Entrepreneurship 3209

Gregory Odiwa

Mr. Hicks

5th Jan 2024

1.0: Executive Summary

1.1 Business Description

1.2 The Industry

1.3 Management

2.0 Market Description

2.1 Customer Profile

2.2 The Market

2.3 Competition Analysis

3.0 Product/Service Development

3.1 Original Idea

3.2 Consumer and Industry Research

3.3 Product or Service Improvement

4.0 Product/Service Marketing

4.1 Product

4.2 Pricing

4.3 Distribution

4.4 Promotion

5.0 Operations

5.1 Venture Organization

5.2 Break Even Analysis

5.3 Risks and Assumptions

Executive Summary

1.1 Business Description

This business is a food truck that aims to provide affordable meals to the general public,

especially focusing on students who don’t have access to good food. The Canada Food Guide

restricts a lot of good food options for students. The business is unique because it’s mobile and

provide healthier food options at cheaper prices compared to McDonalds and other fast food

restaurants.

1.2 The Industry

The food truck industry has grown 15.8% a year on average from 2018 - 2023. The food truck

industry is also very labour intensive making a a big chunk of expenses so we will have to keep

the workforce running the business to a minimum preferably about 3 at the most. This industry is

made up of large motorized vehicles that are equipped to store, transport, cook, prepare, serve

and sell food.

1.3 Management

I plan to run this business as a sole proprietorship with me as the head overseeing operations. I

think that my skills with organization, adaptability, kitchen experience, customer service and

communication make me a great option to lead this business.

Market Description

2.1 Customer Profile

This food truck will be directed to those who are in need of a convenient place to get a healthy,

affordable meal. This includes tourists, local workers, students and event attendees of varying

ages. The food truck will be able to provide them with their dietary needs; primarily for young to
middle aged individuals. The younger population of the province is more diverse therefore they

would appreciate more diverse menus. Quick service will also align with their busy lifestyles.

More people are worrying about their health so nutritious meals will be appreciated. The food

court at MUN is always extremely busy making it inaccessible to a lot of people.

2.2 The Market

The primary trading area will be the Avalon Mall area extending downtown depending where we

expect there to be the most business. Secondary trading areas will be nearby neighbourhood and

event venues/parks. Tertiary trading areas will be suburban communities, businesses, parks ,

industrial areas and transportation hubs. 67.7% of St. John’s 110,525 population is between the

ages of 15 to 64, our primary demographic.

2.3 Competition Analysis

Ziggy's Peelgoods - Owned by Tod Hickey and Tony Gilbert. They sell a variety of French Fries

and have been in business for over 25 years. Recognized as one of Newfoundland’s most iconic

poutine purveyors. The locations on Water Street and Elizabeth Avenue contribute to the amount

of business they encounter. The approximate size of their location is about 120 sp ft. Ziggy’s

Peelgoods offers a range of sides and their fries and poutines average a cost of about $10. They

offer cash and card as forms of payment.

Johnny & Maes - Owned by Alicia and Kyle McKenna. They specialize in a variety of

homestyle hamburgers, tacos, chicken sandwiches as well as fries and poutines. The business

was founded in 2019. The truck is pretty well known, regularly attracting line ups. Their

Location is near downtown, a great area to gain exposure to the widest range of people. This has

allowed the business to gain rapid exposure. Their combos cost upward of $20.
3.0 Product/Service Development

3.1 Original Idea

The original idea was to create a food truck that provided affordable meals to the student

population of PWC and the general public. This was going to be in competition to the other fast

food places in the area like McDonalds and Dominos.

3.2 Consumer and Industry Research

Interviewing potential customers informed us on what they want from a business in terms of

service and the speed, to fit their fast paced lifestyles. Learning about customer preferences,

price sensitivity, convenience, location, menu items and purchase frequency helped to refine the

business.

Interviewing business people informed us on some operational challenges and issues like

staffing, maintenance and permits. The importance of location and its impact on exposure and

business was also emphasized. Tips to minimize costs and maximize profit like bulk buying

were also shared.

3.3 Product or Service Improvement

Moving the location to somewhere with more exposure downtown

Downscaling the menu to make it more achievable in the space that’s available

Setting a good price point that is realistic for a meal

Providing combos to give the illusion of better value

Making the target market broader.

4.0 Product/Service Marketing

4.1 Product

The business is a mobile food truck, offering a fusion cuisine. It would provide a convenient and

on-the-go dining experience serving up an array of healthy meals with a focus on affordability.

The goal is to bring delicious food directly to customers creating a unique and enjoyable dining

experience.

The mobility and flexibility of a food truck allow us to explore diverse locations and adapt to

changing trends. It’s also lower cost when compared to a traditional restaurant model, allowing

for a more effective cost business. Direct customer interaction will also foster a personal

connection building consumer loyalty.

4.2 Pricing

The competition uses bundle pricing which encourages customers to purchase multiple items

under the facade of gaining better value. Particularly, Johnny & Maes use price skimming

offering more hearty meals but at a more expensive price. The special often used include

combos.

This business will also offer combo deals to create the illusion of better value. Fire Flavours will

then offer a 25% discount on Thursdays, the day most people get paid meaning spending is

highest. Lastly, the business will offer combo meals mimicking the competition, with a focus on

less variety but higher quality food

4.3 Distribution

The products we sell will be made by our own company. The CEO plans to be working in the

kitchen to ensure the highest quality meals are produced and employees truly grasp how to create

the meals.
We will be selling our own product that we create and distribute directly to the customers

ourselves.

4.4 Promotion

The most viable tools to reach our audience, the youth to the middle aged category, would be

social media, websites, television ads and flyers. These methods of advertisement are rapidly

consumed fitting into the fast-paced lifestyle of today's population.

Television advertisements - About $50 per 100 viewers for 30 seconds. Therefore for are

tr=arget audience of 110,000 it’ll be about $5,500.

Flyers - About $300 for 1000 flyers across the city

Website - About $300 a month to set up and maintain. So $3,600 yearly

Social Media - Instagram and Facebook ads cost $6.70 per 1000 impressions. So on both

platforms for our target audience this’ll be about $2,000.

5.0 Operations

5.1 Venture Organization

This business would be a sole proprietorship because there will be one person as the driving

force behind the running of the business. For a project on the scale of a food truck having too

many heads involved in decisions would be detrimental as decisions must be made quickly in

such a fast-paced business.

5.2 Break Even Analysis

Fixed Costs

- Implementing a POS System ~ $2,000

- Truck Customization & maintenance ~ $3,000

 - Permits ~ $1,500

Total ~ $5.500

Recurring Costs (for 1,000 meals)

- Lease for truck ~ $750

- Fuel ~ $100

- Propane ~ $100

- Food ~ $ 3,260

- Employees ~ $3,000

Total ~ $7,210

7210/1000 = 7.21 per meal

5500/(13-7.21) = 949.914 ~ 950 meals to sell to reach break-even point

5.3 Risks and Assumptions

Risks

- Economic uncertainty can affect how much consumers spend. A downturn in the

economy can lead to less demand for the business's product.

- Shiftsin consumer preferences may make marketing strategies less appealing. The

business must stay attuned to consumer behaviours

- Issues with the supply chain, like delays and shortages, can impact our ability to deliver

products.

Assumptions

- Assuming sufficient customer demand in business locations

- Pricing strategy is competitive and appealing to the target market

- Stable economic environment that allows customers to spend on non-essential goods like

food from a food truck.

Sources

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Statistics. IBISWorld Industry Reports.

https://www.ibisworld.com/industry-statistics/number-of-businesses/food-trucks-united-

states/

How to lease a food truck. CHEF’STORE. (2023a, March 15).

https://www.chefstore.com/about/blog/how-to-lease-a-food-truck/

Shewan, D. (2023, December 1). The Comprehensive Guide to online advertising costs -

WordStream. The Comprehensive Guide to Online Advertising Costs.

https://www.wordstream.com/blog/online-advertising-costs

How to buy a Food Truck. WebstaurantStore. (2021, September 4).

https://www.webstaurantstore.com/article/172/how-to-buy-a-food-truck.html#:~:text=How

%20Much%20Does%20a%20Food%20Truck%20Cost%3F%201,food%20truck

%20typically%20costs%20between%20%242%2C000-%243%2C000%20each%20month.

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Census of Population geographic summary: St. John’s, City (CY) [Census subdivision],

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