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Retailing Paper

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For Retailing, my group and I decided to create a campus bar for our business. We did everything from find an actual location, to finances and financial forecasts, to inventory, to marketing for our …

For Retailing, my group and I decided to create a campus bar for our business. We did everything from find an actual location, to finances and financial forecasts, to inventory, to marketing for our business plan.

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  • 1. Executive Summary NoCo plans to become the new hotspot for students in the Greeley area to spend their nights. Its target market will be that of local college students who are least 21 years old. NoCo’s prime location will be 807 17th St, which is a promising one due to its close proximity to the University of Northern Colorado campus. The bar layout will be one that allows for both a relaxing atmosphere and a party atmosphere at night. NoCo will have couches within it to provide the relaxing feeling, along with beer pong tables, pool tables, and plasma televisions for the more traditional bar setting. Advertising efforts will target college student specifically in a variety of ways including use of the Internet, including its own website with a virtual store for NoCo apparel, text messaging, and flyers. Print ads use either a humor element that highlights NoCo’s close location to student housing or blatant sex appeal. NoCo will be a purely alcohol (beer and liquor) based bar. Shirts, hoodies, shot glasses and pint glasses will also be available for sale. The projected annual sales amount to $362,350.46. Though this seems like a low sales amount, with the annual cost of goods sold being low, NoCo will still be able to turn a positive net profit. The pricing is relatively low in order to cater to the student target market. With the markup kept well above fifty percent on all inventory items, the prices will bring in the market wanted and will still benefit profitability. NoCo expects to see higher profits in the months that students arrive back at school and the months of graduation that accompany the end of the school year. Over the summer months, profits will decrease, but with the remaining student population in the city profits are still expected. Overall, NoCo will excel within the bar industry by appealing to college students with cheap drinks and a prime location. 2
  • 2. Table
of
Contents
 Introduction 4 Target Market 4 Location 5 Store Design 5 Merchandise Plan 7 Pricing 10 Financial Section 13 Advertising 14 Salespeople 17 Virtual Store 18 Conclusion 18 Appendixes 19 3
  • 3. Introduction NoCo is the next great student bar in the Greeley area located right off the UNC campus. Students will come to NoCo for the party atmosphere, cheap drinks and nightly specials. It will be located within walking distance of virtually all student housing, making it the premier student hangout. The design of this proposal is to create familiarization with NoCo’s business plan and goals. With your financial support, this project will surpass all expectation for years to come. Target Market The Target market for NoCo will be college students at UNC and Aims Community College who are over 21. Total current enrollment for UNC is 12,148 undergraduate and graduate students. Estimated enrollment numbers for AIMS are around 2000 for the Greeley campus. Of that 2000 an estimated 1000 will be 21 or over and eligible for the target market. The numbers below are estimates of amount of academic year students that meet our age criteria of 21. NoCo chose this target market for several reasons. The owners are part of this target market, can more accurately assess what their peers want to see in a student bar, and can put our own input into the operations as they have a similar thought process to the target market. NoCo chose this because of the success other bars have had in the area. There are several student-oriented bars in the area many of which are doing very well. This indicates that college students are 4
  • 4. currently visiting these local bars on a frequent basis. NoCo will be able to compete for this target market because it will be the closest bar to the UNC campus and within walking distance of a large amount of student housing, including every fraternity and sorority house affiliated with UNC. Location Owners chose Noco’s location primarily due to its close location to the student population. As the view from simplymap indicates, the area surrounding NoCo’s location is highly populated with people enrolled in a public college. Similarly, the area surrounding the bar contains a great amount of non-family households with people under the age of 25 with very low incomes. Clearly, this description fits that of the target market of college students. Data from simplymap also indicates that the demographic surrounding NoCo are heavy beer drinkers. This information indicates that the 807 17th St location in a prime one for NoCo. Store Design The design for NoCo will focus on creating a relaxing atmosphere that will be very welcoming to students. There will also be a central open space for Friday and Saturday nights when crowds are larger, a wrap around bar in the southeast corner that will seat 5
  • 5. approximately 18 stools, and nine tables that will seat four people. The tables will be very small, as NoCo will not serve food. All tables in NoCo will be high top with stools. The west wall will have a seating area with one couch and two large chairs centered on a television. This small seating area will be for those who would like a more comfortable experience. The bar will have three televisions behind it; one placed in the southwest corner and one placed on the north wall. NoCo will also have beer pong tables that will be stored and brought out if requested. The décor will be very college oriented, but will not be exclusively UNC. NoCo will place an emphasis on college team apparel, with framed jerseys and college signs. NoCo will not allow CSU or CU décor, as this would anger our specific target market. There is one bathroom internal to NoCo and two additional bathrooms if one were to exit NoCo and take a left down the hallway. The northwest corner will be storage space as designated by the existing layout. 6
  • 6. Merchandise Plan Due to this target market, NoCo will keep its alcohol inventory basic with wells being the majority of the liquor sales, with the occasional higher priced liquor also available. The inventory will be strictly alcohol and beer, along with t-shirts, hoodies, shot glasses, and pint glasses sold in the virtual store. NoCo will open doors in January when students get back from Christmas break. This will make January the highest income month. May, September, and December will be the next most profitable months because of the return of students to school and the graduation months. The summer months will be the lowest profit months. 7
  • 7. The sales forecast was found by taking the NAICS code (7224) for bar establishments from the government census (Accommodation and Food Services Colorado, 2002). Colorado bars sales were then divided by the bar establishments in Weld County, one was then added, followed by inflation because the numbers were from 2002. Although this number seems low, due to the hours and being a new bar with limited merchandise assortment, this is a proper number from which to base the sales forecast. 8
  • 8. NoCo receives its beer inventory from three different suppliers: American Eagle Distributors, Western Beverage Distributing Co., and High Country Beverage. NoCo will use Pepsi Bottling Group as the soda provider. Southern Wine and Spirits, Beverage Distributors, and National Distributing will be the liquor and wine suppliers. Through building relationships with suppliers, prices are expected to decrease over time, while also receiving promotional items from them such as bar mats, posters, and coasters. 9
  • 9. Pricing NoCo’s prices reflect the average beer or drink specials in the area. In order to appeal to the student demographic, items were priced on the lower end of the spectrum. The markups used were calculated by taking the retail price minus the retail cost and then dividing by the retail price. 10
  • 10. 
 11
  • 11. NoCo’s prices reflect the average beer or drink specials in the area. In order to appeal to the student demographic, items were priced on the lower end of the spectrum. The markups used were calculated by taking the retail price minus the retail cost and then dividing by the retail price. 12
  • 12. Financial Section NoCo owners have decided to invest $20,000 of their own money into starting up the bar and to get a loan for $60,000, combining for $80,000. This will cover the capital budget and starting costs, while still having extra for any other costs incurred. Our bar equipment, dishes, furniture and fixtures, and other miscellaneous items were bought from shortorder.com, barsuppliesdirect.com, acemart.com, and billiardstore.com. 13
  • 13. Advertising NoCo will institute various marketing and promotional strategies in order to increase brand awareness in UNC students over the age of 21, while also differentiating it from competing student bars in the surrounding Greeley area. Internet: NoCo will use Facebook in various ways to generate buzz and to update customers about upcoming events and specials. NoCo will use different formats within Facebook to increase the likelihood of the target market seeing the marketing efforts displayed on it. For instance, NoCo will have its own profile so that fans of the bar can become “friends” with the bar, thereby getting status updates from managers of NoCo. Similarly, NoCo will have its own group and fan pages so that fans can “follow” its happenings. NoCo will also design a website that describes the different events, promotions, and drink specials taking place during different nights throughout the year. 14
  • 14. UNC Newspapers: NoCo will use student newspapers, such as The Mirror, as more traditional forms of advertising, placing full-page ads in each edition. These ads will highlight NoCo’s close proximity to campus and student houses with the tagline “Luckily home’s only a block away.” Different advertisements will use different images; however, most will include pictures of a man crawling home after a long night of drinking. The other advertisement used will appeal to the male members of the target market containing images of attractive women wearing to NoCo logo. The cost of running such ads in The Mirror is $412.50. Campus Cash: NoCo will have coupons placed in the campus cash booklets given to UNC students. These pamphlets target college students specifically, correlating perfectly with the target market. Coupons will run during both the fall and spring semesters, costing $699 for the entire year. The coupons will offer “buy one get one free pints”, or a “½ price Mind Eraser.” 15
  • 15. UNC Radio: UNC Student Radio will run advertisements throughout its programming. This station plays over radio waves and also on one of the cable G r eel ey’ s ho ttes t new co l l ege bar . 8 0 7 1 7 th S t. N ext to Chipo tl e. channels in the dorms. This advertising will focus specifically on marketing towards $ 1 . 5 o Happy Ho ur Pints M ind Er as er s : $ 2 . 0 0 each Lo ng I s l ands : $ 2 . 5 0 each the target market. Not only will we purchase commercial slots from the radio station, but also owners will schedule interviews to promote the bar on a more personal level by talking about the bar, its atmosphere, and the goal of NoCo’s owners to have a fun environment for UNC students. Flyers: NoCo will have flyers placed throughout campus and surrounding areas. The most heavily covered locations will be that of Kepner, Frasier, Candelaria and the near-by parking lots. This will result in a higher traffic rate for NoCo. These flyers will remain consistent with the “crawling home” print ads that will run in newspapers. Campus Reps: Employees will act as campus reps in order to create a more personal level of advertising. People tend to be more receptive to advertising and promotions from people they can relate to; therefore, these campus reps will be students that have a high level of influence on their peers. These reps will wear t-shirts with the NoCo name and logo and have merchandise to sell to anyone interesting in purchasing a shirt of their own. Wearing these shirts will be a beneficial grassroots marketing technique; producing a greater awareness level of the bar. Text Messaging: In NoCo, there will be a sign-up sheet for people who would like to receive text message alerts about new events, promotions, or drink specials, similar to the idea of a mailing list, only instantaneous. This will allow NoCo to relate to dedicated 16
  • 16. customers on a more personal level and keep them up-to-date with news regarding the establishment. This technique is particularly relevant members of the Gen Y target market, who are very technologically savvy and love instantaneous information. Salespeople NoCo will employ eight employees, including one 
 
 
 Bartender's
Schedule
 
 
 
 manager and the owner, who will also work as a 
 Monday
 Tuesday
 Wednesday
 Thursday
 Friday
 Saturday
 Sunday
 manager. The six bartenders will earn an hourly 2:30pm‐
 wage of $4.50/hour plus tips, while the managers 10pm
 A
 F
 E
 D
 B
 C
 E
 will receive $15/hour plus any tips. Paychecks will 4pm‐
 be distributed biweekly on the 5th and 20th of each 10pm
 B
 A
 C
 E
 C
 B
 D
 10pm‐ month, based off pay periods ending on the 15th 2:30am
 C,D
 D,E
 B,F
 A,F
 E,D
 A,F
 B,C
 and 30th or 31st of each month. Benefits will not be 
 
 
 
 
 
 
 
 available during this stage of the business 
 
 
 
 
 
 
 
 operation. The bartenders will work on a rotational 
 
 
 Manager's
Schedule
 
 
 
 schedule, with four working five days a week, and 
 Monday
 Tuesday
 Wednesday
 Thursday
 Friday
 Saturday
 Sunday
 two working four days a week. Only one manager 2:30pm‐ will work each day, with the owner working four, 2:30am
 A
 A
 B
 B
 A
 B
 B
 including Saturday and Sunday. Following the 17
  • 17. schedule above, the average amount the bartenders will earn per week is $118.13 with an average of 26.25 hours worked per week. The manager that is not the owner will earn $540 per week. It can also be determined that the average quarterly labor costs for NoCo will be $14,985.00. Virtual Store The website will be a marketing tool and have information on NoCo’s location, a live webcam, and a virtual store. This will be an important marketing tool because the target market uses the internet very heavily. The webcam will enable customers to see what is going at NoCo and whether they would like to patronize it. There will also be a virtual store on the website that will sell t-shirts, hoodies, shot glasses and pint glasses imprinted with the NoCo logo. These products will be mass-produced from zazzle.com and discount mugs.com. A PayPal account has been set up which will enable NoCo to set up a bank account for income to be deposited. Conclusion The information provided has illustrated that NoCo will be a very profitable business venture from which any firm could greatly benefit. With its prime location, excellent target market, and sound management structure, NoCo is ready for success. Students will pack NoCo with business on a nightly basis and it will become the place to be in Greeley. NoCo is a new kind of student union and is primed for success. 18
  • 18. Appendix A Simplymap information regarding location (highlighted section is area closest to NoCo): Greeley,
 ALL
OF
 Variables
 20‐22
st
21‐23ave
 20‐28
st
35‐47ave
 16‐19
st
8‐11ave
 CO
 USA

 Geographic
Unit
 Census
Block
Group
 Census
Block
Group
 Census
Block
Group
 

 

 #
Enrolled
Public
College,
2008
 158
 427
 1,452
 11,387
 12,920,032
 %

Enrolled
Public
College,
2008
 16.76%
 12.33%
 85.66%
 12.56%
 4.45%
 %
<25
Non‐Family
With
Lower
Income,
2008
 4.98%
 3.05%
 58.40%
 5.20%
 1.47%
 #
<25
Non‐Family
With
Lower
Income,
2008
 24
 46
 277
 1,826
 1,730,325
 Ave
$
Away
from
home
(alcoholic
bevs)
2008
 $264.83

 $291.13

 $191.77

 $251.83

 $247.48

 Ave
$
Beer
and
ale
away
2008
 $92.37

 $101.19

 $94.51

 $94.38

 $85.98

 19
  • 19. Appendix B Shortorder.com Ice Maker: Manitowoc – QD-0132A-115-1 $1554.00 Back Bar Storage: Beverage – Air- BB48-B 48” $1,679.00 Bottle Cooler: Beverage – Air – DW49-B $1215.00 Glass Chiller: Glastender-MF24-B $1549.00 Under Bar Sink: Glastender-SWA-12 12” wide $592.00 Blender: Hamilton Beach HBB908 $76.00 Ice Bin with 6 bottle wells: Eagle B2CT-18 $310.00 Soda Gun Dispenser & Tubing Chase: Glasetender-SHB-4 $259.00 Coffee Maker: Bunn Coffee Maker 13300.0001 $267.00 Barsuppliesdirect.com Bottle Openers $3.50 Cocktail Shakers: Shake Set 15oz & 30 oz $9.99 Liquor Pourer: 1 dozen $12.95 Acemart.com Wine Glasses: Round, 14 oz, case of 12 $58.78 Pint Glasses: 16 oz, case of 24 $49.74 Shot Glasses: Fluted 2 oz, case of 48 $56.98 Martini Glasses: Salud Grande, 10 oz, case of 12 $63.58 20
  • 20. Rocks Glasses: Iverness, 9 oz, case of 36 $81.58 Glass Washer: 11ov Submersible MotorGlass Washer $424.99 Glass Sanitizer: ¼ oz case of 100 $28.95 Glass Cleaner: ½ oz case of 100 $28.95 Stools: Double Ring, black swivel seat $39.98 Bar Stools: Black vinyl bucket with tapered legs $59.98 Tables: square 2” x 2” $43.98 Billiardstore.com Pool Table $1500.00 21

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