Do you want to start gourmet store business plan?

Executive Summary

Company Summary

Services

Marketing Analysis of Gourmet Food Store Business

Strategy

Personnel plan

Financial Plan

Do you want to start grocery store business plan?

If you are planning to start a gourmet food store business, you can rest assured that it is a wise decision on your part. Starting this business is not only easy but also profitable as well. However, to make this venture a success, you must first have to prepare a comprehensive gourmet food store business plan.

The business plan will provide you a roadmap to follow and will also guide you through all your major decisions. To help you do this, we are providing the business plan of gourmet food startup named Foody Stop.

Executive Summary

If you are looking to make a business plan for a grocery store, this executive summary sample for food business  as well as the business plan that follows can help you a lot.

2.1 The Business

Located in the serene environment of 11th Avenue, Boston, Foody Stop will be a one-stop service for all the food-related needs of our customers. Our location is almost ideal for starting a specialty food store. As a bonded and licensed food store business, we will provide high-quality food products to our customers.

The business will be owned by Keith Jim who has been associated with the food and retail industry for the last 10 years. Owing to his extensive experience, Jim knows everything about how to start a specialty food store  and make it successful.

2.2 Management

The business will be managed by Jim, who will be helped a group of dedicated workers. The store will function 24/7 and will be run by three shifts of workers. All employees will be recruited on merit and will be trained for one month before they start working.

2.3 Customers

Food Stop will provide an assortment of services to the residential community as well as working class people and visitors. The diversity of our offerings will be our major competitive advantages. From meat products to canned foods, dairy products to baking goods, we will provide almost all food products that our customers might need.

2.4 Target of the Company

Our business targets are as follows:

  • To become the best food store in Boston by next three years
  • To achieve the net profit margin of $10k per month by the first year, $15k by the second year, and $25k by the third year
  • To balance the initial cost of the startup with earned profits within six months
  • To start two more stores by the end of our second years

Gourmet Food Store Business 1

Company Summary

3.1 Company Owner

Foody Stop will be owned by Keith Jim, who is an MBA from Harvard. Jim has served in the food and retail industry for the last 10 years in an assortment of positions. Known for his sharp business acumen and incredible management skills, Jim has both the experience and the knowledge needed for starting a gourmet food store.

3.2 Why the Business is being started

The business will serve as a gateway to Jim for making it big in the food retail industry. Foody Stop is being started not only for profit generation but also for providing best-in-class services to customers.

3.3 How the Business will be started

Located in the serene environment of 11th Avenue, Boston, Foody Stop will be a one-stop service. A newly constructed shop spanning an area of 750 square feet will be acquired on lease for the business. Jim will seek the services of a local contracting firm for all the woodwork and furniture of the shop. The shop will function 24/7 and will be operated by workers in three shifts. The startup costs in accordance with the gourmet food business plan  as forecasted by the financial experts are as follows:

Gourmet Food Store Business 2

The detailed startup requirements, as forecasted by experts, is given below:

Start-up Expenses 
Legal$55,300
Consultants$0
Insurance$32,750
Rent$32,500
Research and Development$32,750
Expensed Equipment$32,750
Signs$1,250
TOTAL START-UP EXPENSES$187,300
Start-up Assets$0
Cash Required$332,500
Start-up Inventory$32,625
Other Current Assets$232,500
Long-term Assets$235,000
TOTAL ASSETS$121,875
Total Requirements$245,000
START-UP FUNDING$0
START-UP FUNDING$273,125
Start-up Expenses to Fund$11,875
Start-up Assets to Fund$15,000
TOTAL FUNDING REQUIRED$0
Assets$23,125
Non-cash Assets from Start-up$18,750
Cash Requirements from Start-up$0
Additional Cash Raised$18,750
Cash Balance on Starting Date$21,875
TOTAL ASSETS$0
Liabilities and Capital$0
Liabilities$0
Current Borrowing$0
Long-term Liabilities$0
Accounts Payable (Outstanding Bills)$0
Other Current Liabilities (interest-free)$0
TOTAL LIABILITIES$0
Capital$0
Planned Investment$0
Investor 1$332,500
Investor 2$0
Other$0
Additional Investment Requirement$0
TOTAL PLANNED INVESTMENT$695,000
Loss at Start-up (Start-up Expenses)$313,125
TOTAL CAPITAL$251,875
TOTAL CAPITAL AND LIABILITIES$251,875
Total Funding$255,000

Services

Food Stop will provide an assortment of services, as highlighted by our mini grocery store business plan. The diversity of our offerings will be our major competitive advantages over other gourmet food stores in the area. From meat products to canned foods, dairy products to baking goods, we will provide everything that our customers might need.

Listing your offerings and services in a general store business plan  guides your other major decisions that’s why it must be done before you think about   how to open a gourmet food store . According to Jim’s mini market business plan, Foody Stop will provide the following products and offerings:

  • Meat and produce: poultry, beef, lunch meat, pork, fruits, vegetables, and more.
  • Baking goods and bakery products: sandwich loaves, tortillas, bagels, dinner rolls, cereals, pasta, mixes, flour, sugar, and more.
  • Frozen foods and beverages: waffles, vegetables, individual meals, ice cream, coffee, tea, juice, soda, drinks, and more.
  • Dairy products and canned goods: cheese, eggs, milk, yogurt, butter, vegetables, spaghetti sauce, ketchup, and more.

We will offer food products of both local and international brands. We will make sure to keep our products like meat and vegetables as fresh as possible. Our food products will meet all standards set by food authorities. Also, we will provide our offerings in standard packaging sizes.

Marketing Analysis of Grocery Business

The most important component of an effective mini grocery store business plan  is its accurate marketing analysis that’s why Jim acquired the services of marketing experts to help him through this phase. It is only after this stage that a good food stall business plan  could have been developed. After identifying the local market trends in Boston, the marketing experts also guided him to select the best location for his food store. Marketing analysis is a must-do thing before you even think about how to start a gourmet food business.

5.1 Market Trends

The gourmet food industry has been constantly expanding in the US for the last several decades. According to 2016 figures, the US convenience store industry stood at $680 billion. Out of this astronomical figure, around 21.4% of the amount was generated by the sale of food products. Moreover, analysts have predicted a constant growth of this sector for many decades to come. Considering these trends, it is evident that the grocery food business is an immensely profitable niche.

5.2 Marketing Segmentation

In order to make an effective food retail business plan, it is crucial to analyze the market segmentation of your potential customers. Our marketing analysts have identified the following type of target audience which can become our future consumers:

Gourmet Food Store Business 3

The detailed marketing segmentation of our target audience, as per our   food market business plan, is as follows:

5.2.1 Local Residents: The community residing near our food store will be the primary customer group of our business. We will devise special plans to target this potential group as we expect a lot of sales to happen through them.

5.2.2 Working Class: Our second category of customers include those people whose busy routine makes them rely on packed foods. Our ready-made, packed foods will be a feasible option for the working-class people to have lunch without missing on their important work.

5.2.3 Passers-by: The third group includes those people who are in the area for some specific purpose. Our food store will provide a perfect spot for them to rest for a while and grab a drink or something.

The detailed market analysis of our potential customers is given in the following table:

Market Analysis
Potential CustomersGrowthYear 1Year 2Year 3Year 4Year 5CAGR
Working Class32%11,43313,34416,55318,74520,54513.43%
Local Residents48%22,33432,34443,66552,54466,43210.00%
Passers-by20%12,86714,43315,99917,56519,13115.32%
Total100%46,63460,12176,21788,854106,1089.54%

5.3 Business Target

We aim to become the best gourmet food store in Boston within the next three years of our startup. This could be achieved by providing high-quality products and winning the trust of our customers. Our primary business targets could be summed up as follows:

  • To achieve the net profit margin of $10k per month by the end of the first year, $15k per month by the end of the second year, and $25k per month by the end of the third year
  • To balance the initial cost of the startup with earned profits within six months
  • To start two more stores by the end of our second years

5.4 Product Pricing

After considering the current market prices offered by our competitors, we have priced all our products in similar ranges as of them. We have to attract customers while yielding a profit at the same time that’s why we can’t afford to lower our prices at the moment, especially when we will offer incredibly high-quality food products.

Strategy

Like the marketing plan for a grocery store, sales strategy is also an important component of your business plan. After you have identified the market trends, market demand, and potential customers of the gourmet business, you will next have to plan a creative sales strategy to attract your target audience toward you and convert them into loyal customers.

After carrying out extensive research about successful advertising strategies that are being used by other similar business, Jim came up with brilliant ideas to attract customers and generate sales. Our sales strategy, as highlighted by our produce store business plan  is as follows:

6.1 Competitive Analysis

Before finalizing your sales strategy, it is crucial for you to find out your competitive advantage over other similar businesses and make them a part of your business plan on supermarket . Considering the current market situation, Foody Stop will face really tough competition. However, we will soon emerge as a leading food store due to our numerous competitive advantages.

We will be open 24/7 and provide diverse offerings as a one-stop service provider. We will ensure that our goods meet all quality standards and are always available in a fresh state. Moreover, we will exceptional customer service to turn our visitors into loyal customers.

6.2 Sales Strategy

Following are some of the brilliant ideas by which we will advertise ourselves and generate sales.

  • We will conduct a large-scale Facebook and Instagram marketing campaign for our advertisement.
  • We will offer gifts and discounts on all our products for the entire first month to encourage sales.
  • We will issue referral cards to our loyal customers and offer special discounts on customer referrals.

6.3 Sales Forecast

Considering our sales strategy and the current market demand for our business, our sales pattern is expected to increase with years. By analyzing our market segmentation strategy, our forecasted sales on a yearly basis are summarized in the following column charts.

Gourmet Food Store Business 4

The detailed information about sales forecast, total unit sales, total sales is given in the following table.

Sales Forecast   
Unit SalesYear 1Year 2Year 3
Meat and produce1,887,0302,680,3202,588,240
Baking goods and bakery products802,370815,430823,540
Frozen Foods and beverages539,3207702301,002,310
Dairy products and canned goods265,450322,390393,320
TOTAL UNIT SALES3,494,1704,588,3704,807,410
Unit PricesYear 1Year 2Year 3
Meat and produce$140.00$150.00$160.00
Baking goods and bakery products$600.00$800.00$1,000.00
Frozen Foods and beverages$700.00$800.00$900.00
Dairy products and canned goods$650.00$750.00$850.00
Sales
Meat and produce$2,149,800$2,784,000$3,383,200
Baking goods and bakery products$120,050$194,500$268,500
Frozen Foods and beverages$50,110$71,600$93,000
Dairy products and canned goods$139,350$194,600$249,850
TOTAL SALES
Direct Unit CostsYear 1Year 2Year 3
Meat and produce$0.70$0.80$0.90
Baking goods and bakery products$0.40$0.45$0.50
Frozen Foods and beverages$0.30$0.35$0.40
Dairy products and canned goods$3.00$3.50$4.00
Direct Cost of Sales
Meat and produce$989,300$1,839,000$2,679,700
Baking goods and bakery products$66,600$119,900$173,200
Frozen Foods and beverages$17,900$35,000$52,100
Dairy products and canned goods$19,400$67,600$115,800
Subtotal Direct Cost of Sales$1,294,100$1,699,400$2,104,700

6.4 Sales Monthly

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6.5 Sales Yearly

Gourmet Food Store Business 6

Personnel plan

Before starting a gourmet food business, it is essential to estimate the number and type of employees required. Our personnel plan, as developed with the help of HR experts is as follows:

7.1 Company Staff

Jim will act as the General Manager of the company and will hire the following people:

  • 1 Store Manager for managing the store operations
  • 2 Administrators/ Accountants for maintaining financial records
  • 2 Sales Executives for marketing purposes
  • 10 Employees for running the store
  • 2 Inventory Manager for managing the merchandise
  • 1 Supply Chain Manager for purchasing food products
  • 3 Drivers for transporting products from storage to store
  • 2 Cleaners for keeping the store clean
  • 1 Front Desk Officer for providing information to customers
  • 2 Security Officers

7.2 Average Salary of Employees

The forecasted data about employees’ salaries for the next three years is given in the following table.

 Personnel Plan   
Year 1Year 2Year 3
Store Manager$85,000$95,000$105,000
Administrators / Accountants$45,000$52,000$59,000
Sales Executives$85,000$92,000$109,000
Employees$410,000$440,000$480,000
Inventory Managers$66,000$73,000$80,000
Supply Chain Manager$35,000$42,000$59,000
Drivers$60,000$63,300$70,000
Cleaners$63,300$70,000$76,700
Front Desk Officer$20,000$23,300$30,000
Security Officers$40,000$45,000$52,000
Total Salaries$784,300$855,600$963,700

Financial Plan

A financial plan is the final component of your grocery store business plan. It addresses all the costs and expenses which will be required for the startup. From the cost of inventory to your rent, from the overhead expenses to the cost of bills, it will address each and every financial component of your departmental store business plan. The financial plan of Foody Stop is as follows:

8.1 Important Assumptions

 General Assumptions   
Year 1Year 2Year 3
Plan Month123
Current Interest Rate10.00%11.00%12.00%
Long-term Interest Rate10.00%10.00%10.00%
Tax Rate26.42%27.76%28.12%
Other000

 

8.2 Brake-even Analysis

Gourmet Food Store Business 7

 Brake-Even Analysis 
Monthly Units Break-even5530
Monthly Revenue Break-even$159,740
Assumptions:
Average Per-Unit Revenue$260.87
Average Per-Unit Variable Cost$0.89
Estimated Monthly Fixed Cost$196,410

 

8.3 Projected Profit and Loss

 Pro Forma Profit And Loss   
Year 1Year 2Year 3
Sales$309,069$385,934$462,799
Direct Cost of Sales$15,100$19,153$23,206
Other$0$0$0
TOTAL COST OF SALES$15,100 $19,153 $23,206
Gross Margin$293,969$366,781$439,593
Gross Margin %94.98%94.72%94.46%
Expenses
Payroll$138,036$162,898$187,760
Sales and Marketing and Other Expenses$1,850$2,000$2,150
Depreciation$2,070$2,070$2,070
Leased Equipment$0$0$0
Utilities$4,000$4,250$4,500
Insurance$1,800$1,800$1,800
Rent$6,500$7,000$7,500
Payroll Taxes$34,510$40,726$46,942
Other$0$0$0
Total Operating Expenses$188,766$220,744$252,722
Profit Before Interest and Taxes$105,205$146,040$186,875
EBITDA$107,275$148,110$188,945
Interest Expense$0$0$0
Taxes Incurred$26,838$37,315$47,792
Net Profit$78,367$108,725$139,083
Net Profit/Sales30.00%39.32%48.64%

8.3.1 Profit Monthly

Gourmet Food Store Business 8

8.3.2 Profit Yearly

Gourmet Food Store Business 9

8.3.3 Gross Margin Monthly

Gourmet Food Store Business 10

8.3.4 Gross Margin Yearly

Gourmet Food Store Business 11

8.4 Projected Cash Flow

Gourmet Food Store Business 12

 Pro Forma Cash Flow   
Cash ReceivedYear 1Year 2Year 3
Cash from Operations
Cash Sales$40,124$45,046$50,068
Cash from Receivables$7,023$8,610$9,297
SUBTOTAL CASH FROM OPERATIONS$47,143 $53,651 $59,359
Additional Cash Received
Sales Tax, VAT, HST/GST Received$0$0$0
New Current Borrowing$0$0$0
New Other Liabilities (interest-free)$0$0$0
New Long-term Liabilities$0$0$0
Sales of Other Current Assets$0$0$0
Sales of Long-term Assets$0$0$0
New Investment Received$0$0$0
SUBTOTAL CASH RECEIVED$47,143 $53,651 $55,359
ExpendituresYear 1Year 2Year 3
Expenditures from Operations
Cash Spending$21,647$24,204$26,951
Bill Payments$13,539$15,385$170,631
SUBTOTAL SPENT ON OPERATIONS$35,296 $39,549 $43,582
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out$0$0$0
Principal Repayment of Current Borrowing$0$0$0
Other Liabilities Principal Repayment$0$0$0
Long-term Liabilities Principal Repayment$0$0$0
Purchase Other Current Assets$0$0$0
Purchase Long-term Assets$0$0$0
Dividends$0$0$0
SUBTOTAL CASH SPENT$35,296 $35,489 $43,882
Net Cash Flow$11,551$13,167$15,683
Cash Balance$21,823$22,381$28,239

8.5 Projected Balance Sheet

 Pro Forma Balance Sheet   
AssetsYear 1Year 2Year 3
Current Assets
Cash$184,666$218,525$252,384
Accounts Receivable$12,613$14,493$16,373
Inventory$2,980$3,450$3,920
Other Current Assets$1,000$1,000$1,000
TOTAL CURRENT ASSETS$201,259 $237,468 $273,677
Long-term Assets
Long-term Assets$10,000$10,000$10,000
Accumulated Depreciation$12,420$14,490$16,560
TOTAL LONG-TERM ASSETS$980 $610 $240
TOTAL ASSETS$198,839 $232,978 $267,117
Liabilities and CapitalYear 1Year 2Year 3
Current Liabilities
Accounts Payable$9,482$10,792$12,102
Current Borrowing$0$0$0
Other Current Liabilities$0$0$0
SUBTOTAL CURRENT LIABILITIES$9,482 $10,792 $12,102
Long-term Liabilities$0$0$0
TOTAL LIABILITIES$9,482 $10,792 $12,102
Paid-in Capital$30,000$30,000$30,000
Retained Earnings$48,651$72,636$96,621
Earnings$100,709$119,555$138,401
TOTAL CAPITAL$189,360 $222,190 $255,020
TOTAL LIABILITIES AND CAPITAL$198,839 $232,978 $267,117
Net Worth$182,060$226,240$270,420

 

8.6 Business Ratios

 Ratio Analysis    
Year 1Year 2Year 3Industry Profile
Sales Growth4.35%30.82%63.29%4.00%
Percent of Total Assets4.35%4.71%5.80% 9.80%
Accounts Receivable5.61%4.71%3.81%9.70%
Inventory1.85%1.82%1.79%9.80%
Other Current Assets1.75%2.02%2.29%27.40%
Total Current Assets138.53%150.99%163.45%54.60%
Long-term Assets-9.47%-21.01%-32.55%58.40%
TOTAL ASSETS100.00%100.00%100.00%100.00%
Current Liabilities4.68%3.04%2.76%27.30%
Long-term Liabilities0.00%0.00%0.00%25.80%
Total Liabilities4.68%3.04%2.76%54.10%
NET WORTH99.32%101.04%102.76%44.90%
Percent of Sales
Sales100.00%100.00%100.00%100.00%
Gross Margin94.18%93.85%93.52%0.00%
Selling, General & Administrative Expenses74.29%71.83%69.37%65.20%
Advertising Expenses2.06%1.11%0.28%1.40%
Profit Before Interest and Taxes26.47%29.30%32.13%2.86%
Main Ratios
Current25.8629.3932.921.63
Quick25.428.8832.360.84
Total Debt to Total Assets2.68%1.04%0.76%67.10%
Pre-tax Return on Net Worth66.83%71.26%75.69%4.40%
Pre-tax Return on Assets64.88%69.75%74.62%9.00%
Additional RatiosYear 1Year 2Year 3
Net Profit Margin19.20%21.16%23.12%N.A.
Return on Equity47.79%50.53%53.27%N.A.
Activity Ratios
Accounts Receivable Turnover4.564.564.56N.A.
Collection Days9299106N.A.
Inventory Turnover19.722.5525.4N.A.
Accounts Payable Turnover14.1714.6715.17N.A.
Payment Days272727N.A.
Total Asset Turnover1.841.551.26N.A.
Debt Ratios
Debt to Net Worth0-0.02-0.04N.A.
Current Liab. to Liab.111N.A.
Liquidity Ratios
Net Working Capital$120,943$140,664$160,385N.A.
Interest Coverage000N.A.
Additional Ratios
Assets to Sales0.450.480.51N.A.
Current Debt/Total Assets4%3%2%N.A.
Acid Test23.6627.0130.36N.A.
Sales/Net Worth1.681.290.9N.A.
Dividend Payout000N.A.