Professional Documents
Culture Documents
PREFACE
This Project is a part of 1203302 Project Feasibility Study and Evaluation Course in
the second semester of 2010. In this project is studying the feasibility of frozen food producer
in Samutsakon Thailand, which is include generally of frozen food industry, management,
competition analysis and marketing feasibility, the technical process in frozen process, the
financial feasibility, and risk of the industry.
This project makes everyone who interested to get knowledge and information about
frozen food before make decision to investment for the benefit to investment and profit of
doing this business.
We expect that our project will provide benefit more and more interested person,
moreover, if they are any error in this project or whatever, our ground made an apology at
this opportunity.
GROUP MEMBERS
MR.SOPHON KIMKAEW
MR.THANATHIP CHAISEN
MS.SUCHADA FANGPONG
MR.CHAOWALIT BOONSIRI
MR.ITTIPHAT NARONGPHUNT
[i-Food] 2
TABLE OF CONTENT
CHAPTER 1: INTRODUCTION..........................................................................................................6
2.5 Mission......................................................................................................................................15
3.1Environment Analysis................................................................................................................19
Product........................................................................................................................................25
Price.............................................................................................................................................27
Promotion....................................................................................................................................28
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3.6 Conclusion.................................................................................................................................37
4.2.1 Rent....................................................................................................................................72
4.3.2 Depreciation.......................................................................................................................80
4.4.2 Overhead............................................................................................................................81
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Financial Analysis.......................................................................................................................110
CHAPTER 7: CONCLUSION..........................................................................................................118
References.........................................................................................................................................119
APENDIX............................................................................................................................................126
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CHAPTER 1: INTRODUCTION
Nowadays the innovation is get ahead of for respond demand of human and hurry life
in rush time.Speed and quickly are the mains factor in daily life ,Then everybody divert to get
delicatessen for consumption. Such as freeze food, which can store for a long time and when
you hungry, just take it in to microwave for a few minute. Thailand have many entrepreneurs
in freeze food market, Such as CP, Quick meal from S&P , Eazy meal brand from Suraporn
food and Prantalay.
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From table 1 show growth rate of frozen food and customer consumption are growth
continuously. So, it’s a good opportunity fine a new way of frozen food to serve customer
need in future. This project try to study feasibility in frozen food market in frozen industry,
source of raw material, process in manufacture, place for contain, competitors in Thai and
foreign, and sustainable of financial.
For fine feasibility to be one market share of frozen food manufacturer in Thailand.
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Activities November 2010 December 2010 January 2011 February 2011
Time frame(week) 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4
1. Business Project
Identify
2. Market Analysis in
chapter 1Introduction
3. Market Analysis
chapter 2_Industry
Profile
4. Technical Analysis in
chapter 3
5. Financial Analysis
6. Risk Analysis
7. Clean Up Project
8. Project Evaluation
9. Presentation
Frozen foods refer to foods that ready to eat are in frozen just melting ice and warm to
hot then you can eat immediately which identified into two main categories: General
delicatessen and Dim sum. Over 90 percent of frozen food market is international markets,
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but domestic markets is still very small that have only 5-10 percent because of Thai prefer to
eat foods from fresh cooking both at home and/or purchased from restaurants or supermarkets
unlike the international markets which consumers have quite few channels to buy.
Frozen processed food has experienced considerable growth during the review period.
Other frozen processed food accounts for the largest share of sales thanks to the product
variety offered within this category. Modernization and hectic lifestyles serve as the main
drivers of demand. In addition, frozen processed food is not only perceived as being more
convenient but also more hygienic compared to some pre-cooked food sold at hawker centers
or on street stalls.
Investment in the frozen food business with a production capacity of 200,000 pieces
per day have to invest about 50 million Baht that classified into fixed assets 40 million Baht
and working capital 10-12 million Baht that raw materials are 60 percent, cost of production
26 percent, and wages 14 percent of total production costs.
Product coverage: Frozen Bakery, Frozen Desserts, Frozen Meat Substitutes, Frozen
Noodles, Frozen Pizza, Frozen Processed Fish/Seafood, Frozen Processed Potatoes, Frozen
Processed Poultry, Frozen Processed Red Meat, Frozen Processed Vegetables, Frozen Ready
Meals, Frozen Soup, Other Frozen Processed Food.
Source: http://www.reportlinker.com/p0176843/Frozen-Processed-Food-in-Thailand.html
From the last issue, I promised to write about “Ready food in Seven-Eleven in Japan”.
But with the requests from readers wanting to update about situation of food and agriculture
products in the next year, so I would like to apologize for changing the topic. However, in the
next issue I will go back to “Ready food in Seven-Eleven in Japan” as promised.
In 2008, Thailand exported in the rank 13th in the world, valued 23,864 million US
dollars (approximately, 800,000 million Baht which is accounted of 2.4% of the total world
[i-Food] 9
food export). While USA was the largest world food exporter, of 111,054 million US dollars
(approximately, 3,000,000 million Baht which is accounted of 11.1% of the total world food
export). However, when calculated export value of all 27 EU countries, EU became the world
largest food exporter with total value of 462,838 million US dollars or 4 times of the USA.
Although Thailand was in the 13th rank of the world, but when analyzed export value
to export quantity (US dollars/ton), we found that exported foods from Thailand had value
per unit higher than foods from many countries. When considered in rank of value per unit,
Thailand was in the 5th rank. USA and the Netherland had the lower value per unit by being
in the 6th and 7th ranks, respectively. Looking at EU, uniting together made the higher
competitive potential in the world market. It is interesting to look at Thailand if we have
strategy to unite in trade within the region. We may enhance our potential in trade same as
EU.
Therefore, our food strategy towards safety and quality foods did increase export
value of products and also strengthen good image of Thai foods which altogether lead to total
better country’s economy.
Considered 4 main foods i.e. rice, seafood, meat and poultry, and fruit and vegetable
Rice – Thailand is the world largest rice exporter, in 2008, we exported 15,000 million US
dollars or 42% world market share.
Seafood – (including shrimp and all kinds) - Thailand was in the 3th rank of the world
export, valued 6,000 million US dollars or 8% world market share. We were in lower rank of
Norway (7,000 million US dollars) and China (9,000 million US dollars).
Meat and Poultry – (of all kinds - chicken, duck, swine, kettle, goat, sheep, etc.)-Thailand
exported in the rank 18th of the world, valued 2,000 million US dollars or 2% world market
share. If considered only chicken, we exported processed chicken meat number one in the
world. But if included fresh and processed chicken, we were number 4th with 5% market
share. And if looked at duck meat, we were number 4th with 8% market share.
Fruit and Vegetable – Thailand was the 16th exporter, valued 2,000 million US dollars or
2% market share.
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Besides, Thailand had many exported food items in the upper lists of the chart (as can
be seen in Table 3) or could say that some items we were the biggest players in the market
such as rice, chicken, shrimp, and pineapple. All as mentioned we were number one.
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obtained support from government since we announced the use of the first National
Economic and Social Development Plan in 1961. Because food industry used less investment
while consumed local raw materials that benefited agricultural sector for sustainable
development of the country. Therefore food industry should be the major strength of Thailand
that obtains continuous support from the government.
2. Thailand has high potential in producing foods for export – due to strong
agricultural base and abundance that can be used for producing various kinds of foods.
3. Quality labors – skilled and trained labors are available for the industry that make
Thai products more value added.
4. Customer confidence on Thai foods in production process and quality- We
have followed strong quality standards on food products such as GMP, HACCP, Animal
Welfare etc. Also traceability forwards and backwards all along processing line from farm to
table is fixed to make consumers confident in our safe and quality foods.
5. Modern technology – We use modern, cutting-edge technology along all food
processing line to produce and control product in quality. We also pay attention to reuse
waste to turn to energy for environmentally friendliness. This makes more competitiveness in
cost.
Source:http://www.foodindustrythailand.com/v17/index.php?
option=com_content&view=article&id=1435:future-food-product&catid=55:food-
safety&Itemid=142
We design package in style and size to appropriate food. We design label to see
clean, easy, clear, quickly, and attractive.
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2.4 Vision of your organization
i-Food want to be leader of frozen food manufacturer in Thailand. We wish every
gender and generation can consume in every day and every time.
2.5 Mission
We set our mission to……
Find new way for distribution to satisfy customer need on time in the future.
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Find new taste, new sea food in variety regularly.
i-Food Inc. will lead company by use stability strategy to operate in primary.
We will don’t have investment in first time, but emphasize to make i-Food company
to be stronger.
After i-Food’s strong already, i-Food Inc. will operate by use growth strategy.
Three ways we use to growth business:
2. Invest in new business that doesn’t involve with frozen food product. It’s
I-Food Inc. will be leader’s frozen food in low cost product. We set price
lower than competitors. Moreover, we will add new value into the product to make
differentiation between I-Food Inc. and competitors, then to put new product to satisfy new
customer needed.
Administration
From our mission, we would like everyone able consume in every time and
everywhere. So, we try to distribution channels in 7-11 convenient stores in primary.
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Secondary we will fine new distribution way. Then fine new menu. for I-Food, the main
target is customers that we must first take care and attention. So shop following our quality
products and process. Includes the shop decorate and customer service.
Administration Strategies
Business Strategies
Our shop is decorated restaurant that is interesting.
- We are offering new promotions for regular customers and temporary
- Build strong relationships with customers.
Marketing
I-food will set located at Bangkok market, so our target market is students and officer who
have a limited time around the area where we sold products. However, we will promote our
business known many people. Within two months, we will be advertising, and more expand
our business in the future.
Marketing Strategies.
We are offering advertising to customers who buy our product. Special promotions such as
buy 10 get 1.
- Good Service.
- expand many stores in Bangkok.
Production
To help Thai farmers better income and improve the Thai economy. We will use all the
ingredients and raw materials to Thailand for our products. We will support a low seafood is
different from other products, focusing on the quality of raw materials and manufacturing
processes are attractive in fashion Such as food box might be an interesting pattern. And tell
to get nutrients per day or benefit from the nutrients. Our production volumes are based on
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customer needs and market. We will reduce the range of products that our customers are
holidays or long weekends because we cannot sell.
Production strategies.
- Production must be supported customers' needs.
- Cleanness production processes
- A good quality of raw materials.
- We need to preserve the flavor of the product at all times.
Human Resources.
We will be focusing on the performance of our employees. By providing knowledge of
systems and manufacturing processes. We want to develop our people in every day of their
work. Work will be higher quality. However relationship between employees is very
important because it will get success in business quickly.
Human Resource Strategies.
- Training and appropriate guidelines to the employees always ready to work.
- Create incentives to employees by increasing the bonus.
Financial.
We should have a good financial system. And have a good capital to build confidence with
entrepreneurs or loan money.
Financial Strategies.
- Find a low interest loan.
- We will make expense account receipts every month. To know the total sales
- saving economic such as water and electricity
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CHAPTER 3: MARKETING ANALYSIS
3.1Environment Analysis
Political
Economic
In 2552 the Thai economy contracted 2.3 percent from last year is the first
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time in 10 years because of the global financial crisis. It Impact on the economy of the
country's main exports to Thailand's
and the manufacturing industry.
Private company not confident
includes consumers and investment
in country. The Thai economy
contracted the most in the first
quarter and began to recover in the
second half of the year 2552 as
global economic. Combined with
the relaxed monetary and fiscal
policies have helped stimulate the
economy and encourage the confidence of producers and consumers improved in
order
http://www.bot.or.th/thai/economicconditions/pages/index.aspx
Social
Today, consumers change behavior consume because the lifestyle and way of
life hurry to work. The wife house having to be tied in with the purchase of frozen
foods and can be heated in a microwave. Ready to eat, whether in the morning before
going to work or to school or after we finish working
http://www.arip.co.th/businessnews.php?id=412312
Technology
Now, Human learns to know nature from and around environment that can
survive until the discovery process of new inventions. The growth of food processing
technology may be used to display the material progress of the community. Because
social change eating in food processing technology advances, such as canned food or
frozen food.
http://www.swu.ac.th/royal/book5/b5c6t1.html
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Quick Freezing
Before refrigeration units became widely
available in homes in the early 1920s, cooling
techniques were stagnant among food producers.
Clarence Birdseye, a recent college graduate,
was working in Labrador region of eastern
Canada. In cold temperatures, the local native
Inuits showed Birdseye how to freeze fish, duck
and caribou. He came to understand that the very
low temperatures at which the fish were frozen
sped the freezing process, thus producing a much
fresher and more desirable result when the fish was thawed.
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3.1.3 Competition Analysis
In Thailand frozen foods has pervasive both in delicatessen group such as frozen
shrimp, frozen fish, until frozen food ready to eat such as rice box that have many menu.
In the market have a lot of entrepreneur both big entrepreneur, old entrepreneur and
new entrepreneur. These entrepreneur interested in entering the menu of frozen food to the
market for example CP sand Ready Meal brand of CP and selection on sale in convenience
stores. There are various menus in group of staple food and snack various nationality such as
Thai food, Japan food and Chinese food. Although is a new segments but consumers will to
consume. In the group of food have increase the new product comes out recently, including
Japan food such as menu Rice Grilled Salmon Teriyaki, Pork Curry Rice Japan and Chinese
food in categories of noodles such as noodle and noodle salad, the category of all food it all
depends on the nature of popular consumer in each period. CP have survey research and
needs of consumers are always
Quick Meal form S&P Company when talks the name S&P is names that sound
familiar it is not difficult of the S & P with use the brand of the restaurant and fame of quality
to guarantee taste and quality than aims to market frozen foods ready to eat gradually.
Believes that S&P will increase market size of frozen food.
Source: http://www.snpfood.com/export/export_seafood.php
Source: http://www.surapon.com/index.html
Brand of PFP Company start from fame in part of fish grind frozen or Surimi in
business seafood group processes complete that produce and sell food products processes
fully cook that make from fish meat grinds frozen in various type for export. PFP come back
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to market in Thailand and rank oneself is a leader in products group processes the seafood
frozen and in this year PFP plan business for enlarge the way to sale food processes Including
adding the list of food more than 10 the list send reach the department store.
Source: http://www.pfp-pacific.com/pfp5/index2.php
Prantalay emphasize the leadership presents new innovation of seafood products and
ready to cook food go together with build the clearness in about the seafood for the health
with new project “good healthy good brain with Prantalay over all Thailand 2010.” Emphasis
to advantage from seafood and cover social activity, can be considered building the brand in
premium level of Prantalay also
Source: http://www.prantalay.com/cms/index.php
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i-Food i-Food 270-277g 29-39 2 menu Mass market
Copany.,Ltd
Segmentation
Source: http://www.arip.co.th/businessnews.php?id=412312
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The second is about Psychographics Segmentation in life style and healthy, from the research
show about more than 70% of consumers, they believe that frozen foods can reduce their
times and have benefit for them. About healthy more than 50 % of consumers have view for
frozen food that they believe the frozen food have nutrient for healthy because it fresh after
warming with microwave.
Target
I-food targeting on the frozen food market, on the officer and student in 18-25 years
old. There are more competitors in this market share in frozen food but we look at the gap
that we think that is our opportunity, which emphasize in kind of frozen seafood to take this
gap to gain the profit.
Position
I-Food set position of frozen food in medium class. That is position, which
appropriate with price and quality. I-food have identity of brand and different from other
brand such as rush hour life style. Except this we set our product in another view, that is
healthy and price, Nutrient for healthy in product and price. I-Food can set the price not too
high but can give more integrate in a product, because I-food can find raw material in low
price and fresh, then this is highlights of I-food. “Save your time, save your life”
Product
I-Food’s product emphasizes to show characteristic of Common Thai food with sea food.
Because of sea food menu is hard to find and delicious, if customer does not live near the sea.
Beside that, quality and low price is main characteristic. We use fresh shrimp and squid from
Mahachai market ,where the fresh and cheap seafood in Thailand.
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Package detail:
http://foodpackage.tarad.com/product.detail_269672_th_2107298
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Source: http://www.ppcfactory.co.th/
Price
We set all of product to 39 bath. Because this price is appropriate to the product by
the quality , quantity and target group. We use “39 bath” but not use “40” bath because this is
one of price strategy , cause “39 bath” it look like cheaper than “40 bath” but it just 1 bath.
Place
Source: http://www.7eleven.co.th/corp/franching_main.php
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Promotion
Promotion is part of a marketer can always rely on. Doing market with all activity for
announce to customers know what products are specially and encourage target group to pay
attention and decide to buy. i-Food start by bringing products for mass media tastes to the
publisher, this method may be make to mass media sympathetic and present information of
product. Later we will release via the Internet. Everyday all website open opportunity to
advertising, buy-sale freely. And to increase opportunity via many alternative distributions,
we will look for business partners as the option to make promotions.
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3.4 Sale for cash-profit Estimation
From resource about number of students in public and private institutions by grade and level of education: academic year 2002-2009 in
Thailand by Statistical Data Bank and Information Dissemination Division, National Statistical Office of Thailand. In year 2009 number of high
school until Doctorate degree are 7,079,779 and resource by National statistical office of Thailand about number of officer in Thailand in year
2010 show in chart below. http://www.nso.go.th/
12600
33000 00 Student
0 Officer
14000 70797 Bank officer
00 79
Education
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Sale forecast for year 1
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Sale forecast for year 3
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Sale forecast for year 5
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3.5 Marketing Exchange (Sale incentive)
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Selling expense in year 1
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Selling expense in year 3
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3.6 Conclusion
First i-food Company expect target customer purchase product just 10 percent- Squid
basil rice 7% and shrimp fry rice 3%. I-Food forecast sale by increase 1.5% per month on
average. But in month February, March, April, and September sale will decrease. Because of
in these month target group-student and officer are stop to work and study. As a whole, i-food
product has a worth of selling per year growth continuously by 4.8%.
500,000,000
400,000,000
300,000,000
200,000,000
100,000,000
-
1 2 3 4 5
i-Food Company will pay for selling expense via shipping and advertising. On
advertising, we will promote on website, magazine, and TV. In first year promote advertising
on Thai channel 7 and follow on channel 3, 9. Then last year i-food cancel advertising on
Thai channel 3, cause of high cost.
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CHAPTER 4: PRODUCTION AND OPERATIONS ANALYSIS
Delicatessen menus
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Ingredients:
Rice 150 g
Shrimp 60 g
Carrot 10 g
Oyster 7 g
Soy sauce 12 g
Granulated sugar 5 g
oil 5 g
Egg No. 4 1
Weight: 277 g
Cost per piece: 14.82 BTH (no package)
The main raw material get from this local, almost including seafood, such as shrimp
and fresh vegetables. Source of raw material which the importance of seafood from Samut
Sakhon at MahaChai market. While source of raw material as seafood and vegetable are
expand everywhere.
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I. Squid basil rice Ingredients
http://www.u-rice.com/?gclid=CNazjcikhacCFYQa6wod7gcwdg
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Basil 15 BTH/kg.
Source:http://www.srimuangagro.com/index.php?
option=com_content&task=blogcategory&id=34&Itemid=45
Source: http://www.talad-yingcharoen.com/price.php
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Soy sauce 184 BTH 6 Liter
Source:
http://www.siammakro.co.th/main/mail_hot.php
Source: http://www.trrsugar.com/aboutus.asp
Source: http://www.oleen.co.th/product_detail.php?id=188
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Bean 20 BTH/kg.
Source: http://www.talad-yingcharoen.com/price.php
Direction:
1. Pour oil in pan, wait for oil is hot. After that put garlic, pepper, onion and bean
until good smell.
2. Put squid and adjust flavors with soy source and sugar
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Rice 1650 BTH per Sack
Source: http://www.u-rice.com/?
gclid=CNazjcikhacCFYQa6wod7gcwdg
Source:
http://www.thaiqualityshrimp.com/production/link1.asp?nID=17
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Garlic 160-165 BTH/kg.
Source: http://www.talad-
yingcharoen.com/price.php
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Oyster 150 BTH 3 Liter
http://www.tarad.com/_tarad/_templates/b/_modules/gotolink.php?
aHR0cDovL3d3dy50aGFpb3lzdGVyc2F1Y2UuY29t
Source:
http://www.siammakro.co.th/main/mail_hot.php
Source: http://www.trrsugar.com/aboutus.asp
Source: http://www.oleen.co.th/product_detail.php?id=188
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Egg No. 4 panels at 79.50 Baht
Source: http://www.rachakaikai.com/Product-
priceList.asp
Direction:
1. Chopped garlic and split onion, carrot and put it to the hot oil in pan.
Food box (Already screen logo when order more than 3,000 pieces)
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12*18* 4.5 cm (250g) can be use with microwave
http://foodpackage.tarad.com/product.detail_269672_th_2107298#
Spoon
http://risuc.is.in.th/?md=product&ma=show&id=27
Film
25 cm x 500 m. . 1.59 kg
Price 70 / 1 roll , 1 roll can film 138 box (50 stang per piece)
http://www.thaitechno.net/t1/productdetails.php?id=15500&uid=35487
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Material receiving & preparation:
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Prepare the ingredients as fresh meat, vegetables and more water to clean if it
is fresh through the collection by use cutter machine.
Cutting machine
Cooking:
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Bring materials to divide by recipes. And cooking with fryer machine and mix with
mix machine.
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Safety and Quality Checking
I.Q.F Freezer: bring the product into machine freezing (I.Q.F) at -18c
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Sealing by plastic:
Bring the product that pass machine freezing come to Sealing by plastic
Sealing machine
Freeze room
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1. Cutter Machine use for trim material to the size desired.
3. The machine gives the heat such as Steamer Boiler and Fryer use for steam.
4. I.Q.F freezer machine use for fall temperature fast and harden
Manufacturers Address
Location
We should location at Samutsakorn .Because Samutsakorn is one province of industry
about seafood product in Thailand. It can find integrates in low cost such as seafood in
Mahachai, labor in low cost, at price 215 bath/day. and the most important thing is reduce
cost of transportation to shop in Bangkok.
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Source:
Land
Our factory rent at bangnamjeed district Samutsakhon at 1600 square wah
[i-Food] 53
http://www.thaiselling.com/thaiselling_Postview.asp?key=83684
Landscape
Samutsakhon has the topography is coastal plain. Above the sea of about 1.00 – 2.00
meters with The chin River flows through this provinces. it good ideal to agriculture and
some of business such as industrial and residential. The lower areas of Samutsakhon is
closely the sea for 41.8 km that suitable to fishing , coastal aquaculture and salt farming. That
is our opportunity from landscape of SamutSakhon about the raw material from the sea,
because main raw material of I-food is seafood.
[i-Food] 54
http://www.samutsakhon.go.th/data/data51/21s.htm
Building
The building has area at the front 25 meters and at the side 90 meter; area of use is
250 square meters.
[i-Food] 55
http://www.thaiselling.com/thaiselling_Postview.asp?key=83684
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Inside the industry
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Plan of factory and facility
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4.1.5 Facility management
From the Production Processes used to Produce i-Food’s Frozen Foods, i-Food
factory has 9 procedures following:
2. Cooking
5. I.Q.F. Freezer
7. Sealing By Plastic
Therefore, i-Food is going to plan to allocate our factory’s sections follow the
procedure for facility in production and operation processes within our factory as well as
possible.
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4.1.6 Machine tool and Equipment
Tunnel Freezer
http://www.maxikool.com/products02.html
Freeze room
http://apache.plazathai.com/electronic/show153831/
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Anvil / griddle flat top Electronic
www.tarad.in.th
Tray
www.tarad.in.th
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Cap
www.tarad.in.th
Sealing machine
200v/175 w
Size 470x600x100mm
Price 5,885
www.tarad.in.th
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Flipper used in frying
Price 60 bath
http://www.kitchenwaremarket.com/oscommerce/catalog/product_info.php?
products_id=3134
http://www.kitchenwaremarket.com/oscommerce/catalog/product_info.php?
products_id=3238
Price 40 bath/unit
http://www.kitchenwaremarket.com/oscommerce/catalog/index.php?cPath=419_430_425
Mashed Machine
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To mash intregrate
Uniform of employee
Price 99
bath/unit
www.tarad
.com
Scales
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electronic
Price 450
bath
http://www.kitchenwaremarket.com/
Stanless bowl
Price 80 bath
http://www.kitchenwaremarket.com/oscommerce/catalog/product_info.php?
products_id=2766
Recycle bin
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Price 147 bath / unit
Pot
22x22 cm
Price 436 bath / unit
http://www.kitchenwaremarket.com/
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Price 13,609 bath
www.tarad.com
Price 51,414
www.tarad.in.th
Rice cooking
http://www.sripiboon.com/product.detail_0_th_789936
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2 Freeze room 2 150,000 300,000
3 Anvil / griddle flat top Electronic 5 13,375 66,875
4 Tray 20 268 5,360
5 Cap 40 114 5,760
6 Sealing machine 10 5885 58,850
10 Flipper used in frying 10 60 600
11 Mixer integrate machine 10 6,295 62,950
12 Glove resist fire 40 40 1,600
13. Mashed Machine 10 890 8,900
14. Uniform of employee 40 99 3,960
15. Scales electronic 10 450 4,500
16. stainless bowl 20 80 1,600
17. Recycle bin 10 147 1,470
18. Pot 10 436 4,360
19. Air conditioner / air filter 10 13,609 136,090
20. Cutter vegetable , mash , mix integrate 1 51,414 51,414
21 Rice cooker 10 3900 39,000
Total tools and Equipment 1,853,289
4.2.1 Rent
According I-Food will be rent factory at Pharam 2 road samutsakhon with the rental
rate at 67 bath / sq.m. per year. So all of area in factory is 2250 sq.m. then the total rent cost
for one year are 67 x 2250 = 150,750 but the owner just set the cost is 150,000 bath per year.
And The Rent cost for one month is 12,500 baths. The agreement is forward rental for 1 year.
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Substitute license: 50
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According to the flow above ,I-food find the raw material from many company for order
integrate in our product ,then when got raw material the next station is in our industry to produce the
product. After our product ready to sell , we will use transportation service from “Dxplace” to
transport our product to DC (Distribution center) of 7-Eleven. then it’s mission of 7-Eleven to
distribution our product to consumers in everywhere in Thailand.
Industy to Dc of 7-Eleven
I-Food use transportation service of “Dxplace” .The price for transportation from SamutsaKhon to Dc
7-Eleven in Bangkok by Teller truck is 4,769 bath per lot. We deliver to distribution centre of 7-11
every 3 days. So, in one month i-food will deliver to DC 7-11 around 10 times. Estimate cost 4,769 x
10 = 47,690 BTH per month
http://www.dxplace.com/price/list
We choose 7-Eleven to distribute our product. Because the power of 7-Eleven to distribution product
is the front rank in Thailand. The Form of delivery is point to point. And type of delivery at many
point on a route. 7-Eleven has standard transportation trucks more than 700 vehicles per day cover the
delivery more than 4,000 point everyday ,including the amount of transportation and distribution more
than 65 million units per year. The most important about 7-Eleven is Distribution center (DC) for
distribution all product to all franchise of 7-Eleven in Thailand.The main DC of 7-eleven that have 4
main Dc , Lamphang DC to distribution cover the north region of Thailand. Khonkaen Dc to
distribution cover the northeast of Thailand. And Bangkok Dc (1500 sq. m.) distribution in Bangkok
and South of Thailand. Not only 3 Dc but 7-Eleven has plan to build more in the future. Therefore our
company select 7-Eleven to distribution our product to consumers.
[i-Food] 71
http://www.7eleven.co.th/corp/about_business_structure_dynamic_management.php
http://www.logisticsthaiclub.com/index.php?mo=3&art=531580
http://www.logisticsdigest.com/index.php?option=com_content&task=view&id=1900
[i-Food] 72
7-Eleven is committed to satisfying customer’s need with quality products and services
through our network all over Thailand. They have been continuously developing and selecting new
products and services to better serve our customers. Therefore, to working with manufacturers and/or
suppliers that sharpen their competitive edge by helping they better meet our customer’s expectation.
If who are manufacturer and/or supplier with intent, qualifications, capability and confidence in their
products, 7-Eleven are looking forward to welcoming they to be one of 7-eleven’s partners. If who
are interested in providing their products and services to 7-eleven,though internet, by fill all details
and information in 7-eleven website form.7-Eleven will consider and contact back as soon.
After 7-Eleven contact back to sign contact Agreement in partner with 7-Eleven. This
agreement has expense, the first is 400,000 bath for one type of product and the last is 35% of price in
product that sale in 7-eleven.
*(I-Food can’t find information to show about cost of 7-Eleven in payment cost in carrying product to
7-eleven because it’s secret in business but member in I-Food group have parent ,who working with
company that contact with 7-Eleven can tell about true cost of agreement and sure.)
http://www.7eleven.co.th/corp/partner.php
https://webmail.7eleven.co.th//database/work_flow_supplier.nsf/RequestFrom_NoteTh?
OpenForm
[i-Food] 73
4.3 Investment cost
Equipment 1,853,289
Decoration 300,000
Total 2,153,289
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Fee
- Application fee at 5 Baht Bangkok made request 2 issue, 3 copies of a provincial
request.
- Fee for permit pay as follow people and/or machinery used in the factory(100 BTH to
20,000 BTH)
- Substitute license: 50 Baht
[i-Food] 75
Approval form
[i-Food] 76
4.3.2 Depreciation
Production cost
Medium-sized business.
For the use of electricity for industrial business government that is similar to an industrial
enterprise as well as related areas. Which demand an average of 15 minutes maximum from
30 kW but less than 1,000 kW and average power consumption 3 months up to 250,000 units
per month. Set up only electric meter.
[i-Food] 78
Minimum: the lowest electricity costs cannot be less than 70 percent of the peak demand
during the past 12 months that ended in the current month.
http://www.eppo.go.th/power/pw-Rate-PEA.html#4
WATER RATES
[i-Food] 79
Level of USER TYPES
water used
State Enterprise,
Cum./mont
Connection Official and Small Industrial and large
h
Business Business
Low Level Rate 50 Low Level Rate 100 Low Level Rate 200
Baht Baht Baht
http://www.pwa.co.th/service/tariff_rate.html
[i-Food] 80
4.5 Management Analysis
o Employee salary
Wage rate for our organization
1. Executives manager 1 person (1x 50,000) 50,000 BTH
Secretary Executives manager 1 person (1x 20,000) 20,000 BTH
2. Employee in organization
- Accounting department
o Manager of accounting 1 person(1x 15,000) 15,000 BTH
o Accounting officer 3 person(3x 12,000) 36,000 BTH
- Financial department
o Manager of Financial 1 person(1x 15,000) 15,000 BTH
o Financial officer 3 person(3x 12,000) 36,000 BTH
- Sales and Marketing department
o Manager of Sales and Marketing 1 person(1x 15,000) 15,000 BTH
o Sales and Marketing officer 2 person(2x 12,000) 24,000 BTH
[i-Food] 81
- HRM department
o Manager of HRM 1 person(1x 15,000) 15,000 BTH
o HRM officer 2 person(2x 12,000) 24,000 BTH
- Purchasing department 2 person(2x 12,000) 24,000 BTH
o Check store 2 person (2x 12,000) 24,000 BTH
- Worker 40 person(40x 7,500) 300,000 BTH
Total salary per month 598,000 BTH
Office equipment
Pen
2 25 19 475
Highlight Pen
3 50 18 900
Liquid
4 25 14 350
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Glue
5 20 139 2780
Scotch tape
6 10 545 5450
paper
7 20 15 300
Sticky notes
8 50 70 3500
File Document
9 30 10 300
Jacket
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10 10 85 850
Document box
11 10 170 1700
calculator
12 3 3690 11070
Phone
14 1 1300 1300
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15 20 499 9980
Table
16 20 299 5980
Chair
17 25 39 975
Stapler
18 10 6.50 65
Staples
19 10 22 220
Scissors
20 10 22 220
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Cutter
21 1 7990 7990
Time Recorder
22 1 pack 99 99
Clock
24 10 50 500
Bin
25 5 19,900 99500
Air Condition
[i-Food] 86
26 10 180 1800
Plug
27 3 3100 9300
Printers
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28 20 15900 318000
Computer
29 1 2,299 2,299
Router
30 100 m 5/m 500
Lan
31 1 15000 15000
Conference table
32 1 9900 9900
Executives table
33
http://infinity_office.tarad.com/product.detail_634629_th_306513
Asset
Pre-operating cost
Substitute license: 50
Investment cost
Decoration 300000
Liability
[i-Food] 89
Working capital 2,000,000
[i-Food] 90
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[i-Food] 94
[i-Food] 95
5.2 Cash flow statement
[i-Food] 96
[i-Food] 97
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5.3 Balance sheet
Asset
Inventory 8740
Liability
Equity
Expense -5907955
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Balance sheet for year 2
Asset
Inventory 8740
Liability
Equity
Expense -5907955
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Balance sheet for year 3
Asset
Inventory 8740
Liability
Equity
Expense -5907955
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Balance sheet for year 4
Asset
Inventory 8740
Liability
Equity
Expense -5907955
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Balance sheet for year 5
Asset
Inventory 8740
Liability
Total liability 0
Equity
Expense -5907955
[i-Food] 105
Financial Analysis
[i-Food] 106
NPV 6.37%
Start up -9,107,955
Year 1 19,023,517
Year 2 20,377,994
Year 3 21,676,270
Year 4 22,902,036
Year 5 24,036,825
NPV = ฿75,527,153
IRR
Start up -9,107,955
Year 1 19,023,517
Year 2 20,377,994
Year 3 21,676,270
Year 4 22,902,036
Year 5 24,036,825
IRR = 215%
Payback period
= 5.75 months
[i-Food] 107
CHAPTER 6: RISK MANAGEMENT
6.1 Risks Analysis
Risks refer to opportunities of problems that are expected to occur in the future. Lack
of operation, production, planning, and every other activities can separated into two types of
risk: First; the risk that called External Risk that occurs outside company those cannot be
predicted or controlled, but it may be avoided and eliminated. Second; the risk that called
Internal Risk that occurs within company those can be controlled, avoided, and eliminated.
Risks caused by external factors those i-Food cannot be predicted and controlled, but
it may be avoided and eliminated; so we have to plan for protect the risks those may occur
from external factors that i-Food will confront in the future; technological change, consumers
need, economic condition, competitive condition, suppliers, and delivery:
Risk management in this problem; i-Food always needs to follow the news or update
for finding the information about development or changing of the technology and apply the
information or knowledge to adapt and develop techniques for satisfy the consumers’ need.
Therefore, we are going to always check products’ quality for good nutrition to consumers or
purchasing new machines or equipments for good production processes.
http://www.ehow.com/about_5561411_frozen-food-technology.html#ixzz18CYcxJgp
[i-Food] 108
The need of consumers to purchase our products can differently change such as the
trend of consumers need changes by generation which there are different attitudes, lifestyle,
and need of frozen food nowadays. Moreover there are a lot of competitors’ products those
are choices for consumers to choose. In this problem is direct risk to i-Food’s products that
may affect to sales and revenues of i-Food.
From the reasons above; it is the risk that affects i-Food and to change the consumers
purchasing behavior, i-Food has to manage the risk about consumers’ decision making. So, i-
Food will use the marketing strategy that is focus on consumers intimacy by enough
informing until attract the consumers’ need, after that satisfy them to make them be our
loyalty.
Economic conditions are a big problem in Thailand and on all investment. It affects
purchasing of consumers that has decreased significantly. Investment in private is lower than
all over investment in country and foreign country, public spending that reduced because of
lower revenues. So people must more carefully in spending, its make the purchase are
decrease (Eureka, 2008). This problem can be risk that affect to decrease sales and revenues
of i-Food.
From the reasons above; i-Food must manage this risk by setting the strategies and
advertising those appropriate to promote to increase sales and revenues with prices and
qualities. Moreover, i-Food is going to serve variety products for respond to all level of
consumers’ need whose have several levels - low, middle, and high levels for making
decision to buy. In recessive economic period; it will satisfy consumers and increase sales
when variety products, and prices the consumer can have more choices which can satisfy
consumers and attract a lot of consumers. These strengths can lead i-Food to the market
easier; so, i-Food can expand market for increase the consumers, market share, and can make
higher profit as well.
[i-Food] 109
Nowadays, frozen food is being interested from all levels of consumers; so, there is
many investors interested to run this business because of this business will be popular in the
future; of cause, in this business have high competition that makes more growth market and
there is variety of products that consumers can make decision for choosing to buy. So, there
is cut pricing between competitions which affects to our market share. In this reason, it is risk
that can affect to i-Food that can reduce sales and revenues of i-Food.
From above reasons; i-Food has to determine good strategies for competing with
competitors in the market by looking for opportunity to build differentiation for the products,
prices, places, and promotions for increasing quality of products for consumers efficiently.
When there are varieties of products which the consumers have more choices for making
decision to buy; it can satisfy consumers and more attracts consumers. If i-Food has strength
which others competitors cannot fight, so i-Food can expand the market then can increase our
consumers and market share until be leader in this market.
http://www.arip.co.th/businessnews.php?id=412312
http://www.marketingoops.com/reports/behaviors/%E0%B8%AD
%E0%B8%B2%E0%B8%AB
%E0%B8%B2%E0%B8%A3%E0%B9%81%E0%B8%8A
%E0%B9%88%E0%B9%80%E0%B8%A2%E0%B9%87%E0%B8%99-
%E0%B9%81%E0%B8%8A
%E0%B9%88%E0%B9%81%E0%B8%82%E0%B9%87%E0%B8%87-
%E0%B8%A7%E0%B8%B4%E0%B8%96/
6.1.1.5. Suppliers
i-Food has many suppliers; It is possible to have problem from them such as lack of
products or raw materials. If they cannot produce for our ordering, it can be effect with our
[i-Food] 110
products. Therefore, the best way to manage risk is, we will forecast sales when close to
festival and order it before festival that can prevent the problem of lack of suppliers which we
will not rush the supplier to produces for prevent wrong or error products.
6.1.1.6. Delivery
Risks caused by internal factors those i-Food can expect and control, so we have to
plan for protect the risks that may occur from internal factors that i-Food will confront in the
future; administration, human resources management, production management, and financial
risk:
6.1.2.1. Administration
Wrong management process or wrong decision that can be causes of i-Food to get loss
or any problems in the company. This may affect the cost and revenue earnings to the
company which is delicate and complex. I-Food is going to solve these problems by training
and developing our employees, controls the manufacturing and operating processes, and
separate responsibilities of employees to effectively working.
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6.1.2.2. Human Resources Management
The successful of many businesses are depends on its professional employers and
employees. The availability of qualified workers is an important factor for the growth and
profitability of the business, and if the company has low attention in recruiting employers and
employees, the company will has low quality both of products and services; company may
loss of sales and benefits. So, i-Food will attend about recruitment and send them to training
before start working and motivate them to good working and make consumers satisfaction by
give bonus or holiday for who best working for the company.
Production is more important one within company this department has to have good
processes and good quality checking that good for nutrition and health of consumers, but
sometimes this department will have the risk about delay of suppliers in raw materials
delivery that does not on time. i-Food is going to produce the products 7,000 units per day
that more than the need of market per day.
Financial management is very important that needs to have good management with
circumspection because of the financial risk can affect the operations and production
processes of i-Food.
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6.1.2.6. Financial Risk
If sale decrease 5%
Year 2010 Net income is 25,027,934 BTH
[i-Food] 113
Interest increase by 5%,
Year 2010 Net income is 32,539,149 BTH
[i-Food] 114
Year 2012 Net income is 29,053,896 BTH
Risks refer to opportunities of problems that are expected to occur in the future. Lack
of operation, production, planning, and every other activities can separated into two types of
risk; First, the risk that called External Risk that occurs outside company those cannot be
predicted or controlled, but it may be avoided and eliminated; Risks caused by external
factors those i-Food cannot be predicted and controlled, but it may be avoided and
[i-Food] 115
eliminated; so we have to plan for protect the risks those may occur from external factors that
i-Food will confront in the future; technological change, consumers need, economic
condition, competitive condition, suppliers, and delivery. Second, the risk that called
Internal Risk that occurs within company those can be controlled, avoided, and eliminated;
Risks caused by internal factors those i-Food can expect and control, so we have to plan for
protect the risks that may occur from internal factors that i-Food will confront in the future;
administration, human resources management, production management, and financial risk.
However, i-Food hoped that all of risks those we have told will not incur with us now and
forever or incur at least.
CHAPTER 7: CONCLUSION
Nowadays the market share about frozen food in Thailand, Frozen food business is one of the
business that many consumer need because Nowadays people have hurry life and limited
time. They need to find something that can replace the nutrition needs of their. Therefore,
frozen food is main choice that customer needs it. We selected raw material quality. So our
customers can enjoy frozen food using a variety of raw materials and natural.
From the statistic, that show about population that will be target group in frozen food market.
The number of target group is 10,029,779; our company estimate we will get market share
about only 5% for this target group. Our product capacity is we can produce the product for
10,000 unit / day. So after we desire to get market share for 5% , for one day we must
produce the product for 6,600 unit per day ,but we produce only 70% of product capacity ,it’s
7,000 unit per day for reserve ,if have risk about production.
About financial of i-Food Company; we start up business with 9.1 million. From the Income
statement in the first year we have net income for 32 million and at the last year for 37
[i-Food] 116
million. Internal rate of return of our company is 215%; Net present value in the last year is
75 million and Payback period is about 5.75 months!
From risk management; we have planned about avoiding or reducing all of the risks that can
incur internal risk and external risk our company including technological change, consumers
need, economic condition, competitive condition, suppliers, delivery, administration, human
resources management, production management, and financial risk.
Finally ,If some investor want to join with our company,we hope I-food is best brand of
frozen food to provide comfort and satisfaction to all customers and gain more profit to
investor with the best service possible.
References
อุตสาหกรรมสาร. (2009). แนวโน้มอุตสาหกรรมอาหารพร้อมปรุ ง-พร้อมทานในตลาดโลกกับอนาคตที่สดใส.
Retrieved February 16, 2011, from Website: http://library.dip.go.th/multim1/ebook/J
%20 กสอ 127%202552.1.pdf
[i-Food] 117
E.C.S. Package. (2009). กล่องอาหาร PP 2 ช่อง S250 /2. Retrieved February 16,
2011, from Website:
http://foodpackage.tarad.com/product.detail_269672_th_2107298
P.P.C. Factory Co., Ltd. (2010). บริ ษทั พี.พี.ซี . อุตสาหกรรม จำกัด. Retrieved February
16, 2011, from Website: http://www.ppcfactory.co.th/
[i-Food] 118
http://www.prantalay.com. (2007).Retrieved February 16, 2011, from
Website: http://www.prantalay.com/cms/index.php
[i-Food] 119
http://www.talad-yingcharoen.com (2007).ราคาสิ นค้าวันนี้ . Retrieved February 16,
2011, from Website: http://www.talad-yingcharoen.com/price.php
OLEEN CO.,LTD. (n.d.). น้ำมันถัว่ เหลือง ตราโอลีน. Retrieved February 16, 2011,
from Website: http://www.oleen.co.th/product_detail.php?id=188
[i-Food] 120
Well Plas CO.,LTD.(n.d.). ฟิ ล์มยืดห่ออาหาร / ฟิ ล์มห่อกระเช้า. Retrieved February 16,
2011, from Website: http://www.thaitechno.net/t1/productdetails.php?
id=15500&uid=35487
[i-Food] 121
http://www.kitchenwaremarket.com/oscommerce/catalog/product_info.php?
products_id=3134
[i-Food] 122
CP ALL PUBLIC COMPANY LIMITED. (2007). Trading Opportunity with
C.P. 7-Eleven. Retrieved February 16, 2011, from Website:
http://www.7eleven.co.th/corp/partner.php
[i-Food] 123
APENDIX
[i-Food] 124
[i-Food] 125
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