Business Plan

2019-2020 School Year

3160 Skillman Ave Suite 202
Oceanside, NY 11572
516-678-2129
siippinsnacks.weebly.com
[email protected]
Sippin_snacks
Sippinsnacks
Sippin Snacks
 Table of Contents
Business Rational
Customer Empathy 1
Problem Statement 1
Ideal State 1
Company Goals 1
About the Business
Mission Statement 2
Company Overview 2
Company Flow chart 2
Company Management 3
SWOT Analysis 4
External Enviroment
Current Economic Conditions 5
Unemployment 5
Real Industry Analysis 6
Virtual Industry Analysis 6
Competitive Analysis 6-7

Marketing
Goals 8
Target Market and Market Segmentation 8
Demographics, Geographics and Psychographics 8-9
Marketing Mix: Product 9
Marketing Mix: Pricing 9
Marketing Mix: Placement 9
Marketing Mix: Promotion 9
Marketing Mix: Positioning 9-10
Financials
Financial Planning 10
Profit and Loss Statement 11
Balance Sheet 12
Financial Write Up 13
Appendix
Angel Investors A-1-A-3
Bank Balance A-4
 Executive Summary
In The United States only, it is estimated that around 500 million straws are used per day, that’s
about 182 trillion straws a year! A large pollution problem has arisen in the world; plastic products
are killing and making our beaches and waters polluted and ugly. Although straws are just a small
piece of pollution, this problem arises a great business opportunity. Sippin’ Snacks set out to create
a straw alternative with a twist. The students of our class collaborated to create an effective and
appealing edible straw. Between our love for environment and our affinity to be different and
vibrant, we created edible straws with fun flavors and colors that appeal to children and young
adults. Not only do we appeal to younger customers, anyone can use our straws due to the largely
loved and universal flavors. We offer high quality straws with your satisfaction guaranteed, or your
straws are free. Since our launch in October 2019, we have kept up with bills through seed money
of $20,000 and 3 angel investors who invested $150,000 total. To ensure efficiency, we will be
purchasing inventory as we sell it, which will help us keep our costs low. Our goal is to create the
best drink experience for our customer. Now, Sip your Drink with your Snack and invest in Sippin’
Snacks.
 Business Rational
Customer Empathy: At Sippin’ Snacks we value our customer’s satisfaction with their
experience using our straws with their favorite drinks. Our main goal is to provide customers with
tasty and convenient straws. Our straws are unique and carefully baked to ensure customer
satisfaction. We guarantee that every single straw works properly or your money back. So let
Sippin’ Snacks be a part of your next drink and be a part of the new movement, in edible straws.

Problem Statement: Our company solves the excessive and dangerous use of plastic straws,
and the inability for paper straws last for a long time. In America, 1 person uses 1.6 straws per day,
paper and plastic: both of which have many downsides that must be solved. Consumers do not
want to think about how their straws effect on our world, or worry about how long their straw will
last.

Ideal State: We at Sippin’ Snacks believe that all aspects of our business are key; Customer
satisfaction, sales, ethics and public relations. Our straws are only the highest of quality to ensure
customer retention, and to help promote our products. A premiere marketing strategy will help
acquire our first customers, but our quality will impress and the word of mouth will spread.

Company Goals: Sippin’ Snacks most important goal is always customer satisfaction; whether
it is regarding taste, freshness or product that is not up to par. We will not be pleased until our
product reaches a rating of 5 stars on our website, no questions asked. Sippin’ Snacks needs to
educate customers at first; Through education, we can create a brand awareness to reach new
customers, allowing us to keep customer acquisition costs low and helping us reach 1st week sales
of $5,000, $10,000 2nd week, $15,000 3rd week, and 4th week sales totaling $20,000. This would
mean a total goal of $50,000 in sales in one month after launch.

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 About the Business
Mission Statement: To make tasty straws that can take a bite out of bland drinks, bringing the
market an alternative to environmentally hazardous plastic straws and flimsy paper straws.

Company Overview: Sippin’ Snacks is focused on making a fun and tasty alternative to
harmful plastic straws and low quality paper straws. Plastic straws are losing popularity and paper
straws are falling apart in all drinks, all the time. As a new firm, Sippin’ Snacks must appeal to all
consumers; being accessible and tasty for everyone and every drink is essential. Our straws are
made out of candy, wafers and cereal products, allowing it to last long on shelves and be paired
with many of everyone’s favorite drinks.

CEO

CFO CMO

Human
Resources

Accounting
Marketing

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 About The Business

Chief Executive Officer: The CEO is the highest administrator that overlooks all day to day
operations. Working hand in hand with CFO, CMO and Human Relations will allow the CEO to
better understand the state of the company; through the financials, sales and marketing efforts and
the policies of the company.

Chief Financial Officer: The CFO is in charge of all operations inside of the Accounting
department. While the CFO may not do basic accounting daily, he may check in with the others in
the department to make sure all is in order and that the financials are being properly managed by
each employee for each task like payroll, inventory, bill payment etc. Every month the CFO and
CEO will sit and discuss the shape of the financials to determine where we can improve and where
we are doing well.

Chief Marketing Officer: The CMO overlooks the actions of the marketing department and
keeps the firms sales up to par. The CMO will develop a plan to obtain customers and drive sales,
and consult the CEO if needed for these plans. The CMO needs to personally optimize the customer
acquisition costs and work with the rest of the team to efficiently run the social media accounts,
email other firms and try to obtain out of network sales.

Human Resources Associate: The Associates in our Human Resources associates are
responsible for tracking attendance, benefits, training, and employee relations. They are also
responsible for organizing meetings, directing and regulating departmental functions of the
company. The HR department will work directly with the CEO to do all these tasks.

Marketing Associate: The Associates in our Marketing Department are responsible for
promoting our company and our products. They are required to take a visual approach to inform
and captivate our customers. They will manage social media accounts, email VE firms and manage
out of network sales.

Accounting Associate: The associates in our Accounting Department are responsible for
accounting procedures and financial statements. They produce financial reports, pay
bills, maintain payroll, keep record of stock transactions, direct investment activities, and
develop strategies and plans for long term goals.

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 Strengths Weakness
New to the market
Edible, biodegradable,
strong management staff

Opportunities Threats
The plastic straw era is Plastic straw alternatives
coming to an end opening the such as paper and metal
market to our tasty alternative straws.

Strengths: Sippin’ Snacks sells biodegradable edible straws makes our company distinctive and
gives us an advantage. Sippin’ Snacks also has a dedicated staff lead by our strong leadership. Our
CEO works closely with our CFO, CMO, and Human Resources to understand all components of
our company in great depth. Our leader’s dedication and skills have inspired and set an example for
all employees.

Weaknesses: Sippin’ Snacks is new and unknown; therefore our marketing team will focus on
establishing brand awareness. To gain recognition, our marketing team will promote Sippin’ Snacks
through the use of our website, social media, and advertisements.

Opportunities: Plastic straws are losing their popularity, because they are harmful to the
environment and. While their era is coming to an end, ours is just beginning. The opportunity for
our Sippin’ Snacks to provide people with a tasty alternative is now. This is because the market an
alternative to plastic straws is on the rise.

Threats: Plastic straw and metal straw companies such as Just Artifacts and Alink have the same
goal as Sippin’ Snacks. They have also established a strong customer base and brand awareness,
making it harder for our company. Trying to enter an almost saturated market will make it harder to
generate a profit, but not impossible. Even though our competitors are successful their products are
just boring reusable straws. Our product is something consumers would enjoy more because it is
delicious and useful.

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 External Environment
Current Economic Conditions: Gross Domestic Product, GDP is the total value of goods
and services produced within a country for a specific time period. A high GDP indicates an
increasing amount of production in the economy leading to higher spending from the increased
income. Our luxury straw brand offers consumable straws offering a better experience consuming
beverage than other straws like plastic and paper. We are more expensive than plastic straws but we
are offering an entirely different product. The current American GDP is 2.86% as of 2018
increasing in quarter 3 and has been rising for the past 4 years. This means the economy is stable
and people have more income at their disposal, which is good for Sippin’ Snacks. We are a
consumable straw and are nonessential to consumers’ needs. In this current state, people will have
more money to spend on unnecessary items like our straws.

The graphic below outlines GDP growth in the United States for the past eight years. As shown, the
GDP has been steadily increasing and is at one of its highest in the past eight years with and
without applying inflation at about 3%.

Unemployment: Unemployment measures the amount of people that are not employed and
seeking employment. Currently the national unemployment rate is at its all-time low since
December 1969 at 3.6%. This is ideal for Sippin’ Snacks because we sell luxury consumable straws
that cater to people of all incomes as a confectionary and non-essential items. People will have
more money to spend on consumable straws. This is a sign of a strong economy when more people
are working, they will have more money to spend on discretionary items like chocolate.

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Federal Government and Interest Rates: With the economy going in an upward trend,
GDP’s high and unemployment low, the government has not raised taxes or interest rates on
producers. From a consumer standpoint this is good because it keeps money in their pockets and
allows them to spend their money on other things. Recently the federal government lowered rates
for businesses saving them money as well. This is beneficial for Sippin’Snacks since we will be
able to raise money more efficiently and focus on consumers, allowing us to keep our prices low
and margins high, helping our bottom line. This will allow us to lower prices to compete with other
straw companies.

Real Industry Analysis: Sippin’ Snacks operates in the high end straw business and we
compete with companies like Tiffany & Co. This company has a large following on social media
and consequently a large ecommerce market. However, their main priority is not straw, our main
priority is. The plastic straw industry is becoming extinct. However, the paper straw and plastic
straw alternatives are starting to become popular among consumers if not their only option. People
will always want straws with their drinks. This graph below shows the amount of plastics used
global of which 4% is used for straws.

Virtual Industry Analysis: The virtual enterprise straw industry is different than the world
straw industry. There are many companies in the real world that provide straws. However, there are
almost no competitors in our virtual marketplace that specialize in edible straws and in the actual
marketplace; there are almost no competitors that make edible straws either. Our closest
competition at Sippin’ Snacks is any straw company but they pose no threat to us.

Competitive Analysis: Sippin’ Snacks operates in the luxury straw business with few
competing companies. We offer a unique product that few other companies can match. There are
other competing straw companies but none of them offer edible straws. The straw industry is
changing; plastic straws are being outlawed in more places every year. The prediction is that the
straw industry will reach one billion dollars in a few years and is currently valued at around 925
million dollars. However, the virtual industry is different than the real world but in both industries
we have very few competitors like plastic straw companies or metal straw companies like Final

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Straw. However, no company can pose a threat to Sippin’ Snacks. The graph below shows the
amount of straws consumed in the largest consuming countries. An opportunity because of the
amount of markets Sippin’ Snacks could develop.

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 Marketing Plan
Goals: We plan to have $50,000 in sales by our first month and after our first year we will have a
total income of $960,000, a 15% revenue increase every single month. In order to reach these goals
our determined marketing team will promote our products through the use of advertisements such
as flyers, commercials, and social media and by promoting our website. Through our thorough
promotion our business will become internationally known. This will help increase our clientele and
sales. With the use of consistent promotion our potential customers will be able to differentiate us
from our competitors and see why our product is better. If these goals are not met we will take our
time to re-evaluate our marketing strategies and create appropriate goals.

Target Market: Our target market ranges from tweens to adults, ages 12-50, specifically
towards those who have a sweet tooth. This is because sugar is not only limited for kids to enjoy, in
fact it’s for everybody of all ages to enjoy. We aim to sell our straws to companies that want to ban
the use of plastic straws in their work environment and for their customers. Places such as New
York City, Washington and Florida. Our customers are fun and energetic and they always enjoy an
extra treat, their colorful personalities match our many varieties of tasty, fun and vibrant straws.

Marketing Segmentation: The target market for Sippin Snacks is anyone who drinks with
straws. We want to make an effort to focus the majority of our marketing advertisements towards
our students in high school. We plan to target them by using Instagram, Snapchat, Twitter, and
Facebook. Along with advertisements in cafes, boba shops, ice cream parlors, and local
supermarkets we can use online marketing, especially; food based media pages and YouTube
reviews on our product.

Demographics: Approximately 500 million straws are used by Americans daily. The majority of
which (85-90%) are between the ages of 18-54. Our target market is in a similar range (ages 12-50)
because statistics show that sugar consumption is the highest during this age range. Targeting this
age range is beneficial because they are the majority of sugar and straw consumers.

Geographics: Our company takes place in Oceanside, New York and will have the ability to sell
our product worldwide with our online sales but the majority of our international sales would be
through well cafes like Starbucks as well as local coffee shops and supermarkets, for families to
buy. Targeting mostly families with kids of any age and individuals with a sweet tooth. With our
increase with sells, we aim to start businesses along other countries that demand to get rid of plastic
straws.

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Psychographics: We plan to target consumers who are energetic, lively, and have a sweet tooth.
We want our consumers to have personalities that match our fun and colorful straws. Young adults
under the age of 18 are more likely to want our product because they consume sugar often and are
willing to try new products. According to Visioncritical.com, “They prefer cool products over cool
experiences”, this suggests that teenagers and young adults ages 12-24 are more likely to buy our
products because we are unique and trendy. We are also targeting adults who want to stop using
plastic straws and help the environment.

Marketing Mix
Product: We sell a variety of fun flavored straws made of different foods like wafers, hard candy
and cereals. We strive to satisfy every ones sugary wants therefore we offer wafer straws, hard
candy straws, and cereal straws. Our flavors vary depending on the type of straw. We offer vanilla,
chocolate, and cinnamon wafer straws; grape, watermelon, green apple, blue raspberry, cherry,
strawberry, and swirl hard candy straws; fruity or chocolate flavored cereal straws. These straws
can be sold individually at local coffee shops or in quantities of 10, 20, or 50.

Pricing: In each package, we provide a vast amount of straws based on its price. For a case of 10
Sippin Snack straws, we sell for a price of $20. For a case of 20 Sippin Snack straws, we sell for a
price of $37.00 and for a case of 50 Sippin Snack straws; we sell for a price of $85. Different sizes
for different events, for example, parties, cafes, or just to enjoy at home.

Placement: Our company will be active on Instagram, Snapchat, Twitter, and Facebook telling
about our product and reposting reviews from customers about our snacks. As a result, we plan to
place our straws in local coffee shops, Starbucks and bagel shops as an addition to their coffees and
drinks. Also, we have created a Sippin’ Snacks website, where customers can buy directly from us
and get it shipped directly to their doors.

Promotion: In order to connect with our target market, our marketing team will rely on the use
of social media platforms such as Instagram and Twitter and through the use of our website. Using
social media will help connect us with potential customers and get our brand well known. Our team
will also use email firms and make “shop to shop” sales in coffee shops, bagel shops, and local
commercial offices. Email firms will also be sent to other VE restaurants and commercial offices.

Positioning: As a small edible straw company, we must create a good initial reputation of
exceptional service and top of the line quality. Our company must be viewed as the best alternative

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to plastic straws and we will not stop until we reach that mark. Our customers will view us as a fun,
tasty and vibrant straw company that provides a great complements to their favorite drinks, while
promoting environmentalism.

Financial Planning
Business Risks: Starting a new business comes with many risks that a company has to face in
order to make it successful. A big risk that comes with starting a new business is having startup
money and gaining customers. You first need money to get the business up and running, without
some money, it would be hard to make any progress. Also, a company needs to have customers to
make profit and continue expanding their business to achieve success. Without brand awareness
we won’t be able to get customers thus affecting our revenue. Lastly, competitors can quickly
shut down a business if the opposing business was seriously thriving. If two companies sold the
same product and one was that much better, than it would be hard for the less popular company
to earn money.

Break-even Analysis: Sippin’ Snacks offers many different varieties of quality food straws that
are sold at different prices and cost different amounts. Because of our wide selection we took the
average cost of each SKU and how much the consumer pays. The average cost to produce a box of
10 is 1.37 and the box price is $20. To break even Sippin’ Snacks must sell 2250 boxes of 10 to
start generating profits, but there are larger options available that would produce more revenue. We
believe this is attainable to reach with our sales projection.

Sales Projection Summary: We predict our quality straws and our lower prices will
emerge and establish ourselves in the market. With the launch of our website we predict
that 50% of our sales will come from it and we hope to gross $50,000 for the month
of December due to the holiday time. With the upcoming trade show we believe that the sky is the
limit for sales; trade shows will help us educate customers and we hope to have high customer
retention. With the potential to now acquire out of network sales, we predict that we will able to sell
up $25,000 first month. We predict that the holiday season will greatly benefit our sales, as many
customers are looking for tasty treats.

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Profit and Loss

Summary Profit & Loss Statement: Since Sippin’ Snacks is a new company that just
started in November so we haven’t had any sales. This was because our website was not up and
running and our company did not have inventory. Since receiving this information we have gotten
our website up and running, and have begun to purchase inventory. We have begun an aggressive
marketing campaign to establish brand awareness.

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Balance Sheet

12
 Financial Write Up
With many risks in starting a business, two of the major risks were finding investors and
entering an established market. With investors you have to pitch your company to them
to secure the desired amount you require. With any new company raising capital is hard.
Throughout the course of 2 months we were able to raise $150,000 in capital by selling stocks to
3 different angel investors as well as an initial seed funding of $20,000. Each received 5,000 shares
at a $10 par value in preferred stock for a total investment of $50,000 each. This money was used to
start our company and help pay for the initial starting cost of office equipment, rent, utility, labor
expense, advertising expenses, and everything else. The second risk we dealt with at Sippin’ Snacks
was entering an already established market place. Older consumers may not care about the
environmental impacts of using a plastic straw, so they may not feel the need to switch and paper
straws have been around for a few years now. We will have to further establish brand awareness in
this sector as well as continue to try and lower our cost because we are lowering our price to
compete with other companies allowing for a greater influx of customers.

As a brand new company we don’t have any sales as of now, however, we plan to do
$50,000 in gross revenue within the month of December through out-of-network
sales and through our website. We hope to increase sales drastically and by the end of
January we should increase our gross revenue to $60,000. We plan to raise this money by having
multiple advertising campaigns leading into February. This is where we will focus our marketing
around Christmas in order to increase sales. Our Marketing will make Sippin’ Snacks a necessity
for the Holiday season, boosting our sales greatly.

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Angel Investors

A-1
A-2
A-3
Bank Account

A-4