Business Management Class

Naperville Central High School

440 West Aurora Ave.

Naperville Illinois, 60540

Consultant: Jim George, The UPS Store

CEO: Kyle Castner

Mission Statement:

Our mission is to deliver a varied selection of Arizona Iced teas to the students of

Naperville Central at a fair price. The students of Naperville Central need a quick

refreshing drink to carry them through the school days. Our teas not only combat thirst,

but also bring out the true flavor of summer which will make our customers keep coming

back for more. We also promise to keep an ample supply of our product on hand at all

times. By excelling in these standards, our company aims to enhance the learning

environment of Naperville Central by quenching the never-ending thirst of the

Redhawks.

Core Values:

A. Commitment- Each team member of Arizona Breeze is committed to serving

our customers. We will always work as fast as we can to get the beverage of

choice into their hands, while making sure the teas are cold.

B. Value- We pride ourselves in knowing we serve a great tasting drink at an

affordable cost of only one dollar. Customers will always get more than what

they pay for.

C. Integrity- Each worker in our company knows how important maintaining

integrity is, which is why we never cheat anybody in our business. You get

what you pay for.

Statement of Purpose:

Arizona Breeze will be selling prepackaged cans and bottles of Arizona Iced Tea.

The teas are directly supplied by the Arizona Bottling Company and will be sold during

school hours for one dollar per Tea. We will be selling a variety of flavors including

Sweet tea, Fruit Punch, Mucho Mango, Diet Green Tea, Diet Arnold Palmer, Raspberry

tea, Watermelon, Kiwi Strawberry, Lemonade, as well as the original Arnold Palmer

flavor. The price difference is there to cover labor and our investor’s interest on

investment. The turnaround time on our shipments is one day.

Business Goals:

1. Our goal is to sell at least 200 cans per day

2. Our weekly goal is to sell at least 1000 cans

3. Our goal for return on investment is 100% over the course of our sales

4. Achieve at least twenty daily customers

5. Obtain 100% customer satisfaction

Significant Characteristics of the Industry:

The Arizona Beverage Co. is one of the largest distributors of tea in its sector.

Right now, Arizona holds 38% of the total market, which is one percent behind Lipton

Tea from Pepsico. Last year they previously held 35% of the market share, they aim to

grow their presence at a steady pace, one day becoming the largest tea distributer in

the world. Arizona is an American company based out of Brooklyn New York and has

been around since 1971and has been selling tea ever since.

Unique Features:

Arizona Breeze is unique due to the fact that out of all the selections of drinks at

Naperville Central, we are the only ones who provide so much for so little. At only one

dollar for twenty four ounces for a cold drink, we prove the meaning of true value. We

also work quickly to ensure everyone gets served in under a minute so that waiting in

line is not an issue as it is in the cafeteria. The vestibule is only a stone’s throw from the

cafeteria, making it an easy stroll to buy a tea during lunch.

Process of the Company so Far:

Before choosing to sell Iced tea, our company had to select that product. At first,

it seemed as though we were going to sell Mcdonald’s apple pies because they had

great profit margins at 400%. Buffalo Wild Wings was also an option we considered, but

keeping the food safe to eat as well as warm was going to be a challenge, so we

dropped the idea. We then surveyed the student population and figured out that Arizona

Iced Teas would be our best seller, so we moved on to the planning phase.

We met with many different stores to find who could supply us with the product.

After one week, we still could not find a vendor, so we called the company itself. It

turned out that they had a bottling plant nearby and Chris Sanders, the executive

manager, was very excited to work with us. Arizona had worked with other schools in

the past, so they wanted to give us the same deals the other schools received. We were

given free merchandise and display items to help with our sales as well as free samples

of the tea.

We then sent out one final specific survey regarding what flavors would be most

popular and we figured out they were Arnold Palmer, Raspberry tea, Lemonade, Fruit

punch and Kiwi Strawberry. We called up Chris and placed our order for 30 cases and

two complimentary ice barrels to hold the tea. The next day, the truck delivered our

product and we were ready to begin selling.

Choosing to work with the actual Arizona Company was a great idea because we

got a lot of advice, such as which flavor to purchase, as well as free merchandise. The

shipping costs ended up being a mere $3.00 only per delivery, and the cost per can of

the tea was reasonable. We were glad we gave the company a call that day, it all turned

out great and they helped us succeed.

Sales &

Marketing

Plan

Kyle Faulkner- VP of Marketing

ARIZONA BREEZE

Explanation of Market Research Process:

At the beginning of our research process on February 7th, 2011 our company surveyed 85

students and staff members for a feasibility study. We had surveys for 3 companies, Buffalo

Wild Wings, Arizona Iced Tea, and McDonald's Apple Pie. After analyzing our data carefully

for each product, we selected Arizona Iced Tea as our final product. The surveys proved that it

was the most popular most likely because of its affordable price. We contacted their company

immediately and started making appointments for meetings. After our feasibility research, we

conducted a major research on March 3rd, 2011 consisting of 514 students and staff members

here at Naperville Central. We had a great sample of 29% freshmen, 32% sophomores, and 25%

juniors, which is great because those are the grade levels that make up our target market. We

didn't leave out the 12% of seniors and 2% of staff that we surveyed because they are still valid

data to help us sell our product. Personally, as the Vice President of Marketing, I designed the

survey with some input from the CEO and other VP's of course. Creating the survey was a team

effort and organizing the schedule of classes that we were planning on surveying was also a big

deal. Our VP of Operations did a fantastic job making a schedule and distributing it to everyone

so that we didn't interrupt a class at the wrong time and so that all of the classes we visited were

expecting us. The process of conducting this major survey was long and hectic but we worked

well together as a company and everything went smoothly. We had a great sampling and it really

helped us make decisions when planning our sales.

Market Research Results and Analysis:

After collecting all 514 of our surveys on March 3rd, we tallied our results and analyzed

our results which helped us while determining who is going to buy our product, when they will

buy it, if they will buy it, at what price they would buy it, what flavors they would buy, and how

frequently they would purchase our product. We began our survey with basic questions such as

"What grade are you in?" We gave the option for all grade levels, 9-12, and staff members. We

had a great sampling which consisted of 149 freshmen, 163 sophomores, 129 juniors, 63 seniors,

and 12 staff members. Based on our results we know that grades 9-11 are our target market and it

was very helpful that we surveyed mostly those grade levels. The next basic question was "What

is your lunch period?" We had an almost equal distribution of lunch periods which is good

because we got data from many potential customers in each lunch period. We surveyed 166

people from 4th period, 181 people from 5th period, and 167 people from 6th period. This was a

great sampling because it was almost equal for each period. This shows us that we can sell

during each lunch period because people would be willing to buy at that time. Next, we began

our more in depth questions like "How likely are you to buy a can of iced tea?" This was on a 0-

5 scale with 5 being most likely to buy. We had a good sampling from this question because

there were a lot of people who said they would maybe, most likely, and definitely buy our

product. We received a rather low amount of not likely to buy with 66 people who chose 0. Less

people chose 1 with a total of 58 people that would probably not be our most frequent customer.

Even fewer chose 2 with a total of 37 people that would maybe try our product. There were 83

people that chose 3, there were 91 people who chose 4, and 179 people that chose 5 being the

most likely to buy our product. This data showed us that the majority of students will purchase

our product and we will need to order a lot of cans each week especially if 74% (students that

marked 3, 4 or 5) of students are going to buy our product in each lunch period. The following

question was "What is the most you would be willing to pay for 1 can of iced tea?" We left this

question open-ended which is risky to do in a survey, but it turned out well. We received a very

broad sampling of different prices but the average price was $1.29 which is greater than the

suggested price of $1.00 which is what Arizona sells it for. Based on our data, we determined

that students would in fact be willing to pay more than a dollar for our product. Since our

supplier is willing to provide us with cans of Arizona Iced Tea for $0.60 per can, I recommend

we should sell our product for a price in the $1.00-$1.50 range. This will still give us a quality

profit while keeping the price very affordable for customers. The following question was "What

flavors would you be willing to buy?" We had 16 different choices of flavors and we had a

massive sampling that showed that Arnold Palmer (Half tea & Half lemonade) was the most

popular flavor. It was followed by the next top 5 flavors that were Raspberry, Lemonade, Kiwi

Strawberry, Fruit Punch, and Watermelon. Since there were so many popular flavors, we

determined that we should sell a wide variety of them and offer a flavor of the week. Our final

question was to determine how frequent our customers would be. We asked "How many cans

would you buy per week?" There are many people who will buy a few cans each week, which

was very encouraging because the results show that 85% of students will purchase at least 1 can

per week. There were 72 people who wouldn't buy any cans, 268 who would buy 1 or 2 cans,

115 who would buy 3 or 4 cans, and 59 who would buy 5 or more cans per week. This data

shows us that we will really need to make sure we have enough cans supplied especially because

we don't have to worry about our product going bad or rotten. We can over-supply for a week but

just store the remaining cans until the next week. Overall, this massive survey has allowed the

VP of Sales and myself to make decisions and suggestions about many aspects of our company

and our business plan. We suggest that we should sell during all lunch periods, before school,

and after school. We are going to be selling in a room adjacent to the cafeteria and possibly

outside by the bus pick-up zone. Our suggested price for each 23 fl. oz. can is $1.25 which will

allow us to profit $0.65 per can since we are buying them for $0.60 per can. Since there are so

many wanted flavors, we suggest that we sell the top 5-10 flavors every week and make 1 of the

remaining 6 flavors available as a flavor of the week which we would change every week. This

will allow us to give a great variety of quality products to our customers. Since there are about

500 students on campus for each lunch period, 85% of them will purchase at least 1 can per

week, we should over-supply just so we don't run out for the 1st week because we can just keep

them for the following weeks. There is an estimated total of 1,500 students that will be our target

market so we should purchase about 1,300 cans for our 1st week. This survey gave us a great

sampling and really helped us make many business decisions that will be applied in the near

future.

Grade Level

29%

32%

25%

12% 2%

Freshman

Sophomore

Junior

Senior

Staff

What grade are you in?

Great sampling: 514 students.

Mainly freshmen, sophomores, and juniors which are

our target market.

Lunch Period

166181

169

0

20

40

60

80

100

120

140

160

180

200

4th Period 5th Period 6th Period

What is your lunch period?

Almost equal amount from each lunch period.

Many potential customers!

Likeliness to Buy

6658

37

8391

179

0

20

40

60

80

100

120

140

160

180

200

0 1 2 3 4 5

How likely are you to buy iced

tea?

Large amount of 3-5 on our 0-5 scale

Majority of people are interested in buying our

product

Price (Avg.=$1.29)

7 142

191

26

1

80

3

45

5 2 1 1 1 20

50

100

150

200

250

What is the most you would be

willing to pay for 1 can?

Open-Ended was a success

Our average price was $1.29

Most frequent price was $1.00

Based on this data, we will set our price at 1 dollar

because it’s the suggested retail price

Flavors319

103 97 108

38

221

149 156

53

94

234

74

168 180

136161

050

100150200250300350

What flavors would you buy?

Arnold Palmer (Half tea&Half lemonade)- most

popular

The next top 5 were Raspberry, Lemonade, Kiwi

Strawberry, Fruit Punch, and Watermelon.

Based on this data, we will include a wide variety of

flavors and possibly a flavor of the week.

Number of Cans per week

59

115

268

72

0

50

100

150

200

250

300

5 or more cans 3-4 cans 1-2 cans 0 cans

How many cans would you buy

per week?

Most students will buy a couple cans each week.

Loyalty Card Program- We will consider using loyalty

cards to promote repeat business.

Based on this data, we have high sales projections,

about 15 cases per day.

Final Recommendation Based on our great sampling, we recommend that we

sell our product for $1.00 in the vestibule during lunches.

We should sell Arnold Palmer, Raspberry, Lemon, and Fruit Punch.

We also recommend advertising our product and selling it at sporting events and by the busses.

Finally, we should offer cans and bottles and change flavors based on what customers demand.

Marketing Mix:

Product:

Our final product is a variety of flavored iced teas and juice blends that come in a 23.5

fluid ounce recyclable can. It comes in a variety of 16 different flavors. Those flavors are:

Arnold Palmer, Half tea & Half tropical, Southern Style Sweet Tea, Green Tea with Ginseng and

Honey, Diet Green Tea with Ginseng and Honey, Raspberry Tea, Lemon Tea, Peach Tea,

Cranberry Tea, Grapeade, Lemonade, Orangeade, Fruit Punch, Kiwi Strawberry, Mucho Mango,

and Watermelon. The flavors we will actually be selling are: Arnold Palmer Lite which has no

high fructose corn syrup, Lemon, Raspberry, Lemonade, Watermelon, Kiwi Strawberry, Fruit

Punch, Green Tea and Diet. We will be co-branded with AriZona Beverage Company and

Naperville Central High School. AriZona is a well respected business, they are privately owned

and they are the number 1 tea on the market because they offer the most delicious, best-looking

drinks on the shelf. They offer them in bigger cans at better prices, they are doing extremely well

and we believe our company will succeed as well. Drinking iced tea is very common throughout

the entire world. It has many benefits especially to your health because real tea is its first

ingredient, unlike many tea companies. Many Asian cultures have linked drinking natural tea to a

healthy life. Its great taste and soothing qualities are perfect to experience on a hot spring day

while relaxing with a nice refreshing iced tea. By selling at school, we add value to the product

because there is nothing better than enjoying a refreshing iced tea during a stressful day at

school. For marketing utilities, our product offers all of them. Our product offers form value

because we sell it in 23 fl. Oz. cans and 20 fl. Oz. bottles. We also offer a variety of flavors as I

mentioned above. Our product offers place value because we are located at a convenient spot in

the vestibule where we can catch seniors entering and exiting from off-campus lunch, and other

students near the cafeteria. Time value is also present in our company because we sell during all

3 lunch periods. We are also considering selling before and after school which would add more

time value by maximizing company hours.

Place:

Due to contracts with the school and Sodexho, we aren't allowed to sell our product

directly inside the cafeteria. We will be selling it in a room adjacent to the cafeteria where

seniors exit for lunch and where students enter and exit while arriving and leaving school. This

room is called the Vestibule and it is near the patio by the football field which is a great location

for students to buy a can of iced tea and relax outside and drink it in the warm spring air. We will

also be selling our product outside in the area where students are dropped off and picked up by

busses. We will carry a cooler around and also have a sign advertising our product. We will sell

before and after school some days and we will sell during all lunch periods every day. Another

place to sell, is at sporting events like baseball and soccer games. We can also sell energy drinks

from Arizona outside of school because the district policy doesn’t apply. Additionally, Spring

musicals and the “Honor Dodge” dodge ball tournament are great places to sell our product.This

will allow anyone who is interested in purchasing our product, to enjoy it at they're convenience.

Price:

We will be selling one size of our product, 23.5 fl. oz. cans and they will be priced at

$1.00 for every flavor. Our price is cost-oriented because we are purchasing it for $0.60 per can

so we would rather make $0.65 profit per can rather than $0.40 per can if we only sold it for

$1.00 which is the suggested retail price. It is also market-oriented because when we surveyed

our target market, the data showed that people would be willing to pay more than $1.00 for a can

of iced tea. They considered $1.29 a reasonable price because that was the average price of our

data. Therefore, I think selling it for over $1.00 is perfectly acceptable especially since iced tea is

not offered at our school.

Promotion:

Advertising: Our company will spend a lot of time and effort getting the word out about

our product. We will create posters displaying our company name, a picture of the product,

where and when to buy, and other information. These will be displayed on announcement nooks

around the school. Additionally, an advertisement on Hawk TV on a late arrival day would help

spread the word about our company and draw customers to us. Another idea is to create an

announcement to publicize our company over the intercom. It is a very important aspect to a

company and we need to spread the word about our product quickly because we are only selling

for a month.

Sales Promotion: Our company will promote our product by promoting throughout the

school, inside and outside of it. We will also have an appealing sign and posters behind our table

that we will be selling at to draw customers in promoting sales with prices and flavors labeled.

We will offer a flavor of the week based on what the customers ask for the most. This should

draw some customers in to try our product. We are also going to sell raffle tickets for 1$ to give

customers a chance to win one of our Arizona branded ice barrels. Also, we will offer loyalty

cards if we need to improve sales. It will allow frequent customers that give a discount to

someone that buys from us every day for a whole week.

Publicity: We will publicize a lot for our company. We will contact the Central Times to

attempt to get an article in the school newspaper. I am creating a facebook event that gives

details about our company and people can choose to attend, maybe attend, or not attend. This

will give us a rough estimate of how many people are interested in buying our product. We are

also going to sell at the “Honor Dodge” dodgeball tournament for charity which will be great

publicity for Arizona Breeze. Additionally, we will be very polite and outgoing to our customers

so that they know we are a good business and they will want to come back again.