CHURRO ILOCO Description of the Product Churros are tasty deep fried, ridged sticks of dough, sugar-sprinkled and served with warm different for dipping. Churro Iloco will be putting a new spin into rich dessert by starting with seven different churro flavors and dipping. Customers can choose to have their churros serve in cone with these flavors:
Classic with Belgian chocolate dip Churros Classic Covered with Matcha Chocolate Banana Nutella Classic Churros Coated in Butterscotch Flavored Chocolate Butterscotch and Classic Churros Classic Covered in Dark Chocolate
Our Vision Our vision is to be a sought-after pastry snack provider in Mariano Marcos State University, City of Batac to satisfy the urge for the sweet taste that students crave several times a day. Aside from these, Churro Iloco shall have the unique selling proposition of. “Y’all ain’t ready for this churro!” Our Mission Our mission is to bring customers delight with every taste and bite. Churro Iloco is dedicated to providing top of the line products and quality service. It is our goal to prosper as a business and grow as entrepreneurs. By doing so we share our success in the local market, as well as provide a profitable return to our team members. Objectives
To be a market leader in the food stand business To position ourselves as a small scale enterprise, with strong ties to the community. To be perceived as the cleanest, most responsive food stand within the school vicinity.
Goals
To maintain positive balance in our lives so that the business rounds us out and reflects our values. To offer the MMSU studentry a wholesome snack that is satisfying, great tasting and worth every cent. To have our employee/s and customers feel appreciated, supported, and satisfied, every time they come.
Need Analysis *Conducted on November 24, 2016 Table1. We conducted a survey with regards to putting up a Churreria Business to 100 students in the 5 different colleges of Mariano Marcos State University, City of Batac, Ilocos Norte. College of Business, Economics and Accountancy, College of Health and Sciences, College of Engineering, College of Food and Sustainable Development, and College of Arts and Sciences. COLLEGE CBEA CHS COE CAFSD CAS TOTAL
NUMBER OF STUDENTS 39 13 22 12 14 100
Table 2. 75% out of the total survey are students who are willing to pay a churro for Php 25.00, which garnered the highest percentage among four different prices: 15% for students who are willing to pay at Php 50.00; 9% for students who are willing to pay at more than Php 50.00 and 1% are students who won’t buy a churro, respectively. AMOUNT Php 50.00 Php 25.00 More than Php 50.00 Not interested in buying TOTAL
FREQUENCY 15 75 9 1 100
PERCENTAGE 15% 75% 9% 1% 100%
Table 3. 71& of the total survey are willing to wait 0-5 minutes for an order. While, 28% of the students are willing to wait 5-10 minutes; 1% is willing to wait for more than 20 minutes and none is willing to wait for 15-20 minutes. WAITING TIME 0-5 5-10 15-20 More than 20 TOTAL
FREQUENCY 71 28 0 1 100
PERCENTAGE 71% 28% 0% 1% 100%
Table 4. 59% of the survey are students that prefers their churros in a cone. Meanwhile, 5% of the students would prefer it in a skewer; 24% would like their order in a plate and 12% would like their order in a plastic cup, respectively. PRESENTATION Skewer Cone Plate Cup TOTAL
FREQUENCY 5 57 23 15 100
PERCENTAGE 5% 57% 23% 15% 100%
Table 5. In terms of how many churros are students are willing to buy, 45% of the survey would like to pay for 1-2 piece/s of churro/s, while 26% of the survey are students that would like to order 2-3 piece/s of churro/s; 9% are students that would like to order 3-4 piece/s and 20% are students that would like to order more than 4 pieces of churros. NOS. OF CHURROS 1-2 2-3 3-4 More than 4 TOTAL
FREQUENCY 45 26 9 20 100
PERCENTAGE 45% 26% 9% 20% 100%
Table 6. 53% of the survey are students that would buy churros anytime during the day. While, 47% of the students are most likely to buy churros in the food stand during their snack time, and none would like to buy churros during lunch time. TIME Snack time Lunch time Anytime during the day TOTAL
FREQUENCY 47 0
PERCENTAGE 47% 0%
53
53%
100
100%
Table 7. For the location, 49% of the survey are students that would like the Churro business to be located inside the campus. While, 31% of the students would like the Churro business to be located near the campus vicinity and 15% of the students would rather see the Churro business to be located in a mall. LOCATION Inside the campus Nearby the campus Mall TOTAL
FREQUENCY 49 31 20 100
PERCENTAGE 49% 31% 20% 100%
Thus, Churro Iloco will operate its first stand inside MMSU campus in Batac City, with a population of 15,000 students. The food stand will be located near the MMSU Oval grounds, south-western part, where customer traffic always takes place. Furthermore, it is also near the University Covered Court. Most of the activities, university wide, is done in the Covered Court. All activities from production to selling will occur in the stand.
Flavors
Percentage 13%
18%
7%
18%
9%
25% 10%
Churro Iloco will be starting up with seven different churro flavors and a survey was conducted to the same number of students based on what flavors they like among the seven varities. Here is a pie chart to show the statistics of the said survey.
Legend Classic with Belgian Chocolate dip Churros Classic Covered with Matcha Chocolate Banana Nutella Classic Churros Coated in Butterscotch Flavored Chocolate Butterscotch and Classic Churros Classic Covered in Dark Chocolate
Target Market Our main customers for Churro Iloco stand will be the students of MMSU who are present during regular school days and activities conducted within the vicinity of the University.
Selling Price Churro Iloco plans to sell 12-inch churro (any flavor) in a cone, that may come with a chocolate dip in a small container, at an affordable price of Php 25.00
SWOT ANALYSIS
STRENGTHS
OPPURTUNITIES
Only Churros store in Ilocos Norte Ingredients are easy to acquire at low cost Quality Products, Affordable Prices No direct competitors
Diversification of Product Offerings Expansion of Business to New Potential Locations
WEAKNESSES
THREATS
Low Brand Awareness Menu limited to one product only
Changing customer preferences Customer’s move to healthier lifestyle
FINANCIAL REQUIREMENTS Fixed Capital. The business’ fixed Capital shall include items which are used for more than one period and are expected to benefit future periods. The entity’s fixed capital shall include the following: Frying Pan (deep) Portable Gas Stove Pastry Tip Measuring cups TOTAL
Estimated useful time 5 years 5 years 10 years 10 years
Price (Php) 1,500.00 2,500.00 100.00 200.00 4,300.00
Raw Materials. The raw materials needed are available in supermarkets in the Batac City. These will be purchased weekly. To ensure availability and prevent stockouts, safety stock for one week operation for non-perishable ingredients such as oil, flour, salt, sugar shall be maintained. The necessary raw material for the business is as follows: Churros Brown Sugar 2kg Salt Butter White Flour Eggs Vanilla extract Cinnamon Confectioner’s Sugar Banana Nutella Paper Container Oil Chocolate Dip Chocolate Syrup TOTAL
Suppliers Gemma’s Grocery Gemma’s Grocery Gemma’s Grocery Gemma’s Grocery Gemma’s Grocery Gemma’s Grocery Gemma’s Grocery Robinson’s Grocery Batac Public Market Robinson’s Grocery Robinson’s Grocery Robinson’s Grocery Robinson’s Grocery
Price (Php) 80.00 35.00 80.00 84.00 150.00 20.00 200.00 300.00 145.00 400.00 500.00 500.00 500.00 2,994.00
Cost of Labor. The business will hire four (4) personel who will be in-charge in the stand daily. Work schedule will start from 9:00 – 5:00 pm. Churro Iloco shall register its employees with the sss, PhilHealth and Pg-ibig when they are employed. For
each unit of labor that will be acquired the entity shall incur a salary expense of Php 233.00 per day, minimum salary for small enterprise in Region 1. The table will show the salary expense for the first week of operation. Four personnel
233.00 x 4 Personnel x 5 days
4,660.00
Rent Expense. MMSU charges Php 5,000 as rent expense for stand vendors. Rent expense is paid one month in advance. In addition, a Php 15,000.00 rend deposit shall be paid at the beginning of the first month. Organization Cost Procedure Registration and verification at SEC Preparation of legal documents Bank Account Opening Notarization of SEC Documents Registration at SEC and TIN acquisition Barangay Clearance Pay for Business permits Certificate of Registration at BIR Registration as Barangay Micro Business Enterprise at the City Treasurer’s Office TOTAL
Estimated Cost (Php) 40.00 500.00 250.00 500.00 3,500.00 300.00 8,100.00 115.00 1,000.00 14,605.00
Administrative Expenses (Supplies) Item Bond Paper (1 ream) Special Books (4 pcs) Envelopes (5 pcs) Ballpens (12 pcs) Stapler (1) Staple wires ( 1 box) TOTAL
Amount (Php) 300.00 150.00 40.00 60.00 85.00 50.00 685.00
Marketing Budget. Churro Iloco will mostly rely on the goodwill it will generate through its innovative and high- quality food offerings. As such, we expect our customers to share good reviews about us orally or through social media. Thus the marketing budget is simply broken down into cash needed for the grand opening and product launch, as follows: DESCRIPTION Balloons Flyers
Free Samples
Tarpaulin Transportation
QUANTITY 100 pieces 100 pieces 180 whole piece of Classic Churro *1pc of churro is 12”; will be divided in half that makes it 6” 2 2x3 ft. piece
COST Php 200.00/ pack of 100’s Php 1.00
1 pc Churro Php 25.00
Php 60.00/ piece
TOTAL 200.00 100.00
4,500.00
120.00 100.00
TOTAL
5,020.00
FINANCIAL PLAN START-UP COST First Month of operation Particulars
Amount (Php)
Fixed Capital Raw materials Cost of Labor Rent Expense Rent Deposit Organizational Cost Administrative Expenses Marketing Budget Set-up of stand Gas Tank Training of personnel Transportation Expense Miscellaneous Expenses
4,300.00 11,976.00 18,640.00 5,000.00 15,000.00 14,605.00 685.00 5,020.00 22,000.00 574.00 700.00 500.00 1000.00 100,000.00
TOTAL Funding Estimate Source of fund Investor Funding Owner 1 Owner 2
Amount (Php) 20,000.00 20,000.00 TOTAL
Bank Loan Bank 1 Bank 2 Non-Bank
40,000.00 20,000.00 20,000.00 20,000.00
TOTAL
60,000.00 100,000.00
HUMAN RESOURCES 1. Manager/Supervisor Manager/Supervisor is primarily responsible for preparing food items to be used in all menu items. He/she is also responsible for receiving inventory and verifying the orders. Duties also include: Presents a clean-cut, neat and professional image Resolving customer complaints Answering customers' questions, and provide information on procedures or policies Preparing all menu items using standard facility equipment ensuring quality and efficiency and customer satisfaction Assumes responsibility for quality of products prepared and served Monitoring stocks of ingredients and food items and with the preparation of inventory supply orders Receiving delivered food stocks and supplies, verifying receipt of ordered items. Stores and rotates all products properly follows FIFO (first-in, first-out) Ensuring that all items meet or exceed food safety standards Ensuring proper use of all equipment per manufacturer’s and company specifications 2. Cashier Responsible for assisting the Manager/Supervisor and accepting payment from the customers for products provided. Duties also include: Receiving food orders from server Entering acquisition into cash register to compute total buy price Receiving payments and present change to customers Maintaining enough amounts of change in cash drawer Balancing cash drawer and receipts; documents discrepancies Keeping accurate time sheets daily Checking that orders have been correctly delivered and charged for serving customers in a pleasant and courteous manner Reporting any issues to the Manager/Supervisor 3. Cook The cook’s job isn’t mainly making the churros mixture, prepares and cooks the churros, he/she also maintains the cleanliness of the kitchen area. Duties also include: Inspect food preparation and serving areas to ensure observance of safe, sanitary food-handling practices Season and cook food according to recipes or personal judgement and experience Observe and test foods to determine if they have been cooked sufficiently, using methods such as tasting, smelling, or piercing them with utensils Weigh, measure, and mix ingredients according to recipes or personal judgement, using various kitchen utensils and equipment Portion, arrange, and garnish food, and give the food orders to server 4. Server Duties include:
Attend to customers upon entrance Present menus Take/serve orders and answer questions or make recommendations for other products Collaborate with other employees Giving order form to the cashier for billing Deal with complaints or problems with a positive attitude
Marketing Strategy Churro Iloco will host a grand opening and product launch with free samples on December 5, 2016. A special Spotify Playlist shall accompany the event. Flyers shall be distributed and balloons shall be set up around the stand. To guide the organization and to leave a distinct impression upon its customers, Churro Iloco stand shall bear a sign with Churro Iloco logo and shall be decorated in a way that reflects Churro Iloco mission and vision, which will be displayed prominently on its stand. The point-of-sale display will be done in a creative manner to appear visually appealing to potential customers.
Churro Iloco will position itself as a leader in the sweet snacks market by offering unique products that will satisfy customer’s cravings and budget. This product differentiation strategy is expected to capture the attention of the academic community. Our marketing strategy will include:
Establishing a website
We will establish a website for our business and all the relevant information needed. This information entails our address, our phone number, the list of our products offerings with their corresponding flavors and prices and a place where our prospective customers can place or reserve their respective orders.
Churro Iloco Cards
We will be giving free Churro Cards that rewards our repeat customers for their loyalty. They earn loyalty points each time they come and buy to our food stall. Every purchase will be equivalent to points. Every time they buy our products, they will be reminded that they are coming closer to earning a free Churro snack from us. •
Use of Social Media Platforms
We will be at every social platform that our customers are on. This most definitely includes Facebook, the undisputed king of social media and Instagram where we can show photos of our delectable food and fun images of your staff and customers.
Offer delivery
Offering a delivery service can raise awareness for our business. You don’t really need to do the delivering ourselves. We can partner with a delivery services within our area. •
Creating local buzz
We will reach out to local magazines, newspapers, and radio stations, to come for a free snack and do a piece on our business. Reviews will appear on their publications for their entire circulation/audience. We will post those reviews in your food stall and on social media for a little proof that experts and critics love our place. According to a research, even if people have been eating for a particular business for ages, statistics show the psychological effect (confirmation bias) produces more money getting spent there.