow-the-leader pricing
Variable pricing
Dynamic pricingPrice lining
Breakeven Analysis
Relationship of Cost and Revenue
Breakeven point = September 2013
Approach
Our approach to fundraising centralizes around maintaining control of the company by seeking alternative methods of obtaining funds without giving up part of the company.
Fundraising
$40,000 initial cost $30,000 owner contribution (7,500 each) $5,000 through incentive based crowd sourcing
(Any excess needed would be attained through loans)
Use
The initial funds will be used for: Purchasing the truck
Outfitting the truck with equipment Restyling exterior
Renting a prep-kitchen Purchasing inventory/ingredients Allowing for employment of staff
Nature of Raise
We will seek to consistently fund ourselves through the use of debt financing methods.