The document outlines a group project for an F&B operation called GreenLife in Tsim Sha Tsui East, including an executive summary, external environmental analysis, objectives, target market, and marketing mix strategies and programs. It provides details on products, pricing, place, and promotion strategies, and analyzes competitors like Starbucks and McCafe. Break-even pricing is proposed based on estimated fixed and variable costs.

1. HTM 2121
TOURISM AND HOSPITALITY MARKETING
GROUP PROEJCT
Project Title :F & B Operation in Tsui Sha Tsui East
Names: LAM KA YEE, Iris, 11225906D
LEE CHO YIN, Kristy, 11025186D
LEE KA YU, Jason, 11370913D
KWOK WING TUNG, Kylie, 11205003D
1

2. Project flow
Sections
Executive summary
External environmental analysis and opportunities & threats
Objectives
Target market
Marketing mix strategies and programs
Implementation milestone
Marketing budget
Marketing controls
Reference
2

3. Name and Logo
GreenLife:
Environment and life cannot be separated
Logo:
Orange - cooperate with Fair Trade
Brown (words) - coffee
Green (leaf) - organic products
3

4. Mission
High quality of Food & beverages &
customer services
Promote organic and fair trade‘s concepts
and products
Break-even
4

5. External Environment
macro-environment
5

6. Demographic trends
Opportunities:
•Healthy eating trend
Organic product  attract customers
•Price sensitive customers
Generally not brand loyal when a discount is offered
Threats:
•Growing trend of Cafe culture
 Customers knowledge about coffee products↑
6
High quality products

7. Economic Trend
The local economy is started to recover since 2010
Opportunities
 A chance for GreenLife to survive
 The more the prosperity of economy, the more revenue expected
to earn
Threats
 Problem of inflation may arise
 Affect the food cost
 May affect spending pattern of people

8. Ecological
Opportunities
 Eating habit changed  organic products
 Support sustainable development
Threats
 Organic products are high in costs
 Trend may vary if new idea pop up

9. TECHNOLOGICAL TRENDS
• Opportunities
 Marketing planning and mixes more focused on Internet
 Nowadays, global internet users >20 billion
 Global use of mobile devices to access internet ↑
 accounted for total internet users : 4.3% in January 2011
8.5% in January 2012
 Customers : obtain products and services information
online, shopping online
 ↑ Distribution channel
 ↑ Promotion channel 9

10.  Suppliers and distributors :
(1) provide online service
(e.g. homepage which contains product and services’ categories with
order and delivery services)
(2) ↑ focused on Internet promotion
(e.g. Facebook page and Apps )
 F&B operation
computerized system :
( e.g. POS system and Management system run the operation and keep
records such as inventory.)
 ↑systematic , ↑effective ,↑efficiency 10

11. POLITICAL-LEGAL
 According to the Public Health and Municipal Services
Ordinance (Cap. 132) and other relevant legislation
 F&B operation : apply corresponding licenses
match numbers of requirements
 Two licenses for our operation
1)Restaurant licence (from FEHD)
 sell any kind of food for consumption on the premises
2) Liquor licence (from Liquor Licensing Board)
 Sell any kinds of Liquor on the premises
11

12. POLITICAL-LEGAL
Requirements
fire-fightingequipment (from HK Fire Services Department)
ensure the health and hygiene conditions (form FEHD)
ensure buildings safety (from Buildings Department)
Certified no unauthorized building
+ compliance with Government lease conditions
(from The Land Registry)
Statutory Plan Restrictions (from Town Planning Board)
12

13. THREATS
 Costs ↑
 Application fee and annual fee of the licenses :
 Our store : 100-150 sq.m $3140 (annual fee )
 maintenance costs  match the reqirements
 Time costs :
 obtain the licences from FEHD
 provisional food business licence
 maintain these standards for 6 months  full licence
13

14. Social cultural trends
• Opportunities
 E-commerce
 Use of smartphone &WIFI-service↑
(According to PayPal, more than 8,000 mobile payments were processed on average
per day in Hong Kong in 2011 & 106 million active PayPal users in 190 markets
worldwide buy products from thousands of Hong Kong-based PayPal merchants)
14

15. Social cultural trends
• Opportunities
Coffee and tea culture
 strong in Asia
(According to the Synovate survey, among the 501 respondents, about one third of residents now
purchase ready-to-drink coffee from outside)
(coffee is imported from 50 different countries world while in China)
 Tea culture customs of China
15

16. Social cultural factor
 Opportunities
Healthy eating
 Sales ↑ in the past few decades
 The choice expands to over 2000 items
(Park N’ Shop and Wellcome & CitySuper, and Jusco, have set up separate organic food sections
or allocated retail space to organic products)
16

17. External Environment
micro-environment
17

18. COMPETITORS ANALYSIS
 Current Competitors :Coffee shops and café in
TST East
 46 coffee shops : 13 large chain stores
33 non-chain stores
 13 large chain stores : 9 Starbucks
3 Pacific Coffee
1 Mc Cafe
18

19. MAJOR COMPETITOR
Starbucks
 Products :
 beverages (various kinds with hot and iced)
 Fresh food & Snacks (e.g. breakfast, lunch, tea, salads
and cakes)
 Services:
 Computer with web cam
 Free Wi-fi services
 Sofas and chairs with magazines and newspapers 19

20. SERVICE
 Relaxing environment with soft music
 Official website and facebook page  interact with
customers
(obtain the latest information ,history of starbucks )
 Online registration system  member receive special
promotion
 Delivery services (a minimum of HK$300 per order
,except 12 noon -2pm) 20

21. COMPETITOR’S PRICE RANGE
 Price range ( different categories)
 Breakfast $8-22
 Lunch $19-38
 Snacks and Salad $8-38
 Beverages (3 different sizes in order)
 Tall $22
 Grande $34
 Venti $42
 Overall price range :$8-42
21

22. A STARBUCKS’ STORE IN TST EAST
 Location
Located at : Avenue of Stars ,Tsim Sha Tsui Promenade
✔facing victoria habour
✔having trees and flowers nearby
✔footpaths in front of the shop  no cars
✔sunlight and sea breeze
 Environment : ✔ relaxing , peaceful and comfortable
✔ fresh air
22

23. STARBUCK’S PROMOTION
 Promotion
✔ Press releases
✔ Internet : Official website ,Facebook,Email
 Close to the market trends and nowadays’ technology
23

24. SWOT ANALYSIS
 Starbucks
 Strengthens & Opportunities
 World’s brand name company
 Highest percentage of share of mind
 High percentage of market share
 Positive Image : ✔ social responsibilities
 Enormous amount of capital  ↑products and services’
quality
 High bargaining powers among suppliers and customers
  ↑ selling price  ↑revenue
24

25. SWOT ANALYSIS
 Weaknesses & threats
(1) Certain extent of over-expansion
(9 stores in Tst East  may weaken its own turnovers)
(2)Only focus on western food (lack of variety)
People don’t like western food culture ✕ consume
E.g. many elder in HK  will go tea restaurant rather
than Starbucks
25

26. MAJOR COMPETITOR
MC Cafe
Products
26
Beverage (Espresso, hot and iced drinks)
Frappes and extras
Services
Free WiFi service
Sofa and chairs
Official website and facebook page interact with customers

27. MAJOR COMPETITOR
MC Cafe
Price ranges
27
The overall price ranges are between $8 and $26.
Location
Most of the stores are located at the ground floor  convenient
Promotion
Coupons or punch cards
Slogans
Advertisements
Apps
Newspaper

28. SWOT ANALYSIS
MC Cafe
Strengths and opportunities:
28
A mid-range quality substitute
McDonald’s reputation
A large amount of capital

29. SWOT analysis
MC Cafe
Weaknesses and threats
29
Products are lack of variety
The place is small
Are not operate independently

30. Supplier
 Opportunities
Cooperation with Fair Trade
provide organic food
(According to a recent statistics accounts for 1 to 2% of total food sales worldwide)
Abundant suppliers of certain foods
 ↑ chance to find out the lowest possible food cost
(420manufacturers supplying sauce and seasoning)
30

31. Supplier
 Threats
Some food fewer food supplies
 Meat dominated by big supplier
(Spaghetti only22and15 manufacturers in Hong Kong)
 bargaining power ↓ relatively
31

32. Marketing intermediaries
Opportunities:
Newspaper and magazines
e.g. Daily Economics, Times and Asia Finance
Direct mail house
Mail an advertisement to business firms in Tsim Sha
Tsui East (by café’s staff)
(match with the target group of customers)
Threats:
•Increase costs 32

33. Publics
 Opportunities
Support from citizen-action publics
 Environmental groups  may be attracted by our fair trade
products
(For example, the Environmental Working Group which recommending consumers should look for
organically produced products so as to lead a healthy life n be attracted to our business)
Support from media groups
 Environmental groups  may be attracted by our concept of
healthy eating habits 33

34. Target market
34

35. Target customers
 Business people
B Tsim Sha Tsui is one of the Central Business District
 Younger age groups
YMajority of buyers in Hong Kong of Western foods tend to be females, who do
more food shopping than males, with younger age groups
 Middle class income group
MDemand for high-value food and beverage is mainly among the 2.3 million
middle class consumers
 Behavior: Business customers are willing to pay in purchasing
B price is not the main factor to decide purchasing
35

36. Marketing mix strategies and
programs
36

37. Marketing Strategies
Products and services:
customer-oriented, psychographic segmentation
Pricing:
market skimming
Cost-based pricing à breakeven pricing
Price-adjustment strategies :
segment pricing, psychological pricing
37

38. Four marketing mixes
38

39. 1. Products& Services
2. Price
3. Place
4. Promotion
39

40. PRODUCTS & SERVICES
• Food
• Beverages
• Customer service
40

41. PRODUCTS- FOOD
 (1)Spaghetti and rice (main dishes)
(Salmon, meat sauce, bacon & mushroom and
vegetable)
 (2)Snacks
 chicken wings
 Sandwiches (egg, cheese, tuna, tomato for mix and match)
 fruit salad (fresh organic vegetables and fruit)
 (3)Cakes (blueberry cheesecake, chocolate cheese cake
41
and cup cakes)

42. EXPLANATION OF FOOD
PRODUCTS
 ✔From light  main dishes
Not only for tea time
 ✔breakfast , lunch ,dinner (normal meal)
 ✔healthy and fresh ( use organic products)
good refreshment for business people
 Tailor-made for business people
42

43. PRODUCTS- BEVERAGES
(1)Coffee
Cappuccino, Mocha, Latte and Espresso
(most of the coffee beans  organic and fair trade products)
(2)Alcoholic drinks
Red wine
(e.g. Chateau des Leotins 2008 )
White wine
(e.g. Trebbiano d'Abruzzo Badia Frasca,D.O.C. 1998 )
Champagne
(e.g. (A.O.C.) Brut, Pascal Fleury )
(3) Non-alcoholic drinks
Milk, chocolate, milk tea and lemon tea in terms of hot and iced.
Special drinks :
Tea (both British tea and Chinese tea) 43
Fresh fruit juice (apple ,orange & pineapple)
Fruit punch

44. EXPLANATION OF
BEVERAGES PRODUCTS
 ✔ variety of beverages  different people’s taste
 Refresh  help to think & brainstorm ideas ↑
 Unique beverages among coffee shop and café
 ★ Alcoholic drinks
 Various kinds (red, white wine and champagne)
 Red wine for meetings
 champagne for celebrations
44

45. SERVICES
 Customer service:
provision of service to customer before, during and after
a purchase
 (1) First stage (before purchasing)
Customer  can make reservation ( through reservation
system online or by phone call)
Research information (through company’s homepage
,Facebook page ,email , phone call & Fax)
45

46. SERVICE
(2) Consumption phase
Core product : Food and beverages
Facilitating
products :
customer services- taking order of food , handling guests’
requires
Augmented products : (atmosphere) (target customer’s needs)
quiet and relaxing environment
Tables, computers, projector, stationery, free wi-fi
VIP room (private area)
✔ conference table  designated for meetings
46

47. SERVICE
(3) Detachment phase
ask for feedback satisfied or not
✔ service recovery chance  create satisfaction to
unsatisfied guests
create a guests profile (visited ≧5 times)
Records find out preference and spending patterns
Keep paid bottle wine  for next visit
Quality of service ↑
47

48. Price
48

49. Pricing approach
Break-even
pricing!!
49

50. Reasons for choosing break-even pricing
1. Predicting the change of sales when price changes
3. Preventing losses
5. When the business starts generating a positive return
50

51. Price list
Here are the tables showing the fixed costs (Table 1) , variable costs (Table 2)and food costs(Table 3).
Items Cost(HKD)
1.Rent 80,000
2.Decoration 8333
3.Furniture 2500
4.Kitchen equipment 1666
5.Coffee machine 833
6.Salaries 2500
7.Others 261
Table1
Totals 96093
Items Cost(HKD)
1.Gas 2,000
2.Water 1,500
3.Electricity 3,000
4.Others 750 51
Totals 7,250
Table2

52. Table3- Items Selling Unit
price demand
Expected unit Total revenue Total costs
demand at a
Profit
Beverages (HKD) needed to given price
break-even
1.Cappuccino(hot:350ml, cold:500ml) 45 480 750 33,750 27,110 6,640
2.Expresso(hot:350ml, cold:500ml) 42 546 450 18,900 21,110 -2,210
3.Mocha(hot:350ml, cold:500ml) 45 480 460 20,700 21,310 -610
4.Latte(hot:350ml, cold:500ml) 45 480 485 21,825 21,810 15
5.Wine
a) BORDEAUX , A.O.C., Chateau des a)130 a)109 a)40 a)5,200 a)12,910 a)-7,710
Leotins 2008 (750 ml) b)370 b)34 b)19 b)7,030 b)12,490 b)-5,460
b) Cardeal Reserva, DAO, c)114 c)105 c)49 c)5,586 c)13,090 c)-7,504
D.O.C. 1983 ( 750 ml) d)170 d)80 d)32 d)5,440 d)12,750 d)-7,310
c)Trebbiano d'Abruzzo, Badia Frasca, e)200 e)60 e)23 e)4,600 e)12,570 e)-7,971
D.O.C. 1998(750 ml) f)340 f)37 f)20 f)6,800 f)12,510 f)-5,710
d) PETIT CHABLIS A.O.C. (Chardonnay),
Domaine Millet 2007 (750ml)
e) CHAMPAGNE Brut, Charles Leprince,
Chateau Leprince (half-bottle), A.O.C.
f) CHAMPAGNE (A.O.C.) Brut, Pascal
Fleury
52
6.Non-alcoholic drinks(hot:250ml, 35 800 810 28,350 28,310 40
cold:500ml)

53. 7.Spaghetti/rice- 69 245 450 31,050 21,110 9,940 Table3-
Salmon
food and
snack
8.Sandwich 40 600 350 14,000 19,110 -5,110
9.Cake
a) blueberry cheese a)35 a)800 a)980 a)34,300 a)31,710 a)2,590
cake and chocolate b)38 b)672 b)510 b)19,380 b)22,310 b)-2,930
cheese cake
b)Cup cake
10.Fruit salad 45 484 540 24,300 22,910 1,390
11.ChickenWings(6 40 600 700 28,000 26,110 1,890
pieces)
53

54. Pricing strategy
Market
skimming!!
!
54

55. Pricing strategy-Market skimming
Reasons for choosing:
1. Target customers are price insensitive towards our products
(According to Journal of Business Research, business customers are willing to spend large amounts
of money in their purchase of goods and services, while keeping loyal business customers can
give greater revenue for a supplier or a service provider)
55

56. Pricing strategy-Market skimming
Reasons for choosing:
2. a high quality image of GreenLife can be created
by charging a higher initial price
first cafe selling organic products in TST Easr
high chancegrabbing the early adopters
56

57. Place
57

58. Place
Shop 44B, G/F, Harbour Crystal Center, 100 Granville
Road, Tsim Sha Tsui East in Kowloon
Near to the Hung Hom and Tsim Sha Tsui MTR Station
Ground floor u
58

59. Distribution channel : Internet
 Create website and facebook
 Upload Coupon
 76.4% of all households in Hong Kong have PC at home
and able to access the Internet (according to Thematic Household Survey Report -
Report No. 48)
 Facebook is the most influential social networking site
in Hong Kong
 Hong Kong users have has grown to 3,700,320 users
59

60. Promotion
60

61. Promotion
Promotion policy and advertising
• Promotion cards on tables
• Large poster on the window of café
Public relations and sales promotion
• Products tasting event
• Membership scheme
• Different festivals promotions
• Issue online coupon
• Design an app
• Giving sample
61

62. Products tasting event
Knowing which products can be main or are most
popular products
Held periodically
3 to 5 new products or improved products to be tested
62

63. A membership scheme
Establish good relationship with customers
E gain support and loyalty
Invite them to join events
I giving them discount and sample, and using special equipment in
café without extra charge
A-one-year membership
spending $400 or above at once or spending $800 within 2 months
Permanent member
meet other standards to get the membership card
i.e. purchase the coupons or to spend more
63

64. Different festivals promotions
Christmas
New Year (31st Dec – 1st Jan)
Valentine’s Day
 build relationships with customers
64

65. Issuing online coupon
• Cooperate with online restaurant guide websites
Open rice Facebook
• Rate GreenLife • always catch up with
Customers GreenLife
• Download the coupons
of GreenLife issued
• Easy to know the • Promote GreenLife
GreenLife comments of GreenLife
• Improve our products
and services
65

66. Design an app
Trend of using smart phones
Design app for download
 make reservations
 book the facilities (Projector)
 download the code of coupon and use it in GreenLife,
members can have a special chat room or corner
66

67. Giving sample
Let others know GreenLife will be launched
soon
How good our products are or our products
do match with their taste
67

68. Marketing budget
68

69. Marketing budget- projected sales
 The time period of the sales projection is one year and the figures are
presented in a monthly basis.
 We need to have three hundred and thirty-nine thousand dollars in order to
open a cafe in our chosen destination
 After half year of operation, we can cover our cost.
Months Expected revenue Expected cost
January 309,210 339,230
February 315,394 342,622
March 321,702 346,048
April 328,136 346,013
May 341,391 342,553
June 348,218 339,128
July 351,700 335,737
August 355,217 332,380
September 358,769 329,057
69
October 362,357 325,767
69
November 365,980 322,510
December 373,300 328,960

70. Marketing budget- marketing expense
 Including fixed costs, variable costs which include the promotional expense and
food costs
 Fixed costsi $96,093 per month, Variable costsn $7,225 per month which
includes $9,000/12 = $900 average monthly promotional fees. Here is the list
about the details of our promotional fees.
 All food costs are $235,887 in the first month. As we have eight types of
products and thus the food costs for each type product is $982 every day.
Name of promotional programs Date Budget
Pre-promotion Mid May – June $2500
Opening ceremony 1st June $3000
Member recruiting - $200
Product tasting event Mid Nov. $800
Printing cost - $500
Decoration fee Christmas, New Year and $2000 70
Valentine’s date
Total - $9000

71. Marketing control
71

72. Marketing control
Program Person Date Budget Explanation Budget
name responsible
1.Sales Accountant Monthly N/A • Find out whether Expected revenue:
evaluation and the actual sales=the
Jan-June: ↑2% monthly
Managers expected sales
target Jul-Nov: ↑1% per month
Dec: ↑2%.
• Adjusting the
strategies to ↑the Expected cost:
sales revenue
Jan-Mar controlling cost:
↑ 1% Apr-Nov t cutting
cost by1%
Dec controlling cost: ↑2%
72

73. Marketing control
Program Person Date Budget Explanation Budget
name responsible
2.Progress All Quarterl N/A To evaluate how the Expected Revenue:
check y business goes  meet
1) First quarter : evaluate whether the
the objectives
revenue and cost of these 3
i.e. break even and
months=monthly target.
customer retention
the price-adjustment 2) Second quarter: three months
strategies
revenuen
3) Third quarter: three months,
revenueo 4%, cost: -2%
Fourth quarter: three months
revenueq 3%, costt 6%
73

74. Marketing control
Program Person Date Budget Explanation Budget
name responsible
3.Annual All 31st N/A To evaluate how the Expected revenue: $4,131,374
evaluation May business goes
Expected Cost: $4,030,005
 meet the
objectives  Earn $101,369 at the
end of a year
i.e. break even and
customer retention
 the price-
adjustment strategies
74

75. Thanks
75