ag ec 495 college of agriculture and bioresources, university of saskatchewan company overview...

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Company Overview•Business overview

•Small Saskatoon Based Business

•Snacks and Snack Making Products

•Mission Statement•“Schneider’s Gourmet World is committed to providing unique, high quality, premium snack food and popcorn products that round out the at home entertainment experience for the end consumer, available through intermediaries on a wholesale basis.”

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Objectives and Goals•Evaluate the wholesale market and possibilities for expansion

•Increase retail wholesale product line

•Evaluate the snack food market and potential business to business customers that would be interested in providing products to end consumers

•Expand into new avenues to provide bulk supplies to for direct-to-consumer snack food companies.

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Industry Overview

• Falls within 3 industries

•Wholesale trade

•The snack food industry

•Seasoning and dressing industry.

•Important Industry Trends

•Large Growth

•Important Consumer Trends

•Convenience

•Health

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Operations Plan

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Organizational Structure

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Floor Plan

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Flow of Work

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Capital Budget

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Working Capital Cost of Goods Sold

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Administration, Marketing and General Expenses

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

• Inventories– 7 Week Inventory Turnover

• Accounts Receivable– 30 Day Terms

• Accounts Payable– 30 Days

• Cash Conversion Cycle– CCC = 49 + 30 – 30 = 49 days

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Human

Resources Plan

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Staff• President

• Operations Manager

• Part time Staff

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Strategy• Training

– Manual– On Site

• Motivation– Discounts– Staff Parties– Management

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Marketing Plan

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Marketing Plan•4 P’S of Marketing

•Product•Price•Place•Promotion

• Segmentation• Targeting• Positioning

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

SWOT• Internal Strengths

• Internal Weaknesses

• Opportunities

• Threats

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Past Performance

• Wholesaler/Retailer

• 30 – 50 year old women

• High Margins

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Market– $60 billion– 5% growth

– 200 000 retail establishments– 100 large commercial

establishments

– 500 HBC– 100 in Western Canada

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Customers– Young families to retired

couples– High disposable income– Impulse shoppers– Needs:

• natural foods• novel foods• entertainment• comfort• indulgence• premium products• value time

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Customers– HBC retail stores– Large establishments– Need:

• Unique products• Products that fit trends

– Difficult to enter, but:• Large market• Large orders• First mover

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Product

– Spices– Popcorn seed– Kactus Chips– Oil – Stovetop popper– Gift pack– Competitors

• Act II, Back To Basics, Orville Redenbacker, Ultimate Popcorn Lovers

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Objectives

– Market Share - 20%

– Unit Sales - 193,400

– Revenue - $1,069,148

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Distribution

Manufacturers/products

Agents/brokers

Wholesalers/distributors

RetailersRetailers

Consumers and organizational end users

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Pricing

– Current pricing strategy will be adhered to:

• Retail less 20% to HBC stores

– Premium retail pricing• differentiation

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Promotion

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Financial Plan

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Net Income

2007 2011 2016

Unit Sales $96,700 $241,750 $241,750

Revenue $513,816 $1,363,164 $1,535,144

Direct Costs

$212,084 $573,916 $633,650

Expenses $376,435 $551,373 $583,532

Net Income

- $110,745 $204,421 $249,621

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Cash Flows

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

NPV, IRR, ERR

– Net Present Value:• $300,300

– Internal Rate of Return:• 42%

– External Rate of Return:• 25%

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Break Even

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Critical Variables

– Unit Sales– Selling Price– Direct Costs

– Contingency Planning:• New locations• Marketing Expenses• New suppliers

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Future Considerations

Ag Ec 495 College of Agriculture and Bioresources, University Of Saskatchewan

Questions