Candy Corner

Project Manager: Sukrit RajpalFinancial Analysist: Stephen Nestor

Promotional Strategist: Sujaay Jaganathan

Business Proposal

What’s the Issue?

• Prices at the servery rising• Students wanting lower prices• Students want better quality• Frozen products served at servery

Our Solution

• Open a new counter• Sell fresh baked goods with

better quality• Sell candy, large and small• Keep prices low

Where’s the Market

• North Park Secondary School• 1385 students• Commons Area• Service between lunch breaks

Supply and Demand: Small Candy Packs

$- $0.20 $0.40 $0.60 $0.80 0

200

400

600

800

1000

1200

SupplyDemand

Price ($)

Qua

ntity

Supply and Demand: Large Chocolate Bars

$0.70 $0.80 $0.90 $1.00 $1.10 $1.20 $1.30 $1.40 $1.50 $1.60 $1.70 0

2

4

6

8

10

12

SupplyDemand

Price ($)

Qua

ntity

Supply and Demand: Cookies and Muffins

$0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 $2.000

20

40

60

80

100

120

140

SupplyDemand

Price ($)

Qua

ntity

Estimated Consumer Demand

• Projected Demand per Dayo Small Treats – 30 unitso Large Chocolate Bar – 5 unitso Baked Goods

• Cookies – 6 units• Muffins – 2 units

Price

– Supply and Demand Based Price • $0.30 for small packs of candy• $ 1.25 for large chocolate bars• A range between $0.75 - $1.50 for baked

goods

– Recommended Price• $0.25 for small packs of candy• $ 1.25 for large chocolate bars• A range between $0.50 - $1.25 for baked

goods

Price Comparison

Item Candy Corner Servery Vending Machine

Small Pack of Candy $0.25 N/A N/A

Large Chocolate Bars

$1.25 N/A $1.50

Baked Goods• Cookies• Muffins

$0.50$1.25

$1.00$1.25

N/AN/A

Average Cost of Goods

Product Needed Price Vendor Quantity

95 Skittles and Starburst Pack

$9.95 Wal-Mart 1

Cadbury Fun Treats $10.97 Zellers 1

Farmer’s Market Fresh Cookies

$5.99 No Frills 1 (30 per container)

Farmer’s Market Fresh Muffins

$4.99 No Frills 1 (6)

Chocolate Bars $2.99 No Frills 1 (4 per pack

Expected Monthly Sales

ItemExpected

Units of Sale Per Month

Expected Selling Price per Unit

Expected Monthly Sales

Small Candy 30 X 20 = 600 $0.25 $150

Large Chocolate Bars 5 X 20 = 100 $1.25 $125

Baked Goods:• Cookies• Muffins

6 X 20 = 1202 X 20 = 40

$0.50$1.25

$60$50

Total Monthly Sales 860 $385

Expected Monthly Cost of Sales and Operating Cost

ItemExpected

Units of Sale Per Month

Expected Cost per Unit

Expected Monthly Cost

Small Candy 30 X 20 = 600 $0.10 $60.00

Large Chocolate Bars 5 X 20 = 100 $0.75 $75.00

Baked Goods:• Cookies• Muffins

6 X 20 = 1202 X 20 = 40

$0.20$0.83

$24.00$33.20

Total Monthly Cost 860 $192.20

Total Monthly Operating Cost – 25% of Monthly Cost

$48.05

Projected Monthly Profitability

Sales $385

Less: Cost of Sales $192.20

Gross Margin $192.80

Less: Operating Cost $48.05

Net Margin $144.75

Our Plan

• Buy weekly• Buy minimal baked goods• Buy fresh and quality products• Sell as quickly as possible• Create product differentiation

Our Competition

• Servery• Vending machines• Vendors in

neighbourhood

Projected Life Cycle

Product Life Cycle: Maintaining Business

• Introduce new goods• Periodically sell

specials• Systematic and

periodic surveys• Reassess situation

continuously

Recommendations: Product

• Small candy packs, large chocolate bars, cookies and muffins

• Emphasize quality and freshness• Hygienic condition

Recommendations: Place

• Commons Corner Store in North Park Secondary School

• Much of target in Commons Area

• In a crowd between:

– Period 3: 11:08am – 12:26 pm– Period 4: 12:26pm – 1:41 pm

Recommendations: Price

• Meets target consumer preference

• Lower than competitor prices

• Attract customers• Enforce other tactics

and goals

Recommendations: Promotion

• Small target• No need for large scale

promotion

• Promotional Strategies:– Announcements – Posters– Newsletter

Potential Challenges

• Garbage • Changing Customer Demand• Price Drop Competitor• Trained Professionals in Servery

Some Solutions

• Placards • Periodic surveys• Create product differentiation• Hire friendly, welcoming

employee• Special goods sold occasionally

Conclusion

• Meets consumer preferences• No or little competition • Profitable• Easy to manage• Minimal overheads• No wastage• Easy to change products