Final NUNLEE Marketing Plan

Running head: TILIPIA CONSORTIUM OF DELAWARE FARMS

Marketing Plan

Group 2Danielle DawkinsCheron FarleyTashana Sprattling Hong GuanYang Yang YuJennhyfer Laforest

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Table of ContentsIntroduction ………………………………………………………………………....3 Executive Summary ………………………………………………………………...4 Goals ……………………………………………………………………………….. 5 SWOT …………………………………………………………………………….. 6-8Market Analysis Market and Productive Objectives ……………………………………………. Target Market …………………………………………………………………..Positioning Statement …………………………………………………………… Feasibility ………………………………………………………………………Marketing Strategy Recommendations Product …………………………………………………………………………. Distribution …………………………………………………………………….. Promotion ………………………………………………………………………. Price …………………………………………………………………………….Financial Data and Projections Cross Tabulations ………………………………………………………………. Past Sales Revenue …………………………………………………………… Performa Statements / CLV Analysis ………………………………………… Projected Sales Revenue ………………………………………………………. Break Even Analysis …………………………………………………………

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Executive Summary

This marketing plan in its entirety is a complication of semester long assignments

and research in which a marketing plan was developed for a consortium of Delaware

farms. Tilapia is the common name for nearly a hundred species of fish. Tilapia is a

popular fish with a mild flavor. In order to market this product a cohesive marketing plan,

promotion plan, and feasibility test were conducted in order to reach to our conclusion.

The tilapia being marketed in our plan is superior to its competitors in that our tilapia is

always imported fresh, pricing points, and the raising of our fish.

The focal point for this marketing plan is the promotion and selling of fresh fish

tilapia. Tilapia in a nutshell is an African freshwater cichlid fish that is widely popular in

areas of seafood and fish concerts. Tilapia fish are probably the oldest farm raised fish in

the world. Tilapia is popular because it is a mild flavored, white-fleshed fish that is

available throughout the year at a competitive price. Tilapia is a hardy herbivorous fish

that feeds on algae or small aquatic plant cells, and is primarily raised in freshwater

systems using cages, ponds, raceways or open water. Tilapia as a product has numerous

benefits to offer to consumers. Tilapia is a disease resistant fish with low cost. Tilapia is

an ideal choice for any segment of the market solely on price aspects. In this marketing

plan the focal target market is families with annual incomes of 50,000 or lower with

children located in the mid-Atlantic. Our targets have at least a high school degree.

In beginning the marketing plan the feasibility of tilapia in the market was first

looked at. Cross tabulations and break even analysis were financial methods used in order

to prove the validity and worthwhileness of tilapia for the target market. Distribution will

spread between various cities. The tilapia will be distributed to local fish markets in

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North Carolina, Virginia, Maryland, Delaware, New Jersey, and New York. Overtime the

demand for tilapia will increase because of its quality, source of fish, and the freshness.

For the promotional advertising we choose to promote this business via the

following mediums of communication: newspaper, website, magazine, and salesperson.

The cost of each, in its respective order, is: $26,088.63 + $25,050 + $90,000 + $44,000.

This gives a total of $185,138.63 for our overall promotional budget. We would also like

to advertise through social media, as this way would be completely free. These five

choices are best for our promotional plan simply because we will advertise and promote

in more than enough ways, while still remaining under the total budget of $1 million for

the entire business investment.

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STRATEGIC FOCUS

MISSION/VISION

Mission: Our mission is to show our customers how important it is to eat healthier

by providing a facility that reproduces, harvests, and sells its own fresh tilapia. We will

serve customers along the Mid-Atlantic region of the United States offering premium-

grown and premium-sold fresh fish.

Vision: The vision of Tilapia Consortium of Delaware Farms is to expand western

throughout the central, mid-western, and western zones of the United States. We will then

decide to “go global” based on our sales/profit performance in the United States. Our

business will expand overseas housing many franchises in numerous countries of the

world, serving as the lead company specializing in Tilapia.

GOALS

NON FINANCIAL GOAL

FINANCIAL GOALS

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SWOT ANALYSIS

Strengths:

The company’s strengths would be a large population target, selling fresh fish vs.

frozen, and economies of scale. The target market the company is aiming for has a high

demand for fresh fish. The Mid-Atlantic is derived of Caucasians, African Americans,

Mexicans, as well as Asians who would contribute to buying fresh fish. Selling fresh

versus frozen fish will help attract more customers because of the healthy nutrients it

provides. Fresh is better than frozen because a customer will know where the fish is

coming from and how it was raised and fed versus having the frozen fish that was

imported in. Regarding economies of scale, the more fish the business can produce, the

lower the fixed costs will be making a profitable company.

Weaknesses:

The company requires high initial investment because the business will have its

own facility. According to the information we found online, the estimate initial

investment for a 6-tank tilapia facility is $301,575. The transportation cost(s) for fresh

shipments of tilapia to other regions of the U.S. would also be high. Because the

company will be selling fresh tilapia, the quality of the fish has to be guaranteed entailing

that the tank(s) require(s) specific qualities of air, water, and temperature. The company

is a new company in the fish market. No one is aware of the brand-thus this start-up

company has a weak brand right now. This company has a weak supply chain. It is facing

problems in its distribution process. Transportation companies are needed to help with

transporting the fresh tilapia. The company needs to build long-term relationships with

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seafood markets, supermarkets, and restaurants in the Middle Atlantic region to amend

this issue.

Opportunities:

This company faces low competition. There are not a significant amount of fish

markets that produce/breed and/or sell only tilapia, nor are there a significant amount of

fish markets performing the above-listed with fresh, non-frozen tilapia. To further ensure

quality-sold tilapia, the company needs to contract with a local fish market to hire a

skilled fresh fish preparer. As a plan to reverse the continuation of a weak brand, the

company should host programs promoting tilapia awareness and knowledge. Because

tilapia is a disease-resistant fish, it will not pose a threat to human life. The company

needs to incorporate and instill this knowledge into a qualitative, attractive brand.

Threats:

There is inconsistency in the availability of fish supply. Being that tilapia is not a

popular fish, this means customers have a plethora of alternatives to choose from. The

average price of tilapia is not very high. So, people can afford it. However, the average

price of fresh tilapia is higher than the average price of frozen tilapia. So, if the economy

is experiencing a recession, price-sensitive customers will easily switch from buying

fresh tilapia to buying frozen tilapia. Technology that is not updated, efficient or effective

will pose a major threat for this company. Water quality is one of the most overlooked

aspects of pond management regarding fish production. Clay turbidity in ponds is one of

the most common quality issues addressed. However, several other variables like water

temperature, phytoplankton, photosynthesis and pH, carbon dioxide, alkalinity and

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hardness also influence water quality. A transportation technological method is mandated

to deliver fish to each market. If the technology isn’t executed in the most efficient and

effective way, the fish sent to other markets will succumb to death as a result of being

exposed to oxygen. It is a private company, so there won’t be lots of regulations.

However, there are state regulations on the types of tilapia they can raise.

Target Market

The target market for this business should be families (with children) that gross

$50,000 or below a year, residing in the Mid-Atlantic region of the United States.

Families that make this amount of money are considered to be the working/working poor

social class. Being that tilapia is an inexpensive and healthy food source, these families

would contribute to the most profit of the business. Families that bring home more than

$50,000 would not even consider tilapia because of its “cheap” price. These families will

more than likely buy from higher-end fish markets that sell their tilapia for a higher price,

mistaking only this factor for better quality fish. As for the children being involved with

the buying power of the tilapia within a family making $50,000 or below, parents will be

aware that tilapia is a healthier source of fish being that it is disease-resistant and use this

knowledge as a reason to buy more tilapia for the sake of the kids’ health. This, in turn,

will drive the profits high because the kids are being involved.

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MARKET ANALYSIS

Marketing and Productive Strategy

Our main goals for our business are increasing awareness among consumers,

providing information about the benefits of consuming fresh tilapia, reducing resistance

to buying the our product. Also, distinguishing our fish as a premier type of tilapia with

the best taste, at the best price in our region. We also will focus on increasing our sales.

Our strategy for achieving this goal increasing sales among women between the ages of

25-50. We choose to specify on that target market because most woman of those ages

have children and women they are more cautious about what they eat and what they feed

to their kids. Profitability is one of our major objectives, making sure that revenue stays

ahead of our cost of production. The key to achieving that is focusing on both our

production and operation while making a profit. The core of any business is the

employee. They are the face our company and they help the company retain our customer

and generate repeat revenue, and keeping our clients happy. With all these objectives we

hope to bring forward the marketing to help in the success of our company.

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Target Market

Our target market is families with 50,000 annual incomes or lower with children.

According to the data from U.S. Census Bureau, the median household income in the

U.S. was $51,939 in 2013. People with higher income will choose more expensive fish

instead of tilapia, or they will go to restaurants instead of cooking by them. Our targets

have at least high school degree, because people with a high school degree or lower

consumed significantly less of any fish (Jahns, Raatz, Johnson, Kranz, Silverstein, &

Picklo, 2014). Tilapia is known as a healthy food. Tilapia contains all the essential amino

acids human body requires from the diet to help build proteins. The most important factor

is that tilapia is a rich source of omega-3 fatty acids, which are important for growth and

development in children and brain function (Coleman, n.d.). Families with kids have

higher demand for food that promotes health and well-being. They will consume fresh

tilapia for the health of their children.

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Positioning Statement

For a household making $50,000 or less that wants to find an inexpensive fish that

is fresh and raised on a farm, then purchasing tilapia is best. This fish, when fresh,

provides you with a healthier choice in your life style. A household making $50,000 or

less would prefer to purchase tilapia and on a regular basis than a household making

$50,000 or more. This is because tilapia is very inexpensive as opposed to the price(s) of

other kinds of fish. Because of the inexpensiveness of this fish, a family making over

$50,000 would prefer to buy an expensive kind of fish simply because the price of tilapia

would seem too cheap for them to buy. Because they make more money than a family

making $50,000 or less, they can afford to buy not only a pricier fish but a much tastier

fish as well.

Unlike imported and/or frozen fish, the fresh tilapia grown here will provide a

sense of familiarity. Because this company will mate the fish to increase production and

harvest them, consumers and customers will know how the tilapia is raised. This includes

what it is fed and any contamination it may have that may lead to food poisoning if not

harvested properly. If the fish were brought in from local waters and/or ocean

contamination would be of very high concern.

The factors that are influencing the consumer to purchase this fish are: that it is

affordable, healthier and that it is fresher compared to the frozen tilapia. We should

segment the market by looking at who purchases this type of fish based off income. We

need to collect statistics on the income that generates the most sales in purchasing tilapia.

At Wal-Mart, one brand of fresh tilapia fillets run for around $6/lb. For this weighted

price, three fillets are included. Another brand sells 2lb bags of frozen tilapia for $7.

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Feasibility (Financial Analysis)

SPECIFIC COST COST (IN DOLLARS)

Promotion (yearly) $185,138.63

Refrigerated truck (one-time cost) $24,300

Distribution (yearly) $10,400 ($200 weekly, once a week

* 52 weeks in a year)

Employees (yearly) $514,000

Facility (one-time cost) $48,000

Machinery (one-time cost) $180,000

TOTAL $961,838.63/$1M

As previously discussed, our total promotion costs are $185,138.63. The cost of

three refrigerated trucks total is $24,300 ($8,100 x 3). We agreed on three delivery trucks

because we would be able to evenly distribute the states into three main sections based on

location. One truck would deliver only to the top half of North Carolina, another

delivering only to West Virginia and Virginia, and the last truck delivering to

Pennsylvania, Delaware, some of New York, Connecticut, and New Jersey. This

distribution would be beneficial because if this business was to only have on truck, we

would have to factor in more mileage which, in turn, would mean more gas money and

longer traveling distance for the truck drivers. The kind of truck is a 2006 Isuzu NPR 16’

Reefer Van Refrigerated Truck that will be purchased off eBay. This would bring a total

distribution (gas) cost to $10,400. There will be fourteen total employees: two fish

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butchers making $30,000 salaries, two technical trainees for operation of the machinery

making $52,000 salaries, five workers that would monitor the fish tanks and collected

data of the machinery making $30,000 salaries, the three truck drivers making $50,000

salaries, and two overall cameramen observing the cameras in the entire facility making

$25,000 salaries. We are hoping to find a facility of 12,000 square feet where we can

lease for a total of $48,000 somewhere in Delaware. The machinery needed will cost

$180,000. This gives a grand total of $961,838.63 for start-up costs of the business in its

entirety.

We feel that these costs are beyond feasible since this is a new business that has

yet to actually be established yet. Further technologies (advancement), newer vehicles,

and increased salaries will emerge in the later years as the business success proves itself.

MARKETING STRATEGY RECOMMENDATIONS

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Product

Distribution

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The companies’ channel of distribution is we are the producers of the fish then it

will be distributed among different stores in varies cities. We feel that this method will be

the most profitable because it gives our customers a variety of places to get our product.

The target market that we are achieving to reach is the Mid-Atlanta region, with that

being said we will distribute our fish to local fish markets in North Carolina, Virginia,

Maryland, Delaware, New Jersey and New York. With the mass-producing of fish, we

will deliver the fresh fish weekly to our fish markets in the various cities by a refrigerated

truck.

Over time the demand for the fresh tilapia will increase because of its quality,

source of the fish and its freshness. The demand will be at an all-time high, which we will

be well equipped for the demand. Since the fresh tilapia will be stationed in each state we

are targeting the profit will be greater than having it stationed in one main location.

Promotion

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Price

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TYPES OF FISH

STORE Fresh Tilapia Frozen Tilapia Swaii

Walmart 2 lbs $6.98;

3 lbs $7.92

1lb $4.98 $2 lbs $6.98

Wholey’s 2lbs $24.00 N/A N/A

The Fresh

Lobster

Company

1lb $17.50 N/A N/A

Our selling price for 1lb of fresh Tilapia is $6.50, where the percent

markup on cost is: (1+Markup) x (UC): (1+.50) x ($4.334)=$6.50. The

percent markup on selling price is: UC/(1-Markup): $4.334/(1-.50)= $8.668.

Cross Tabulations

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Tilapia/Income Eat Tilapia Don’t eat Tilapia$0---$30,000 7 1

$30,000---$50,000 8 3$50,000---$70,000 0 2

$70,000---$100,000 4 0Total 19 6

Tilapia/Children Eat Tilapia Don’t eat TilapiaHave child 9 2

No child 10 4Total 19 6

Tilapia /Race Eat Tilapia Don’t eat TilapiaCaucasian/European 3 0

Asian 5 0African American 5 4Hispanic or Latino 3 1Native American or

American Indian0 0

Other 4 0Total 20 5

FINANCIAL DATA AND PROJECTIONS

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Past Sales Revenue

Because this business has not been established yet, there are no past

sales revenues; therefore, the past sales revenue is $0.

Projected Sales Revenue

Weekly Projected Sales/ Revenue Forecasting

Estimated Fillet Tilapia Sold: 300 lbsAverage Sales per order $6.50 $1,950

Estimated Whole Tilapia Sold: 90 lbsAverage Sales per order $6.50 $585

Total Projected Sales $2,535Net Sales $2,535

Break Even Analysis

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Store Fish

Frozen Price (lb)

Fresh Price (lb)

Premium

Walmart Tilapia 3.49 5.94 70.20%Sams Club

Mahi Mahi 10.49 17.04 62.44%

Walmart Salmon 4.93 6.66 35.09%Average 55.91%

BEV=FC/(P-VC)

BEV= ($185,138.63 + $10,000 + $514,000) / ($6.50 – ($24,300 + $48,000 + $180,000))

BEV= ($709,138.63) / ($6.50 – ($252,300)

BEV= ($709,138.63) / (-252,293.50)

BEV= ($-2.81076853)

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BIBLIOGRAPHY

References

(2002). Aquaculture in North Carolina: Tilapia. North Carolina Department of Agriculture and Consumer Services.

Transportation of Fish and Fish Products. (2015). Retrieved from Food and Agriculture Organization of the United States: http://www.fao.org/fishery/topic/12327/en

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APPENDICES

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Final NUNLEE Marketing Plan

Documents