BUSINESS IMPLEMENTATION

of
The Creative Café
Kaylee Jabbour, Sarah Ryan, Luke Reeves-Rollins & Polina Puchkova

ENDTERM PROJECT-1st sem

ENTMAN

Submitted By:
Mary Joy Quinola

Submitted to:
Ma’am Joena Balladares

Date Submitted:
January 20,2023
Executive Summary The Creative Café will be a business unlike any other in Downtown
Charlottetown, Prince Edward Island. The business will be a welcoming and adaptable
environment, where people can come for a quick coffee, a lunch meeting, or a night out
with friends. We will provide consistent and superior customer service, offer quality,
local and certified food and beverages, and uphold an environment that promotes
creativity at all times. Through these core values we expect to gain high consumer-
perceived value of our product. This perceived value will enable us to penetrate the
market and gain market share. From a situational analysis, we have determined our
industry to be one that provides food, non-alcoholic beverages, and amusement services
(NAICS 2012). We have found that although this industry is highly competitive our
business still has the potential to be successful. This is because of the fact that we have
strong product differentiation in a rapidly growing industry (Friend 2016). From our
consumer analysis, we have determined that one of our strengths is the correlation of the
age demographics in Charlottetown with our main product offerings. For example it can
be seen that the median age in the City of Charlottetown, falls in the age range that
consumes the most speciality coffees from coffee shops (Holmes 2012, Government of
Canada 2016). Consumers are also becoming much more socially responsible and
expecting the same from the businesses in which they are purchasing from. We have
taken this research into consideration when creating our marketing plan, and it has
heavily influenced many of our business decisions (Business Development Bank 2013).
The marketing strategy gives direction on where to focus our resources to gain the most
opportunities. Using this strategy we hope will increase both our sales and our
competitive advantage. At the Creative Cafe, our mission is to is to provide our
consumers with a unique and welcoming environment, where they can showcase their
creativity in a vibrant social setting. To achieve our mission we have outlined our
company’s objectives into measurable and strategic goals. These goals Include our
projections for market share, sales, and profitability, and our plans to diversify our
product offerings. To determine our target markets we have used age, lifecycle and
psychographic segmentation to break up the market. We determined our two target
markets as middle-aged educated adults and millennials. We have created a positioning
statement to adhere to the two different markets, middle-aged coffee lovers and
millennials looking for an alternative night out. We have determined our points of
difference to be that we provide an atmosphere that promotes a facilitates the creation of
art, the fact that we use ethical and local products, and also as an alternate option for
evening entertainment. Because of the differential aspects of the business we have
determined that we will be able to be successful in the market due to our unique product
differentiation. The marketing program demonstrates the experience we can provide and
how that differs from our competitors. It communicates our idea of creating an
environment which promotes acceptance and happiness. Within the marketing program
we have communicated how we plan to be profitable while still maintaining our core
values. These values include community building and commitment to high-quality local
goods. We are planning to promote and advertise our products and services, using the
five components of the promotional mix: advertising, sales promotion, personal selling,
public relations, and direct marketing. The placing strategy talks about how we are going
to physically distribute our product to the market, and the value distribution chain that is
involved with our business. We determined that we are a level one channel as there are
no intermediaries between the company and the consumer. The customer service strategy
refers to the ability to satisfy our consumers by increasing and advancing our variables,
such as workforce, technology, and atmosphere. We plan to increase out customer service
by increasing human resources and training.

Situational Analysis
To gain a better understanding of the current and future states of the market we are
entering we have done a SWOT analysis, which is a situational analysis done to identify
the internal strengths and weaknesses, and the external opportunities and threats of an
organization. We have done a detailed analysis on three specific areas that will affect our
business: the industry, the competition and the customers.- Marketing Plan These
analyses allow us insight into what to expect as we penetrate the market as well as what
to expect over time. Internal Strengths - Quality products - - Strong product
differentiation -
Weaknesses - Small, startup company - - Similar product offerings to the competitors -
External Opportunities
- Decreased interest in nightclubs and binge drinking - - Increased consumer interest in
local, ethically sourced products - - Coffee shops are the fastest growing industry in the
foodservice industry -
Threats - Crowded marketplace -

Marketing Strategy
Mission
Our mission is to provide our customers with a unique and welcoming environment,
where they can showcase their creativity in a vibrant social setting.

Marketing and Product Objectives

Within the first five years of being open, we are planning for expansion in products,
brand awareness, and profit. We have decided on 8 key objectives that we feel are
specific, measurable, attainable, realistic, and timely (SMART) for our business. Each
goal is set to be completed within a certain time frame, but they will all be hopefully be
completed within a two to five year range of the business being open. Key Objectives: ➔
By year 2 have developed enough brand awareness that 20 percent of Charlottetown
knows about the business. ➔ By year 2 Expand menu options ➔ By year 3 breakeven.
➔ By year 3 Become licenced to serve alcohol, and start to serve local craft beer ➔ By
year 3 begin to target more niche markets, such as artists ➔ By year 5 occupy 20% of the
industry’s market share. ➔ By year 5 have yearly sales of approximately $1,000,000. ➔
By year 5 have a profit margin of four percent. Moving forward these 8 key objectives
should guide us towards running a successful and profitable business. This vision will
hopefully keep us on the right path, and keep us in line with our marketing and overall
business plan.

Product & Branding Strategy At the Creative Café, we strive to provide an

environment in which individuals have access to the resources that allow them to express
their creativity. The majority of cafés follow a similar model that consists of providing
hot beverages and a cozy space. At the Creative Café, however, our goal is to enhance the
customer’s traditional café experience by adding a truly valuable element to one’s
otherwise run of the mill experience. The way in which we choose to separate ourselves
from our competitors is centered around allowing the consumer to expand their minds
through art, as well as, meaningful conversation with other creative individuals. Our goal
is to establish an image of acceptance and friendliness. We wish to be seen as a place
people can go where they are not only included, but where they can make lasting bonds
and friendships. To achieve this, we must brand ourselves in an appropriate fashion. At
the Creative Café we will advertise the fact that we are not only a unique business to
Charlottetown, but that we support local, as well as ethically sourced goods. We believe
branding ourselves in a socially responsible manner will be attractive to our target
markets.

Price Strategy
At The Creative Café, our pricing strategies will consist of cost-plus pricing ensuring we
make a reasonable margin. We will also incorporate competition based pricing for certain
products, to ensure that our beverage prices will be comparable to other upscale local
cafés. That being said, we also have a goal to enhance our local community. A certain
portion of our profits will be donated to local charities and organizations in
Charlottetown. We feel as though our target market would greatly appreciate this
generosity. This in turn would promote brand loyalty, setting us up for a promising future
with a substantial loyal customer base.

Promotion Strategy
Promotion is the communication between the company and the consumer. In order to
make the market aware of your product offering, you must create a promotion strategy
that will inform, persuade and remind consumers about your product. Without this,
consumers would most likely be unaware of your existence, regardless of how great your
product or service might be. The Creative Café will to some extent, take advantage of all
five components of the promotional mix: advertising, sales promotion, personal selling,
public relations, and direct marketing. By blending all five components we will create
effective and integrated marketing communications (IMC). Because we are a new
company, we must start out with strong IMC to ensure market penetration.

We will use advertising to reach large groups of people in the Charlottetown region.
Because we are just starting out and our budget is not very large, we will avoid expensive
advertising channels such as television, and stick to medias such as newspaper and radio.
More specifically we will buy advertisements in the Buzz, which is local paper that
comes out monthly and is placed in locations all over Charlottetown. Because the Buzz
comes out monthly, this will increase the frequency of the advertisement, which is often a
very effective method in getting people to recognize your brand. We will also purchase
advertisements in the Guardian - PEI’s provincial newspaper, as well as on Hot 105.5,
CFCY, and Ocean 100 - the most listened to Island radio stations. Although personal
selling is the most expensive tool per consumer reached, it is often the most effective. So
even though we are working on a tight promotional budget, we still want to put some
effort into this component. We will be walking around Downtown Charlottetown telling
the people in the streets about our business. Along with this we will integrate a sales
promotion by giving away discount cards as incentive to come into the café and try it out
at a reduced cost. Public Relations (PR), also known as publicity is the act of generating
positive publicity and this is something we are aiming to take advantage of. Publicity,
like advertising reaches mass amounts of people. But, unlike advertising, PR is unpaid
and often perceived by consumers as more credible and therefore they are more likely to
consider going into your business. Looking into the final piece of the promotional mix,
we will use direct marketing by creating a website that contains all of the information
about our business. We will also use social media as a tool to spread the word about our
product offering. We will create a Facebook, a Twitter, an Instagram, and a Snapchat.
These are four very popular and commonly used social medias, and if we use them in a
smart and interactive way, this could be a wonderful and cost-effective method to gain
some the market’s attention.

Place Strategy
In general the value delivery network is made up of everyone involved in getting the
product to the consumer. For the The Creative Café, this network, as well as the
distribution strategy will be relatively simplistic due to the small size of the company. For
our business we have suppliers who give us, the company, the products we need to serve
our customers. This means that we are a level one channel as there are no intermediaries
between our company and our consumers. We will take a closer look at the three
components of our value delivery chain. We pride ourselves in exclusively using local
and/or ethically sourced products. Therefore our suppliers are very important to us, as we
work closely with them to ensure they are meeting our standards and providing us with
Island or Canadian products. Our first, and arguably our most important supplier is
Laughing Whale, this is a Nova Scotia based coffee company that provides us with our
coffee supply. We chose to work with them, because their values of environmental
protection and fair trade align with those of our company (Laughing Whale Coffee
Roasters, 2016). Other suppliers who are of great value to us include, Lady Baker’s Tea
Trolley, Buns and Things Bakery, Harvest Wholesale, and MacQuarrie Meats, these are
all PEI suppliers who provide us with tea, bread and baked goods, produce, and meats
respectively. We also require art supplies which we order almost exclusively online from
the Canadian company - Studio Six Farming and Art Supplies.

Sales Forecast
A typical, independently owned café generates roughly $2500 in revenue daily
(Heibutzki, 2011). For our financial projections we are going to assume this to be a
reasonable starting point for our income. However, we are expecting an increase in
customers with time, and from this we are forecasting a steady increase in sales by 5%
annually for our first four years. After the four year period we project our sales will
stabilize, leaving us with daily average revenues of $2993, and an annual average
revenue of $1,066,752 .
Implementation Plan
Month 1: In the month leading up to our opening, we will ensure that we have established
a relationship and a understanding with all of our suppliers, and that they understand
what we will need from them for opening day and beyond. We also have all our staff
hired, as well as the HR manager. Everyone will receive orientation and training, so that
they are prepared for the opening day. Before we open for business, we will also begin to
introduce ourselves to the public, more importantly, our target market. In the first month
of implementation, we will strive to create a buzz surrounding our opening, as well as
communicate our points of differentiation from our competitors. Heavy use of the
promotional mix will be used during this stage, as it is integral to a successful future in
the coffee shop industry. We will put an advertisement on the radio and in the Buzz, we
will implement personal selling on the streets of Charlottetown, as well as the distribution
of coupons as incentive to visit our business when it opens. Finally we will create all of
our social media accounts, and our website, beginning the direct marketing portion of the
promotional mix.

Month 2: The first month of operations will be crucial, and we need to make sure our
product and service is of the utmost quality. The first impressions of our business will be
taken from this time frame, and it is important in order for us to be successful, that these
be positive impressions. Word-of-mouth is very important in a small city like
Charlottetown, so being able to impress the people who come through the door, will
likely create positive publicity, one of the key tools in the promotional mix. During this
month there will be continued promotions, including advertisements, sales promotions,
and direct marketing. We will have lots of entertainment and special activities during this
month to draw people into the business. Focus will beon establishing an upbeat and
welcoming atmosphere and culture. Though our intention is to always maintain this
atmosphere and culture, demonstrating it early to our customers is vitally important to
developing consumer relationships.
Month 12: By the end of our first year in business, we hope to have gained a large
amount of insight into what we can continue to do to see the business thrive, and what we
need to remove from our goals/plans. This month will be a time to re-assess previous
notions and assumptions. At this time the marketing plan may be updated, and an
implementation strategy for the following year will be put in place, keeping in mind the
marketing objectives and what we can do to make this happen. We will reassess the
training needs of our staff, and seek consumer feedback.