1. Devin Sauer, Emily Steelman, Kayla Vankirk, Xinyao Wang, Zhouyang Lin, & London
Graves
Noodles & Company
Group #2
2. 1
Table of Contents
I. Executive Summary..........................................................................................................2
II. Vision and Mission Statements .....................................Error! Bookmark not defined.
III. Environmental Analysis .................................................Error! Bookmark not defined.
IV. Products and Services.....................................................Error! Bookmark not defined.
V. Market Analysis
VI. Management Team and Human Resources
VII. Day- To-Day Operations
VIII.Financials
IX. Funds Required
X. Critical Risks
XI. Appendix
3. 2
Executive Summary
Mission and Vision Statements:
The Noodles & Company mission is to provide a warm and inviting place for
everyone to gather and eat as one, with noodles from around the world, right in the
heart of Norman, OK.
The vision of our Noodles & Company is to create memories one bowl at a time.
Environmental Analysis:
The five forces that will play a major role in our franchise are the threat of
substitutes, and the threat of new entrants. These forces are relatively high in the
restaurant industry. We will need to be aware of these forces.
The PESTEL analysis for Norman, OK shows certain tax policies and health and
safety laws that we will follow, along with a wide range of different ages, races, and
incomes in the area. It was also found there are certain natural disasters that could
occur, along with technologies that we will need to be aware of when conducting
business.
Products and Services:
Noodles & Company offers a wide range of different pasta and noodle dishes
from around the world. We pride ourselves in the freshness of our ingredients, and the
ability for the customer to “create” their dish based on their tastes. Customers will order
at the counter and them be served at their table.
We also have expectations that we must follow from our franchisor. These
expectations include: proper training, limited complaints, food up to corporations
standards, follows culture outlined in franchise agreement, no fryers or microwaves in
kitchens, dishes are cooked to order, no tippling is required
Market Analysis:
Noodles & Company is targeting on white-collar workers from different cultural
backgrounds and customers with higher educations. With a little, less than half of the population
in Norman holds a bachelor’s degree and more than 30,000 college students the new site is
expecting consistent revenue to ensure stability of the business. In addition, the new Noodles &
Company restaurant will be located at the University Town Center.
Management Team and Human Resources:
Our Noodles & Company will consist of the six-team members in the management
roles with the two lowest job titles being hired on. Pay will depend on position ranking
and experience. However, experience is not required to be hired on. We will train all
new employees the “Noodles” way and they will be able to succeed in their positions
with this training.
Day-to-Day Operation:
Noodles & Company provides guide for day-to-day operation for its franchisee with little
flexibility. It requires all its new coming franchisee to hold a “Grand Opening Marketing
Program” and contribute 1.25% of Net Royalty sales on local promotion. Furthermore, Noodles
& Company also provides guidelines of Noodles & Company: Menu Detail website emphasizes
the importance of providing “real food with real ingredients.”
4. 3
General Manager with the assistance from Shift and Assistant Manager will be
responsible for most of the administrative issues and personnel selection. Team members who
had experiences with accounting will handle bookkeeping.
Key Financial Information:
Funds Required/ Used:
Critical Risks:
Risks that could have an effect on our business include our supplier could cut or delay
food ingredient shipments, fluctuations in employment, natural disaster hits Norman, OK,
construction in the area, fluctuations in customers, technology issues, competition, changes in tax
or employment laws, and food and safety law changes. Al of these risks could have the potential
to harm the way we operate. Therefore, we have prepared for them and will deal with the issues
as they arise.
5. 4
Vision and Mission Statements
Vision Statement
To create memories one bowl at a time.
Mission Statement
To provide a warm and inviting place for
everyone to gather and eat as one, with noodles
from around the world, right in the heart of
Norman, OK.
6. 5
Environmental Analysis
The Five Forces
The five forces analysis can help determine what is driving competition in the restaurant
industry. According to MarketLine, there are a large number of transactions in the restaurant
industry so the impact of any single customer on revenues is likely to be fairly small. Therefore,
buyer power is moderate. The statutory minimum wage imposed increases the importance of
suppliers so supplier power is moderate. New entrants are assessed as strong, because the U.S.
restaurants industry has maintained moderate growth in recent years. The threat of substitutes is
also assessed as strong as there are many other leisure options one may choose to do instead of
eating out (Market Line). Please see the Appendix A for a graphic depiction of the five forces
analysis for the restaurant industry.
PESTEL Analysis
Please see Appendix B for a chart describing the macroeconomic factors affecting the restaurant
industry in Norman, Oklahoma.
8. 7
Products and Services
Noodles and Company focuses on providing delicious, fresh dishes that are always satisfactory
to the customer’s order. Noodles and Company takes pride in their unique menu and business
operations that set them apart from competitors of similar size. For example, Noodles and
Company has a “no tip required rule,” does not have fryers or microwaves in the kitchen, and
possesses a relatively reasonable average price of $8 per dish. Noodles and Company serves
sixteen dishes under 400 calories to cater to the health conscience generation. The menu also has
gluten free and vegan options as well. The menu has options for adults and children. The key
elements of being able to cater to all types of health conscience groups, providing a family
oriented atmosphere, and being sensitive to consumers’ budgets provides an optimistic look on
the opportunity for customer growth.
9. 8
Market Analysis
Target Market
Noodles & Company seeks location in downtown areas or in neighborhoods with a dense mix of
residential housing and white-collar office buildings. The company has clearly indicated the
target market as white-collar workers from different cultural backgrounds and customers with
higher educations (Noodles & Company-Franchise Disclosure Document Exchange).
Market Base and Needs
According to the Henry J. Kaiser Family Foundation, in the U.S. workforce overall, “there are
39% white collar workers and 61% blue collar workers. Among the state of Oklahoma, white-
collar workers occupy 35% of the workforce” (The Henry J. Kaiser Family Foundation). White-
collar workers emphasize the importance of quick service, fresh ingredients, and warm
atmosphere. Noodles & Company have considered their customers’ needs and interpreted their
goal as “serving real food, real quick” (Noodles & Company-Restaurant Site Criteria).
According to the U.S. Census Bureau, population in Norman is 118,197 with 92.0% high school
graduates and 43.5% bachelor degree holders (Federal Census). As listed above, Noodles &
Company targets customers from different cultural backgrounds and with higher educations.
Therefore, the estimated customer base would be the population of about 51,415.
In addition, the students and staff members from the University of Oklahoma provide an even
bigger market for all the food businesses in the city of Norman. With over 30,000 students and
more than 2,700 full-time faculty members, the University of Oklahoma has been considered as
one of the major economic boosters for Norman (Federal Census).
Competition
Competition level within Norman is moderate. Only seven other restaurants provide noodles and
pasta, but none of them have a similar business model, menu variety, or quickness like Noodles
& Company does. Furthermore, Pei Wei, which is located at 24th Ave NW, Norman, is
considered the major competitor. It is a restaurant chain in the U.S., with 190 locations in the
U.S. and 3 international locations. According to Pei Wei, it provides customized meal with fresh
ingredients with a similar pricing strategy (Pei Wei).
Location
Noodles & Company has restricted policy on location choices. It requires the location to be as
large as 2,400 to 2,600 sq. ft. as well as the ability of providing 40 to 50 parking spaces. Please
see Appendix C for the detailed Franchise Disclosure Document.
The Norman Noodles & Company will be held at the University Town Center, 1400 24th Ave
NW (see map below). The University Town Center is a booming business location for the city of
Norman. Two of the major supermarkets, Target and Crest Foods, attract high-class-income
customers. Other than Pei Wei, there are five restaurants currently running in the similar location
but they not considered as serving the same target market as Noodles & Company.
10. 9
Estimated market share projected
According to the U.S. Census Bureau, the estimated total accommodation and food services sales
in 2007 was $281,624,000 and average net sales for each Noodles & Company Restaurant was
$1,120,097 in 2010 (Federal Census). Therefore, in the base of total accommodation and food
services of Norman, market share will be about 0.4% (Federal Census). Please see Appendix D
for the Norman Census details. With average $8 per person per meal, the estimated unit sale for
each will be 140,000 bowls, which account for targeted customers to have three meals per person
each year.
11. 10
Management Team and Human Resources
Our managers are also owners. We want our managers to take a personal stake in the success of
the company, and for that reason, they are also part owners for the franchise. This franchise
location will have a management team made of up the six members of our group. One of our
members will have the label of area manager. The remaining four-team members will be placed
in the following titles: Market Training Manager, General Manager, Assistant Manager, and
Shift Manager. The two lowest levels of employment at Noodles & Company, Journey Leader,
and Team Member, will be hired on and trained for their appropriate positions within the
company. If in the case one of the management positions requires more than one person in the
position, the next lowest level of management team member will move up to help the higher
position. This will result in training of the next lower level person to move up a promotion level.
It is our plan to hire mostly University of Oklahoma students for the positions of Journey Leader
and Team Members. These employees will work mostly part time. It is because of this that these
employees will require no benefits, thus reducing our payroll burden.
Our team members will hold the following positions:
Position Team Member
Area Manager Devin Sauer
Market Training Manager Emily Steelman
General Manager Kayla Vankirk
Assistant Manager Xinyao Wang
Shift Manager Zhouyang Lin
Shift Manager London Graves
Job rankings within our franchise are as the follows:
12. 11
Team members will include positions such as cashier, server, dishwasher, cook, etc. Journey
leaders will have the same positions as the team members only they will have a little more
responsibility. These responsibilities will include being a mentor to the team members, helping
with training of new team members, and helping with the management team with a variety of
tasks. These positions will require no prior work experience. This is because we want to train our
employee the “Noodles” way and not have to fix old bad habits acquired elsewhere.
Salaries and Wages
Salaries and wages will depend on the position of the employee and their experience
background, but the average salaries and wages will look as follows:
Position Wages
Team Members $9/hour
Journey Leaders $10.50/hour
Shift Manager $22,500/ Year
Assistant Manager $36,000/ Year
General Manager $42,000/Year
Market Training Manager $58,000/ Year
Area Manager $71,500/Year
13. 12
Day-to-Day Operations
Promotion
Noodles & Company has a very strict market promotion policy. It requires a “Grand Opening
Marketing Program” for when restaurant is started. It would incur a minimum cost from $7,500
and further market promotion program after the “Grand Opening” (Noodles & Company). Please
see Appendix E for detailed of these requirements. Furthermore, Noodles & Company requires
all franchisees to spend at least 1.25% of net royalty sales on location promotion. For the purpose
of advertising and public relations, expenditures include spending for advertising media,
marketing of coupons, public relations to create goodwill, and enhancing public image and
community relations including events and sponsorships (Noodles & Company-Franchise
Disclosure Document Exchange). Please see Appendix F for a detailed description of marketing
expenses.
Production
Noodles & Company’s Menu Detail website emphasizes the importance of providing “real food
with real ingredients.” It requires all franchisees to sell all of the menu items designated as part
of its standard menu and provide all standard services designated. All products must be
purchased from designated suppliers. All other items must be purchased from approved suppliers
(Noodles & Company). Please see Appendix E.
Noodles & Company purchases different products from various supplier:
Products Suppliers/ Locations
Pasta Dakota Growers Pasta Company
Noodles Thailand
Beers Local Favorites
Cheese Self-Make
Vegetables Local
Personnel
Selection will be mainly processed through website. We will create an online hiring page which
contains the information for positions available and job descriptions. Moreover, we have
anticipated that lots of our staff members would be the current students of the University of
Oklahoma. Therefore, we have designed a hiring plan for peak season (school time) and off-peak
season (summer and winter).
No. of Staff member
Peak Season
14. 13
Off-peak Season
Noodles & Company requires their employees to attend specific training programs (Noodles &
Company-Franchise Disclosure Document Exchange). Please see Appendix G.
Customer Protocols
Noodles & Company holds for a general customer services call center, which receives complaint
calls from all the customers around the U.S. Within the store, Shift Managers will be taking care
of customer service issues on a daily basis.
All customer policy will be strictly performed according to Noodles & Company customer
service requirement. The aim for our store is to have zero complaints from customers and
provide the most welcomed environment to all the customers.
Administrative
General Manager will be handling daily administrative issues with assistance from Shift
Managers.
Bookkeeping
Financial and accounting transactions as well as record keeping will be handled by our team
members who have previous accounting experience. Most accounting data will be kept within
the computer system provided by Noodles & Company.
Legal Form of Business:
The legal form of business will be a Limited Liability Company and taxed on the corporate level.
In this way, “the owners do not pay personal income taxes on profits left in the company”
(Bplans Blog). Furthermore, it will allow unlimited number of owners and limited liability for
members.
15. 14
Financials
Selected financials are included below. For additional projection figures, please see Appendix (XX)
Monthly Cash Flows, Year 1
Balance Sheet, Year 1
17. 16
Funds Required
Fund required/used
· The financial plan depends on initial investment of $300,000. Six founders, who each
contribute $50,000 for the same amount of share, owned the company. Because this will not
cover start-up, requirements and we will establish a bank relationship as soon as possible. The
start-up funding amounts are shown in the table below.
Start-up funding
Start-up Expenses to fund $82,000
Start-up Asset to fund $661,667
Total funding required $743,667
Non-cash assets from start-up $660,167
Cash requirements from start-up $1,500
Additional cash raised $0
Cash balance on starting date $0
Total assets $651,667
Liabilities
Current Borrowing $0
Long-term Liabilities $443,667
Accounts Payable $0
Other current liabilities $0
Total Liabilities $443,667
Planned investment
Investor 1 $50,000
Investor 2 $50,000
Investor 3 $50,000
Investor 4 $50,000
Investor 5 $50,000
18. 17
Investor 6 $50,000
Additional Investment Requirement 0
Total Planned Investment $300,000
Start-up Expenses ($82,000)
Total Capacity $218,000
Total Capacity and liabilities $661,667
Total Funding $743,667
19. 18
Critical Risks
Tolerance Cost Strategy
-Supplier cuts or delays food
ingredients
Unacceptable .4 x .8 x 15
days= 4.8 day
delay
Mitigate/Avoid
-Fluctuations in employment Acceptable with 2 weeks’
notice from employee
.8 x .4 x 3 days=
.96 days delay
Accept
-Natural disaster hits Norman,
OK
Acceptable and
Unavoidable
.5 x .9 x
100,000=
$45,000 hit
Share with
insurance
-Construction in the area Accept for a few weeks
and work with city
council
.6 x .6 x 15
days= 5.4 day
delay
Accept
-Fluctuations of customers Accept .7 x .3 x 4 days=
.84 day delay
Accept
-Technology issues Unacceptable .5 x .8 x 6 days=
2.4 day delay
Mitigate/Avoid
-Competition Accept .9 x .4 x 3 days=
1.08 day delay
Accept
-Changes in tax or employment
regulations-if minimum wage
increases
Accept .3 x .7 x 2
days= .42 day
delay
Accept
-Food safety laws-chance of
food poisoning
Unacceptable .4 x .7 x 2 days=
.56 day delay
Avoid
20. 19
Appendix A
Five Forces Analysis
Figure 7: Forces driving competition in the restaurants industry in the United States, 2014
(MarketLine)
21. 20
Appendix B
PESTEL Analysis
POLITICAL Tax Policy:
Sales Tax Rate 8.25%
Social Security Tax 6.2%
Medicare Tax 1.45%
Income Taxes 6%
Oklahoma Use Tax 4.5%
1) levy on thepurchase price of tangible personalproperty, including pre-paid
transportation, purchased outsideOklahoma and stored, used, or otherwise
consumed within the state (Commission).
Stability of government: Stable
ECONOMIC Interest Rates:
Unemployment Rates: 3.7%
Median Household Income: $48,248
General State of Economy: Healthy (Federal Census)
SOCIAL Size: 117,528
Age:
Under 15: 16.6%
Age 15 to 24: 25.1%
Age 25 to 44: 25.2%
Age 45 to 64: 22.1%
Age 65 and Over: 10.3%
Ethnicity:
White: 90,583 81.1%
American Indian and Alaska Native: 4,238 3.8%
Black: 4,530 4.1%
Asian: 3,796 3.4%
Native Hawaiian and Other Pacific Islander: 179 0.2%
Two or MoreRaces: 7,239 6.5%
Other: 1,188 1.1%
Hispanic or Latino: 5,995 5.4% (Federal Census)
TECHNOLOGICAL Computerized technologies located at tables, front counter, and in kitchen
ENVIRONMENTAL Natural Disasters include: tornados, flooding, and high winds
LEGAL Health and Safety laws:A safe work environment is critical to providing excellent service and a
workplace that values thehealth of employees.
We conduct safety inspections of City operations to ensure compliance with Occupational
Safety and Health Administration (OSHA) standards and to identify unsafe work
conditions and practices.
We providesafety training to prevent employeeinjuries and property damage. Training
programs include hazard communication, fall protection, confined workspace, traffic
barricading, and proper useof personal protectiveequipment, etc. We also provide
consultative services to assist City operations with safety-related problems. This includes
regulation interpretation, work practice review, accident trend analysis, loss prevention
recommendations, etc.
We investigate vehicle and equipment accidents to determine cause and responsibility, and
make recommendations for corrective actions (McLendon)
29. 28
Works Cited
Bplans Blog. How Limitied Liability Companies(LLCS) are taxed. 13 December 2007. Website.
23 June 2015. <http://articles.bplans.com/how-limited-liability-companies-llcs-are-
taxed/>.
Commission, Oklahoma Tax. Oklahoma Business Tax Information. 08 08 2014. Web. 16 06
2015. <<http://www.ok.gov/tax/Businesses/Tax_Types/>>.
Federal Census. City of Norman Comprehensive Plan Norman. 2010. Website.
<http://www.ci.norman.ok.us/content/demographics>.
MarketLine. Forces Driving Competition in Restaurants Industry in the United States. 08 April
2015. Website. 16 June 2015.
<http://advantage.marketline.com/Product?pid=MLIP1590-0025&view=d0e500>.
McLendon, Brandon. City of Norman-HR Safety. 2015. Web.
<http://www.ci.norman.ok.us/hr/hr-safety>.
Noodles & Company. Estimated Initial Investment. n.d. Website. 23 June 2015.
<http://www.noodles.com/about/noodlesfranchisepacket.pdf>.
Noodles & Company-Franchise Disclosure Document Exchange. n.d. website. 23 June 2015.
<http://fddexchange.com/view-fdd-docs/noodles-company/>.
Noodles & Company-Restaurant Site Criteria. n.d. Website. 23 June 2015.
<http://www.noodles.com/about/noodlesfranchisepacket.pdf>.
Pei Wei. Who We Are. n.d. WEbsite. 23 June 2015. <http://www.peiwei.com/info/who-we-are>.
30. 29
The Henry J. Kaiser Family Foundation. Workers by Occupational Category. 2013. Website. 23
June 2015. <http://kff.org/other/state-indicator/blue-and-white-collar-workers/>.
United States Census Bureau. 2013. 23 June 2015.
<http://quickfacts.census.gov/qfd/states/40/4052500.html>.
