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Executive summary


As our product name suggests, Cup on Wheels will introduce, to the more discerning consumer, a
mobile coffee shop similar to coffee truck formats but with high-quality, premium blend coffee and an
enhanced customer experience. We will offer consumers a convenient delivery directly to workplaces
throughout the GTA. Not to be confused with inferior quality services that other coffee trucks offer in
suburbs we intend to serve a high quality coffee. Our coffee truck is a solution for those busy
professionals who appreciate and value the services of a coffee-truck that delivers them a high quality
coffee to their doorstep. We view this as one of our business major strengths. This makes us unique vs
coffee focused competitors for example Tim Hortons, Starbucks etc. Our pricing strategy will be
competitive as we project lower operating costs to run a truck versus a traditional bricks and mortar
location. Our main objectives are to set up trucks in different locations that are accessible by at least 3000
coffee drinkers and gain 33% share of these consumers per location. Our objective is to increase sales by
50% in year two and 100% in year three. We also hope to achieve 95% positive reviews on the product
and 90% on the service. Cup on wheels will use different control mechanisms to ensure our product is
being well accepted by our customers. It will conduct routine sales and cash flow analysis to ensure
financial objectives are being met. We will deploy state of the art payment methods to prevent long line-
ups at our trucks to ensure quick flow of traffic. Finally strong relationships with our suppliers are critical
to ensure timely delivery of high quality materials our product will require.




























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TABLE OF CONTENTS
Executice Summary _____________________________________________________ 1
Table of Contents ____________________________________________________________ 2
Current Marketing Situational Analysis ___________________________________________ 3
Environments ____________________________________________________________________ 3
Product Review___________________________________________________________________ 3
Competitive Review ______________________________________________________________ 4
Distribution Review ______________________________________________________________ 4
SWOT Analysis ________________________________________________________ 5
Strengths and Weaknesses __________________________________________________________ 5
Opportunities and Threats ___________________________________________________________ 5
Objectives and Issues _____________________________________________________________ 5
Value Proposition _________________________________________________________________ 5
Marketing Strategy _____________________________________________________ 6
Positioning ______________________________________________________________________ 6
Marketing Research _______________________________________________________________ 6
Marketing Organization ____________________________________________________________ 6
Product Strategy __________________________________________________________________ 7
Price Strategy ____________________________________________________________________ 7
Distribution Strategy _______________________________________________________________ 7
Marketing Communication Strategy ___________________________________________________ 7
Action Programs (ME) _________________________________________________ 8
Action Programme ________________________________________________________________ 8
Budgets _________________________________________________________________________ 8
Controls ________________________________________________________________________ 8


















Current Marketing Situational Analysis

Target Market:

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Professionals with high disposable incomes (earning annual salary of $50k or more) working high
demanding jobs, living busy lives with little to no time to leave their workplace to purchase a cup
of coffee during work hours or even prior to work.
Ideally working in office buildings (many potential customers, 500+ per office building) that are
not in convenient walking distance to a local Tim Hortons, Starbucks etc.; 43% of population
drink coffee in restaurants/cafes200+ potential customers per office building, they usually have
a fancy i.e. a high quality coffee

Customer Needs Feature/Benefit
High quality coffee/tea Great taste, freshly brewed, wide selection
Time Savings Redeploy time and be more productive; improve
punctuality
Convenience Reduce time in car, save time
Pick me up to help with a demanding day Enhance alertness, increase performance

Addressing 2 gaps simultaneously Quality & Access: These professionals appreciate delivery of a high
quality fresh coffee to their doorstep

Environments:
Competition: positive- The giant players in the coffee service industry have not targeted this
segment. Professionals have few choices at work (instant coffee or free coffee if employer
provides this) or will need leave and travel to a quick serve restaurant. This creates a gap that our
coffee truck will fill, by showing up at workplaces and serving employees hot and cold
beverages. Our coffee truck provides its services even at late evening hours for those people who
do night shifts and need coffee to keep them alert.
Suppliers: negative- with high demand delivery delay leads to customer dissatisfaction
Economic: negative- During recessions our customers might not buy coffee on a daily basis and
rely on substitutes( instant coffee or free coffee provided by their employer)
Technological: positive- we can locate our customers easier and create a two way communication
using mobile app and website; also we could adopt more effective ways of making coffee in large
quantities.

Product Review:
Cup on Wheels is a mobile beverage truck focused on providing high quality coffee.
Our main customers are busy professionals with premium tastes who dont have time to
drive/stand in line-ups and drive-throughs. Our better quality product will be worth the cost to the
consumer, plus it will be delivered to their doorstep.
Coffee & tea costs will range depending on customers choice of coffee flavour, milk, cream and
sugar usage. An average cup of coffee will cost $0.60 excluding labour/other overheads. We plan
to retail at $1.49 giving us a gross profit of $0.89 per cup
Secondary product offerings will include cold beverages including soft drinks and iced coffees
which we expect will be in greater demand during the summer months.




Competitive Review

1. Starbucks
Market Position:
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Holds a dominant position with expensive and premium product in the coffee market with over
17,000 stores worldwide, over $11.7 billion in sale; 151 stores in GTA.
Introduce innovative products and providing excellent service, also a great place for conversation
and a sense of community
Marketing Strategy:
Major emphasis on product quality to satisfy customers in premium taste and those that enjoy the
unique experience in coffee shops
By creating a relaxing and enjoyable atmosphere, the company has become a third place for
people (work, home and coffee shop)
2. Tim Hortons-
Market Position:
The largest franchisor with 3,300 Canada wide restaurants that attracts approximately 41% share
of quick service restaurant traffic (8 out of 10 cups of coffee sold in Canada are poured at Tim
Hortons) with very consistent coffee sold at affordable prices; Drive-thrus extremely popular
Fourth largest publicly traded restaurant company measured by market capitalization in Canada
Marketing Strategy:
Attacking daytime, category and marketing opportunities to drive same-store sales: grow hot
and cold beverages, morning and lunch snacks; increase advertising and marketing investments
Investing to build scale and brand in new and existing markets : expand into non-traditional
locations for example Wal-Mart super centre or gas stations
Growing differently in ways business hasn't grown before :- quick and convenient, expanding
brand name to household coffee consumers for example Tassimo disks and ground coffees
3. Mother Parkers Food Service
Market Position
Leaders in Office Coffee Service with strong relationships with partners who service thousands of
offices on a daily basis
Provide highest quality and consistency in private label coffee solutions for Foodservice
customers
Leader in providing best single serve coffee portion and equipment solutions
Marketing Strategy
Expansion in providing self-serve coffee disks/packs and coffee machines
Extensive hot beverage line up that keeps employees satisfied
Major focus on Research and Development to ensure innovative selection of products

Distribution Review

Evaluation of current types of channels: - Starbucks and Tim Hortons distribute the product by
setting up quick serve shops at the physical locations for consumers. Mother parker supplies the
product to food service operators who serve the offices.
Trends: - a) Rise in coffee sale, for example: Tim Hortons reported 4% same store growth in sale.
b) Drastic shift towards flavour diversification: For example the single serve coffee disks/packs
made by various coffee companies such as star bucks, Maxwell house etc.
Product Sale: - We are taking the coffee shop quality to the consumers and minimizing travel
time to local coffee shops. Catering to the office meetings to increase the productivity.


SWOT ANALYSIS
Strengths
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Our major strength is the mobile nature of our coffee-truck that provides our customers a convenient
access to our product, and also helps us save on overhead expenses like the lease of multiple buildings to
house franchises. We also accept online orders and payments that eliminates line-ups.
Weakness

Our major weakness is a lack of brand recognition. Cup on Wheels is a startup and will be in tough to get
our name out to coffee drinkers.

Opportunities

1. Technological advances in the Auto sector: We can take advantage of the new hybrid technology and
apply it to our business. By using a hybrid coffee-truck we will save costs on gas
2. Consumer Trends: 43% of the Canadian population drinks coffee in cafes and the number continues to
grow
3. Low interest rate environment: will help in financing equipment and other start-up cost leading to
increase cash flow

Threats

1. Consumer trends toward a healthy diet and a green environment: Our solution is to offer decaffeinated
coffee for these health fanatics and give them the opportunity to bring their own mugs as a result of
which, there will be fewer cups for disposal, saving costs and the ecosystem.
2. Unpredictable excessive demands: Because we have limited resources and space on the truck, if we
face high demands at one location we will have difficulty fulfilling our customers demands: the solution
is to build a strong relationship with our suppliers so that we can replenish our inventory in a timely
manner
3. The downside of operating out of a truck: Unpredictable events such as hike in gas prices, accidents,
traffic jams and inevitable truck repair could delay our deliveries.

OBJECTIVES AND ISSUES
1. Set up our trucks in various locations throughout the day thereby being accessible to at least 3000
coffee drinkers per location and gain 33% share (1000 customers a day)
Issue: How can we derive traffic to our truck and away from coffee shops and machines?

2. Increase sales in year two by 50% over year one and by 70% in year three
issue: How can we ensure our final objects are met?

3. Achieve 95% positive reviews on the product and 90% on service
Issue: How can we ensure repeat customers?

Value Proposition

We offer premium great tasting coffee which enhances alertness to improve performance throughout the
day. The delivery of our product is quick and convenient for consumers.


MARKETING STRATEGY
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Positioning

After analyzing research derived from consumer opinion data and publicly available data from
established retailers, Cup on Wheels has decided to position itself and its line of coffees in direct
competition with both lower/middle-end coffee retailers such as Tim Hortons, McDonalds (including
McCafes), coffee suppliers in offices (Mother Parkers) and convenience stores as well as the higher-end
boutique establishments such as Starbucks, Timothys and Second Cup. By choosing to market
boutique, world-renowned coffees at the prices of the lower/middle-end coffee establishments, we aim
to establish and maintain a sizeable market share of patrons within the marketplace. Coupled with our at-
your-door business model of service, we are confident of being able to establish and maintain the
success of the Cup on Wheels model and brand as a premier beverage provider to hundreds of thousands
and, with continued expansion, eventually millions of coffee drinkers in need of a premier quality coffee,
well priced and conveniently brought to them.

Market Research

In order to ensure a successful launch, sales growth and operational efficiencies for Cup on
Wheels, we will conduct additional research on the following:
Consumer/market coffee preference Extent of the rate of change of those preferences (flavors
and strength for example).
Our competitors sales, revenue and overall business models of other mobile beverage retailers;
bricks and mortar retailers such as Starbucks in close proximity to our target areas.
Population and demographics in target and potential target areas (household size, income level,
shopping patterns, ethnicity)

Marketing Organization
Cup on Wheels will be organized with a main head office with executive and administrative staff
as well as satellite locations where the trucks are stored. The marketing functions will be handled by a
combination-type structure. Head office will handle the bulk of the marketing responsibilities including
advertising (print and radio) as well as the social media presence (on-line advertising, Facebook, Twitter,
etc.) The second part of the marketing campaign will be visibility of the trucks in the targeted areas.












Product Strategy

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Our product strategy consists of marketing several variations of high-quality coffees using
imported coffee beans from well-known, high-grade producers of coffee beans from locations such as
Brazil, Columbia and the Middle East. Cup on Wheels, and our encompassing products, will attempt to
synergize the concepts of boutique coffee and street-level, at-your-door convenience in order to
provide our customers with a new experience not normally associated with convenience-level coffee
retailers. By doing this, Cup on Wheels will take what is usually associated with a convenience product
and transform it into a specialty product that will be renowned for its ingenuity and praised for its quality
and convenience.

Price Strategy

Because of our mobile truck distribution channel and the avoidance of bricks and mortar
establishments, Cup on Wheels will be able to price its products in a competitive manner, similar or lower
to established vendors such as Tim Hortons and Starbucks known as the Going-Rate approach to
pricing. This head-to-head competition with established retailers providing similar high-quality coffee
at a lower price will enable us to penetrate the current market base thereby establishing Cup on Wheels
brand image. By doing this, we estimate to be able to gain a sizeable market share of 5-10% upon
establishment within the coffee drinkers market.

Distribution Strategy

In order to give our customers the highest quality products, it will be necessary to source and
acquire top-grade coffee beans from around the globe. In order to accomplish this, we will use a mix of
direct purchase from the growing corporations as well as purchasing through secondary sources to be able
to take advantage of discounts afforded to major bulk distributors.

Distribution to our consumer base will consist of direct sales at the street level through a fleet of
mobile retail locations (i.e. trucks) hybrid vehicles where possible.

Marketing Communications Strategy

Cup on Wheels will launch its business in conjunction with mass advertising in multiple mediums
including local television and radio spots, online advertising through search engines, Facebook, Twitter,
etc. to bring awareness of our business to the hundreds of thousands of coffee drinking workers in our
target locations. In conjunction with this, Cup on Wheels will attempt to establish mutually beneficial
partnerships to businesses that endorse, encourage and discount our product to their employees, families
and friends.

In conjunction with this, and in order to attain sustained growth, the most powerful advertising medium
will be the word of mouth from Cup on Wheels patrons to other potential customers.





Action Program
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Startup:- During the startup period, we will utilize most of our bank loans in order to purchase
our vehicles (coffee trucks) as well as the procurement of our products ingredients such as coffee
beans and accessory products such as milk, cream, sugar, cups, stir sticks etc. Furthermore, the
extensive launch of our marketing campaigns will further utilize our acquired bank loans. Lastly
the procurement of permits in the downtown core for retailing on the street-level will also be
necessary.
Six Months:- In six months we expect rapid acceptance in the marketplace. We estimate that
profit of $15,000 to $20,000, will cover our daily costs. We also expect net profits to increase at
an exponential rate. Our main actions and concerns are to increase public awareness of Cup on
Wheels and expand our business.
Year One:- Cup on Wheels expects to have gained a respectable market share within the coffee
retailing market of 5% to 15% after one year with revenue significantly exceeding costs. Our
main focus at this point will be to secure the necessary raw product resources (coffee beans) in
the required quantities as we expect sales volume to continue to growth by 50 to 100% per year
for the next 3 years.
Marketing Budget
Money Needed: A rough estimate of the amount of money that we need to start the business is for
$250,000 for production, equipment (including vehicles) and supplies as well as $100,000 for
marketing expenses. This money will be taken out of loan from a bank.
Expected Revenue: Expected sales from year 1 are 50,000 and year two are 75,000 and 150,000
year three. Therefore sales from year one to year two will increase by 50 percent and double by
third year, this will allow to accommodate for the marketing expenses and competition from local
coffee suppliers.
Expected expense: The three major expenses are advertising costs, labour costs and supply costs.
Advertising expenses will be the highest in the early stage. Also, labour costs, like most other
service companies are going to be huge. Supplies, which include the cups, utensils, and the
equipment, will be the other large expense.

Marketing Controls
The following systems will ensure proper control of the marketing efforts that help and/or hinder the
growth of this company.
Market Share Analysis: To measure our position within the market, we will conduct routine
comparisons against competitors to estimate whether Cup on Wheels is gaining, losing or
maintaining its market share.
Sales Analysis: Cup on Wheels will conduct routine sales analysis on a monthly, as well as
annual basis, comparing current and past sales to determine how well the product is selling
compared to the sales objectives we have outlined above.
Quality Control: To ensure that we sell the highest quality coffee there is to offer, we will run
checks on the quality of the coffee beans acquired from our sources bi-annually.
Feedback from Customers: We will create online forums and surveys. The link for those can be
found on the bottom of receipts. It will consist of questions regarding the quality of the drink,
their opinions on the price of the drink, the speed and efficiency of the person who made the
drink, etc. Possibly a small prize could be awarded through a lucky draw to draw more potential
survey takers.