1 BUSINESS PLAN DECEMBER 2014 Prepared By: Kaleigh Reagan Chandni Panchal Aileen Pan Megan Negrich
Aug 16, 2015
1
BUSINESS PLAN
DECEMBER 2014
Prepared By
Kaleigh Reagan
Chandni Panchal
Aileen Pan
Megan Negrich
2
EXECUTIVE SUMMARY
Company
Go Nuts Donuts Cafeacute will strive to be the best local cafeacute and donut shop in the New
Stanton PA area Our objective is to become a leading competitor in the Coffee Snack Industry
We will accomplish our objective by provide a relaxing ecofriendly environment that will make
customers feel comfortable With a growing demand for gourmet coffee shops and outstanding
customer service we will capitalize on travelers locals local businesses and college students in
and around the area
Go Nuts Donuts Cafeacute mission statement is to provide high-quality personalized donuts
and beverages using green products We strive for customer satisfaction and achieve top notch
customer service by training our employees to the highest levels and establishing a solid
relationship with our clientele We aspire to develop our relationship with the community by
giving back to those in need
Target Market
Our major customer groups are college students and white collar workers who live in or
travel to New Stanton PA College students and local white collar workers tend to gravitate to
places that are convenient and provide a nice environment for studying or lunch breaks Our
local demographics suggest that we should target customers in the age group 22-49 Because our
location is located off three major highways the commuters most likely will be white-collar
workers college students or travelers
3
Operations
The company will operate in a 1100 square foot space that rents for $1314month At
the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members and two
managers one marketing director and one accountant Pending business growth we may add
additional employees later Our hours are 5am to 10pm on Monday through Thursday and on
Friday and Saturday we close at 11pm
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competitors are
the restaurants and fast food chains in and around New Stanton PA This includes places like
McDonalds Dunkinrsquo Donuts and Starbucks Our indirect competition would be the Keurig K-
Cups Go Nuts Donuts Cafeacutersquos strengths relative to its competition is that we offer a unique and
customizable product We also will be environmentally friendly which some of our competitors
are not Lastly with our organic donuts we offer a healthier alternative to other snacks in the
industry Some of our weaknesses relative to our competitors is that we are a small business with
no recognizable brand We also lack the convenience of a drive thru With our small market
share and competition with already established companies in this market we will have to stand
out from our competitors
Advertising
Our primary source of advertising will be direct mailing using Vista Print to reach the
New Stanton and Youngwood regions We will also purchase half page ads in Tribune Review
for 44 editions This will enhance our exposure in the Greensburg market We are relying on our
4
customers to communicate our quality products and excellent customer service through
Facebook Twitter and Instagram
Management
Go Nuts Donuts Cafeacute was founded by four upcoming graduates from the University of
Pittsburgh at Greensburg Each partner has a 20 share in the company We have selected
positions based on past experience and expertise Our management team will consist of Chandni
and Kaleigh handling day to day operations Aileen will be marketing director and will be
responsible for promoting and advertising Megan will be our accountant and will handle
financial reports including accounts payable federal tax forms and payroll
Financials
Ratios 2017 2016 2015
Degree of Operating Leverage 235 303 303
Break Even 2 3 3
Current Ratio 1138 624 421
Quick Ratio 1115 601 399
Inventory Turnover 2038 1910 1987
Total Asset Turnover 124 177 277
Debt Ratio 009 016 023
Gross Profit Margin 068 063 066
Operating Profit Margin 029 033 033
5
I COMPANY
Company Description
Go Nuts Donuts Cafeacute is part of the Snack and Nonalcoholic Beverage Bars (NCIS Code
722515) industry We will serve fresh customizable donuts and specialty gourmet coffees We
will be located in the Stanton House Center plaza on 111 Center Avenue New Stanton PA
15672 This is a high traffic area that is located off three major highways State Route 119 State
Route 70 and the PA turnpike It is within walking distance for some members of the
community and accessible by the Route 8 (GreensburgYoungwoodNew Stanton) bus of the
Westmoreland Transit Authority The business will be set up as an S-Corporation This will help
protect assets pass-through taxation tax favorable characterization of income straight forward
transfer of ownership and heightened credibility
Mission Statement
Our mission at Go Nuts Donuts Cafeacute is to provide high quality personalized donuts and
beverages using green products We strive for customer satisfaction and achieve top notch
customer service by training our employees to the highest levels and establishing a solid
relationship with our clientele We aspire to develop our relationship with the community by
giving back to those in need
Objective To become a leading competitor in the Coffee Snack Industry
Logo Pink Green Yellow and Blue
6
Marketing Strategy
We will accomplish our goal by creating and maintaining customer relationships within
the community We plan to listen and cater to our customer needs we understand that every
customer has distinct taste and they may like some toppings but not others We also will be
generous to our loyal customer base and treat them well Most importantly we will strive to keep
our employees happy in a fun and safe environment We at Go Donuts Cafeacute understand that
happy employees are productive employees and their productivity benefits the employees
Slogan Premium coffee and donuts done your way
7
II INDUSTRY MARKET ANALYSIS
Coffee Industry
Prior to the 1960s Americans purchased coffee from grocery stores and brewed it at
home In the late 1960s entrepreneurs opened coffee shops carrying hard to find blends of
gourmet coffee During the 1980s the demand for flavored coffee caused producers to add
different flavors to the coffee beans This attracted a younger customer base In 2010 it was the
worldrsquos second most traded commodity to oil The Specialty Coffee Association of America
estimated the United States coffee market was worth more than $30 billion in 2013 The United
States was also named the leader in coffee consumption (Specialty Coffees)
The United States has shown steady growth in gourmet coffee Coffee consumption is
universal throughout different income categories Specialty coffee is a billion dollar industry and
itrsquos expected to grow 31 percent per year over the next 5 years About 52 million Americans
drink coffee and on average they consume about 23 gallons a year (Business Global Insights)
Projected Industry Outlook
Over the years coffee has become an increasingly desired beverage for many consumers
Even with the threat of coffee shortages due to severe weather conditions the industry is still
expected to grow With the economy in recovery it is an ideal situation for consumers to be able
to spend their money on more luxury products such as higher quality gourmet coffee Their
ldquospending is expected to increase 28 percent per yearrdquo over a five-year period until 2019
(IBISWorld) After all coffee is no longer just ldquoa shot of caffeinerdquo every morning to fill a
physiological need (USA TODAY) Coffee has become an epicurean past time with gourmet
coffee in the front of the line ldquoIts a $30 billion-a-year national industry a foodie fixation an
8
affordable luxury a boost of disease-fighting antioxidants a versatile ingredient an intoxicating
aroma and a beverage that brings people togetherrdquo (USA TODAY) Joe DeRupo the National
Coffee Association president describes coffee as part beverage and another part pop culture that
will not be going away anytime soon According to IBISWorld ldquothe industryrsquos recent growth is
expected to continue over the next five years to 2019rdquo As a result ldquorevenue is projected to rise
at an average of 38 percent to $364 billion during the five year periodrdquo (IBISWorld)
Industry Trends
Single cup brewing systems are becoming more popular within coffee shops They
provide a better variety than just brewing one blend they are great for convenience and
freshness These systems can also keep costs down by brewing only the amount of coffee
necessary for each sale
Specialty (gourmet) drinks are on the rise by 34 percent in 2014 a 31 percent increase
from 2013 according to the NCA (Daily Coffee News) The ldquoconsumption was found to be
highest among those between the ages of 25-29 (42 percent) second highest among the 18-24
and 40-59 demographics (about one third) and lowest among 60-plus-year-oldsrdquo (Daily Coffee
News) One of the leading gourmet coffee types is specialty espresso which saw a 5 percent rise
in consumption from 13 percent in 2013 to 18 percent in 2014 Over 30 million Americans drink
specialty espresso daily While gourmet coffee consumption is increasing regular non-gourmet
coffee consumption decreased by four points to 35 percent (Daily Coffee News) This change
is a result of the aging millennial population A spokesperson for the Thompson Rueters
Corporation points out that millennials are willing to spend more on coffee because they are
feeling better about their financesrdquo (Whole Lattee Love Community) The millennial and
previous generations are also educated or becoming educated about where the coffee beans are
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
2
EXECUTIVE SUMMARY
Company
Go Nuts Donuts Cafeacute will strive to be the best local cafeacute and donut shop in the New
Stanton PA area Our objective is to become a leading competitor in the Coffee Snack Industry
We will accomplish our objective by provide a relaxing ecofriendly environment that will make
customers feel comfortable With a growing demand for gourmet coffee shops and outstanding
customer service we will capitalize on travelers locals local businesses and college students in
and around the area
Go Nuts Donuts Cafeacute mission statement is to provide high-quality personalized donuts
and beverages using green products We strive for customer satisfaction and achieve top notch
customer service by training our employees to the highest levels and establishing a solid
relationship with our clientele We aspire to develop our relationship with the community by
giving back to those in need
Target Market
Our major customer groups are college students and white collar workers who live in or
travel to New Stanton PA College students and local white collar workers tend to gravitate to
places that are convenient and provide a nice environment for studying or lunch breaks Our
local demographics suggest that we should target customers in the age group 22-49 Because our
location is located off three major highways the commuters most likely will be white-collar
workers college students or travelers
3
Operations
The company will operate in a 1100 square foot space that rents for $1314month At
the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members and two
managers one marketing director and one accountant Pending business growth we may add
additional employees later Our hours are 5am to 10pm on Monday through Thursday and on
Friday and Saturday we close at 11pm
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competitors are
the restaurants and fast food chains in and around New Stanton PA This includes places like
McDonalds Dunkinrsquo Donuts and Starbucks Our indirect competition would be the Keurig K-
Cups Go Nuts Donuts Cafeacutersquos strengths relative to its competition is that we offer a unique and
customizable product We also will be environmentally friendly which some of our competitors
are not Lastly with our organic donuts we offer a healthier alternative to other snacks in the
industry Some of our weaknesses relative to our competitors is that we are a small business with
no recognizable brand We also lack the convenience of a drive thru With our small market
share and competition with already established companies in this market we will have to stand
out from our competitors
Advertising
Our primary source of advertising will be direct mailing using Vista Print to reach the
New Stanton and Youngwood regions We will also purchase half page ads in Tribune Review
for 44 editions This will enhance our exposure in the Greensburg market We are relying on our
4
customers to communicate our quality products and excellent customer service through
Facebook Twitter and Instagram
Management
Go Nuts Donuts Cafeacute was founded by four upcoming graduates from the University of
Pittsburgh at Greensburg Each partner has a 20 share in the company We have selected
positions based on past experience and expertise Our management team will consist of Chandni
and Kaleigh handling day to day operations Aileen will be marketing director and will be
responsible for promoting and advertising Megan will be our accountant and will handle
financial reports including accounts payable federal tax forms and payroll
Financials
Ratios 2017 2016 2015
Degree of Operating Leverage 235 303 303
Break Even 2 3 3
Current Ratio 1138 624 421
Quick Ratio 1115 601 399
Inventory Turnover 2038 1910 1987
Total Asset Turnover 124 177 277
Debt Ratio 009 016 023
Gross Profit Margin 068 063 066
Operating Profit Margin 029 033 033
5
I COMPANY
Company Description
Go Nuts Donuts Cafeacute is part of the Snack and Nonalcoholic Beverage Bars (NCIS Code
722515) industry We will serve fresh customizable donuts and specialty gourmet coffees We
will be located in the Stanton House Center plaza on 111 Center Avenue New Stanton PA
15672 This is a high traffic area that is located off three major highways State Route 119 State
Route 70 and the PA turnpike It is within walking distance for some members of the
community and accessible by the Route 8 (GreensburgYoungwoodNew Stanton) bus of the
Westmoreland Transit Authority The business will be set up as an S-Corporation This will help
protect assets pass-through taxation tax favorable characterization of income straight forward
transfer of ownership and heightened credibility
Mission Statement
Our mission at Go Nuts Donuts Cafeacute is to provide high quality personalized donuts and
beverages using green products We strive for customer satisfaction and achieve top notch
customer service by training our employees to the highest levels and establishing a solid
relationship with our clientele We aspire to develop our relationship with the community by
giving back to those in need
Objective To become a leading competitor in the Coffee Snack Industry
Logo Pink Green Yellow and Blue
6
Marketing Strategy
We will accomplish our goal by creating and maintaining customer relationships within
the community We plan to listen and cater to our customer needs we understand that every
customer has distinct taste and they may like some toppings but not others We also will be
generous to our loyal customer base and treat them well Most importantly we will strive to keep
our employees happy in a fun and safe environment We at Go Donuts Cafeacute understand that
happy employees are productive employees and their productivity benefits the employees
Slogan Premium coffee and donuts done your way
7
II INDUSTRY MARKET ANALYSIS
Coffee Industry
Prior to the 1960s Americans purchased coffee from grocery stores and brewed it at
home In the late 1960s entrepreneurs opened coffee shops carrying hard to find blends of
gourmet coffee During the 1980s the demand for flavored coffee caused producers to add
different flavors to the coffee beans This attracted a younger customer base In 2010 it was the
worldrsquos second most traded commodity to oil The Specialty Coffee Association of America
estimated the United States coffee market was worth more than $30 billion in 2013 The United
States was also named the leader in coffee consumption (Specialty Coffees)
The United States has shown steady growth in gourmet coffee Coffee consumption is
universal throughout different income categories Specialty coffee is a billion dollar industry and
itrsquos expected to grow 31 percent per year over the next 5 years About 52 million Americans
drink coffee and on average they consume about 23 gallons a year (Business Global Insights)
Projected Industry Outlook
Over the years coffee has become an increasingly desired beverage for many consumers
Even with the threat of coffee shortages due to severe weather conditions the industry is still
expected to grow With the economy in recovery it is an ideal situation for consumers to be able
to spend their money on more luxury products such as higher quality gourmet coffee Their
ldquospending is expected to increase 28 percent per yearrdquo over a five-year period until 2019
(IBISWorld) After all coffee is no longer just ldquoa shot of caffeinerdquo every morning to fill a
physiological need (USA TODAY) Coffee has become an epicurean past time with gourmet
coffee in the front of the line ldquoIts a $30 billion-a-year national industry a foodie fixation an
8
affordable luxury a boost of disease-fighting antioxidants a versatile ingredient an intoxicating
aroma and a beverage that brings people togetherrdquo (USA TODAY) Joe DeRupo the National
Coffee Association president describes coffee as part beverage and another part pop culture that
will not be going away anytime soon According to IBISWorld ldquothe industryrsquos recent growth is
expected to continue over the next five years to 2019rdquo As a result ldquorevenue is projected to rise
at an average of 38 percent to $364 billion during the five year periodrdquo (IBISWorld)
Industry Trends
Single cup brewing systems are becoming more popular within coffee shops They
provide a better variety than just brewing one blend they are great for convenience and
freshness These systems can also keep costs down by brewing only the amount of coffee
necessary for each sale
Specialty (gourmet) drinks are on the rise by 34 percent in 2014 a 31 percent increase
from 2013 according to the NCA (Daily Coffee News) The ldquoconsumption was found to be
highest among those between the ages of 25-29 (42 percent) second highest among the 18-24
and 40-59 demographics (about one third) and lowest among 60-plus-year-oldsrdquo (Daily Coffee
News) One of the leading gourmet coffee types is specialty espresso which saw a 5 percent rise
in consumption from 13 percent in 2013 to 18 percent in 2014 Over 30 million Americans drink
specialty espresso daily While gourmet coffee consumption is increasing regular non-gourmet
coffee consumption decreased by four points to 35 percent (Daily Coffee News) This change
is a result of the aging millennial population A spokesperson for the Thompson Rueters
Corporation points out that millennials are willing to spend more on coffee because they are
feeling better about their financesrdquo (Whole Lattee Love Community) The millennial and
previous generations are also educated or becoming educated about where the coffee beans are
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
3
Operations
The company will operate in a 1100 square foot space that rents for $1314month At
the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members and two
managers one marketing director and one accountant Pending business growth we may add
additional employees later Our hours are 5am to 10pm on Monday through Thursday and on
Friday and Saturday we close at 11pm
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competitors are
the restaurants and fast food chains in and around New Stanton PA This includes places like
McDonalds Dunkinrsquo Donuts and Starbucks Our indirect competition would be the Keurig K-
Cups Go Nuts Donuts Cafeacutersquos strengths relative to its competition is that we offer a unique and
customizable product We also will be environmentally friendly which some of our competitors
are not Lastly with our organic donuts we offer a healthier alternative to other snacks in the
industry Some of our weaknesses relative to our competitors is that we are a small business with
no recognizable brand We also lack the convenience of a drive thru With our small market
share and competition with already established companies in this market we will have to stand
out from our competitors
Advertising
Our primary source of advertising will be direct mailing using Vista Print to reach the
New Stanton and Youngwood regions We will also purchase half page ads in Tribune Review
for 44 editions This will enhance our exposure in the Greensburg market We are relying on our
4
customers to communicate our quality products and excellent customer service through
Facebook Twitter and Instagram
Management
Go Nuts Donuts Cafeacute was founded by four upcoming graduates from the University of
Pittsburgh at Greensburg Each partner has a 20 share in the company We have selected
positions based on past experience and expertise Our management team will consist of Chandni
and Kaleigh handling day to day operations Aileen will be marketing director and will be
responsible for promoting and advertising Megan will be our accountant and will handle
financial reports including accounts payable federal tax forms and payroll
Financials
Ratios 2017 2016 2015
Degree of Operating Leverage 235 303 303
Break Even 2 3 3
Current Ratio 1138 624 421
Quick Ratio 1115 601 399
Inventory Turnover 2038 1910 1987
Total Asset Turnover 124 177 277
Debt Ratio 009 016 023
Gross Profit Margin 068 063 066
Operating Profit Margin 029 033 033
5
I COMPANY
Company Description
Go Nuts Donuts Cafeacute is part of the Snack and Nonalcoholic Beverage Bars (NCIS Code
722515) industry We will serve fresh customizable donuts and specialty gourmet coffees We
will be located in the Stanton House Center plaza on 111 Center Avenue New Stanton PA
15672 This is a high traffic area that is located off three major highways State Route 119 State
Route 70 and the PA turnpike It is within walking distance for some members of the
community and accessible by the Route 8 (GreensburgYoungwoodNew Stanton) bus of the
Westmoreland Transit Authority The business will be set up as an S-Corporation This will help
protect assets pass-through taxation tax favorable characterization of income straight forward
transfer of ownership and heightened credibility
Mission Statement
Our mission at Go Nuts Donuts Cafeacute is to provide high quality personalized donuts and
beverages using green products We strive for customer satisfaction and achieve top notch
customer service by training our employees to the highest levels and establishing a solid
relationship with our clientele We aspire to develop our relationship with the community by
giving back to those in need
Objective To become a leading competitor in the Coffee Snack Industry
Logo Pink Green Yellow and Blue
6
Marketing Strategy
We will accomplish our goal by creating and maintaining customer relationships within
the community We plan to listen and cater to our customer needs we understand that every
customer has distinct taste and they may like some toppings but not others We also will be
generous to our loyal customer base and treat them well Most importantly we will strive to keep
our employees happy in a fun and safe environment We at Go Donuts Cafeacute understand that
happy employees are productive employees and their productivity benefits the employees
Slogan Premium coffee and donuts done your way
7
II INDUSTRY MARKET ANALYSIS
Coffee Industry
Prior to the 1960s Americans purchased coffee from grocery stores and brewed it at
home In the late 1960s entrepreneurs opened coffee shops carrying hard to find blends of
gourmet coffee During the 1980s the demand for flavored coffee caused producers to add
different flavors to the coffee beans This attracted a younger customer base In 2010 it was the
worldrsquos second most traded commodity to oil The Specialty Coffee Association of America
estimated the United States coffee market was worth more than $30 billion in 2013 The United
States was also named the leader in coffee consumption (Specialty Coffees)
The United States has shown steady growth in gourmet coffee Coffee consumption is
universal throughout different income categories Specialty coffee is a billion dollar industry and
itrsquos expected to grow 31 percent per year over the next 5 years About 52 million Americans
drink coffee and on average they consume about 23 gallons a year (Business Global Insights)
Projected Industry Outlook
Over the years coffee has become an increasingly desired beverage for many consumers
Even with the threat of coffee shortages due to severe weather conditions the industry is still
expected to grow With the economy in recovery it is an ideal situation for consumers to be able
to spend their money on more luxury products such as higher quality gourmet coffee Their
ldquospending is expected to increase 28 percent per yearrdquo over a five-year period until 2019
(IBISWorld) After all coffee is no longer just ldquoa shot of caffeinerdquo every morning to fill a
physiological need (USA TODAY) Coffee has become an epicurean past time with gourmet
coffee in the front of the line ldquoIts a $30 billion-a-year national industry a foodie fixation an
8
affordable luxury a boost of disease-fighting antioxidants a versatile ingredient an intoxicating
aroma and a beverage that brings people togetherrdquo (USA TODAY) Joe DeRupo the National
Coffee Association president describes coffee as part beverage and another part pop culture that
will not be going away anytime soon According to IBISWorld ldquothe industryrsquos recent growth is
expected to continue over the next five years to 2019rdquo As a result ldquorevenue is projected to rise
at an average of 38 percent to $364 billion during the five year periodrdquo (IBISWorld)
Industry Trends
Single cup brewing systems are becoming more popular within coffee shops They
provide a better variety than just brewing one blend they are great for convenience and
freshness These systems can also keep costs down by brewing only the amount of coffee
necessary for each sale
Specialty (gourmet) drinks are on the rise by 34 percent in 2014 a 31 percent increase
from 2013 according to the NCA (Daily Coffee News) The ldquoconsumption was found to be
highest among those between the ages of 25-29 (42 percent) second highest among the 18-24
and 40-59 demographics (about one third) and lowest among 60-plus-year-oldsrdquo (Daily Coffee
News) One of the leading gourmet coffee types is specialty espresso which saw a 5 percent rise
in consumption from 13 percent in 2013 to 18 percent in 2014 Over 30 million Americans drink
specialty espresso daily While gourmet coffee consumption is increasing regular non-gourmet
coffee consumption decreased by four points to 35 percent (Daily Coffee News) This change
is a result of the aging millennial population A spokesperson for the Thompson Rueters
Corporation points out that millennials are willing to spend more on coffee because they are
feeling better about their financesrdquo (Whole Lattee Love Community) The millennial and
previous generations are also educated or becoming educated about where the coffee beans are
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
4
customers to communicate our quality products and excellent customer service through
Facebook Twitter and Instagram
Management
Go Nuts Donuts Cafeacute was founded by four upcoming graduates from the University of
Pittsburgh at Greensburg Each partner has a 20 share in the company We have selected
positions based on past experience and expertise Our management team will consist of Chandni
and Kaleigh handling day to day operations Aileen will be marketing director and will be
responsible for promoting and advertising Megan will be our accountant and will handle
financial reports including accounts payable federal tax forms and payroll
Financials
Ratios 2017 2016 2015
Degree of Operating Leverage 235 303 303
Break Even 2 3 3
Current Ratio 1138 624 421
Quick Ratio 1115 601 399
Inventory Turnover 2038 1910 1987
Total Asset Turnover 124 177 277
Debt Ratio 009 016 023
Gross Profit Margin 068 063 066
Operating Profit Margin 029 033 033
5
I COMPANY
Company Description
Go Nuts Donuts Cafeacute is part of the Snack and Nonalcoholic Beverage Bars (NCIS Code
722515) industry We will serve fresh customizable donuts and specialty gourmet coffees We
will be located in the Stanton House Center plaza on 111 Center Avenue New Stanton PA
15672 This is a high traffic area that is located off three major highways State Route 119 State
Route 70 and the PA turnpike It is within walking distance for some members of the
community and accessible by the Route 8 (GreensburgYoungwoodNew Stanton) bus of the
Westmoreland Transit Authority The business will be set up as an S-Corporation This will help
protect assets pass-through taxation tax favorable characterization of income straight forward
transfer of ownership and heightened credibility
Mission Statement
Our mission at Go Nuts Donuts Cafeacute is to provide high quality personalized donuts and
beverages using green products We strive for customer satisfaction and achieve top notch
customer service by training our employees to the highest levels and establishing a solid
relationship with our clientele We aspire to develop our relationship with the community by
giving back to those in need
Objective To become a leading competitor in the Coffee Snack Industry
Logo Pink Green Yellow and Blue
6
Marketing Strategy
We will accomplish our goal by creating and maintaining customer relationships within
the community We plan to listen and cater to our customer needs we understand that every
customer has distinct taste and they may like some toppings but not others We also will be
generous to our loyal customer base and treat them well Most importantly we will strive to keep
our employees happy in a fun and safe environment We at Go Donuts Cafeacute understand that
happy employees are productive employees and their productivity benefits the employees
Slogan Premium coffee and donuts done your way
7
II INDUSTRY MARKET ANALYSIS
Coffee Industry
Prior to the 1960s Americans purchased coffee from grocery stores and brewed it at
home In the late 1960s entrepreneurs opened coffee shops carrying hard to find blends of
gourmet coffee During the 1980s the demand for flavored coffee caused producers to add
different flavors to the coffee beans This attracted a younger customer base In 2010 it was the
worldrsquos second most traded commodity to oil The Specialty Coffee Association of America
estimated the United States coffee market was worth more than $30 billion in 2013 The United
States was also named the leader in coffee consumption (Specialty Coffees)
The United States has shown steady growth in gourmet coffee Coffee consumption is
universal throughout different income categories Specialty coffee is a billion dollar industry and
itrsquos expected to grow 31 percent per year over the next 5 years About 52 million Americans
drink coffee and on average they consume about 23 gallons a year (Business Global Insights)
Projected Industry Outlook
Over the years coffee has become an increasingly desired beverage for many consumers
Even with the threat of coffee shortages due to severe weather conditions the industry is still
expected to grow With the economy in recovery it is an ideal situation for consumers to be able
to spend their money on more luxury products such as higher quality gourmet coffee Their
ldquospending is expected to increase 28 percent per yearrdquo over a five-year period until 2019
(IBISWorld) After all coffee is no longer just ldquoa shot of caffeinerdquo every morning to fill a
physiological need (USA TODAY) Coffee has become an epicurean past time with gourmet
coffee in the front of the line ldquoIts a $30 billion-a-year national industry a foodie fixation an
8
affordable luxury a boost of disease-fighting antioxidants a versatile ingredient an intoxicating
aroma and a beverage that brings people togetherrdquo (USA TODAY) Joe DeRupo the National
Coffee Association president describes coffee as part beverage and another part pop culture that
will not be going away anytime soon According to IBISWorld ldquothe industryrsquos recent growth is
expected to continue over the next five years to 2019rdquo As a result ldquorevenue is projected to rise
at an average of 38 percent to $364 billion during the five year periodrdquo (IBISWorld)
Industry Trends
Single cup brewing systems are becoming more popular within coffee shops They
provide a better variety than just brewing one blend they are great for convenience and
freshness These systems can also keep costs down by brewing only the amount of coffee
necessary for each sale
Specialty (gourmet) drinks are on the rise by 34 percent in 2014 a 31 percent increase
from 2013 according to the NCA (Daily Coffee News) The ldquoconsumption was found to be
highest among those between the ages of 25-29 (42 percent) second highest among the 18-24
and 40-59 demographics (about one third) and lowest among 60-plus-year-oldsrdquo (Daily Coffee
News) One of the leading gourmet coffee types is specialty espresso which saw a 5 percent rise
in consumption from 13 percent in 2013 to 18 percent in 2014 Over 30 million Americans drink
specialty espresso daily While gourmet coffee consumption is increasing regular non-gourmet
coffee consumption decreased by four points to 35 percent (Daily Coffee News) This change
is a result of the aging millennial population A spokesperson for the Thompson Rueters
Corporation points out that millennials are willing to spend more on coffee because they are
feeling better about their financesrdquo (Whole Lattee Love Community) The millennial and
previous generations are also educated or becoming educated about where the coffee beans are
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
5
I COMPANY
Company Description
Go Nuts Donuts Cafeacute is part of the Snack and Nonalcoholic Beverage Bars (NCIS Code
722515) industry We will serve fresh customizable donuts and specialty gourmet coffees We
will be located in the Stanton House Center plaza on 111 Center Avenue New Stanton PA
15672 This is a high traffic area that is located off three major highways State Route 119 State
Route 70 and the PA turnpike It is within walking distance for some members of the
community and accessible by the Route 8 (GreensburgYoungwoodNew Stanton) bus of the
Westmoreland Transit Authority The business will be set up as an S-Corporation This will help
protect assets pass-through taxation tax favorable characterization of income straight forward
transfer of ownership and heightened credibility
Mission Statement
Our mission at Go Nuts Donuts Cafeacute is to provide high quality personalized donuts and
beverages using green products We strive for customer satisfaction and achieve top notch
customer service by training our employees to the highest levels and establishing a solid
relationship with our clientele We aspire to develop our relationship with the community by
giving back to those in need
Objective To become a leading competitor in the Coffee Snack Industry
Logo Pink Green Yellow and Blue
6
Marketing Strategy
We will accomplish our goal by creating and maintaining customer relationships within
the community We plan to listen and cater to our customer needs we understand that every
customer has distinct taste and they may like some toppings but not others We also will be
generous to our loyal customer base and treat them well Most importantly we will strive to keep
our employees happy in a fun and safe environment We at Go Donuts Cafeacute understand that
happy employees are productive employees and their productivity benefits the employees
Slogan Premium coffee and donuts done your way
7
II INDUSTRY MARKET ANALYSIS
Coffee Industry
Prior to the 1960s Americans purchased coffee from grocery stores and brewed it at
home In the late 1960s entrepreneurs opened coffee shops carrying hard to find blends of
gourmet coffee During the 1980s the demand for flavored coffee caused producers to add
different flavors to the coffee beans This attracted a younger customer base In 2010 it was the
worldrsquos second most traded commodity to oil The Specialty Coffee Association of America
estimated the United States coffee market was worth more than $30 billion in 2013 The United
States was also named the leader in coffee consumption (Specialty Coffees)
The United States has shown steady growth in gourmet coffee Coffee consumption is
universal throughout different income categories Specialty coffee is a billion dollar industry and
itrsquos expected to grow 31 percent per year over the next 5 years About 52 million Americans
drink coffee and on average they consume about 23 gallons a year (Business Global Insights)
Projected Industry Outlook
Over the years coffee has become an increasingly desired beverage for many consumers
Even with the threat of coffee shortages due to severe weather conditions the industry is still
expected to grow With the economy in recovery it is an ideal situation for consumers to be able
to spend their money on more luxury products such as higher quality gourmet coffee Their
ldquospending is expected to increase 28 percent per yearrdquo over a five-year period until 2019
(IBISWorld) After all coffee is no longer just ldquoa shot of caffeinerdquo every morning to fill a
physiological need (USA TODAY) Coffee has become an epicurean past time with gourmet
coffee in the front of the line ldquoIts a $30 billion-a-year national industry a foodie fixation an
8
affordable luxury a boost of disease-fighting antioxidants a versatile ingredient an intoxicating
aroma and a beverage that brings people togetherrdquo (USA TODAY) Joe DeRupo the National
Coffee Association president describes coffee as part beverage and another part pop culture that
will not be going away anytime soon According to IBISWorld ldquothe industryrsquos recent growth is
expected to continue over the next five years to 2019rdquo As a result ldquorevenue is projected to rise
at an average of 38 percent to $364 billion during the five year periodrdquo (IBISWorld)
Industry Trends
Single cup brewing systems are becoming more popular within coffee shops They
provide a better variety than just brewing one blend they are great for convenience and
freshness These systems can also keep costs down by brewing only the amount of coffee
necessary for each sale
Specialty (gourmet) drinks are on the rise by 34 percent in 2014 a 31 percent increase
from 2013 according to the NCA (Daily Coffee News) The ldquoconsumption was found to be
highest among those between the ages of 25-29 (42 percent) second highest among the 18-24
and 40-59 demographics (about one third) and lowest among 60-plus-year-oldsrdquo (Daily Coffee
News) One of the leading gourmet coffee types is specialty espresso which saw a 5 percent rise
in consumption from 13 percent in 2013 to 18 percent in 2014 Over 30 million Americans drink
specialty espresso daily While gourmet coffee consumption is increasing regular non-gourmet
coffee consumption decreased by four points to 35 percent (Daily Coffee News) This change
is a result of the aging millennial population A spokesperson for the Thompson Rueters
Corporation points out that millennials are willing to spend more on coffee because they are
feeling better about their financesrdquo (Whole Lattee Love Community) The millennial and
previous generations are also educated or becoming educated about where the coffee beans are
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
6
Marketing Strategy
We will accomplish our goal by creating and maintaining customer relationships within
the community We plan to listen and cater to our customer needs we understand that every
customer has distinct taste and they may like some toppings but not others We also will be
generous to our loyal customer base and treat them well Most importantly we will strive to keep
our employees happy in a fun and safe environment We at Go Donuts Cafeacute understand that
happy employees are productive employees and their productivity benefits the employees
Slogan Premium coffee and donuts done your way
7
II INDUSTRY MARKET ANALYSIS
Coffee Industry
Prior to the 1960s Americans purchased coffee from grocery stores and brewed it at
home In the late 1960s entrepreneurs opened coffee shops carrying hard to find blends of
gourmet coffee During the 1980s the demand for flavored coffee caused producers to add
different flavors to the coffee beans This attracted a younger customer base In 2010 it was the
worldrsquos second most traded commodity to oil The Specialty Coffee Association of America
estimated the United States coffee market was worth more than $30 billion in 2013 The United
States was also named the leader in coffee consumption (Specialty Coffees)
The United States has shown steady growth in gourmet coffee Coffee consumption is
universal throughout different income categories Specialty coffee is a billion dollar industry and
itrsquos expected to grow 31 percent per year over the next 5 years About 52 million Americans
drink coffee and on average they consume about 23 gallons a year (Business Global Insights)
Projected Industry Outlook
Over the years coffee has become an increasingly desired beverage for many consumers
Even with the threat of coffee shortages due to severe weather conditions the industry is still
expected to grow With the economy in recovery it is an ideal situation for consumers to be able
to spend their money on more luxury products such as higher quality gourmet coffee Their
ldquospending is expected to increase 28 percent per yearrdquo over a five-year period until 2019
(IBISWorld) After all coffee is no longer just ldquoa shot of caffeinerdquo every morning to fill a
physiological need (USA TODAY) Coffee has become an epicurean past time with gourmet
coffee in the front of the line ldquoIts a $30 billion-a-year national industry a foodie fixation an
8
affordable luxury a boost of disease-fighting antioxidants a versatile ingredient an intoxicating
aroma and a beverage that brings people togetherrdquo (USA TODAY) Joe DeRupo the National
Coffee Association president describes coffee as part beverage and another part pop culture that
will not be going away anytime soon According to IBISWorld ldquothe industryrsquos recent growth is
expected to continue over the next five years to 2019rdquo As a result ldquorevenue is projected to rise
at an average of 38 percent to $364 billion during the five year periodrdquo (IBISWorld)
Industry Trends
Single cup brewing systems are becoming more popular within coffee shops They
provide a better variety than just brewing one blend they are great for convenience and
freshness These systems can also keep costs down by brewing only the amount of coffee
necessary for each sale
Specialty (gourmet) drinks are on the rise by 34 percent in 2014 a 31 percent increase
from 2013 according to the NCA (Daily Coffee News) The ldquoconsumption was found to be
highest among those between the ages of 25-29 (42 percent) second highest among the 18-24
and 40-59 demographics (about one third) and lowest among 60-plus-year-oldsrdquo (Daily Coffee
News) One of the leading gourmet coffee types is specialty espresso which saw a 5 percent rise
in consumption from 13 percent in 2013 to 18 percent in 2014 Over 30 million Americans drink
specialty espresso daily While gourmet coffee consumption is increasing regular non-gourmet
coffee consumption decreased by four points to 35 percent (Daily Coffee News) This change
is a result of the aging millennial population A spokesperson for the Thompson Rueters
Corporation points out that millennials are willing to spend more on coffee because they are
feeling better about their financesrdquo (Whole Lattee Love Community) The millennial and
previous generations are also educated or becoming educated about where the coffee beans are
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
7
II INDUSTRY MARKET ANALYSIS
Coffee Industry
Prior to the 1960s Americans purchased coffee from grocery stores and brewed it at
home In the late 1960s entrepreneurs opened coffee shops carrying hard to find blends of
gourmet coffee During the 1980s the demand for flavored coffee caused producers to add
different flavors to the coffee beans This attracted a younger customer base In 2010 it was the
worldrsquos second most traded commodity to oil The Specialty Coffee Association of America
estimated the United States coffee market was worth more than $30 billion in 2013 The United
States was also named the leader in coffee consumption (Specialty Coffees)
The United States has shown steady growth in gourmet coffee Coffee consumption is
universal throughout different income categories Specialty coffee is a billion dollar industry and
itrsquos expected to grow 31 percent per year over the next 5 years About 52 million Americans
drink coffee and on average they consume about 23 gallons a year (Business Global Insights)
Projected Industry Outlook
Over the years coffee has become an increasingly desired beverage for many consumers
Even with the threat of coffee shortages due to severe weather conditions the industry is still
expected to grow With the economy in recovery it is an ideal situation for consumers to be able
to spend their money on more luxury products such as higher quality gourmet coffee Their
ldquospending is expected to increase 28 percent per yearrdquo over a five-year period until 2019
(IBISWorld) After all coffee is no longer just ldquoa shot of caffeinerdquo every morning to fill a
physiological need (USA TODAY) Coffee has become an epicurean past time with gourmet
coffee in the front of the line ldquoIts a $30 billion-a-year national industry a foodie fixation an
8
affordable luxury a boost of disease-fighting antioxidants a versatile ingredient an intoxicating
aroma and a beverage that brings people togetherrdquo (USA TODAY) Joe DeRupo the National
Coffee Association president describes coffee as part beverage and another part pop culture that
will not be going away anytime soon According to IBISWorld ldquothe industryrsquos recent growth is
expected to continue over the next five years to 2019rdquo As a result ldquorevenue is projected to rise
at an average of 38 percent to $364 billion during the five year periodrdquo (IBISWorld)
Industry Trends
Single cup brewing systems are becoming more popular within coffee shops They
provide a better variety than just brewing one blend they are great for convenience and
freshness These systems can also keep costs down by brewing only the amount of coffee
necessary for each sale
Specialty (gourmet) drinks are on the rise by 34 percent in 2014 a 31 percent increase
from 2013 according to the NCA (Daily Coffee News) The ldquoconsumption was found to be
highest among those between the ages of 25-29 (42 percent) second highest among the 18-24
and 40-59 demographics (about one third) and lowest among 60-plus-year-oldsrdquo (Daily Coffee
News) One of the leading gourmet coffee types is specialty espresso which saw a 5 percent rise
in consumption from 13 percent in 2013 to 18 percent in 2014 Over 30 million Americans drink
specialty espresso daily While gourmet coffee consumption is increasing regular non-gourmet
coffee consumption decreased by four points to 35 percent (Daily Coffee News) This change
is a result of the aging millennial population A spokesperson for the Thompson Rueters
Corporation points out that millennials are willing to spend more on coffee because they are
feeling better about their financesrdquo (Whole Lattee Love Community) The millennial and
previous generations are also educated or becoming educated about where the coffee beans are
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
8
affordable luxury a boost of disease-fighting antioxidants a versatile ingredient an intoxicating
aroma and a beverage that brings people togetherrdquo (USA TODAY) Joe DeRupo the National
Coffee Association president describes coffee as part beverage and another part pop culture that
will not be going away anytime soon According to IBISWorld ldquothe industryrsquos recent growth is
expected to continue over the next five years to 2019rdquo As a result ldquorevenue is projected to rise
at an average of 38 percent to $364 billion during the five year periodrdquo (IBISWorld)
Industry Trends
Single cup brewing systems are becoming more popular within coffee shops They
provide a better variety than just brewing one blend they are great for convenience and
freshness These systems can also keep costs down by brewing only the amount of coffee
necessary for each sale
Specialty (gourmet) drinks are on the rise by 34 percent in 2014 a 31 percent increase
from 2013 according to the NCA (Daily Coffee News) The ldquoconsumption was found to be
highest among those between the ages of 25-29 (42 percent) second highest among the 18-24
and 40-59 demographics (about one third) and lowest among 60-plus-year-oldsrdquo (Daily Coffee
News) One of the leading gourmet coffee types is specialty espresso which saw a 5 percent rise
in consumption from 13 percent in 2013 to 18 percent in 2014 Over 30 million Americans drink
specialty espresso daily While gourmet coffee consumption is increasing regular non-gourmet
coffee consumption decreased by four points to 35 percent (Daily Coffee News) This change
is a result of the aging millennial population A spokesperson for the Thompson Rueters
Corporation points out that millennials are willing to spend more on coffee because they are
feeling better about their financesrdquo (Whole Lattee Love Community) The millennial and
previous generations are also educated or becoming educated about where the coffee beans are
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
9
grown how the coffee beans are roasted what types of coffees there are etc with the wide
availability of technology
Technology also allows the public to be connected globally whenever and wherever
Thus offering free WIFI is an important feature in a coffee shop It provides a great work
environment for people According to ldquomy place connectrdquo WIFI allows businesses to attract new
customers According to recent surveys 53 percent of people would be happy to sit in a cafeacute by
themselves with WIFI available WIFI also helps people not feel like they are sitting alone
because it allows them to connect with people online WIFI also helps differentiate your business
from competitors It gives customers more reasons to come to your business over the
competition
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
10
III MARKET
Target Market
Go Nuts Donuts Cafeacute will focus on providing a comfortable environment that will attract
consumers of all gender ethnicities and age groups Our major customer groups are college
students and white collar workers who live in or travel to New Stanton PA College students and
local white collar workers tend to gravitate to places that are convenient and provide a nice
environment for studying or lunch breaks Our local demographics suggest that we should target
customers in the age group 22-49 Because our location is located off three major highways the
commuters most likely will be white-collar workers college students or travelers We are also
within a short proximity of several hotels and motels Marriot Fairfield Inn amp Suites the
Comfort Inn Super 8 Express Inn Econo Lodge New Stanton Garden Inn and the Budget Inn
These hotelsmotels have over 560 rooms Most of the nearby hotelsmotels (Marriot Comfort
Inn Express Inn Days Inn and Econo Lodge) have event rooms that can hold up to several
hundred people Because of our location we must cater to a variety of clientele in many different
age groups
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
11
Demographics
The zip code 15672 (New Stanton PA) has a nearby population of 366 for 20-29 year
olds 454 for 30-39 year olds 511 for 40-49 year olds and 1565 for 50+ About 525 percent or
547 people are married homeowners or high school graduates Residents of New Stanton have
careers in the office administration sales executive and education fields The population is also
on the rise by 14 percent from last year The cost of living is less than the state average by 17
percent The population is 3602 with a median age of 45 and a median household income of
$43645 Close to 35 percent of the population are long term residents that have lived there for
more than 5 years and 22 percent have moved in the past year (Realtorcom)
Table 31 Population Age Distribution
0
100
200
300
400
500
600
700
0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+
Population Age Distribution 2013
Column1
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
12
Table 32 Gender
Table 33 Marital Status
50364964
Gender Population Percentage 2013
Male
Female
9
5310
28
Marital Status 2013
Singles
Married
Single Parents
Married w kids
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
13
Table 34 Household Income
New Stanton is only one of the boroughs of Westmoreland County Westmoreland
County is home to a population of 362437 people according to the United States Census Bureau
in 2013 19 percent of people are under the age of 18 and females make up 511 percent of the
population Of the local population whites make up the majority at 952 percent BlacksAfrican
Americans only make up about 25 percent and 23 percent is Other Between 2008 and 2012 91
percent of people live in the same house for one year or more The median value of the
households between 2008 and 2012 was $131800 The median household income for 2008 to
2012 was $49734 The closest locations near New Stanton are Youngwood with a population of
2998 Hunker with a population of 283 Calumet-Norvelt with a population of 1682 and
Greensburg with a population of 14660
0
100
200
300
400
500
600
700
800
$0-$39k $40-$74K $75-$149K $150K+
Household Income 2013
Series 1
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
14
Market Demand
The National Coffee Association in 2010 released a study estimating that over 75 percent
of adults drink coffee and 58 percent say they drink it daily Coffee shops have a large customer
base Many people start drinking coffee by the time they are 24 People between the ages of 18-
34 are more likely to purchase coffee from a coffee shop At the end of 2014 the consumption of
coffee in the US grew from 22006 per thousand 60-kilogram bags in 200910 to 24991 in
201314 (United States Department of Agriculture)
Recent general trends in 2014 show there is an increase in demand for gourmet coffee
even with the increasing prices of coffee beans ldquoThere is a very low price-elasticity-of-demand
for coffeerdquo said Paul Christopher the St Louis-based chief international strategist at Wells
Fargo Advisors (Bloomberg LP) The National Coffee Association USA found that 42 percent
of 25-39 year olds are the strongest consumers of gourmet coffee Of the 25+ individuals
researched 48 of percent Hispanic-Americans 42 percent of Asian-Americans 32 percent of
Caucasian-Americans and 23 percent of African-Americans said they drink gourmet coffee
daily
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
15
IV COMPETITION amp SWOT
Competition
Go Nuts Donuts Cafeacute has both direct and indirect competition Our direct competition
includes both restaurants in New Stanton PA and nearby locations within Westmoreland
County Our indirect competition includes alternatives to restaurants such as home-brewing
coffee machines
Some of our direct competitions are chain-restaurants owned by large corporations They
include Starbucks Co Dunkin Brands Group Inc (owner of our competitor Dunkinrsquo Donuts)
and McDonaldrsquos Co Both Dunkinrsquo Donuts and McDonaldrsquos offer low-cost coffee with high-
quality Arabica beans McDonalds Premium Roast Coffee cost range from $090 for the smallest
to $129 for the largest Dunkin Donuts Coffee prices range from $149 for the smallest to $219
for extra-large Dunkin Donuts is also known for their assortment of donuts They offer 1 piece
for $095 $549 for half-a-dozen and $899 for a dozen They also offer a variety of choices of
beverages including ice coffee cappuccino hot chocolate tea soft drinks etc which can be
drink inside the restaurant or taken out at the customerrsquos discretion
Since some of our competitors are under large corporations they also have enough
revenue to expand their brand through their products services and collaborations with other
companies Starbucks for example has enough money to pay many employees to go to college
and get a higher education The amount of revenue they bring in makes them an ideal
collaborator with other businesses As a result they have high bargaining power with suppliers
for both quality and large quantity of produce For example McDonaldrsquos was able to purchase
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
16
30 percent of the blackberries in the United States of America for their Wild Berry Real Fruit
Smoothie released on July 13 2010 (Bloomberg News)
Our indirect competitors include the makers of coffee machines and brew-at-home coffee
mixes along with the bakeries in any retail or grocery stores One of our biggest indirect
competitors is Keurig Green Mountain Inc the most well-known makerdistributor of single-cup
brewing system and the creator of the K-cups They provide customers with a system of easy
on-the-go coffee without the hassle of cleaning and refilling a coffee machine with coffee filters
and ground coffee All that is required for their machines is the K-cup a small packet filled with
an assortment of ground coffee beans
While both our direct and indirect competitors can be strong they also have their
weaknesses Unlike Dunkinrsquo Donuts and McDonaldrsquos Starbucks is not cheap Some of their
specialty drinks can cost up to $6 and their bakery items can cost around $5 Since Starbucks
Dunkinrsquo Donuts and McDonaldrsquos are a large corporation they lack internal focus They can be
more focused on their employees in the corporate building than those working in their
restaurants The size of their company and popularity also means that they have trouble
providing a large quantity of products in each store They have to rely on factory production and
various mode of transportation to ship their products out to each restaurant nationwide Since the
products arenrsquot being made directly in the restaurants quality and freshness can suffer on its way
to the destination
One large issue with our indirect competitor Keurig Green Mountain begins with the cost
of their product The lowest price for a Keurig coffee machine is $9999 A 5 sample K-cups cost
more than $3 A package of 24 K-cups costs would be more than $16 Aside from the cost
Keurig Green Mountain is not very concern about the environment nor is completely concern
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
17
about the health factors involved in making their products They make their K-cups with only 5
percent biodegradablerecyclable materials while the rest is made of plastic The plastic is a
mixture of polystyrene which contains the chemical styrene that ldquocan wreak havoc on the
nervous systems of those handling it according to the Centers for Disease Control and
Preventionrdquo (Mother Jones) According to Zagg Keurig Green Mountain is trying to monopolize
the single-cup coffee brewing system industry by trying to block other companies from
manufacturing K-Cups for their machine As a result they are limiting choices for their
consumers
In comparison to our competitors Go Nuts Donuts Cafeacute will strive to be a company that
promotes valuable service quality food and a relaxing environment to our customers To
provide this two of our top priorities include employeesrsquo happiness and business transparency
We will provide training help and encouragement to our employees Additionally we will
rectify our wrongs if any occurs We want to be a company without secrets and one that cares not
just about people but the environment as well As we grow we will continue to provide a
positive and beneficial atmosphere to work and eat We will listen to concerns about our
products ideas for new products and provide more options for our customers to choose from
We will continue to value the environment by using organic materials biodegradable products
and do what we can to increase our green footprint
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
18
SWOT Analysis
Strengths- Our strengths include an environmentally friendly establishment We are
entering into a rapidly growing industry We are offering unique and customizable donuts
alongside gourmet coffee We are providing excellent customer service The industry has low
barriers to entry Cafeacutes have relatively low startup costs and government regulations This
industry also has a high turnover rate for new and closing coffee shops
Weaknesses- The industry already has established recognized leaders who have a large
portion of the market share The location we have selected does not have a drive thru which
would bring in more business and provide convenience to our customers Low barriers to entry in
this market increase the chance of new competitors entering the market Our location does not
have a large parking area for our customers
Opportunities- Expanding into other locations and possibly making a franchise would
create many opportunities to establish a larger market share
Threats-Increase of local competitors is always a risk when opening a business People
are more conscientious of the food they consume today For that reason trends that push people
into healthier habits away from junk food and caffeine could greatly impact our business
Droughts and shortages of coffee beans can cause prices to increase dramatically which could be
problematic This would directly affect costs and product availability
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
19
Table 41 SWOT Analysis Table
SWOT
Analysis
Go Nuts Donuts
Cafe
Starbucks Dunkin Donuts McDonalds
Strengths Environmentally
friendly establishment
Growing Industry
Low Barriers to entry
Customizable product
Popular worldwide
establishment
Variety of products
Benefits for
employees
Recognizable Brand
Popular national
establishment
Variety of products
High bargaining power
Recognizable Brand
Popular national
establishment
Variety of products
Cheap products
Recognizable Brand
Weaknesses Competition with
already established
companies and local
businesses
Recognizable brands
and logos
Low barriers to entry
Limited parking
Low Market share
Competition with
already established
companies and local
businesses
Expensive
Not-freshly made
food
Competition with
already established
companies and local
businesses
Factory-made donuts
Less internal focus
Unhealthy
Competition with
already established
companies and local
businesses
Factory-made food
Low wages for
employees
Less internal focus
Unhealthy
Opportunities Expansion into new
areas
Technological
advancements
New Products
Threats Increased competition
Market saturation
Consumer trends
away from caffeine
and pastries
Contamination and
droughts
Scarcity
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
20
V ADVERTISEMENT
Our advertising strategy includes handing out flyers sending direct mail and
spreading the word through social media sites Facebook Twitter Pinterest etc We also
plan to advertise in the Tribune Review offer coupons and hold special events that can
be reported by the local news The advertising cost for our chosen advertisement options
are listed below on Table 61
Table 51 Advertising Schedule
Advertising Cost
Direct Mail (New Stanton) $182800
Tribune Review $44400
Social Media $000
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
21
VI DISTRIBUTION CHANEL
Suppliers
Go Nuts Donuts Cafeacute is dedicated to doing the best for the community and its customers
Starting a business that deals in green products will hopefully change the environment and the
community around us If we want to offer a better experience for the community we need to start
with the right distributors that have the same values as Go Nuts Donuts Cafeacute Thatrsquos why we are
choosing suppliers who will provide more organic ingredients to use and green products to serve
for our coffee teas and donuts Some of our suppliers include Nicholas Coffee Company
Costco Eco-Products and Bobrsquos Red Mills
Nicholas Coffee Company practices fair trade and is certified USDA organic A company
that values the hard work of farming coffee beans and wants the best for its customers by
offering organic beans is very important for Go Nuts Donuts Cafeacute
Costco is a company that is improving their footprint in the world They are reducing
their environmental impact in the world by reducing the usage of plastic recycling and
providing organic food They also value their employees and provide them higher salaries along
with health benefits for all
Eco-Products provide disposable green products that are beneficial to the earth They see
their business venture as an incredible opportunity to benefit the world and change the business
industry
Bobrsquos Red Mills is a certified organic company and also provides gluten free products
They focus on providing awareness and a wide range of healthy products both on a national and
international scale
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
22
Supplies
Donuts There will be a single-base donut that the customers will have the option to
customize with various coatings and toppings The donut will be organically-made and will be
made fresh periodically throughout the day The choices for coatings are powdered sugar
cinnamon sugar vanilla icing strawberry icing peanut butter icing maple icing glaze and
chocolate icing The topping choices include regular and premium choices The regular choices
are rainbow sprinkles chocolate sprinkles graham crackers shredded coconut chocolate chips
and white chocolate chips The ldquoGo Nutsrdquo toppings include crushed Oreos cherry pie fillings
apple pie fillings bacon MampM and Reesersquos Pieces The nuts will be kept separately from the
other ingredients so people with nut allergies can enjoy our donuts without having to worry
about cross contamination
Coffee Go Nuts Donuts Cafeacute will be buying whole coffee beans from the Nicholas
Coffee Company Our house blend will be Colombian Supremo a well-balanced flavorful coffee
with an exceptional body and a nutty taste The Colombian Supremo is available in regular and
decaf For customers whom crave a stronger gourmet coffee we will also be offering an espresso
ldquoa blend of Central and South American Coffees great for a heavy old world espressordquo
(Nicholas Coffee Company) All coffees will be offered hot or iced To appeal to people with a
taste for more flavor Go Nuts Donuts Cafeacute has the possibility of making a variety of different
flavors by offering Torani Syrups for any coffee
Tea A variety assortment of specialty teas will also be available The teas will also be
bought from Nicholas Coffee Company They offer a wide variety of name brand tea such as
Twining of London Bigelow Tea Celestial Seasonings Chai Tea and Tazo Tea Most of our
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
23
customers will be familiar with these brands It is also beneficial to provide an alternative for
consumers who may not like the taste of coffee
Green Paper Products The cups we will be using are Eco-Products Green Stripe
Compostable Hot Cups and Eco-Products Compostable Corn Cups for cold beverages The hot
cups are lined with vegetable base coating which makes the cups 100 percent biodegradable The
cold cups are made with corn instead of plastic also making the cups 100 percent compostable
The cutlery used is Eco-Products Compostable Plant ware Cutlery The Plant ware cutlery is
certified compostable by Biodegradable Products Institute (Greenstaurant)
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
24
VII OPERATIONS
Employees
At the start of business Go Nuts Donuts Cafeacute will have four bakers six crew members
and two managers one marketing director and one accountant Pending business growth we
may add additional employees later
Employee Training
All employers will be trained and certified by ServSafe a program administrated
National Restaurant Association in compliance with the U S Food and Drug Administrationrsquos
(FDA) Food Act At the time of hire employees will be trained by the managers for their
specified positions and will be required to be certified by ServSafe Manuals for the machineries
will be provided for the employees Bakers will be required to learn how to operate and clean the
electric donut machine Baristas will be a fellow employee who will be trained and certified
Like our bakers they will learn how to operate and clean the coffee machines All employees
will also be taught the recipes for both drinks and donuts They are required to know and abide
by these recipes in order to maintain consistency in the quality
Daily Operations
The morning shift begins at 5am we project this to be our busiest time of day We will
provide extra crew members to meet the demands For the afternoon shift we will reduce the
number of crew members accordingly
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
25
Table 71 Hours of Operation
Day Sunday Monday Tuesday Wednesday Thursday Friday Saturday
Hours 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-10pm 5am-11pm 5am-11pm
5am to
Table 72 Crew Members Shifts
Shift 1 Shift 2 Shift 3 Shift 4 Weekend Shift
430am-11am 5am-1130am 11am-530pm 4pm-10pm 530pm-1011pm
Table 73 Bakers Shift
Shift 1 Shift 2 Shift 3
430am-1030am 11am-5pm 5pm-1011pm
Table 74 Managers Shift
Monday 700 AM- 300 PM Sunday 900 AM - 500 PM
Wednesday 900 AM - 500 PM Monday 700 AM- 300 PM
Thursday 700 AM- 300 PM Tuesday 900 AM - 500 PM
Friday 700 AM- 300 PM Thursday 700 AM- 300 PM
Saturday 900 AM - 500 PM Friday 700 AM- 300 PM
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
26
Table 75 Accountant Marketing Director
Monday 800 AM- 400
PM
Tuesday 800 AM- 400
PM
Wednesday 800 AM- 400
PM
Thursday 800 AM- 400
PM
Friday 800 AM- 400
PM
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
27
VIII MANAGEMENT amp STAFF
Table 81 Primary Responsibilities
Job Titles Descriptions
Manager Train and manage employees and schedules certifications and inventory
Market
Director
Design implement execute and update marketing plan
Promote products to consumers
Implement and test the introduction of new products into market
Accountant Work on financial reports including accounts payable federal tax forms and
payroll
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
28
IX FINANCIALS
Go Nuts Donuts Cafeacute is starting out with each partner contributing $10000 cash for a total
of $40000 Based on research there are approximately 18000 cars that are passing in the area
From the 18000 we are assuming that 15 of those cars will be stopping in the first quarter of
business Each quarter from then on will increase sales by 0775 We are assuming since the
Coffee and Snack Industry is growing by 3 that our business will also grow by 3 The next
year will increase to 5 and the third year of operations will increase by 8
Based on the sales projection the company has decided to borrow the bare minimum from
the bank of $5000 at a rate of 6 interest We want to establish a great relationship with the
bank and show that we are a profitable company Therefore making expansion in the near future
a possibility rather than a probability During the projection of sales the net income for the first
year totals to be a little over $100000 For each year after that the profits will steadily increase
The company will have a fifth of the inventory rollover from quarter to quarter Ensuring
quality products at all time we will be using the FIFO (First In First Out) All other expenses are
staying about the same each quarter and only increasing based on the sales for each year
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
29
XI
Work Cited
Specialty Coffee Encyclopedia of Emerging Industries Farmington Hills MI Gale 2014
Business Insights Global Web 3 Oct 2014 (Retrieved from
httpbigalegroupcomglobalarticleGALE|RN25015000938f821134740995e3ce6afe710c9b1
7f2u=upitt_main)
IBISWorld (1994-2014) Coffee and Snack Shops in the US Market Research Report Retrieved
September 15 2014 from httpwwwibisworldcomindustrydefaultaspxindid=1973
2014 Coffee Consumer Trends Report More Gourmet Single Cups (2014 May 9) Retrieved
November 17 2014 from httpdailycoffeenewscom201405092014-coffee-consumer-trends-
report-more-gourmet-single-cups
Daily Coffee Drinking Increases for Young Adults (nd) Retrieved November 17 2014 from
httpcommunitywholelattelovecomblogs2135daily-coffee-drinking-increases-for-young-
adults
5 Reasons Why Your Business Should Provide Free WiFi-MyPlace Connect (nd) Retrieved
November 17 2014 from httpwwwmyplaceconnectcom5-reasons-why-your-business-
should-provide-free-wifi-to-customers
New Stanton Hotels (nd) Retrieved November 17 2014 from
httpwwwtripadvisorcomHotels-g53328-New_Stanton_Pennsylvania-Hotelshtml
Realtorcom (nd) Retrieved November 17 2014 from
httpwwwrealtorcomlocal15672lifestyle
United States Census Bureau (2013 January 1) Retrieved November 18 2014 from
httpquickfactscensusgovqfdstates4242129html
United States Department of Agriculture Foreign Agricultural Service (2014) Coffee World
Markets and Trade (Retrieved from httpappsfasusdagovpsdonlinecircularscoffeepdf)
Perez M amp Doan L (2014 March 13) Coffee Cravers Ignoring Bean-Price Surge for Caffeine
Fix Retrieved October 6 2014 from httpwwwbloombergcomnews2014-03-12coffee-
cravers-ignoring-bean-price-surge-for-caffeine-fixhtml
New Stanton Pennsylvania (nd) Retrieved November 18 2014 from httpwwwcity-
datacomcityNew-Stanton-Pennsylvaniahtml
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
30
Turk S (2014 September 1) IBISWorld Industry Report 72221b Coffee amp Snack Shops in the
US Retrieved November 18 2014 from
httpclients1ibisworldcomreportsusindustrydefaultaspxentid=1973MP
McDonalds Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescommcdonalds-prices
Dunkin Donuts Prices - Fast Food Menu Prices (nd) Retrieved November 18 2014 from
httpwwwfastfoodmenupricescomdunkin-donuts-prices
College Plan (nd) Retrieved November 18 2014 from
httpwwwstarbuckscomcareerscollege-plan
Bloomberg News (2013 July 24) McDonalds Test Kitchen Where Fast Food Is Born
Retrieved from httpswwwyoutubecomwatchv=SRSjY6fWg1s
Richmond H (2014 March 20) Trash from the K-Cups sold last year would circle the Earth
almost 11 times Retrieved November 17 2014 from httpgristorglisttrash-from-the-k-cups-
sold-last-year-would-circle-the-earth-almost-11-times
Nicholas Coffee Company Retrieved October 22014 from
httpwwwnicholascoffeenetwebstorestorefrontSubcatsListcfmCatID=23
Taking Red Mill global - Portland Business Journal (2005 February 20) Retrieved November
19 2014 from
httpwwwbizjournalscomportlandstories20050221story4htmljst=cn_cn_lk
We are not a disposable products company trying to act green (nd) Retrieved November 19
2014 from httpwwwecoproductscomabout_ushtml
BizFilings by CT (2014 November 11) Employers Responsibility for FICA Payroll Taxes
Retrieved from BizFilings by CT httpwwwbizfilingscomtoolkitsbgtax-infopayroll-
taxesemployers-responsibility-fica-payroll-taxesaspx
Intuit Turbo Tax (2014) 2014 Federal Tax Rate Schedules Retrieved November 11 2014
IRS (2014 November 11) Topic 751 Retrieved from Social Security and Medicare
Withholding Rates httpwwwirsgovtaxtopicstc751html
Morningstar (2014 November 24) Starbucks Corp Retrieved from
Financialsmorningstarcom financialsmorningstarcomratiosrhtmlt=SBUX
PA Power Switch (2014 November 18) Pennsylvania Public Utilities Commission Retrieved
from PApowerswitchcom PApowerswitchcom
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624
31
Pennsylvania Department of Revenue (2014 November 11) General Tax Information
Retrieved from Current Tax Rates
httpwwwrevenuepagovGeneralTaxInformationCurrent20Tax20RatesPagesdefaultasp
xVHN7Y_m-2G5
Tax Policy Center (2014 November 11) Tax Facts Retrieved from State Unemployment Tax
Rates 2008-2014 httpwwwtaxpolicycenterorgtaxfactsdisplayafactcfmDocid=541
Westmoreland Development Council (2014 November 11) Tax Summary Retrieved from
Corporate Income Tax httpwwwcowestmorelandpausindexaspxNID=624