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1.0 Executive Summary
The purpose of this business plan is to raise $50,000 for the development of a food truck while showcasing the expected financials and operations over the next three years. The Food Truck, Inc. (“the Company”) is a New York based corporation that will provide mobile sales of food to customers in its targeted market. The Company was founded by John Doe.
1.1 Operations
The primary revenue center for the business will come from the sale and distribution of food served from the Company’s food truck that will operate throughout the New York metropolitan area. The business will specialize in serving general food including: • Hamburgers • Hot Dogs • Fries • Beverage • Ethnic Specialties The third section of the business plan will further describe the services offered by the Food Truck.
1.2 The Financing
Mr. Doe is seeking to raise $50,000 from as a bank loan. The interest rate and loan agreement are to be further discussed during negotiation. This business plan assumes that the business will receive a 10 year loan with a 9% fixed interest rate. The financing will be used for the following:
• Development of the Company’s Food Truck
• Financing for the first six months of operation.
• Capital to purchase a company vehicle.
Mr. Doe will contribute $10,000 to the venture.
1.3 Mission Statement
Management’s mission is to provide the New York metropolitan area (and other areas where the Company expands) with quality food served on a mobile basis.
1.4 Management Team
The Company was founded by John Doe. Mr. Doe has more than 10 years of experience in the food and beverage industry. Through his expertise, he will be able to bring the operations of the business to profitability within its first year of operations.
1.5 Sales Forecasts
Mr. Doe expects a strong rate of growth at the start of operations. Below are the expected financials over the next three years.
1.6 Expansion Plan
As time progresses, the Company will continually expand its presence throughout New York City by attending music concerts, trade shows, sporting events, and other venues that feature a large number of people. Additionally, over time, the business will generate a strong repeat customer base from the continual servicing of the routes planned by Management. In the fourth year of operation, Mr. Doe intends to acquire a second truck that will operate within selected sections of New York. It should also be noted, after the fifth year of operation, Management may acquire several additional mobile food service truck in order to greatly expand the revenues of the business.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
Food Truck, Inc. The Company is registered as a corporation in the State of New York.
2.2 Required Funds
At this time, the Food Truck requires $50,000 of debt funds. Below is a breakdown of how these funds will be used:
2.3 Investor Equity
Mr. Doe is not seeking an investment from a third party at this time.
2.4 Management Equity
John Doe owns 100% of the Food Truck, Inc.
2.5 Exit Strategy
If the business is very successful, Mr. Doe may seek to sell the business to a third party for a significant earnings multiple. Most likely, the Company will hire a qualified business broker to sell the business on behalf of the Food Truck. Based on historical numbers, the business could fetch a sales premium of up to 4 times earnings.
3.0 Operations
As stated in the executive summary, the primary focus of the Company’s operations will be to provide freshly cooked food and beverages to the general public of the New York metropolitan area. The business will operate solely in a mobile capacity through its food truck. In the fourth year of operations, the Company intends to acquire a second truck that will operate through selected sections of New York City. The business also intends to do a significant amount of sales via catering, delivery of pastries, and by having the truck positioned near popular events (such as concerts and sporting events) during the weekends. Approximately 1/3 of all food and beverage sale revenues will come from this aspect of Food Truck, Inc.’s operations. During days of inclement weather, the Company intends to provide delivery services of food and beverages to third party restaurants, cafes, and other food serving venues so that the business can not only generate additional revenues but also reduce inventory spoilage.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
This section of the analysis will detail the economic climate, the Food Truck industry, the customer profile, and the competition that the business will face as it progresses through its business operations.
Current, the economic climate is moderate. The economy is undergoing a transition period due to changes in global trade policy. At this time, interest rates have remained steady due to appropriate and measured policies by central banks. While there has been volatility, this is expected to subside as the economy adapts to these changes.
However, Food Truck, Inc. will be able to remain profitable and cash flow positive as the business produces very strong gross margins from the sale of its fare. Additionally, the business is mobile, and can be readily moved to areas where substantial sales can be made. A primary concern for the Company is its ability to price its services affordably during times of economic recession or spikes of oil prices. This volatility in oil prices has caused the general public’s discretionary income to decrease significantly over the last three months.
4.2 Industry Analysis
The coffee and non-alcoholic retail industry (including mobile food service businesses) has experienced a healthy level of growth over the past decade. The U.S. Economic Census estimates that there are over 190,000 individual cafes, mobile food service businesses, and specialty food restaurants in the United States. This number is expected to increase at a rate of 5% per annum. While the growth rate of the number of establishments has increased 5% per year, the revenues generated per establishment have increased at a rate of 10% per year. As the country is currently in recession, the industries revenues are expected to remain flat until the economic recovery period begins.
4.3 Customer Profile
As the business intends to operate among several sections of New York, it is hard to categorize the “average” customer of Food Truck, Inc. Management expects a broad range of customers including employees within office buildings in New York City, tourists, and residents that simply want a quick meal as they go through their day.
4.4 Competitive Analysis
This is one of the sections of the business plan that you must write completely on your own. The key to writing a strong competitive analysis is that you do your research on the local competition. Find out who your competitors are by searching online directories and searching in your local Yellow Pages. If there are a number of competitors in the same industry (meaning that it is not feasible to describe each one) then showcase the number of businesses that compete with you, and why your business will provide customers with service/products that are of better quality or less expensive than your competition.
5.0 Marketing Plan
The Food Truck intends to maintain an extensive marketing campaign that will ensure maximum visibility for the business in its targeted market. Below is an overview of the marketing strategies and objectives of the Food Truck.
5.1 Marketing Objectives
- Establish a strong presence in the New York metropolitan area via prominent signage on the mobile food truck.
- Heavily advertise the Company’s large selection of food and beverages.
- Establish connections with local suppliers and vendors.
5.2 Marketing Strategies
The primary method of marketing to be used by the Company will be the highly visible signage affixed to the mobile truck. This signage will focus on the affordable nature of the Company’s wide selection of food and beverages. In regards to the catering aspect of the business, the Company intends to send packets of information to event planners throughout New York City that will call on the business for catering needs. As the business serves a broad variety of food and beverages, the mobile Food Truck will be able to effectively provide catering services for a broad spectrum of casual events. Additionally, the business will develop relationships with venue managers that will allow Food Truck, Inc. to place the truck outside of these locations so that sales can be made. These venues will include sports stadiums, concerts, and other large scale entertainment events. The business will also maintain a website that showcases the mobile food service truck, the Company’s menu, information about catering, and other relevant contact information. This website will be listed on major search engines such as Google, Yahoo, and MSN Live.
5.3 Pricing
In this section, describe the pricing of your services and products. You should provide as much information as possible about your pricing as possible in this section. However, if you have hundreds of items, condense your product list categorically. This section of the business plan should not span more than 1 page.
6.0 Organizational Plan and Personnel Summary
6.1 Corporate Organization
6.2 Organizational Budget
7.0 Financial Plan
7.1 Underlying Assumptions
- The Food Truck will have an annual revenue growth rate of 16% per year.
- The Owner will acquire $50,000 of debt funds to develop the business.
- The loan will have a 10 year term with a 9% interest rate.
7.2 Sensitivity Analysis
The Company’s revenues are somewhat sensitive to the overall conditions of the economy. As the US is currently outgoing a recession, the Company may have a decrease in its top line revenues as people will demand fewer café beverages/food products from mobile food locations. However, the Company’s revenues provide high levels of operating income for the business, and Food Truck, Inc, would need to have a significant decrease in its top line income before the Company becomes unprofitable. Additionally, the business is not bound by location, and the Company can relocate at anytime to more populous areas to produce sales.
7.3 Source of Funds
7.4 General Assumptions
7.5 Profit and Loss Statement
7.6 Cash Flow Analysis
7.7 Balance Sheet
7.8 Breakeven Analysis
7.9 Business Ratios
