You are on page 1of 36

[Type text

]

JamYam




JAM YAM
CHIPS
FEASIBILITY STUDY

JamYam
I Yam Healthy!

Introduction
Jamyam Industries is a producer of tantalizing yam chips. The company is an agro-processing
entity focused on manufacturing and distributing yam chips made from locally grown Yam. Yam
chips are not only healthy, but the product is a great source of energy and nutrients. Yams
(Dioscoreaceae) came to Jamaica from West Africa, where the Yam has been cultivated for the
past 10,000 years. Being such a strong plant, along with the ability to be stored up to 6 months,
the Yam has become an integral part of Jamaica's culture, providing nourishment to Jamaicans all
around the year. The partners in this business are: Jahdiel Beaufort, Zanya Hall, Zara Husbands,
Jon-Michail Russell, Jermaine Thompson and Rémon Goulbourne.
The Yam is a very healthy product. It is known that Yam contains 1100 calories per kilogram. Yam
is also a source of Vitamin C (27.4% of daily value), Vitamin B6, Potassium, Manganese and dietary
fiber. In addition to protecting against cardiovascular disease, the yam is also low in sodium,
which, combined with the high potassium content assists in producing a good potassium/sodium
balance in the body. Yams are a better source of energy than many other carbohydrates,
including the potato, as it has a low glycemic index. A low glycemic index means that the yam can
be eaten without greatly increasing one’s blood sugar level, while still providing much energy over
a long period. Hence the Jamyam chip is an excellent product for all sectors of the population.
The Jamyam Chips product will be produced using great discipline and the highest standards to
ensure the consistency and quality of the output. The yam will be sliced and covered with a thin
layer of olive oil, spices and a small amount of sea salt. This will then be baked for 35 minutes. By
using a baking method instead of frying, we are putting out a product that will have as low a fat
content as possible. Furthermore, it ensures that delicate structures and nutrients within the Yam
are not harmed by the cooking process. The Yam chips will be sold in sealed plastic packages, as
most chips on the market are. The packaging process will take place on the Jamyam compound.
Jamyam industries will operate a factory located in Clarendon, Jamaica. At this location, all the
necessary raw material should be stored and processed. The finished product will then be
distributed from this location to supermarkets, wholesales and other retailing businesses island
wide.

Objectives
This feasibility study seeks to do the following:
1. Find out if there is sufficient space in the snack market for Jamyam chips.
2. Find out if Jamaicans would be willing to support the Jamyam chips.
3. To determine whether or not the Jamyam chips can be competitively priced, allowing
Jamyam industries to operate at a profit.
4. To determine whether or not the Jamaican public is interested in purchasing a Jamaican
made, healthy snack product instead of those currently on the market
5. To determine the profitability of Jamyam chips













Population and Sample
The questionnaire was administered to 100 respondents over a one week period. The participants
were found in Clarendon, St Catherine, St Andrew and Kingston. Most respondents were within
the 15 to 30 age group. There were approximately an equal number of male and female
respondents. The social strata of the respondents was spread across a wide area, where 50% were
students, 28% earned between JMD$15,000 and JMD$60,000 per month and 20% earned over
JMD$60,000 per month. The sample was chosen using a stratified-random sampling method.
This was done by establishing two strata, males and females. Random sampling was then carried
out in each stratum where the researchers issued questionnaires to individuals of varying age
groups and social backgrounds. This method of sampling allowed for a generalization of the
Jamaican population. Therefore certain biases would not affect the results.














Methodology
The questionnaires were administered in a face to face method with the researcher nearby to
clarify any possible ambiguous questions. The respondents filled the questionnaires in privacy,
ensuring that their responses were not in any way influenced by the researcher. In addition, the
respondents were assured that the information given was held in confidentiality.
The questionnaires were administered to persons of different lifestyles, physical build and ideas
about food. It was ensured that an equal number of men and women were included in the
sample. Also the researchers attempted to attain a sample representative of the target market,
which would include both children and adults. Questions were asked to gauge the general
feelings of the participants towards the Yam vegetable and products made from it.
The researchers obtained requisite information for this study from two other primary sources.
Interviews were conducted with workers at several supermarkets. These workers were mainly
cashiers. Questions were asked about the observations that the workers have made about
customers and their choice in snacks. This information was essential in evaluating the competition
and preferences of consumers.
Additionally, the researchers observed the consumers themselves in supermarkets. This allowed
the researchers to gain further insight into the actual actions of the target market concerning
snacks while in a shopping environment. Observations were made as shoppers went to the snack
isles in supermarkets and the types of snacks that were most frequently collected by consumers
was noted.
The secondary sources used in this study include the websites of competitors, mainly Jamaica
Producers, as two of their quarterly financial reports was obtained and perused. The World Bank
was also beneficial. The internet was used extensively for research activities as well. Finally,
books about business operation and marketing were also of assistance.














The Questionnaire
The questionnaire comprised of 15 closed ended questions which were formulated without
ambiguity but with much clarity. Questions were asked about: snack types enjoyed, snack
enjoyment levels, popular snack brands, snack consumption level, snack affordability and the
public’s opinion on healthy snacks. Questions about whether or not the respondents would try
the product were asked. The personal questions about age, gender and income level were asked
last. The questionnaire was designed to withdraw useful information from the public on the
feasibility of a Yam based chip product. It was successful in ascertaining whether or not the public
deemed it necessary for a yam based snack to be placed on the market. An example of the
questionnaire is presented on the following page.














The following questionnaire is designed to gather your feedback on a new item JAMYAM Chips, all
anonymity is guaranteed.

1. Do you enjoy consuming snacks?
☐ yes ☐ no
2. What type of snacks do you normally enjoy?
☐biscuits☐ cheese puffs ☐ chips
3. How often do you consume snacks daily?
☐1-3 ☐ 4-6 ☐ 7-9
4. Snacks currently on the market are too expensive:

☐agree ☐ strongly agree ☐ disagree
5. Is it your opinion that snacks currently on the market are of high quality and good tasting?
☐yes ☐ no
6. Healthy snacks are too expensive:
☐agree ☐ strongly agree ☐ disagree
7. Do you think more Jamaican snacks are needed on the market?
☐yes ☐ no ☐ I do not know
8. What would you consider to be an affordable price for a typical single- serving bag of chips?
☐$30 ☐ $40 ☐ $45 ☐ $50 ☐other ___________

9. Please put a tick beside the chip flavors most appealing to you?
☐original☐ barbeque ☐cheese ☐ hot and spicy

10. Healthy snacks are always:
☐first choice ☐ bad tasting ☐expensive ☐ ineffective on my health
11. Which brand of chips do you normally purchase?
☐Holiday ☐ St. Mary’s ☐ Grace☐ Chippies
12. Would you try/eat yam chips?
☐yes ☐ no
13. What is your gender?
☐male ☐female
14. What age group do you fall into?

☐15- 18 ☐19-25 ☐ 26-30 ☐ 30 and over
15. What is your general income range monthly ($JMD)?
☐15-30 thousand ☐ 31-60 thousand ☐ 61-80 thousand ☐ 81 and over












Findings
The following graphs display the information gathered from each question. Each graph displays
percentages and below each graph there is an explanation of the results. A myriad of charting
methods were used to display the data in an attractive yet tasteful style.






















The chart above shows that:
89% of respondents Enjoy snacks
11% of respondents do not enjoy snacks






89%
11%
Snack Enjoyment Level
Enjoy Snacks
Dislike Snacks



The chart above shows that Chips are the overwhelming favourite of snack eaters.
Chips are enjoyed by 62% of the sample, Biscuits by 21% and Cheese Puffs by 17%.







21%
17%
62%
Snack Type Enjoyed
Biscuits
Cheese Puffs
Chips



The chart above displays the frequency with which respondents consume an item they would
consider to be a snack, either purchased or home made.
Most respondents (89%) consume a snack 1-3 times each day.
While 7% and 4% consumed 4-6 and 7-9 times daily.





0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
None
1 to 3 times
4 to 6 times
7 to 9 times
Daily Snack Consumption Frequency



This graph shows the participant’s opinion of snack prices.
50% believed that snacks are currently expensive.
21% felt that snacks are too expensive.
29% believed that snacks are currently not expensive.




0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Expensive Too Expensive Not Expensive
Snack Affordability



This graph shows the respondent’s opinion on the quality of the snacks they buy as well as their
satisfaction after eating them.
64% of respondents were satisfied and believed that they were eating good quality products while
36% disagreed.





64%
36%
Snack Quality and Satisfaction
High
Poor



This graph displays the public’s opinion on healthy snacks.
It shows that the vast majority of person believe that healthy snacks are too expensive.
36% felt that snacks were expensive.
46 believed that healthy snacks were too expensive and 18% believed that they were not
expensive.




0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Expensive Too Expensive Not Expensive
Affordability of Healthy Snacks



This graph displays the opinion of the participants regarding the necessity of Jamaican snacks on
the market.
71% felt that more Jamaican snacks are needed.
14 % believed that more were not needed while 14% were undecided.





0%
10%
20%
30%
40%
50%
60%
70%
80%
Needed Not Needed Undecided
Necessity of Jamaican Snacks on the Market
Needed Not Needed Undecided



This graph is a representation of the respondent’s opinion on the retail price of Jamyam Chips.
50% would like a price of $30.
29% would like a price of $40
11% would like a price of $45
11% preferred a price of $50




0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 0.45 0.5
$30.00
$40.00
$45.00
$50.00
Affordable Price for single serving of Yam Chips
$30 $40 $45 $50



This graph shows how common flavours stack up against eachother. It shows that 47% of
respondents prefer Hot and spicy, 30% like cheese, 10% like Barbeque and 13% like original flavours.







13%
10%
30%
47%
Most Appealing Chip Flavours
Original
Barbeque
Cheese
Hot and Spicy



This graph shows the varying opinions held by members of the public on healthy snacks. 32%
deem healthy snacks as expensive. 29% deem these snacks as bad tasting. 28 %buy these snacks
as their first choice. Finally, 11% of these snacks are thought of as ineffective on health.






28%
29%
32%
11%
The Public's Opinion on Healthy Snacks
First Choice
Bad Tasting
Expensive
Ineffective



This graph displays the public’s opinion on popular snack brands in Jamaica. From the data, it can
be seen that 61% of respondents prefer the St. Mary’s brand, 32% prefer the Holiday brand, 11% of
respondents prefer the Chippie’s brand while a small amount, 4% prefer the Grace brand.






0% 10% 20% 30% 40% 50% 60% 70%
Holiday
St. Mary's
Grace
Chippies
Most Popular Brands



This important graph displays the percentage of the sample that would eat Yam chips.
A whopping 78% would try Yam chips, while only 22% would not try Yam chips.







Would
consume
78%
Would not
Consume
22%
The Percentage that would consume Yam Chips



This graph displays the amount of males and females used in the sample. It was ensured that
equal amounts of each were contacted; therefore, the distribution is 50-50.







0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Male Female
Respondent's Gender



This shows the age distribution of the respondents.
56% fall in the 19-25 age group.
20% fall in the 26-30 group.
15% fall in the 15-18 group.
5% each fall in the 10-14 and 30 and over age groups.




0% 10% 20% 30% 40% 50% 60%
10 to 14
15 to 18
19 to 25
26 to 30
30 and over
Respondent's Age



This graph displays the varying income levels in which the participants fell.
Exactly 50% of the participants were students with no personal income.
14% each fell in the 31-60 thousand and 15 o 30 thousand income group.
11% each fell in the 61-80 and 81 thousand and over income groups.





0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Student
15 to 30 thousand
31 to 60 thousand
61 to 80 thousand
81 and over
Respondent's Income

Analysis

Product Characteristics
The Jamyam chip is a baked product made from Jamaican yams. It is a healthy product, as the
yam contains substantial amounts of vitamins and minerals as well as other nutrients. The
product is baked using Olive Oil, which adds further nutrients to the product. The Yamchips are
crunchy, thin and golden-brown in colour. This product is a healthier alternative to the products
currently on the market. Jamyam chips is also an excellent source of energy as it has a low
glycemic index, which ensures that it has a long and sustained release of energy. Therefore, this
product will benefit all members of the society but especially athletes and students who require
sustained energy to carryout various activities. This product is very unique and of a very high
quality. It is unique in the sense that it is one of the few snacks available that is an excellent
source of vitamin C as well as potassium. Potassium is beneficial for people with hypertension.
This is a high quality product by virtue of the fact that it is affordable, healthy and provides
vitamins and nutrients that are absent in the typical baked snacks.
Each bag of Jamyam chips will have a net weight of 50g, which is higher than most competitors.
In addition, the package containing Jamyam chips will be biodegradable. This is of great
significance bearing in mind the damaging effect that plastic bags and containers are having on
our environment. The design of the package will be attractive and will use a tasteful design aimed
at catching the eyes of both adults and children. Jamyam chips will also have a shelf life
comparable to the best competitors. In its natural form, Yam can be stored for up to 6 months
without refrigeration, however in this cooked form it will be able last several weeks, as much
water will be removed during the baking process and sea salt will aid in preserving the chips. A
small amount of preservative will be used.




Market Analysis
Based on the results of the survey, it is accurate to assume that Jamyam will be taking advantage
of a large potential market. Firstly, 90% of respondents like snacks. Secondly, 70% of respondents
would try yam chips. Therefore, there is a great potential market for the product. Furthermore,
70% of respondents commented that there is a need for more Jamaican snacks in local
supermarkets. Therefore, the presence of Jamyam chips will be accepted by Jamaicans.
Additionally, Jamyam will be marketed as an affordable and healthy snack product. Presently, 82%
of respondents felt that healthy snacks on the market presently are expensive. This is significant,
as it means that Jamaicans are looking for an affordable alternative to the healthy snacks
currently on the market. Also, 28% of respondents select healthy snacks as their first choice while
shopping. Therefore almost a third of the target population favours healthy snacks. Therefore
Jamyam chips will be in a favourable position.
Based on these results, we intend to capture approximately 18% of the local snack market over a
24 month period. Achieving this figure will require a steady increase in our customer base,
increasing the distribution of the chips and increasing the public’s awareness of the product.
There are several threats to the success of the product however. Firstly, hurricanes can deal a
severe blow to the business. After hurricane Ivan, Jamaica producers closed its St. Mary
production plant, where it produces its St. Mary branded snack products. Hurricanes may lead to
a decreased supply of raw materials and inflict physical damage to the company’s infrastructure.
A slowdown in raw material supply will affect market share. Also, being a new product and new
company, the sophisticated machinery required to produce the snacks in large quantities will
increase the time taken for the product to be available all across the island and take full advantage
of the market available.





Sales Analysis
The entrepreneurs establishing Jamyam conducted a sales analysis which allowed us to project
the potential sales of Jamyam chips. This sales analysis will fulfill one objective of the feasibility
study, which was to ascertain the profitability of Yam chips in the Jamaican market. In offering a
product of superior quality, shelf life, great taste and healthy benefits as well as offering great
customer service to our distributors and retailers, the Jamyam team expects great loyalty from
consumers and much growth in sales.

As the company’s capacity grows and more alliances are formed with supermarkets and
distributors, the sales of Jamyam chips should increase greatly each quarter.


0.00
20,000.00
40,000.00
60,000.00
80,000.00
100,000.00
120,000.00
140,000.00
160,000.00
January - March April - June July - September October - December
Projected Sales

Customer Analysis
The customer is the priority of any businesses. Jamyam will target children, school canteens,
wholesales, supermarkets, pharmacies and any businesses that sell snacks. Jamyam will be
targeting consumers all across the island, however, operations will begin in the Kingston and St.
Andrew metropolitan area as this has a high concentration of consumers. Most consumers will
fall between the ages of 5-35 years. This age group contains both children and adults. Children
are generally attracted to snacks and the Jamyam chips are particularly good for children as it
provides more energy than its counterparts while providing much vitamin C and vitamin B. Adults,
many of whom are conscious of their blood sugar levels, weight, cholesterol, salt intake and
calorie intake will be attracted to Yamchips. As, explained earlier, and will be focused on in
marketing, the yam vegetable is a source of fiber, has a low glycemic index, has very low sodium
levels and is a recommended food for those seeking to loose weight. These adults will also be
confident in purchasing this snack for their children as they will be confident in the quality of
Jamyam and that it will provide their children with much energy.
The entrepreneurs behind Jamyam will seek to serve the consumer’s need for an affordable but
healthy snack that provides much energy. Therefore Jamyam chips will greatly benefit the
population while serving the needs of consumers.

Promotion and Advertising
Effective promotional and advertising campaigns are necessary for the growth of any business.
As technology advances, businesses are now able to access consumers through a myriad of new
avenues. Consumers are also able to access potential businesses through new methods. The
typical promotional and advertising portals, television, newspapers and radio, are still prominent
but can be expensive for a young company. Therefore the internet will be heavily utilized in
Jamyam’s marketing strategy.
Information obtained from the World Bank’s Development Indicators, as of 2009, 58.6% of
Jamaica’s population use the internet. Through a Facebook page, twitter account and a website,

Jamyam will be best able at sensitizing the target population to the benefits of eating yam chips.
Frequent posts and messages using Twitter and Facebook would increase the interaction with
customers and serve as a means through which the customer experience can be enhanced.
Competitions and giveaways will also be carried out using the Facebook page. Additionally,
special promotions and discounts will be advertised using this medium.
As a new product, television advertisements will be necessary. Appearances on Smile Jamaica,
aired weekday mornings on TVJ would be beneficial in sensitizing the population of our product as
this program has a very high viewership. Creative 30 second advertisements during off peak
hours on both popular television stations will also be beneficial as these advertisements are not
expensive.
Distributing creative, informative and eye catching fliers in areas such as Half Way Tree, Parade,
Greater Portmore and May Pen will greatly increase the products visibility. Placing fliers in
supermarkets, shops and wholesales will also be of great benefit.
Additionally, Jamyam will seek to sponsor events attracting members of our target market. At
these events, free samples may be given away and Jamyam will be sold at a discounted price.
Frequent newspaper advertisements in the two most popular daily papers, the Gleaner and the
Observer, will also advertise the product to the target market.

Pricing Strategy
By purchasing land and establishing a yam plantation, the entrepreneurs will be able to cut
production costs associated with purchasing yam and transporting it to the manufacturing centre.
This move was recently done by a major competitor, Jamaica producers, who purchased a 600
acre plot of land to grow a range of plants used in snack manufacturing. Additionally, solar panels
will be used at the Jamyam manufacturing site, which will reduce energy costs and thus lessen
production costs.

Based on the results of questionnaire, consumers think that present snacks on the market are
expensive and the bags tend to be filled with air and not the desired product. The main
competitors seem to be using their overwhelming domination of the market to goo effect by
artificially inflating prices. In the aim to meet the needs of consumers, a box of 20 of Jamyam
chips bags will cost $330, leading to a wholesale price of $16.50 per bag. This undercuts the price
of the major competitor; St. Mary’s Banana chips. Any customer ordering 10 boxes will receive 1
complimentary box of Jamyam Chips. The MSRP will be $36, as most consumers were willing to
pay this price based on their responses to the survey.
As a means of promoting the product in its first year on the market, at popular supermarkets such
as the HiLo Chain, the Empire Supermarkets, the Megamart chain and Pricesmart, customers will
be able to buy 2 Jamyam chips and get one free and members of such supermarkets will receive
additional discounts. School canteens will receive the product at special prices to promote
increase penetration in schools.

Competition
Entering a market that is already dominated by a few players is never easy. The snack market in
Jamaica is already controlled by a few local producers and several foreign companies. Most of our
competitors have been on the market for several years and have loyal customers. Therefore, only
through superior customer service, as well as the provision of a unique and affordable product will
Jamyam break into the market and become a successful company.
Jamyam’s main competition will come from the following:
Sunshine snacks
Jamaica Producers
Frito Lay
Grace Kennedy Limited
Holiday Snacks

Sunshine Snacks is a division of Associated Brands Industries Limited (ABIL) which is the leading
distributor of snack foods, chocolate confectionery, biscuits and breakfast cereals in the
Caribbean. Sunshine Snacks was founded in 1977 manufactures a range of products such as:
Potato chips, Tortilla and Corn chips, Children's corn products, cheese curls and similar products.
At the moment, Sunshine Snacks is the largest snack producer in the region with a product range
of 82 items.
Jamaica Producers, through its JP Foods, subsidiary, manufactures snacks at a St. Mary facility.
The main product is the St May Banana Chips, which, based on the survey conducted, is the most
popular chip snack. Other snack products include cassava chips, sweet potato chips, and Plantain
Chips. Profits from the JP Foods division ranges between $30 and $40 million per quarter, based
on information gained from quarterly reports.
Frito Lay North America (FLNA) is a large multinational company based in the United States. Frito
Lay is a subsidiary of PepsiCo and is presently valued at 12 billion USD. Its main brands include
Lays, Cheetos, Tostitos, Doritos and Sun Chips. It owns 28 other brands which are distributed
worldwide. Frito Lay is responsible for most of the foreign competition that Jamyam will face as
Jamaicans have a great love for their products, particularly Lays Potato chips and Doritos.
Jamyam Chips has several advantages over these competitors. Firstly, Jamyam will undercut all in
price based on the penetration price strategy which will be pursued. While undercutting
competitors in price, Jamyam chips will contain more per bag than competitors. With a net
weight of 50g, each serving of Jamyam chips will provide more to the consumer and lead to a
greater customer satisfaction than provided by competitors. Furthermore, the Yam is now being
viewed more favourably by Jamaicans as it has been correlated with the great performances of
our athletes at world games. This will be beneficial to our marketing strategy. Additionally, none
of the main competitors distribute healthy products. Most competitors do not have snacks that
provide any vitamins or even dietary fiber. Jamyam chips contain both vitamins as well as dietary
fiber which is a further competitive advantage.



Conclusion
After the extensive analysis and research carried out, we can successfully conclude that not only is
there a yearning for a product of the likes of Jamyam chips, but launching such a product will reap
much success for the entrepreneurs.
The Yam has been apart of Jamaica’s culture for decades. It is an alternative to rice particularly
loved in rural areas and recently is receiving more attention due to its possible role in the athletic
prowess common to Jamaicans. There is presently no baked snack product made of Jamaican
yams on the local market. Potatoes, bananas and cassavas have all been used to make snacks.
However, the yam has properties that are not matched by these food sources. Jamyam will be
targeting a wide market however the biggest will be children and teenagers, who snack the most.
The prevalence of heart disease, obesity and cancer as well as other factors, has lead to an
increased global awareness of healthy eating and Jamaica has not been left behind by this trend.
Products that are offering health benefits at affordable prices are being viewed more and more
favourably by consumers. Therefore Jamyam chips will be a hit with Jamaican consumers.











Appendices

The following is a method of preparing Yam chips.
Ingredients:
1 pound yams
1 1/2 tablespoons olive oil
2 teaspoon of herb blend
1/2 teaspoon salt (plus more, to add flavour, after baking)

Heat the oven to 425 degrees F. Line a cookie sheet with foil and coat the foil with cooking spray.
Cut the yams into thin slices, about 1/8-inch thick.
Put the slices into a large sealable plastic bag. Add the oil, the herb blend, and the salt. Seal the
bag and shake to coat. Place the yam slices in a single layer on the prepared cookie sheet.
Bake for 25 minutes or until the chips are golden brown, flipping once during cooking time.




An Example of the finished product.


Company Logo


“I Yam Healthy!” – company slogan

Examples of Yams





JamYam

References

1. The World Bank: World Development Data
devdata.worldbank.org/ict/jam_ict.pdf

2. Malhotra, Maresh K. Marketing Research, An Applied Orientation. Fourth Edition. Pearson
Education Inc. 2004.

3. Jamaica Producers
www.jpjamaica.com/

4. WHFoods: Yams www.whfoods.com/genpage.php?tname=foodspice&dbid=113
Ariticle Written on

5. Ensminger AH, Ensminger, ME, Kondale JE, Robson JRK. Foods & Nutriton Encyclopedia. Pegus
Press, Clovis, California 1983.

6. www.ehow.com/video_4399923_make-yam-chips.html