Company Overview (1)

Principles of Marketing

Marketing PlanMarketing Plan

OfOf

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ACKNOWLEDGEMENTACKNOWLEDGEMENT

First, we pay our thanks to GOD Almighty, who made us able to complete our task, before the time a lot.

We express our heartfelt thanks to our kind teacher Mr. Asim Ilyas has always remained supportive to us, throughout our project. His guidelines have been

beneficial to us and who taught us so well that we were in such a position to work for the project with our own work.

We pay our compliments to all those persons who have been cooperative to us in completing our project on

time.

We are also grateful to all those persons who has helped us for successful and

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Principles of Marketing Completing of our project.

Once again, thanks to all.

DedicationDedication

We want to dedicate We want to dedicate

Our this projectOur this project

Report to ourReport to our

Beloved “Parents”Beloved “Parents”

And our Respectable And our Respectable

“Teachers” & “Seniors”“Teachers” & “Seniors”

We also dedicate this We also dedicate this

project repot to each project repot to each

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“Group member” for“Group member” for

their team work and efforts.their team work and efforts.

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Sr.No. INDEX Page No.

1 Abstract 05

2 Mission Statement 07

3 Vision Statement 08

4 Company Overview 09

5 SWOT Analysis 11

6 PEST Analysis 13

7 Situation Analysis 14

8 Segmentation 15

9 Targeting 16

10 Positioning 17

11 Differentiation Strategy 19

12 Marketing Mix 20

13 Product 21

14 Price 22

15 Place 26

16 Promotion 30

17 People 18

18 Financial Projections 32


AbstractAbstract

Chuck Wagon introducing a mobile restaurant in which customers can either dine in or

take-away meals. We will provide high quality items that require minimal cooking time.

We have done SWOT analysis in order to match the company strengths to attractive

opportunity in the environment, while eliminating or overcoming the weaknesses and

minimizing the threats. By PEST analysis, get the information about environmental

forces include all the actors which are close to the company that affect, positively or

negatively. Situation analysis describe us with today’s hectic lifestyles, timesaving

products are increasingly in demand. Perhaps one of the most obvious examples is fast

food. Chuck Wagon segmented the market on the basis of different variables and then

selected its target market in two ways: the age group from 18 to 25 is the primary age

where brand building efforts could take place. Our secondary target is between the ages

of 25 and 40, which are a heavy lounge/restaurant user group. Chuck Wagon positioned

itself as status symbol; by offering a superior product, coupled with superior services,

Chuck Wagon will excel relative to the competition and positioned themselves get more

for same. The analysis of marketing mix on the basis of 5 P’s used by Chuck Wagon

which tells us to handle in different situations and increase customer value by

exceeding customer’s needs and wants. The financial projections have been done on

the basis of assumptions; the starting capital is 12 million rupees, sales forecasted for 5

years and also analyze the financial performance and position. We calculated the

breakeven point in sales as well as in units.

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Company overviewCompany overviewChuck wagon will be incorporated in different cities of Pakistan. Our focus will be on

providing high quality food and convenience for our customers. We are introducing a

mobile restaurant in which customers can either dine in or take-away meals.

Chuck Wagon has four owner-managers who each have an equal stake in the business.

Financially, our mission will be to create a business which will be sustainable and

provide steady growth for many years to come.

Vision StatementVision Statement“Chuck Wagon envisions the best customer services experiences by our customers-one“Chuck Wagon envisions the best customer services experiences by our customers-one

that cheer up the senses and fulfills even the unexpressed wishes and needs of ourthat cheer up the senses and fulfills even the unexpressed wishes and needs of our

customers’. customers’.

Mission StatementMission Statement

“We tend to become the market leaders in mobile restaurant business and provide high

quality food and create customer’s value by exceeding customer’s expectations”.

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SWOT ANALYSISSWOT ANALYSIS

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STRENGTH

We have the first move advantage.

We establish strong relationship with vendors that offer high quality ingredients and fast delivery schedules.

We have the locational benefits as we have focused on various institutions and main markets.

We have the advantage of mobility.

We have an excellent staff which is highly trained and very customer attentive.

We have more variety & high-quality food offerings that exceed competitor’s offerings in quality, presentation, and price.

WEAKNESSES

Lack brand equity.

A limited marketing budget to develop brand awareness.

THREATS

The current unstable political condition of Pakistan is a threat to us.

A slump in the economy reducing customer's disposable income spent on eating out.

Our competitors may plan to come into mobile restaurant business.

OPPORTUNITIES

In future, we can build a proper restaurant as well.

We have the opportunity of introducing innovative ideas and recipes.

We can capture the diverse market segments.

We can launch a new product line.


PEST AnalysisPEST Analysis1. Political policies

a. Government Policies

Our restaurant is bound to obey the government policies and follow the

rules and regulations prescribed by the government in order to run this

kind of business.

b. Price Policies

A Price policy is also an important factor. Chuck Wagon maintains &

designs its price policies keeping in view the income & income distribution

of the people living in the Country.

c. Political Stability

As we want to become leaders in our business, political stability of

Pakistan plays a key role. The current unstable conditions of Pakistan can

prove a threat but we have the security measures in mind.

2. Economical Factors

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Principles of Marketinga. Income

Income is an important economical factor of the Chuck Wagon. This factor

decides which class we are going to target. Initially, we are focusing on

the upper class, the upper middle & middle class.

b. Consumption Behavior

Chuck Wagon has also estimated the consumption behavior of people,

their liking and disliking and accordingly made the decisions.

c. Payment Methods

Payment method is an important factor. In this method, we check the

behavior of people regarding the payment methods that is whether they

pay plastic money or cash.

3. Social /Cultural Factors

a. Social Class

We target the upper class, upper middle class and the middle class as our

products have both quality and taste that does not comes cheap.

b. Culture

We have brought up the old Pakistani culture of vendors with just a little

modernized touch.

c. Religion

The food provided is purely halal and all the activities performed are pure

in the boundaries of Islam.

4. Technological Factors

a. Up-to-date Technology

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Principles of MarketingThe machinery we have is of the latest technology and work as enterprise

resource planning.

b. Research & Development

Research & Development is also an important factor in the technological

factor. Chuck Wagon always supports the work of research &

development in order to introduce new technology.

c. Capital Formation

Capital formation means stock of machinery. We have a stock of

machinery to run our business activities.

Situational AnalysisSituational AnalysisWith today’s hectic lifestyles, timesaving products are increasingly in demand. Perhaps

one of the most obvious examples is fast food. The growth rate in consumer

expenditures on fast food has led most other segments of the food-away-from home

market for much of the last two decades. Since 1982, there is increase in growth rate in

consumer spending at fast food. The consumers spending on fast food outlets grew

annually, the proportion of away-from-home food expenditures on fast food also

increased.

Now People want quick and convenient meals. They don’t have time to spare on

travelling and restaurants where they have to wait long for their meals. Knowing this, the

fast food providers are coming up with new ways to market their products that save time

for consumers. The rapid rate at which the fast food industry continues to add outlets is

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Principles of Marketingas much a reflection of consumer demand for convenience as it is a reflection of

demand for fast food itself.

SegmentationSegmentationAfter the situational analysis, Chuck Wagon segmented its market through different

variables. The profile for Chuck Wagon’s customers consists of the following

geographic, demographic, psychographic, and behavioral and benefit factors:

Geographic’s

Our immediate

geographic target is the

cities; i-e, Lahore,

Gujranwala and

Islamabad.

We have targeted the

institutions and important

markets.

Demographics

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Principles of Marketing Male & Female.

Age 18 – 40, this is the segment that has effective spending power.

Young & Middle aged professionals who work close to the location.

College and university students

An income over 10,000.

Eat out several times a week.

Tend to patronize higher quality food.

Are cognizant about their health.

Psychographic

Upper Class.

Upper Middle & Middle class.

Authoritarians, Extroverted and Ambitious.

Innovators & early adaptors.

Behavioral Factors

Enjoy a high quality meal without the mess

of making it themselves.

When ordering, health concerns in regard to

food are taken into account.

There is value attributed to the appearance or presentation of food.

Benefit Segmentation

Quality

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Principles of Marketing Convenience

Service & Speed

Target MarketTarget MarketChuck Wagon intends to cater to the bulk

of youngsters and middle age

professionals in Lahore, Gujranwala and

Islamabad. We have chosen this group for

several important reasons. It is our goal to

be "the extraordinary fast food place" and

we believe that the age group from 18 to

25 is the primary age where brand building

efforts could take place. They are on limited or fixed incomes and seek a value/price

relationship that will not stretch their budgets.

Our secondary target is between the ages of 25 and 40, which are a heavy

lounge/restaurant user group. They are more flexible in budgets and seek more than a

value/price relationship.

It is also a group of people who is always ready to try new products and like to eat

healthy food but don't want to compromise on taste.

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PositioningPositioningChuck Wagon positions itself in the mind of

consumer as status symbol. Customers expect an

ambient, hygienic and a little sophisticated brand

that respects values. The tag line is “Chuck

Wagon mai hai Kuch Bat” which shows the

commitment of quality of food and service is clean,

easy approach to restaurants which ensure that

Chuck Wagon maintains positive relationship with

the customers. Chuck wagon increase the brand recognition to that point customers

attach themselves with chuck wagon to enhance their self-image.

Chuck Wagon positioning will leverage their competitive edge:

Product

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Principles of MarketingBy offering high quality and diversity of product we will satisfy the consumer

needs. The product will also be developed to enhance presentation, everything

will be aesthetically pleasing.

Service

Customer service will be the priority. Our primary service is mobility that means

near your doorstep. All employees will ensure that the customers are having the

most pleasant dining experience. All employees will go through an extensive

training program and only experienced people will be hired.

By offering a superior product, coupled with superior service, Chuck Wagon will excel

relative to the competition.

DifferentiationDifferentiation

Strategy/Strategy/

Competitive EdgeCompetitive Edge The service of mobile restaurant gives convenience to customers.

Enthusiastic and friendly staff.

Supporting merchandise items that support company's brand building.

ERP System in organization.

Vertical Market System.

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Marketing Mix (5Marketing Mix (5 P’s)P’s)

After segmenting the market, finding the target segment and positioning itself, each

company needs to come up with an offer. The 5 P’s used by Chuck Wagon are:

1. Product

2. Price

3. Place

4. Promotion

5. People

ProductProductChuck wagon just not offering food it involves a lot more than eating food. We explain

our product according to three levels:

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JUNK FOOD

JUNK FOOD

Chunk Wagon

Chunk Wagon

High

Quality

High

Quality

More Variety

More Variety

Mobile Service

Mobile Service

Customer Care

Customer Care


The core product which is offered is junk food, by which customers can satisfy their

need of hungry or eating. Chunk Wagon offers more variety with high quality food. A

product line includes:

The augmented product is our service of mobile restaurant and also customer care by

taking feedback and enhancing loyalty.

Branding Strategy

Brand name: “CHUCK WAGON”

We selected the brand name considering our main differentiating feature ‘mobility’. We

are focusing on our features rather than the pricing. Our salient features are:

Mobility

Quality

Time saving

Distinctive Taste

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Chuck

Wagon

Fast

FoodPiazzas Beverages Deserts


PricePricePrice is an important factor in the marketing mix, it is only who generates revenue. Our

price covers the value provided to the customers that is the price the customers pays is

worth the food quality and the services. As according to the Philip Kotler, when our

marketing objective is to create brand awareness than the price charge by the company

is cost-plus strategy. Initially, Chuck Wagon’s pricing strategy is also Cost-plus strategy,

because our objective is awareness about the brand. We also charge the psychological

price by reducing the customer’s fatigue by providing food at convenient places.

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Source: Philip Kotler, Marketing Management: Analysis, Planning, Implementation, and Control, 10th ed. (Upper Saddle River, NJ: Prentice Hall, 2000), p. 316.

PlacePlace“Place includes the company activities that make the product available to the target

consumers. It includes locations, inventory, distribution channels etc.”

We will use the selective distribution channel. By using it, can develop good working

relationships with selected channel members and expected a better than average

selling effort.

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Principles of MarketingIn distribution channel, Chuck Wagon focuses on Vertical Marketing System instead of

traditional model. In VMS, Chuck Wagon along with their strategic partner acts as

unified and strong power in order to fulfilling the consumers need.

Our restaurant will cover the following city locations:

Islamabad

o Blue Area

o Jinnah Super Market

Lahore

o Jail Road

o Defense Burki chowk

Gujranwala

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Traditional

Model

ManufacturerManufacturer

WholesalersWholesalers

Chuck Wagon

Chuck Wagon

ConsumersConsumers

Chuck Wagon’s Model

Principles of Marketingo GIFT University

o Satellite Town main market

PromotionPromotionThe various promotion channels being used by Chuck Wagon to effectively

communicate the product information. A clear understanding of the customer value

helps decide whether the cost of promotion is worth spending.

We are doing promotion by objective-task-method. There are three main objectives of

advertising for Chuck Wagon’s are to make people aware of an item, feel positive

about it and remember it. The right message has to be communicated to the right

audience through the right media.

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Principles of MarketingFor targeting our audience, we will do below the line activities, because they refer to specific audience in

specific region.

Activities Frequency Cost/Year

Mobile Marketing Once in Month 5000

Social Media Updated -

Bill Boards 8/Quarter 320000

Banners 400/Quarter 160000

Flyers Distributed at different

institutes

40000

Stands Universities &

Organizations

75000

Event Sponsorship Twice in Year 200000

Displaying LCD at

Sale Point

All time by different

names like musical

night, movie, etc.

-

Total 800,000

Some of the projected marketing campaigns of Chuck Wagon’s are:

“You deserve a break today, so get up and get away- To Chuck Wagon”

“Aap ke zamane mein ,baap ke zamane ke daam”.

“Food, Folks, and Fun”.

There is flyer and bill board design given below:

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PeoplePeopleChuck Wagon’s understands the value of both its

employees and its customers. It understands the

fact that a happy employee can serve well and

result in a happy customer. Chuck Wagon

continuously does Internal Marketing. This is

important as it must precede external marketing.

This includes hiring, training and motivating able

employees. This way they serve customers well

and the final result is a happy customer.

The level of importance has changed to be in the following order (the more important

people are at the top):

1. Customers

2. Front line employees

3.Middle level managers’

4.Front line managers

The punch line “Chuck Wagon mai hai Kuch Bat” is an attempt to show that the

employees are working with brand that will love to serve the customers.

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FinancialFinancial

ProjectionsProjectionsKEY ASSUMPTIONS

Project AssumptionsProjected Life of The Project in Years 10Sponsors' Equity 100%General Inflation Rate 13%

Operating AssumptionsTotal No. of Days in One Year 365Total No. of Months in One Year 12No of Working Days in One Year 365No. of Working hours/day 8No. of Shift 2

Depreciation Rate AssumptionsVehicles 10%Machinery 10%Fittings & Installations 10%Office Equipments 10%Furniture & Fixtures 10%

Working Capital Turnover AssumptionsColumn1 Column2 Column3Raw Material Inventory 30 Days Raw Material Consumption 30 Days Raw Material ConsumptionFinished Goods 30 Days Goods available for salePacking Material 30 Days Goods available for sale

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Principles of MarketingWare house 30 Days Stores & Spares ConsumptionExpenses 30 Days of Total Annual Expenditure

Note 2- Cost of Good Sold Statement

Note 2- Cost of Goods Sold Statement

1st Year 2nd Year 3rd Year 4th Year 5th Year

Opening Balance - 300,000 485,000 375,000 101,250

Purchases (Note A) 3,725,000 4,050,000 4,455,000 4,900,500 5,390,550

Freight Inward 150,000 165,000 181,500 199,650 219,615

Cost of Material available for use 3,875,000 4,515,000 5,121,500 5,475,150 5,711,415

Closing Inventory 300,000 485,000 375,000 101,250 450,500

Cost of Material use 3,575,000 4,030,000 4,746,500 5,373,900 5,260,915

OH Exp (Note B) 4,477,050 4,579,050 4,684,110 4,792,322 4,903,780

Cost of Good Sold Manufactured 8,052,050 8,609,050 9,430,610 10,166,222 10,164,695

Cost of goods sold 8,052,050 8,609,050 9,430,610 10,166,222 10,164,695

Note A- Purchases


Raw Materials

Lahore 1,750,000 1,900,000 2,090,000 2,299,000 2,528,900

Gujranwala 1,050,000 1,100,000 1,210,000 1,331,000 1,464,100

Islamabad 925,000 1,050,000 1,155,000 1,270,500 1,397,550

3,725,000 4,050,000 4,455,000 4,900,500 5,390,550

Note B- OH Exp


Utilities 2,000,000 2,060,000 2,121,800 2,185,454 2,251,018

Fuel 1,000,000 1,030,000 1,060,900 1,092,727 1,125,509

Repair and Maintenance 250,000 257,500 265,225 273,182 281,377

Tool Expenses 50,000 51,500 53,045 54,636 56,275

Misc 100,000 103,000 106,090 109,273 112,551Depreciation @ 10% - Office Equipments 37,550 37,550 37,550 37,550 37,550 - Fittings & Installations 155,000 155,000 155,000 155,000 155,000 - Furniture & Fixtures 40,000 40,000 40,000 40,000 40,000

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Principles of Marketing - Machine 180,000 180,000 180,000 180,000 180,000

- Vehicles 664,500 664,500 664,500 664,500 664,500

Total FOH 4,477,050 4,579,050 4,684,110 4,792,322 4,903,780

Sale (Note - 1)

Stations Average Price /Persons Persons Total Sale

Lahore 400 14500 5,800,000

Gujranwala 350 8800 3,080,000

Islamabad 450 8000 3,600,000

Total sale 31300 12,480,000

Note 3 - Operating Expenses 1st Year 2nd Year 3rd Year 4th Year 5th Year

Selling Expense - Salaries (6 * 4) 2,400,000 2,448,000 2,619,360 2,802,715 2,998,905 - Advertisement (Marketing Budget) 800,000 880,000 968,000 1,064,800 1,171,280 - Packing 350,000 360,000 367,200 374,544 382,035Admin Expense - Utility 325,000 336,500 343,230 350,095 357,096 - Salaries (1 * 3)+1 360,000 367,200 374,544 382,035 389,676

- Fuel and Power 225,000 232,500 250,100 225,000 275,000

Total 4,460,000 4,624,200 4,922,434 5,199,189 5,573,992

Income StatementNotes 1st Year 2nd Year 3rd Year 4th Year 5th Year

Sales 1 12,480,000 13,353,600 14,688,960 16,157,856 18,258,377Cost of Goods Sold 2 8,052,050 8,609,050 9,430,610 10,166,222 10,164,695Gross Profit 4,427,950 4,744,550 5,258,350 5,991,634 8,093,682Net Operating Expenses 3 4,460,000 4,624,200 4,922,434 5,199,189 5,573,992Earning Before Tax -32,050 120,350 335,916 792,446 2,519,690

Tax Rate 21,061 58,785 138,678 629,923

Net Profit / -Loss After Tax -32,050 99,289 277,131 653,768 1,889,768

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Balance Sheet 1st Year 2nd Year 3rd Year 4th Year 5th Year Tangible Fixed Assets Office Equipments (Note E) 375,500 337,950 300,400 262,850 225,300

Fittings & Installations (Note F)

1,550,000 1,395,000 1,240,000 1,085,000 930,000

Furniture & Fixtures (Note G)

400,000 360,000 320,000 280,000 240,000

Machinery (Note H)

1,800,000 1,620,000 1,440,000 1,260,000 1,080,000

Vehicles (Note I)

6,645,000 5,980,500 5,316,000 4,651,500 3,987,000

Total Fixed Assets 10,770,500 9,693,450 8,616,400 7,539,350 6,462,300

Current Assets:

- Stock 300,000 485,000 375,000 101,250 450,500

- Cash 1,045,000 1,197,400 1,412,966 1,869,496 3,596,740

- Bank Balance 102,450 868,439 1,928,765 3,227,672 3,473,228

Total Current Assets 1,447,450 2,550,839 3,716,731 5,198,418 7,520,468

Total Assets 12,217,950 12,244,289 12,333,131 12,737,768 13,982,768

Owners Equity:

Capital Introduced 12,000,000 12,000,000 12,000,000 12,000,000 12,000,000

Accumulated Profits -32,050 99,289 277,131 653,768 1,889,768Current Liabilities:

- Accounts Payable 250,000 145,000 56,000 84,000 93,000

Total Liabilities 12,217,950 12,244,289 12,333,131 12,737,768 13,982,768

Note E - Office Equipments

Items No. of Units Cost/Item (Rs)

Total Cost (Rs)

Computers 8 25,000 200,000

Printers 1 6,000 6,000

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Telephone Sets 3 500 1,500

Multimedia 4 42,000 168,000

Total 375,500

Note F - Fittings & Installations

Items No. of Units Cost/Item (Rs) Total Cost (Rs)

Air Conditioners 5 30,000 150,000

Generator 15 KVA – Local 4 250,000 1,000,000

Misc 4 100,000 400,000

Total 1,550,000

Note G - Furniture & Fixtures


Furniture 4 100,000 400,000

Total 400,000

Note H - Machine Description


Pizza Oven 4 110,000 440,000

HotPlate 4 45,000 180,000

Frier 4 55,000 220,000

Misc 4 240,000 960,000

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Total 1,800,000

Note I - Vehicles


Trucks 4 1,500,000 6,000,000

Vans 3 175,000 525,000

Motorcycles 3 40,000 120,000

Total Amount 6,645,000

Cash Flow Statement (Direct Method)

Receipts Sale 12,480,000 13,353,600 14,688,960 16,157,856 18,258,377 Payments COGS (less Depreciation) 6,975,000 7,532,000 8,353,560 9,089,172 9,087,645 Selling Expense - Salaries 2,400,000 2,448,000 2,619,360 2,802,715 2,998,905 - Advertisement 800,000 880,000 968,000 1,064,800 1,171,280 - Packing 350,000 360,000 367,200 374,544 382,035Admin Expense - Utility 325,000 336,500 343,230 350,095 357,096 - Salaries 360,000 367,200 374,544 382,035 389,676 - Fuel and Power 225,000 232,500 250,100 225,000 275,000 11,435,000 12,156,200 13,275,994 14,288,360 14,661,637

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Principles of MarketingCash at the end of the year 1,045,000 1,197,400 1,412,966 1,869,496 3,596,740

Break Even

Sales 12,480,000

Less: Variable Cost

- Purchases 3,725,000

- Freight Inward 150,000

- Utilities 2,000,000

- Fuel & Power 1,000,000

- Advertisement 800,000

- Packing 350,000

- Misc 100,000

8,125,000 8,125,000

Contribution Margin 4,355,000

Contribution Ratio Contribution Margin / Sale

4355000/ 12480000

Contribution Ratio 0.348958333

Break Even (Sale) X = TFC / CMR

4387050/ 0.348958333 12,512,050

Break Even (Sale) 12,512,050

Total Fixed Cost

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Total fixed cost

Depriciation @ 10%

- Office Equipments 37,550 - Fittings & Installations 155,000

- Machine 40,000

- Furniture 180,000

- Vehciles 664,500

Selling Expense

- Salaries 2,400,000

Admin Expense

- Utility 325,000

- Salaries 360,000

- Fuel and Power 225,000

Total Fixed cost 4,387,050

Break Even (Units)

X = Break Even (Sale) / Average Price

12512050/ 400 31,280Break Even (Units) 31,280

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Company Overview (1)

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