Here is the current draft of my business plan excluding the executive summary and financials (the latter of which I won't publish here for obvious reasons). Putting it up to get it out of the dark and into daylight, whether or not anyone feels inclined to read it.
Of course, if you ARE inclined, I would love to get any feedback you might have. Financials aside, do you think this is a reasonable plan?
New Orleans is a city of neighborhoods, and every neighborhood in New Orleans has at least one Grocery or Sandwich shop where locals go day in and day out for delicious, freshly prepared “Po-Boy” sandwiches. They may eat standing at a counter or sitting at tables in the shop, sitting on the stoop, or take their food home to enjoy with the family. And they are fiercely loyal toward “their place” as having the best food in town.
Bywater Grocery is a food cart established as an S Corporation by Kristin Peri in Portland, Oregon in 2014 to serve authentic Po-Boys, the kind New Orleans locals enjoy regularly at their favorite neighborhood spot. Kristin’s husband, Mario, grew up in the working-class Bywater neighborhood of New Orleans, eating Po-Boys loaded with roast beef and dripping with delicious gravy, or spilling over with freshly fried-to-order Gulf shrimp or oysters, or sometimes just piled up with an inexpensive but filling combination of french fries slathered in that delectable roast beef gravy. But regardless of the filling, the sandwich was always made on the distinctive and traditional “poor boy” bread and usually ordered “dressed” with shredded iceberg lettuce, sliced tomatoes, dill pickle slices and mayonnaise.
Kristin Peri, owner of Bywater Grocery, was introduced to and fell in love with New Orleans food and culture by her future husband in 1990. With her professional cooking experience and life-long avocation of cooking and hospitality, she has been mastering the recipes, flavors and techniques of New Orleans foods ever since, thanks to her mother-in-law, family and friends. She has delighted hundreds of Portlanders with real New Orleans cooking through entertaining and catered events.
Who are Bywater Grocery’s Customers?
Bywater Grocery serves people who appreciate unfussy, delicious food served with true hospitality. Whether it is to grab a quick lunch, sit down with the family or pick up dinner on the way home, Bywater Grocery will deliver the authentic foods of New Orleans neighborhoods with minimal waiting and at an attractive price.
Bywater Grocery will generate buzz and attract new customers using social media (Tweeting specials and events, actively interacting via Facebook including promotions, seeking reviews and feedback), as well as more traditional methods--donating gift certificates to local school auctions, implementing a customer loyalty program, and rewarding word-of-mouth.
What are Bywater Groceries short and longer term goals?
Bywater Grocery’s short term goal is to demonstrate the validity of its business plan by rapidly meeting and exceeding break-even operations for a single cart. Once that is accomplished, we will continually improve processes and profitability. This will enable us to expand and scale our operations. As our first expansion, we intend to add a mobile food truck, which will extend our catering and event participation capabilities. Longer term, we believe in the viability of developing a “brick and mortar” location with expanded menus and full bar that maintain the core value and distinct New Orleans neighborhood experience that has been established beginning with the initial cart.
Our Philosophy
Bywater Grocery will serve food that is authentic to the best of New Orleans casual cooking in its fresh, careful preparation and depth of flavor. We will use recipes and ingredients that can pass the taste test with New Orleans natives and aficionados without compromise. As an example, that means wild Gulf shrimp, Blue Point oysters and blue crabs in our seafood items. If we can’t offer them due to price or availability, we’ll temporarily remove those items from the menu.
MARKET ANALYSIS
Market Conditions
According to the IBISWorld, a popular research firm, food trucks and mobile restaurants experienced an 8.4% growth in size from 2007 to 2012, which now comprise a $1 billion industry. Intuit has noted the food truck industry’s steady and rapid growth.They worked with Emergent Research who interviewed 272 food truck customers and 27 owners and managers within San Francisco from May to August 2012.
According to Intuit’s research report “Food Trucks Motor Into The Mainstream,” food trucks will continue to enjoy the profitable trend experienced from 2007 to 2012. In fact, they predicted that the industry will generate about $2.7B in revenue by 2017, which is a massive 400% increase from the National Restaurant Association’s 2012 revenue estimate of $650M.
Intuit’s prediction is supported by their survey results, which showed that the hassle-free and accommodating customer experience provided by these restaurants on the go is the key to the industry’s increasing revenue.
When asked about the quality of food trucks and their offerings, 43% of the interviewees gave an excellent rating and 48% gave a good rating. Over 80% of the interviewees described food trucks using words like Exciting, Fun, Unique, Different when asked why they choose to dine at one.
Combined with the speed of service and the convenience food trucks provide, the diners don’t mind playing a little extra…spending $9.80 for lunch and $14.99 for dinner on average. And almost all of the interviewed customers assert that they will continue supporting and dining at these mobile restaurants.
[Data reported on aboutfoodtrucks.com]
Target Market
The target market for Bywater Grocery is busy professionals and young families who enjoy good food and cooking but don’t always have time. Their busy schedules make dining at a traditional restaurant difficult, but they aren’t inclined to go to fast food chain restaurants. Neighborhood food cart pods offer variety, so everyone can find something they’ll enjoy, served quickly, so they can get on with other activities.
My target customers live or work on the near east side, within roughly a two mile radius of my operating location. They are almost equally divided among genders, typically have some education beyond high school, and are middle to upper middle income. Their age is generally between 19-50. Many have households with families or multiple residents and therefore prefer locations that offer a range of options.
Market Demand
There is a strong local market for the foods of New Orleans, as indicated by the success of bricks and mortar Cajun / Creole restaurants in Portland: Acadia, Tapalaya, Bistro Montage, The Parish, EAT-An Oyster Bar, My Brother’s Crawfish.
Food carts in Portland have steadily grown in popularity, especially those that offer something different than the usual line-up of Mexican, Indian, Chinese,Thai, BBQ, Middle Eastern, and Hamburger/Fries. Examples are Burrata, Maine St. Lobster Company, Potato Champion, Kargi Gogo and The Big Egg. Although there is significant turnover, carts with a combination of unique and excellent product, friendly and efficient service combined with real business savvy, can establish strong customer base and steady growth. Bywater Grocery will be the only local source for a wide selection of New Orleans-style Po-Boys.
Pricing
Sandwiches will be priced in a range from $5 for a 6” french fry Po-Boy to $15-16 (or more, depending on market prices) for a 12” fried shrimp or oyster Po-Boy. The expectation is that the majority of customers will order from the middle range of the menu, a range from $7.50 to $10 for the 8” sandwiches. Side orders of french fries, chips, and sodas will be priced from $1 for a soda, to $3 for a large order of fries. This will place the average order in the $10-15 range which has proven attractive for local carts.
Local Laws and Regulations
In comparison to many cities, Portland has actively encouraged the development of a vibrant food cart culture. They have online materials specifically targeted to potential cart owners that consolidate health, licensing, and safety requirements. Bywater Grocery will operate from a certified and licensed Class IV Mobile food cart, which can perform all aspects of food preparation and service. As per local regulations, the cart will maintain the requirements of operating as a mobile cart despite operating from a fixed location within a cart pod.
The following are the licensing requirements and status for this business:
- Mobile food unit license (Multnomah County health department): To be obtained after having purchased and prepared the cart for operation.
- Food handler’s permit for all employees: Kristin has a food handlers permit, and will also obtain a SafServ certification prior to opening.
- Liability insurance: Will obtain prior to opening
- Annual permit from Fire Department for use of propane: To be obtained after having purchased and prepared the cart for operation.
- Portland and Multnomah County Business Licence Tax Registration -- Completed.
- Oregon Business registration -- Completed.
ORGANIZATION AND MANAGEMENT
Kristin Peri is currently the sole stockholder in Bywater Grocery, Inc. Kristin will be responsible for the operation of the cart, and managing the day to day business, including inventory, hiring, and bookkeeping. Kristin has extensive experience in both business and food service. She has worked in senior level product and program management roles in high tech, including ten years at Qualcomm, developing expertise in creating market leading, profitable products on time and within budget. Kristin gained entrepreneurial experience co-founding a startup software company, Within Technology, that was acquired by Qualcomm in 2001.
Kristin grew up in a “foodie family”, and after graduating from Yale, spent two years apprenticing at La Ciboulette, a top-tier French restaurant on Chicago’s North side. She rapidly moved up from the cold salad and appetizer station through expediting up to fifty tables per night, to being second on the line, responsible for all fish and seafood appetizers and entrees.
Her next job was kitchen manager for the expansion start-up of Ella’s Deli, a popular, high-volume restaurant in her hometown, Madison, Wisconsin. In this role she was responsible for the development of several new menu items, including kreplach, a meat-stuffed noodle similar to tortellini, and a collection of daily soups, along with her other duties.
Although Kristin decided that opening a restaurant was not viable for her at that time, she found other venues to pursue her love of cooking and hospitality while building her career. She volunteered at a weekend respite program for severely disabled low-income youths from New York City, responsible for planning, shopping and preparing six meals per weekend for 80 people in the equivalent of a modest home kitchen. She catered dinner parties for friends and colleagues, and, after she and her husband Mario moved to Portland in 1996, they started a tradition of annual holiday open houses and summer crawfish boils that grew over the years to hosting over a hundred people at a time. All foods served at these popular events were freshly prepared by Kristin and Mario.
SERVICES AND PRODUCTS
Bywater Grocery will serve classic New Orleans Po-Boys, sandwiches served on distinctive “Po-Boy” french bread that is light and crisply so that the fillings shine through. The fillings are generous, freshly cooked, and uniformly delicious. Po-Boys are typically served “Dressed”, meaning with mayonnaise, lettuce, tomato, and dill pickle slices, but are always adaptable to suit the taste of individual customers.
Below is a preliminary menu. These offerings would be standard at most New Orleans sandwich joints.
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Shorty (6”)
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Regular (8”)
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Large (12”)
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Roast beef
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Slow-cooked sliced beef served with gravy and debris (de-bree), the meaty bits that fall off during slicing
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$7
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$9
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$12
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Ham
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Smoked Ham with creole mustard
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$5
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$7
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$9
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Shrimp
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Fried Shrimp with Remoulade
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$9
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$11
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$14
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Half and Half
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Half fried shrimp, half fried oyster with Remoulade
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--
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$12
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$15
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Oyster
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Fried gulf oysters with Remoulade
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$11
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$13
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$16
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French Fry
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Hand cut fries
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$5
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$7
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$8
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Sausage
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Louisiana Hot Link or smoked Andouille
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$6
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$8
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$11
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Red Beans & Rice (with smoked meat or vegan)
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$ 4 small
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$ 5.5 large
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Add sausage $2
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Hand cut fries
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$2 small
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$3 large
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Zapp’s Chips
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Cajun craw-tater
Jalapeno Dill
Voodoo
Regular
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$1.50
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Cold drinks
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Coke, Diet Coke, Barq’s Root Beer, etc.
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$1
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All Poor Boys come as you like with Mayo, Lettuce, Tomatoes, Pickles. Want them all? That’s “Dressed.”
Vegenais, Horseradish, creole or yellow mustard on request.
Add debris gravy, bacon, cheddar or sharp provolone $1 each
Add Remoulade $.50
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As most successful cart owners will attest, it is crucial to have a very focused menu. By limiting itself to Po-Boys and a few sides, Bywater Grocery can offer variety while keeping the list of ingredients and methods of preparation limited. All the recipes have been thoroughly tested and vetted with potential customers.
Based on the overwhelmingly enthusiastic feedback for the concept, pricing, but most importantly, the food itself, Bywater Grocery can expect many repeat customers.
Once the concept has been thoroughly proven in terms of growth and profitability, Bywater Grill will add a mobile food truck to offer catering and appear at local events. The eventual goal is to add or move to a casual “micro-restaurant” format with counter service for take out or eating in, wine and beer, and an expanded menu, including gumbos, jambalaya, additional po-boy selections, etc.
MARKETING AND SALES
Bywater Grocery will use proven methods to attract and retain customers.
Phase 1: Attracting initial customers
As is well known, word of mouth is the best possible marketing and can have an exponential multiplier effect. Kristin will use her experience in social media marketing to leverage her large local network of friends and colleagues, initially via a Kickstarter campaign to raise funding, and then by encouraging them to share their experiences across their own networks via Facebook, Twitter, Yelp, etc. In addition, Bywater Grocery will maintain an active online presence via website, Facebook, and Twitter.
- Bywater Grocery will solicit reviews in local periodicals and websites, including the Oregonian, Willamette Week, Portland Mercury, Portland Monthly, and portlandfoodcarts.com.
- Locating in a popular, high traffic location and making the cart appealing using attractive graphics and decor will be key in gaining first-time customers.
- We will encourage first time customers in the vicinity by donating gift certificates to nearby school auctions, and dropping off menus and coupons at nearby businesses.
Phase 2: Developing loyal customers
Bywater Grocery will make purchasing easier than most carts. Customers will be able to advance order via the website, text or phone, their food will be ready for pick up when they arrive. This will increase sales during periods that see a large drop off in foot traffic--late fall through early spring, since customers won’t have to wait in the rain for their food to be prepared. Potential customers have indicated that advance ordering will make them more likely to order food for pick up on their way home from work.
Although many carts are either cash only or impose a surcharge for card purchases, we will readily accept plastic. Not only does this avoid discouraging potential customers who don’t have cash for payment or prefer to use their card for purchases, but according to Running a Food Truck for Dummies (Richard Myrick, 2012):
“Statistics show that customers spend more when plastic is involved. Customers spend up to 50 percent more with a card rather than cash becauses they aren’t limited by what is in their wallet. Customers also tend to feel the pain of paying when counting up those dollar bills”
Bywater Grocery will offer a loyalty program that offers a ladder of exclusive merchandise based on the number of purchases using a punch card system. From a bumper sticker for the first punch through high-quality t-shirts to limited edition posters to invitations to special private events such as crawfish boils, Mardi Gras parties, etc., our most customers will get fun and unique rewards that may also serve as “mobile advertising.” An added benefit is that we will note customers’ first names on the cards so that we can thank them by name each time they make a purchase.
New Orleans, and Louisiana as a whole has a tradition of “Lagniappe,” which is a small gift or “little bit extra” as a thank you to customers. At Bywater Grocery that might be a small sample of red beans and rice, fried shrimp or slices of sausage--something that shows customers that they are valued and also gives them the opportunity to sample a menu item they might order in the future. This will also be a vehicle to get customer feedback on potential new offerings.
