vitality investor slides
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Krystal Daibes. Melissa Grelli. Galen Mittermann. Jonathan Riddle.
n. the capacity to live, grow & develop
Sweetgreen
M Street-Washington DC M Street-Washington DC
Dupont-Washington DC Bethesda, MD
Vitality Team
product developmentmarketing/sales
brandinggraphic design
finance
team will be consultingwith real estate, nutrition,
and food experts fromthe industry
strengths
gaps
V i · T A L · I ·T Y
Because there is untapped market potential and a way for Vitality to differentiate itself with unique product offerings
The health conscious and time sensitive consumersas well as families
• Who We Are •
• What We Do •
• Why We Matter•
• Who We Matter To •
The mission: deliver healthy meals using 100%natural ingredients to people on the go whileimplementing sustainable business practices
Provide an alternative to traditional, greasy QSRs
Vitality’s Value Proposition
Total investor funds are forecasted at $340,000
“For the health-conscious consumer who wants a fast healthy and nutritious meal, Vitality is a quick service restaurant that provides healthy, natural and sustainable products. Unlike other quick service restaurants that have processed and unhealthy meals, our meals improve health and come from natural, locally-sourced farms for only a slightly higher premium.”
Vitality: A Healthy Solution
3 Seeds to Success
Operations Location
Menu
to live, grow & develop
Operations
1) Volume based business
2) High transaction speed
3) Continually work on process improvement:
Serve as many customers as possible & drive sales
-ordering-food prep-packaging-final order -assembly
Operations Continued
-Vitality’s limited menu reduce costs and help control quality
-Interactive touch screen will help differentiate Vitality as well as allow our drive thru to thrive
-Technology platforms that allow customers to order online or through an Iphone/Blackberry application
Marketing Mix: Place/Location
Open first location in Portland, Oregon with future expansion plans for this local market
Customer convenience
In-Store Presence:
-Eco Friendly approach to in store design
-Decor and Flooring--recycled goods (unique dining experience)
-Drive-thru with a user friendly kiosk (Nextep & MRI Touch Screen) for our drive-thru operations
High traffic area
Easily accessible by foot & car
Strive For:
Marketing Mix: Product/Menu
Mintel: 49% of adults surveyed reported “freshness” as the most important decision when ordering food, followed by fat, calories, and natural non-processed ingredients
Dedicated to serving great tasting “healthy” meals with 100% natural ingredients
Attributes: fresh, natural, and organic.
Oregon customer questionnaire
“Quality” was ranked as extremely important
Speed, Price, and Convenience were ranked as important
Marketing Mix: Product/Menu
Product Development Strategy
-Two Main Product Lines:
1. Salads (wraps) 2. Greek Yogurt (fruit & nut add-ins)
-Allow for customized orders
-Menu names will be distinct to OR
-Biodegradable containers and utensils
-Nutrition endorsed and transparency with regards to ingredients and nutritional content
-Future opportunities to augment the product and Vitality revenue streams
Packaging
Leverage freshness & customizable options
Align with: fresh, natural, sustainable
i· al·i·TTn. the capacity to live, grow, and develop
The VitalsCrescent Caesar
Romaine lettuce, chicken, croutons, parmesan cheese, and caesar dressing.
The Cobb
Romaine lettuce with avocado, turkey bacon, grape tomatoes, chicken, and honey dijon dressing.
The EssentialsThe Oregonian
Romaine lettuce with chicken, mandarin oranges, carrots, won tons, and sesame ginger dressing.
Sweet GrapeSpinach, grapes, chicken, candied walnuts, and and red wine dressing.
Prefontaine ClassicRomaine lettuce and arugula, black beans, chick peas, beets, broccoli, avocado, egg, almonds, chicken, and olive oil.
Blazin’ BachelorRomaine lettuce, avocado, black beans, cherry tomatoes, cucumber, almonds, chicken, and ranch dressing.
·
Track Town Special*1. Choose: spinach, arugula, romaine2. Up to 5 add-ins ($1): black beans, chick peas, broccoli, beets, edamame, avocado, cucumber, egg, corn, cherry tomatoes, carrots cucumber, mandarin oranges, almonds, candied walnuts, crispy wontons, croutons, feta cheese, goat cheese3. Add Protein ($1) chicken, tofu, tuna, turkey bacon4. Balsamic vinaigrette, red wine, caesar, ranch, olive oil, sesame ginger, honey dijon
*starts at $6
$6
$5 $7
$7
$8
$8
y
greek yogurt.Bottled Water $1 Fuze Drinks $2greek yo Choose 2: Almonds, Granola, Candied
Walnuts, Apples, Grapes, Strawberries, Pear, and honey
Soy Milk $2 $3
*All salads can be made into wraps
Marketing Mix: Promotions
Traditional Media Social Media
Principle news outlets Facebook
Advertisements in local papers
TV & radio ads Company Blog
Tactics
-Utilize social media to communicate special promos and incentivize people to eat Vitality
-All menu offerings endorsed by certified nutritionists
-Frequent Vitality card that has 10 unfilled trees on one side and a health or sustainable fact on the other side
-Annual online contest in May (‘Sustainable Month’) in which customers submit and name their salad creation
Marketing Mix: Price
-Value pricing strategy -Affordability is a key factor, but we expect to sell at a premium to traditional QSRs
[Mintel: $4.77-QSR (2009)]
-Food costs will not exceed 35% of the sales price
-Suppliers include: local farmers for produce and UMIF (natural foods distributor) for protein items and yogurt
-Estimate Vitality salad ranging from $6-9, depending on the complexity and ingredients and yogurt $3 with the option of two fruit or nut add-ins
Vitality’s Financials
· Initial Costso First Phase: personally financedo Phase 2: $124,558o Phase 3: $214,127
· Assumptionso 23 customers/avg. hour sales = $496,800 initial saleso 1400 sq. ft. location at premium price of $48/foot plus $18/
foot
· Returno IRR of 31%, plus position to franchiseo Year 5 earnings of over $160,000 with above 10x industry
average P/E
Forecasted Sales
Grow With Vitality.
Vitality Milestones
Q2 Y1 Q3 Y1 Y2 Y3 Y2Prove our
concept
Raise capital
Add new
location
Expand our client
base
Break Even
V i · T A L · I ·T Y
We life fast lives & want fast food
America’s Fast Food Problem Vitality’s SolutionRed Ocean Blue Green Ocean
we also want to eat healthy.but
-Approx. 500,000 restaurants in US combined revenue $400 billion
-Highly fragmented (full and limited service (QSR and fast casuals)
-200,000 QSRs combined annual revenue $120 billion
-Current QSR establishments provide unhealthy food to patrons
-Healthy QSR (imagine Cafe Yumm with a drive-thru)
-Offer a diverse menu with health at the core of our products
-Core target audience: parents and health-conscious consumers on the go
-Emphasis on lunch sales as this accounts for the majority of QSR sales
Hoover: US Restaurant Industry Overview
500,000 restaurants combined annual revenue $400 billion
Highly fragmented (FSR and limited service (QSR and Fast Casuals)
Approximately 200,000 QSRs with combined annual revenue $120 billion
National Restaurant Association (NRA) reports: “A typical fast food restaurant
generates $670,000 annually and a franchised one, $1 to $ 2 million
http://www.hoovers.com/fast-food-and-quickservice-restaurants/--ID__269--/free-ind-fr-profile-basic.xhtml
IBIS-Fast Food Restaurants Key Statistics
KEY FACTS
The top 5 players account for 41% of industry revenue:
- McDonald's Corporation 12.7%
- Yum! Brands, Inc. 9.7%
- Wendy's/Arby's Group, Inc. 6.6%
- Starbucks Corporation 5.9%
- Burger King Corporation 5.1%
http://www.ibisworld.com.libproxy.uoregon.edu/industry/executivesummary.aspx?indid=1676
Mintel Reports: QSR Usage & Frequency
“In the past three months, how many times have you eaten at, picked up food from, or have had food delivered from each of the following restaurants?
Base: 1,884 internet-using adults aged 18+ who have used a restaurant in the past year, May 2009
Restaurant Usage % Frequency #
McDonalds 66% 3.5
Subway 54% 1.9
Burger King 46% 1.4
Wendy’s 43% 1.4
KFC 46% 1.1
http://academic.mintel.com.libproxy.uoregon.edu/sinatra/oxygen_academic/search_results/show&/display/id=393467/display/id=477525#hit1
Mintel Reports-Ingredient Attributes “Healthy Meal”
Fresh Ingredients 49%
Less Fat 39%
More Vegetables 29%
Lower Calories 26%
Made with natural, non-processed ingredients
23%
Less Sodium 20%
Smaller Portions 17%
Less Sugar 11%
More Fruit 10%
Base: 1,726 adults February 2009
“When it comes to choosing a ‘healthy meal’ at a restaurant, which, if any, of the following are the most important to you in your ordering decision?”
http://academic.mintel.com.libproxy.uoregon.edu/sinatra/oxygen_academic/search_results/show&/display/id=393496/display/id=460714#hit1
Portland, OR
Portland earned the second spot on Cooking Light top 20 cities due to its: ‘acres of parkland per capita; percent of population that reports to be in good or better health; percent of population that exercised in the last month; and its walkability.’
Cooking Light Best Cities Award
http://www.cookinglight.com/healthy-living/travel/cooking-light-best-cities-portland-oregon-00400000001413/
Mintel Reports: Pricinghttp://academic.mintel.com.libproxy.uoregon.edu/sinatra/oxygen_academic/search_results/show&/display/id=393467/display/id=477501?select_section=477504
Cuisine Type Q1 2008 $
Q1 2009$
QSR 4.06 4.77
Sandwich 5.75 5.45
Fast Casual 5.86 6.09
Average price per entrée, by restaurant segment- 2008 and 2009
QSR Magazine-Top Drive-Thrushttp://www.qsrmagazine.com/articles/news/story.phtml?id=9413µsite=drive_thruThrus
Top Performers
Chic-Fil-A 3.54 vehicles in line96.4% accurate
Taco Bell
Del Taco
Wendy’s 1.77 vehicles processed with an avg. time of 134
seconds
Based on: speed of service, vehicles processed, accuracy, and customer serviceAverage speed of service (2008) 131 seconds
NE Milestones
Proven Our Concept: Q2 Y1
We believe that we will be able to prove our design and concept by the beginning of the 2nd quarter of year 1. At this point NE will have successfully entered the market by opening its first store in Portland, Oregon.
Raise Capital: Q3 Y1
By the beginning of the 3rd quarter of year 1, we will have access to $300,000.
Expanding our Client base: Y2-Y3
During years 2 and 3 we will strengthen our business model. We intend to increase our client base by adding more locations, improve our product offerings, and establish good relationships with current and potential clients.
Achieving Breakeven: Y2
We intend to break even by year 2.
Exit Strategy:
As a startup company we must take into consideration a viable exit strategy for NE. If our we are unsuccessful, we will sell our business to another competitor looking to sell healthy fast food offerings
Defending the Brand
-First mover advantage
-Current competitors in the marketplace will need to redefine their image and brand
-New entrants will simply be unauthentic NE imitators
Customers are trading down from fast casuals to quick service
Current QSRs are trying to offer more nutritious and premium meals
Vitality Brand