1. C an you te l l Mi l ky Dream ™
Tianchen Liu
she's dr i nki ng Darius Wheeler
Denis Vasilescu
soy mi l k?
She can't.

2. Motivation: A Need for Milk Substitutes
Milk is one of very few foods in which
people who cannot or will not consume it
seek a substitute rather than giving it up
entirely, e.g. there are no broccoli
substitutes.
● Some are lactose intolerant or have milk
allergies which prohibit milk
consumption
● Some wish to avoid the hormones and
organic chemicals that come from farm
factory cows Every one seeking
● Vegans and some vegetarians abstain a milk substitute
from animal products such as dairy seeks something
● Others seek lower calories or different that tastes (and
nutrients found in soy, almond, or looks) like milk!
coconut

3. Who Buys Milk Substitutes?
Source: [Dimitri & Greene]

4. Our Approach: a soy milk that tastes like milk
Starting with a base soy milk, add in milk flavoring,
remove soy flavoring.
● Principle chemicals responsible for milk's taste
are lactose and the products of lactose
breakdown: galactose and glucose.
– Available off the shelf from biotech
suppliers
● Chemicals responsible for soy taste yet
unknown, but tolerable as they are mild
● Worst case, product merely has to taste more
like milk than competitors to grab relevant
market share.
● Product packaged in plastic or glass containers
to distinguish its similarity to milk rather than
soy milk which comes in cartons
– Half-gallons are sold as gallons are
typically bought by households w/ children
● Formula kept as trade secret rather than patent

5. Market Share for Milk & Milk Substitutes
source: [Dhar & Foltz]
Market Potential for
Skim/Low Fat
Milk
Whole Milk
Mi l ky Dream ™
Flavored Milk
Soy Milk Market trends:
● Sales of soy milk down since 2008 due partly to
recession but partly to soy burnout
8.4% ● Largest player, Dean Foods, bogged down since
● Primary reason (>50%) people stick with 2009 by their milk business
their soy milk brand is taste [Mintel] Market prediction:
● Primary reason (45%) people do not buy ● In the milk substitute market, one does not have to
soy milk is taste [Mintel] taste exactly like milk to succeed, only taste more
like milk than the competitors.
● Secondary reason (25%) people do not
buy soy milk is price [Mintel] Dean Foods Milk Market
12000
10000
Dairy Sales
Dairy Gross Profits
Silk Soymilk 8000 Whitewave Sales
Millions of USD
Silk Light Soymilk
Whitewave Gross Profits
Private Label Soymilk
6000
Blue Diamond Almond
Breeze
Silk Pure Almond 4000
8th Continent Soymilk
Silk Plus Soymilk 2000
0
Nondairy Milk Substitute Market Share 12.1%, $58.7 M 2007 2008 2009 2010
source: [Soyfoods: The U.S. Market 2010] (Sales 2010) source: [Dean Foods fiscal annual reports 2007-2010]

6. Business Plan for 1000000
Five Year Budget Expenditures
900000
Mi l ky Dream ™ 800000
700000
Thousands of USD
600000 Capital
Operations
● Initial investment of $1.8 million to cover expected costs 500000 Personnel
of first two years
400000
● Target 15% market share ($10 M sales) of the private
300000
label soymilk by 5th year
200000
● Primary customers are independent natural food
retailers 100000
● Demonstrate value to retailers and consumers through 0
taste tests, generous free samples, and accomodating 2012 2013 2014 2015 2016
sales agreements
➢ Suppliers:Archer Daniels Midland, Biolabs Five Year Projections
12000
➢ Logistics:DHL, FedEx
➢ Distribution partners: independent natural 10000
food retailers in South and West 8000
Thousands of USD Sales
➢ Market risks:Soy prices, competitor makes 6000
Cost of Sales
Gross Profits
better recipe, competitor cuts supply chain
4000
Expected R.O.I. = $10 M over 5 years
2000
0
2012 2013 2014 2015 2016

7. Itemized Budget for the First Year
● Location
– Austin metro area (low taxes, cheap labor, epicenter of target
markets, access to logistics, SBDP)
● Facilities
– 10,000 SQFT office + warehouse + loading bay
@$1.15/SQFT/mo = $138,000/yr
– $3,500/mo utilities = $42,000/yr
● Office Furniture & Supplies
– Desk,chair, cabinet, desktop computer, phone, misc supplies x 15 =
$30,000
● Industrial Equipment
– Xinguang 68 gal mixing vat x3 = $4,800
– Shengxiang soy bean processing machine: $5,000
– SHENS 400L Boiler: $5,000
– Blissum 2000 bottle/hour bottling machine: $30,000
– Misc + discretionary expenditures: $40,000
● Personnel
– 3 founders (chemistry + operations) @ $33,000/yr = $100,000/yr
– 2 marketing and sales @ $50,000/yr = $100,000/yr
● Travel budget x2 = $50,000/yr
– 10 warehouse labor + clerical @ $36,000/yr = $360,000/yr
– Medical insurance + benefits package x 15 = $45,000/yr
● Total: $948,000 for first year

8. Sales Growth Strategy: Value to the Customer
Our target customers are independent natural food
stores who account for ~50% of venues for existing
brands.
● The “nature” of our customers give them more
flexibility and openess to new products
compared to chain establishments, but they
must still earn a profit themselves
● Because the key value of our product is taste,
taste tests are the keystone demonstration
platform.
– Give out free samples to merchants to
taste themselves
– If merchant likes the product, he can stage
a taste test in his store. This enhances the
visibility of his other soy milks, boosting
sales regardless if ours is the best. Good
incentive
● Some parallel marketing to consumers to
demonstrate demand to merchants. Again the
tools of choice are free samples and taste tests

9. C an you te l l she's dr i nki ng
soy mi l k?
She can't.
Mi l ky Dream ™
Fi nal l y, a soy mil k t hat tastes l ike mi l k

10. Investment Profile:
Mi l ky Dream ™ Silk Soymilk
Silk Light Soymilk
Private Label Soymilk
Blue Diamond Almond
Breeze
● Initial investment of $1.8 million to Silk Pure Almond
8th Continent Soymilk
cover expected costs of first two Silk Plus Soymilk
years
● Key advantages: Nondairy Milk Substitute Market Share 12.1%, $58.7 M
Leverages primary reason for source: [Soyfoods: The U.S. Market 2010] (Sales 2010)
–
brand choice: taste
Five Year Projections
– Main competitor hamstrung with
low margins and rigid customer 12000
base 10000
● Market risks:
8000
– Erosion of our customer base
Thousands of USD
Sales
Cost of Sales
– Transient consumer interest 6000 Gross Profits
– Recession contracts market 4000
2000
Expected R.O.I. = $10 M over 5 years
0
2012 2013 2014 2015 2016
“The willingness of consumers to purchase our products will depend upon our ability to offer products
providing the right consumer benefits at the right price.” -Dean Foods 2010 Annual Report, on the matter
of staying competitive in the soy milk market

11. References
● Tirtha Dhar, Jeremy Foltz. “Is Soy Milk? The Economics of the Soy Milk Market” UW
Food Systems Research Group Conference.Madison, WI, June 17-18, 2005.
● Carolyn Dimitri, Kathryn M. Venezia. “Retail and Consumer Aspects of the Organic
Milk Market” Economic Research Service, United States Department of Agriculture.
May 2007.
● Carolyn Dimitri, Catherine Greene. “Recent Growth Patterns in the U.S. Organic
Foods Market” Economic Research Service, United States Department of Agriculture.
● Caryn Ginsberg. “The Market for Vegetarian Foods” Vegetarian Journal. Vol. 30,
Issue Three. 2011.
● Elizabeth Fuhrman. “Soymilks Struggle Under Pressure” Beverage Industry
November 2010.
● Mintel Oxygen Reports. “In the Shadow of Competition, the Soy Market Slumps” PR
Newsire. April 2011.