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LAWS N’SGourmet Chicken Pies

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Lawson’s Gourmet Chicken Pies Date: Friday, July 15, 2011Lisa Helmick Web Address: lawsonspies.com77 Aspen Dr. Phone: (540) 816-7727 Daleville, VA. 24083 Email: [email protected]

Management: CEO, VP Sale/Mktg, Product Development: Lisa Helmick;Storefront manager: UnknownIndustry: Frozen FoodsNumber of Employees: 5Bank: Bank of BotetourtFuture Auditor: MantaLaw Firm: Gentry LockeAmount of Financing Sought:$50,000 loan, $200,000 common stockCurrent Investors:($Amt. Invested)Any Venture Capitalists,Private Investors, Investment Banks, or Personal FundsUse of Funds: Start-Up Cost, Rent, Equipment, Advertising, Distribution

Business Description: Lawson’s Gourmet Chicken Pies is a pie company that specializes in gourmet, frozen, chicken and dessert pies. These pies use high quality ingredients and provide a meal for up to six people. The company will continue to support retail sales while branching out into wholesale with high-end grocery stores such as Kroger, Fresh Market, and Whole Foods.

Company Background: The company originated out of Lisa Helmick’s basement kitchen with the dream to sell chicken pies as an easy, wholesome meal for busy families. Lisa began her business in hopes to be able to send her five children to college and help support her family.

Management: CEO, VP Sales/Marketing, Product Development and Senior Manager, Lisa Helmick, has two years of experience running and operating her business, understanding the processes and operation, as well as providing excellent customer service. Potential storefront manager must possess a college degree in business or management, or have significant past experience. Duties include daily operations, scheduling, and customer satisfaction.

Products/Services: Lawson’s provides a hearty and healthy meal quickly that can serve an entire family. It has the taste of a home cooked meal and does not contain any filler ingredients and each pie is guaranteed to have one pound of chicken. Lawson’s also produces seasonal dessert pies for special holidays and occassions.

Technologies/Special Know-how: Lawson’s Gourmet Chicken Pies contain a trade secret that is unannounced to the public and many employees. The corporation will also have copyrights on the logo and tagline.

Markets: Lawson’s target market consists of the Roanoke Valley and will expand to the Commonwealth of Virginia as well as retailers across the nation. Lawson’s market segments are targeted towards households with children, senior citizens, and young professionals. Lawson’s product line would fit in seamlessly in higher end grocery stores such as Kroger, Whole Foods, and Fresh Market.

Distribution Channels: With the incorporation of a storefront, customers will pick up and order their product at the store or online. Lawson’s will also use a contracted shipping company to pick up the chicken and dessert pies from the distribution center and ship them to the retailers that have contracts with the company.

Competition: Lawson’s is in competition with any frozen food product that is able to feed more than two people. Many of the main competitors for Lawson’s would include Swanson, Stouffers, and Marie Callender’s. The competition is extensive, but with the dynamics of a healthy alternative, the hometown atmosphere, and affordable pricing allows Lawson’s to increase their ability to compete with other products.

Financial Projections (Unaudited): 2011 2012 2013 2014 2015 Revenue: 211.4 700.7 1,558.0 14,157.6 42,861.1 EBIT: (47.1) 229.9 547.8 5,522.5 18,796.7(dollars in thousands)

Use of Funds: Initial funds will be invested into the corporation immediately for start-up costs including rent, operation costs, equipment, advertising, and marketing.


Executive SummaryLisa Helmick, The Pie Lady


CORPORATE STRUCTURE

Table of Contents

MARKETING

NAME AND TAGLINE LOGO MISSION AND VISIONENTRY DECISION AND STRATEGYCORPORATE TYPE AND LEGAL ASPECTSGOALSORGANIZATIONAL STRUCTURERESEARCH AND DEVELOPMENT

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101112131415

MANUFACTURIING PROCESSES POLICIES AND PROCEDURESWORKFORCE CONSIDERATIONSFACILITYPACKAGING AND DISTRIBUTIONEQUIPMENTPROCESS CONTROL PROCEDURESQUALITY CONTROL PROCEDURESCOST CONTROLINTELLECTUAL PROPERTY

18202124262728293031

CONSUMER RESEARCHMARKET RESEARCHDEMOGRAPHICSROANOKE VALLEY STATISTICSPSYCHOGRAPHICSGEOGRAPHICSPROFITS BY PRODUCTPENETRATION GOALSPACKAGINGSERVICEMARKETING AND ADVERTISING PLANSSWOT ANALYSISPRODUCT COMPARISONS

34363840414244454647485657

INCOME STATEMENTBALANCE SHEETREVENUE BREAKDOWNBREAK-EVEN ANALYSISSTART-UP COSTSOPERATIONAL EXPENDITURE

626465697072

EXTERNAL ENVIRONMENTINDUSTRY ENVIRONMENT PORTER’S FIVE FORCES MODEL DRIVERS OF CHANGEINDUSTRY LIFE CYCLE VALUE CHAIN ANALYSISEXIT STRATEGY

889095979798

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OPERATIONS

FINANCIALS

STRATEGY & ANALYSIS

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CORPORATE STRUCTURE

OPERATIONS

MARKETING

FINANCIALS

STRATEGY & ANALYSIS


NAME AND TAGLINE LOGO MISSION AND VISIONENTRY DECISION AND STRATEGYCORPORATE TYPE AND LEGAL ASPECTSGOALSORGANIZATIONAL STRUCTURERESEARCH AND DEVELOPMENT

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101112131415


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LogoCorporate Name and Tagline

Corporate Name

Lawson’s Gourmet Chicken Pies™ is the name that will represent the corporation’s quality, integrity, status, focus on service, and family values. This corporation began as “The Pie Lady”, and through its growth and expansion, it was decided that a more developed name was needed to evolve the company. It was important to incorporate the hometown and family atmosphere, while moving towards a nationwide company. Through deliberation, it was decided that changing the company’s name to Lawson’s Gourmet Chicken Pies™ was the best representation of the corporation. The name keeps intact the family roots and atmosphere that first drove Lisa Lawson Helmick to starting her small business. Lisa, “The Pie Lady”, will remain the face of the company in order to retain the company history.

Tagline

Lawson’s Gourmet Chicken Pies™ will be represented by the tagline, “Easy Meal with a Home Cooked Feel”. This phrase gives insight to the consumer as to why they should purchase a pie.

Logo

Lawson’s Gourmet Chicken Pies™’ logo is simple yet recognizable. The colors red, white, and blue with the gingham background are not only patriotic, but provide a hometown feel. The chicken pie in place of the “O” in Lawson’s provides an additional visual understanding of the chicken pies that are produced.



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Mission and Vision Entry Decision and Strategy

Consumer Mission

Lawson’s Gourmet Chicken Pies™ will provide the highest quality chicken pies that are both convenient and affordable.

Corporate Mission

The mission is to provide the highest quality gourmet chicken pies that are both convenient and affordable. The production process focuses on the highest standards of quality, service, and safety. Lawson’s seeks to maintain their local customer loyalty by opening a storefront, with the goal of expanding relationships state-wide at the beginning of year 3, regionally at the beginning of year 4, and nationwide at the beginning of year 5. Lawson’s will have a learning and teaching culture through constant communication between management and daily employees. All employees will be treated with the utmost respect and trust, making Lawson’s employees part of a close knit family.

Vision

The vision of the company is to be the leading provider of healthy, gourmet chicken pies nationwide. Regardless of the company’s size, the culture will focus on family values through a friendly and cohesive atmosphere.

Entry Decision

Taking the business out of Lisa Helmick’s home and into a storefront facility located in the Roanoke Valley allows her to enter a larger market. The outside location allows for increased production to meet demands of local clientele as well as area retailers.

Generic Strategy

Lawson’s uses higher quality ingredients, is healthier, and tastes better, differentiating it from the competition. Pies are not pre-baked thus they offer a higher level of freshness after being cooked in the customer’s home. This allows for the product to be competitive and appeal to the specific target market. The product is gourmet and uses top-quality ingredients with no fillers or preservatives, allowing it to be sold at a higher price.


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Corporate Type and Legal Aspects Goals

S-Corporation

Lawson’s Gourmet Chicken Pies™ will operate as an S-Corporation. With an S-Corporation, the liability is limited to the investment made in the company. Stock will be issued to raise start-up capital for the business.

Legal Issues

Legal issues pertaining to the business are risks of food borne illnesses. To minimize risk, Lawson’s must obtain certifications from government agencies including Department of Agriculture and Consumer Services and the Food and Drug Administration. This will include meeting regulatory approval for all pie labels by displaying nutritional information, allergens, expiration date, cooking and storing temperature, and other legally binding requirements. Insurance is necessary to cover a variety of issues that can arise within a business. This includes equipment failure, terrorism (covers vandalism and arson), flood, fire, and product corruption.

Short-Term Goals (1-3 years)

1. Move into The Shops at Cedar Ridge, a strategically placed storefront location in a high traffic area2. Hire employees to meet demands of production3. Purchase equipment for the storefront location 4. Implement small business software for scheduling, payroll, tracking, and inventory5. Utilize a point of sales system6. Improve the quality of the product’s packaging 7. Expand marketing efforts throughout the Roanoke Valley8. Outsource distribution 9. Continue to wholesale to Homestead Creamery, while expanding to other local retailers10. Sell pies in Kroger regionally by year 2

Long-Term Goals (3-5+ years)

1. Distribute nationwide2. Expand to a manufacturing plant3. Outsource distribution to a company that has certified refrigerated trucks4. Use large scale advertising campaigns to reach individuals and families across the nation


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Organizational Structure

Phase I

The organizational structure of phase one is appropriate when there are solely retail sales from the storefront and wholesale from Homestead Creamery. High quantities of staff are not needed during this time, therefore the responsibilities of the Storefront Manager and the CEO will be completed by Lisa Helmick, the company owner.

Phase II

Phase two will begin when Lawson’s first starts wholesaling to Kroger and other large retail grocers. Staff will gradually be added and the phase will be complete (as seen in the chart below) at the beginning of year 4.

CEO/Storefront Manager

KitchenManager

Cashiers Cooks

CEO

StoreManager

KitchenManagerCashiers

Cooks

Bookkeeper Warehouse Manager

ProductionManager

DistributionManager

Marketing Manager

Warehouse Workers

Research and Devlopment

Research and Development

To continually gain customer feedback, Lawson’s marketing manager will conduct annual phone surveys; this allows Lawson’s to directly communicate with its current customers. There will be a side bar on Lawson’s corporate website with a single multiple choice question in order to receive quick feedback on customer satisfaction. Focus groups were designed to be small (5-10 participants) and act as brainstorming sessions. A set of questions were written for the administrator to use, but the goal is to spark creative discussion that could provide new and interesting ideas. Direct mailers with a Lawson’s $2 dollar off coupon will be sent to targeted areas. Lawson’s marketing manager will record how many coupons were mailed and how many coupons were redeemed. The data will judge the success and continued use of such promotional materials. Lawson’s cashiers, through direct communication, will be able to gain insight on customers’ opinions. This interaction will enable Lawson’s to ensure that all customers coming to the retail store are satisfied and their opinions are heard.

*See Appenix A for a complete workforce breakdown.


CORPORATE STRUCTURE

OPERATIONS

MARKETING

FINANCIALS

STRATEGY & ANALYSIS

MANUFACTURIING PROCESSES POLICIES AND PROCEDURESWORKFORCE CONSIDERATIONSFACILITYPACKAGING AND DISTRIBUTIONEQUIPMENTPROCESS CONTROL PROCEDURESQUALITY CONTROL PROCEDURESCOST CONTROLINTELLECTUAL PROPERTY

18202124262728293031


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Manufacturing Processes

1 Receive packaged materials along with letters of guarantee from suppliers. All

materials must be stored in a clean area and appropriate temperatures. The chicken must

be refrigerated at or below 40ºF.

2 Begin gravy by melting butter and adding all-purpose flour into a clean

mixing bowl.

3Press the vegetables to eliminate any extra water. Then place vegetables in a refrigerator until end of the

production process.

4Boil water for chicken. Remove chicken from refrigerator and

place in a designated area. Unwrap chicken and place immediately in boiling pot.

Cook chicken until the internal temperature reaches 165ºF.

5Dispose of all wrappings. Disposal can will be sealed and taken out to the dumpster. The area must be bleached to rid of any bacteria and potential contamination.

6 Once chicken reaches 165ºF, place on a processing table

that is covered with disposable paper. Allow chicken to

cool and constantly monitor the temperature to prevent

pathogens.

7 Add bouillon cubes and

chicken base to boiling water to form the chicken

roux.

Take cooled chicken and stage the

cleaning process. Extract all skin and

extra fats. Place clean chicken into Hobart’s meat shredder. Clean

after use.

8

10

9 Combine chicken and roux to make base chicken

mixture. Mix pie dough and place in dough roller. Cut and place into

the foil pie pans. Prepared pie shells are then

moved to assembly area.

11Combine base chicken with

additional recipe ingredients.

12Add mixture to the uncooked pie shells

13Take the pie dough, place it over

the top of the chicken pie and flute (decoratively enclose).

14Pies are then sealed, packaged with appropriate labels, and

placed in walk-in freezer. Pies will remain frozen until the end consumer receives the product.


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Policies and Procedures

Company Policies

Lawson’s Gourmet Chicken Pies™ is an equal opportunity employer and does not discriminate based on race, creed, color, religion, gender, sexual orientation, gender identity/expression, national origin, disability, age, or covered veteran status.

Employee Policies

All workers must be at least 16 years old or possess a certified work permit. Employees must present themselves in a professional manner at all times. This includes having no visible tattoos or piercings, apart from a single stud in ear. In order to prevent accidents, employees are required to wear non-slip, closed toe, full coverage shoes. Upon hiring, all employees will be provided with 3 polos, 2 aprons, and 1 hat embroidered with Lawson’s logo. All staff must wear a clean and wrinkle free pair of khaki pants with a belt, along with a tucked in Lawson’s polo shirt and a Lawson’s apron. All clothing must be clean and free of stains. All employees must wear a Lawson’s hat and hair that is chin length or longer must be pulled back. Employees must wash hands when entering the kitchen, after handling raw meat, after completing a janitorial responsibility, and after using the restroom. Employees are expected to arrive on time as scheduled. Employees are expected to welcome all customers with a warm greeting, always be helpful, and maintain a positive attitude. Employees must follow the philosophy that the customer comes first. Lastly, the storefront must maintain constant cleanliness.

Workforce Considerations

Training

Lawson’s recognizes that employees who are properly trained will outperform those who are simply told what to do. Communication is essential in the education process; for this reason Lawson’s will inform and demonstrate employee duties in order to avoid confusion. The kitchen staff will shadow Lisa Helmick in the specific task that they will be responsible for. The front of store staff will be trained to use the cash register, to take orders in the store and over the phone, and to make sales.

Employee Appraisal

Lawson’s will monitor their employees’ performances and appraise them based on the following criteria; quality of work, quantity of work, versatility, communication skills, and dependability. Employees will be evaluated through the use of a secret shopper on an annual basis. If the employee receives an excellent report then that employee will be rewarded with a $100 bonus. The manager will choose an employee who best upholds the mission of the company during that month to be “Employee of the Month”. This person will receive an extra $50 on their next pay check. Any employee who a manager feels has done an outstanding job in that pay period will receive an extra $20 on their pay check.


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Harassment

Any unwelcome or unwanted conduct that shows hostility or opposition towards another person in a derogatory manner on the basis of an individual’s race, color, gender, ethnic or national origin, age, religion, disability, marital status, sexual orientation, and gender identity is considered harassment. Such conduct is a violation of Title VII of The Civil Rights Act of 1964, The Age Discrimination in Employment Act, The Americans with Disabilities Act, and The California Fair Employment & Housing Act. Lawson’s will implement a harassment prevention policy to ensure prohibited behaviors are avoided. Lawson’s has a zero tolerance policy for harassment. If any person feels as though they have been harassed that individual has the right to file a complaint. Investigative action will occur and if any employee is found guilty, they will be immediately terminated, asked to return their uniform, and escorted off the premises.

Workforce Considerations

Three-Strike Policy

If an employee violates company policies or procedures, then disciplinary action will be taken. Lawson’s will operate off of a three strike policy. Upon the first incident, the employee will be verbally warned and the incident will be documented. If the problem occurs again, then the employee will have a private meeting with the manager in charge and the incident will be recorded again. If the problem occurs a third time, the employee will be terminated, and escorted off the premises. Upon termination, the employee will receive a letter outlining the reasons that have led to their expulsion.

Immediate Termination of Employment

There are some circumstances in which an employee would be immediately terminated. These include if an employee is violent towards another employee or customer, uses profanity towards a customer, commits theft from the store, arrives at work intoxicated or under the influence of drugs, is arrested for a felony, violates the company harassment policy, or participates in sexual misconduct.


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Facility

Location of Facility

The storefront will be located at the Shops at Cedar Ridge in Daleville, Virginia; this location is on Route 220, Roanoke Road. The location was chosen because it resides in an area with a high annual daily traffic count that is easy for trucks to access both for deliveries and distribution. The area has a high-growth potential that will allow Lawson’s to expand the business.

Layout of Facility

The facility will be organized so that each task is broken down into different stations. Each station will be strategically placed to optimize time, efficiency, product flow, labor, and space while minimizing the risk of cross contamination. The layout is to scale, including all equipment and based on architectural standards including door width and counter depth.

Lawson’s Storefront

Restroom

O�ce

DishwasherBreak Area

Hood System

Cooking Line

Chicken Preperation

Packaging

VegetablePrep

Walk infreezerChicken

Storage

Dry Storage

Retail


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Distribution Distribution will be outsourced because the cost of owning and operating a fleet of refrigerated trucks is not cost effective. Lawson’s would dramatically increase their liability by having drivers on the road. By outsourcing distribution, the liability shifts from Lawson’s to the distribution company. Outsourcing will begin in year 2 when Lawson’s expands wholesaling.

Packaging

The packaging will be high-quality paperboard that is structurally stable. More dynamic factors, such as ingredients and nutritional information that changes from pie to pie, will remain sticker labels that can be easily modified. Both material choice and interchangable labels lower packaging costs.

Packaging and Distribution Equipment

FLOOR DOUGH MIXER

STEAM KETTLE

GAS BURNER

*See Appendix B for a complete list of equipment


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Process Control Procedures

Process Control

• Items will be shipped from the supplier to Lawson’s. These items will be examined for correctness and stocked in store. • Allocated areas within the freezer for the different ingredient parts such as the crust, chicken, and vegetables.• The dry storage area will utilize air tight containers in order to avoid contaminants and insure ingredients stay fresh. • All packaging from the ingredients must have a letter of guarantee on file from the supplier that will be kept in the storefront office. • Refrigerators and freezers will be frequently inspected to ensure they are operating properly.

Quality Control

• All ingredients will be purchased from an FDA or USDA inspected source and are Generally Recognize as Safe (GRAS) • Lawson’s will use hormone-free chicken with no fillers, frozen vegetables, and homemade pie crust instead of store bought.• Lawson’ will use an assembly line for pie production to ensure consistency and quality. • Separate processing stations will be used for the different stages of production in order to decrease the possibility of cross contamination.• Temperatures will continuously be monitored when cooking chicken and the roux mixture.• Employees must wash hands after handling raw chicken.• Utensils and internal thermometers will be cleaned after each use.• Only one type of pie will be made during each shift so as not to confuse various ingredients.

Quality Control Procedures


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Cost Control Measures

Several measures will be taken to keep costs to a minimum, particularly utilities. Blinds will be installed to keep sunlight out during the summer and further insulate the building when the air conditioning is in use. During the winter months, the blinds will be left open in order to passively heat the building. Motion sensors will be used for lights in the office, freezer, and bathroom in order to ensure that they are off when not in use. The toilet and bathroom sink will also utilize sensors to prevent water from being wasted. All light bulbs will be energy efficient and plumbing will be high efficiency. The thermostat will be set on a timer so that the building will not be excessively heating or cooling outside of operation hours. In order to keep down food costs, the inventory will be tracked as well as all expiration dates. There will also be high standards of quality control so as not to waste ingredients; scales and other measuring devices will be used to ensure that the correct amounts of ingredients are used in each pie. Orders will be based on the amount of ingredients needed and will vary during the high and low seasons.

Cost Control Measures Intellectual Property

Production versus Sourcing Costs

Some items are less expensive when made from scratch rather than purchasing pre-made pie crust with the aluminum pie shell and the top pie crust costs more than purchasing the aluminum shell and making the crust from scratch. The cost of the pre-made top crust, bottom crust, and shell comes to $2.01. Lawson’s will make their own pie crust, the ingredients associated with making the pie crust in-store including the pie tin equals $0.60 per pie. Lawson’s will save $1.41 by producing pie crust in-store and buying pie tins in bulk. In addition to the price savings, Lisa will be able to utilize her grandmother’s secret recipe that makes a much fresher pie crust that will also lower the fat and cholesterol intake

Intellectual Property

Lawson’s Gourmet Chicken Pies™ will seek trademarks for individual sections of the business. Trademarks are necessary for the name of the business, the merchandise sold, and the actual pies. Lawson’s Gourmet Chicken Pies™ will not seek a patent because the corporation is not creating a new product. Also, copyrighting a recipe is an arduous process and from a liability standpoint, it makes more sense to focus on non-disclosure agreements along with employment contracts prohibiting a Lawson’s employee from leaving to work for a competitor. To avoid recipe theft, a single Lawson’s employee will not be completely involved in the production process from start to finish; tasks will be divided among the kitchen staff.

CORPORATE STRUCTURE

OPERATIONS

MARKETING

FINANCIALS

STRATEGY & ANALYSIS

CONSUMER RESEARCHMARKET RESEARCHDEMOGRAPHICSROANOKE VALLEY STATISTICSPSYCHOGRAPHICSGEOGRAPHICSPROFITS BY PRODUCTPENETRATION GOALSPACKAGINGSERVICEMARKETING AND ADVERTISING PLANSSWOT ANALYSISPRODUCT COMPARISONS

34363840414244454647485657



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Research

Primary Research

In order to successfully penetrate the retail industry, Lawson’s conducted a focus group and telephone surveys to gain accurate knowledge of the industry and potential demographics.

*See Appendix C for a copy of the focus group questions and complete results

Secondary Research

Lawson’s used internet research to analyze competitors trends locally as well as nationwide. Analysis of Stouffer’s, Marie Callender’s, Boston Market, Healthy Choice, Willow Tree Poultry Farm, Freschetta, Amy’s Organics, The Fresh Market, Amy’s Organics and other competitors’ products informed the company of competitors’ strengths and weaknesses. Some of the major weaknesses of Lawson’s competitors were the number of people they served and the high amount of calorie’s they contain. Some strength’s were that all of these companies are already well established in the frozen food industry. This information assisted Lawson’s in decisions regarding issues of pricing, ingredient selection, and distribution.


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Market Share Projection

U.S. supermarkets sold over $500 billion in retail sales in 2008; frozen foods represent 6% of those total sales, approximately $30 billion. Ready to eat frozen meals and pizzas account for the largest single segment of the frozen food market, slightly over 40%. The specific industry of frozen pies brought in $325 million. Of the $12 billion dollars in sales of ready to eat meals, Lawson’s predicts to control $5 million dollars by year 5. (www.driveyoursuccess.com)

Market Size

In year two, Lawson’s hopes to be wholesaling to the Krogers within a 30 mile radius of Roanoke (19 stores), state-wide (62 stores) in year 3, the entire Mid-Atlantic Division (566 stores) in year 4, and the Atlanta Division (315 stores) in year 5. There are 2,438 Kroger stores in the United States that Lawson’s could potentially wholesale to in the next 10 years. Currently, Lawson’s is selling by word of mouth throughout the Roanoke Valley; the region currently has a population of 300,399. Lawson’s loyal clientele is roughly 150 customers; the company predicts an increase from 150 customers to 2,696 in the first year.

Buying Behavior

Within the wholesale aspect of the company, retailers will receive Lawson’s pies biweekly. Their order sizes will be based on consumer demand. In the current retail space, the owner’s home, customers make an average purchase of 3 pies. It is predicted that when the product is easily available in a large retail store, customers will purchase an average of 1.5 pies. It is expected that customers will purchase pies bimonthly.

Industry Trends

In 2008, U.S. food sales declined by 3.7% due to the economic recession; this was the first time food sales have seen this kind of decrease in 60 years. The decline in sales was due to consumers substituting high-priced goods for less expensive ones. As consumers chose to eat at home, the sales of pre-packaged meals and frozen foods increased by 4% since 2008. This includes the frozen food market such as prepared meals, pizzas, vegetables, desserts, novelties, snacks, and, more specifically, chicken pies. (Data Monitor Industry Profile: Frozen Foods)

Growth Potential

A storefront location increases production from 400 to 4,000 pies per week when functioning at maximum capacity. This Lawson’s has captured only a small portion of the potential market in her local region. With aggressive marketing strategies that develop product and company awaresness, Lawson’s clientele in the Roanoke Valley, state, and nation will grow exponentially with the entry into a large retail store such as Kroger.

Market Research


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Demographics

Households with Children

Lawson’s primary target market is households with children, which represent 46% of U.S. households (USA Today, 2008); in particular, working mothers who struggle to prepare a home-cooked meal during their busy schedules. Currently, U.S. mothers control 2.1 trillion dollars of household income. According to a 2009 survey, 65% of mothers feel that they are “under-served” by advertisers. It is important to know where mothers work and socialize in order to properly market to them. Some possible locations include schools, churches, coffee shops, grocery stores, day care centers, and athletic centers. (Business Service Management Review, 2009) Senior Citizens

Senior citizens are a growing demographic with the highest disposable income of any age group; seniors control 70% of the disposable income in the United States (Florida State University, Pepper Institute of Aging and Public Policy). Senior citizens are looking for ways to simplify their lives and seek ways to continue living independently and healthfully. A nutritious, delicious, and convenient meal is appealing to them with their changing needs. Within the retail aspect of Lawson’s, advertisements will appear in the “Retirement in Southwest Virginia” annual issue of The Roanoker Magazine. On a national scale, advertisements will appear in large retirement communities, public transportation, and direct mailers with coupons will be sent.

Young Adults

There are currently 11.27 million full-time college students in the United States (U.S. Department of Education). Students will be targeted by appealing to their parents. The average starting income of a recent college graduate is $48,351 (CNBC.com), which is similar to the average income within the Roanoke Valley. 1.7 million bachelor’s degrees are expected to be awarded in 2011(U.S. Department of Education). Lawson’s will appeal to this demographic by targetting students who will continue consuming Lawson’s products. Ads on public transportation will also appeal to this demographic, particularly in urban areas.

Retailers

Retailers are the most profitable and important target group for Lawson’s to focus on. They provide consistent customers and income along with a legally binding contract that ensures constant revenue. Lawson’s chicken and dessert pies have already proven to sell successfully when retailed by Homestead Creamery. The data available from this early success will help the company to appeal to other retailers.


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Household with Children

The customer psychographic is a modern family in which one or both parents may work. They lead a healthy lifestyle and would like to continue to provide homemade meals for their families without all of the work. They want to have traditional family values while also maintaining a modern family dynamic. These families are busy with many activities and have very limited time to prepare a meal.

Senior Citizen

A secondary psychographic is that of a senior citizen who values maintaining their current independent living situation. They may no longer want to take the time to prepare a home cooked meal. They buy frozen and other prepared meals out of convenience, but also would like to have a high-quality, nutritious meal.

Young Adult

A tertiary psychographic is that of a young professional. This person may have just moved away from home and are still adapting to their new lifestyle. They miss the comforts of home, especially a warm, delicious dinner. They have limited free time because of their new, busy schedule. Convenient food is a staple in their diet and they wish to have a nutritious, enjoyable meal. For a student, the product will most likely be purchased by a parent, who will be advertised to with direct mailers and commercials.

Women

Men

Not in Workforce

Roan

oke

Valle

y W

orkf

orce

*THOSE NOT IN THE WORKFORCE ARE INDIVIDUALS WHO ARE NOT EMPLOYED OR SEEKEING EMPLOYMENT. HIS INCLUDES CHILDREN, STUDENTS, AND RETIRED PERSONS.

Average Income in the Roanoke Valley

The Roanoke Metropolitan Area is estimated to have 300,399 residents amongst its six counties and cities. Of those residents, 80,000 families exist composed of 51,912 working women and 43,842 working men as seen in the pie chart below. The average household income is $56,508 in Roanoke County, $59,441 in Botetourt County, and $35,088 in Roanoke City. Lawson’s Gourmet Chicken Pies are an affordable option for people of diverse income levels.

Roanoke Valley Statistics Psychographics


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Geographics

Geographics

Lawson’s is located in the Roanoke Valley, a 2,325 square mile region. Roanoke is located off of two major highways.; these highways have the ability to facilitate the shipping needs of Lawson’s; the Roanoke Valley is strategically placed for easy access to both the East Coast and the Mid-West. The two major highways in the area are I-81 and I-581; these roads serve as both commercial and commuter routes. I-64 to the north and I-77 to the south are also convenient interstates that people often use when passing through the area. The local geographic in the Roanoke Valley Region includes Botetourt County, Roanoke County, Roanoke City, Franklin County, Craig County, and the City of Salem. The expanding geographic extends to cover the entire state of Virginia. Nearby metropolitan areas include Richmond, 189 miles east of Roanoke City, Washington D.C., 234 miles northeast, and Hampton Roads, 240 miles west. Other nearby metropolitan areas outside of the Commonwealth of Virginia are Baltimore, Charlotte, Raleigh, Greensboro, and Nashville.

Lawson’s Corporate Headquarters

Kroger Co. Corporate Headquarters

Kroger Co. Mid-Atlantic Division Office

Nearby Metropolitan Cities


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Profits by Product

Profits by Product

Lawson’s currently produces eight different pies, which are currently sold for either $12 or $14 per pie. Each pie produces a different profit due to the various ingredients used for certain recipes. The current types of pies are Chicken Veggie, Just Chicken, Chicken Mushroom, Broccoli and Cheese, Chicken Bacon, Asiago & Spinach, Cheesy Chicken, Chicken Fajita, and Chicken Cordon Bleu. The diagram below displays the breakdown of price, cost, and profit margin. Prices for retail sales will be $11.95 for classic pies, $12.95 for dessert pies, and $13.95 for signature pies. Pricing for wholesaling will be $9.00 for classic pies, $8.00 for dessert pies, and $10.00 for signature pies. Cost of goods sold will decrease increased pie production and ordering in bulk from U.S. Foodservice or Sysco.

Type of Pie

Cost of Goods Sold

Retail Price

Retail Profit

Retail % of Profit

Wholesale Price

Wholesale Profit

Wholesale % of Profit

Classic

$4

$11.95

$7.95

67%

$9.00

$5.00

56%

Signature

$5

$13.95

$8.95

64%

$10.00

$5.00

50%

Dessert

$3

$8.95

$5.95

66%

$6.00

$3.00

50%

Penetration Goals

Short-Term

In the short-term, the main goal is to establish the business within the Roanoke Valley. Lawson’s will continue to wholesale to Homestead Creamery and extend into selling in other local stores. As Lawson’s reputation grows, the next step will be to expand wholesaling into a large, retail grocery store, such as Kroger. Wholesaling would begin in the Roanoke Valley are and gradually branch out over more of Virginia.

Long-Term

Long-term goals begin after Lawson’s adds an additional production center that is larger and lower-cost than the storefront. At this point, Lawson’s will begin wholesaling across the state of Virginia. Nearby states will be the next markets to approach, including West Virginia, North Carolina, South Carolina, Kentucky, and Tennessee. In order to accomplish this goal, Lawson’s will utilize an aggressive marketing campaign in those new states that will rapidly spread the name and reputation. Direct mailers will be sent to inform potential customers that they will be able to purchase Lawson’s at their area grocery store. With the grocery stores, there will be taste tests where coupons will be handed out to entice people to try a new product. These stragies will enable Lawson’s to enter the national market.


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Packaging

Packaging

The packaging will strive to reflect the quality of the product. The pie boxes will be made of a high-quality paperboard. The box itself will have a blue, gingham print. A bright color, red, will serve as an accent to attract buyers’ attention. Serif, script fonts will be utilized in order to give the image of gourmet and a more luxurious frozen meal. The logo featured on the packaging will reflect a hometown, wholesome company that can provide a hearty, healthy meal for families across the nation.

Service

Service

Lawson’s focus is on service to the customers. It is not only the quality of the product, but the hometown courtesy that differentiates Lawson’s from its competitors. Customers can always count on Lawson’s using only the highest quality ingredients, such as hormone-free chicken as well as no preservatives or fillers. Consumers will feel good serving this product to their family. Customers will have the assurance that their preferred pie will be in stock through pre-ordering. Customer satisfaction is the employees’ number one priority and they will always be treated with the utmost respect. In the event that a customer is not satisfied, Lawson’s will make every attempt to find a solution. This includes, but is not limited to, refunds, discounts, and coupons. The purchasing experience is more enjoyable when the customer is greeted by a familiar face when they enter the door. Lawson’s will maintain open communication with all retail business associates, including Kroger and Homestead Creamery. This will prevent customer dissatisfaction and ensure that in the event of an issue, a solution can be easily reached. With all marketing and advertising strategies, the most important component is the employees who maintain a positive image through consistent focus on service, courtesy, and meaningful personal interactions. People interact with businesses that they like and trust. Through positive customer interactions, the employees will maintain and expand retention rates and positive relations within the community.


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Internet

Lawson’s Gourmet Chicken Pies™’ aim is to reach out to a variety of demographics through various forms of media and promotions. Easily maintained and updated to provide current information, Facebook, Twitter, and Lawson’s corporate web page will be utilized to communicate with the public. It will be here that seasonal products, weekly promotions, store hours, company history, and current news will be available to loyal customers as well as interested new clientele. As of 2010, 30% of Facebook users are age 35 or older; this data conveys that social media would be an effective way to reach the target market (Istrategy Labs Facebook Statistics and Demographics Report 2010). Promotions such as LivingSocial and Groupon will help spread the company name and reputation to customers who otherwise would not hear about Lawson’s. Internet maintenance will be the responsibility of the in-store manager. This manager will update the corporate website, Facebook, and Twitter account.

Internet Homepage

The homepage will evoke the same hometown feel as the storefront, packaging, fliers, and apparel. It will feature the history of Lawson’s Gourmet Chicken Pies™ starting from Lisa learning to bake from her grandmother to the move from her basement to a storefront. The menu will be available with both nutrition information and ingredients. All company and contact information will be easily accessible. By year 2, it will be possible to order online.

Internet

© 2011 Lawson s Gourmet Chicken Pies. All rights reserved.,

Contact Us Order Online Our Products


50 51

Marketing and Advertising Plans

Networking

Networking and making personal connections with clients and retailers at trade shows and farmers’ markets are effective ways to further the business. Personal interaction will help encourage the buyer’s decision based on the trust, sincerity, and ethics that are displayed through personal conversations. Prior to trade shows, Lisa can target potential retailers by sending an embroidered potholder to them along with a business card and a brief note stating her interest and the excitement she has for future interactions. In-Store

In order to attract new clients, a point of purchase display will be featured each time Lawson’s enters a new retail store. There will also be taste testing in new stores where coupons will be handed out in order to actively market to potential customers.Lawson’s will provide Kroger with stand-alone freezers to increase chances of both entrance into the store purchasing of products.

Direct Mailers

Direct Mailers Direct mailers will be strategically sent out five times a year. In the first year, 250 will be sent out and time and in years 3-5, 500 will be sent out. The mailers will contain promotions and/or coupons. Pop-up calendars will also be sent out annually as an additional mailer to remind customers of the product and attract new customers.


52 53

Promotional Items

Promotional merchandise can provide a useful, tangible object that customers can use in their home on a regular basis to remind them of the fantastic pies and services that they associate with the logo and name of Lawson’s Gourmet Chicken Pies™. Providing Lisa’s current loyal customers and potential new retailers with an embroidered potholder will serve as a constant reminder of the product. Further, promotional merchandise that will be utilized at tradeshows are koozie can holders with a soda. These will be handed out at the booth so that as potential customers walk around the tradeshow, others will see the Lawson’s logo in their hand. Custom pens will also be available to hand out in order to entice visits to the booth. Custom labelled spring water bottles will be handed out at tradeshows in addition to local spring and summer fairs. Samples of Lawson’s pies will also be handed out at the trade show in order to give potential retailers a sample of the product.

Promotional Items


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Storefront

Storefront

The storefront will feature bright signage to attract the attention of potential customers. The aesthetics will reflect the hometown atmosphere, so that customers feel like they are picking up a pie right from Lisa’s own kitchen.

Print

Ads will appear in newspaper inserts that are often focused on community news. Promotional merchandise will be strategically dispersed to both wholesale and retail clientele. Ads will also be placed in The Roanoker Magazine. This medium was chosen because of the reader profile: 96% are over age 35, 62% are female, average net worth is $748,650, average income is $112,000, and 23% of readers are millionaires (The Roanoker Magazine). The ads will continue to be placed during years two through five.

Television Commercials will begin to run state-wide in year 4 and nationwide in year 5. Lisa will appear in the commercials as the face of the corporation and the health, convenience, high-quality, and excellent taste will be the focus of the ad.

Advertisements


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Product Comparisons

Frozen Meal Digiorno PizzaFreschetta Pizza

Stouffer’s Chicken PieMarie Callender’s Chicken Pie

Lawson’s Chicken PieAmy’s Vegetable Pie

Amy’s PizzaKashi Tuscan Veggie Bake

Healthy Choice Meals

Price$9.689.594.259.99

11.952.697.993.272.99

Serving Size6.7oz5.4410.010.0

7.1257.5

14.010.010.6

Price/Serving$3.232.404.252.502.672.692.663.272.99

Servings/Box3414

4.51311

Per Serving Digiorno PizzaFreschetta Pizza

Stouffer’s Chicken PieMarie Callender’s Chicken Pie

Lawson’s Chicken PieAmy’s Vegetable Pie

Amy’s PizzaKashi Tuscan Veggie Bake

Healthy Choice Meals

Calories612607590550450360370260340

Cholesterol60mg

425021750

100

30

Sodium1717mg

1584930826860640580700560

Total Fat27g24343423131999

Protein28.9g26.819.016.026.010.010.017.014.0

Nutrition Comparison

Cost Comparison Matrix


High Price

Low Price

HealthyUnhealthy


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SWOT Analysis

• Lawson’s extremely loyal customers helped generate over $90,000 in sales in 2010, a huge success for a small business out of a basement• Lawson’s expansion to a new storefront will continuously increase sales while productivity will more than double• Lawson’s biggest asset is the CEO’s, Lisa Helmick, experience, particularly when hiring and training new employees• Lawson’s has a family environment and hometown atmosphere, making all customers feel welcome

STR

ENG

THS

WEA

KN

ESSE

S • An employee could discover the trade secret and use it against the company, despite legal documents attempting to prevent this• Lawson’s is entering a well established industry in the mature stage of the industry lifecylce• Seasonal demands will create uneven labor demands and require employees to work uneven hours

• With the expansion of a storefront and warehouse, Lawson’s has the opportunity to distribute to large retail stores, such as Kroger • Enhancing Lawson’s technological capabilities will assist in tracking sales and customers; this information can be utilized for marketing and increasing profit• A clientele database will allow direct communication with customers to send notices, follow ups, coupons, discounts, and save-the-date information• The frozen food industry is very trendy; Lawson’s personal pies and new flavors can increase salesO

PPO

RTU

NIT

IES

THR

EATS

• A large corporation could create a pricing competition by creating a healthier and less expensive product similar to Lawson’s• An incident of a food borne illness could tarnish Lawson’s reputation in the public eye• Competitors, such as Nestle, S.A., have a well- established brand loyalty that will be hard to compete with


CORPORATE STRUCTURE

OPERATIONS

MARKETING

FINANCIALS

STRATEGY & ANALYSIS

INCOME STATEMENTBALANCE SHEETREVENUE BREAKDOWNBREAK-EVEN ANALYSISSTART-UP COSTSOPERATIONAL EXPENDITURE

626465697072


62 63

Revenues:Retail Sales

Wholesale Sales

Net SalesCost of Goods Sold

Gross ProfitOperating Expenses:

Advertising & Promotion ExpenseApperal

Bad batchBenefits

Corporate Permit & RegistrationCredit Card Fees

DeliveryDeprecitation

Employment IncentivesIncorporation

InsuranceLicense Tax: Botetourt

MaintenancePhone Line

RentSalaries

Sale DiscountSecuritySupplies

Travel ExpenseUniversal Code

UtilitiesWages

Website Expense

Total Operating ExpensesEarnings Before Interest

Interest Expense

Earnings After Interest

Year 1

77%23%

100%37%

63%

10.14%0.19%5.68%0.71%0.12%0.37%0.00%9.10%0.59%0.08%0.41%0.07%0.47%0.40%18.96%14.19%0.17%0.24%0.54%1.42%0.35%10.15%10.32%0.66%

85%(22%)1.83%

(24%)

Year 2

46%54%

100%25%

75%

5.20%0.06%1.71%0.50%0.04%0.22%3.83%2.75%0.18%0.01%0.13%0.02%0.29%0.18%5.72%9.99%0.05%0.02%0.29%0.44%0.02%3.22%7.01%0.17%

42%33%0.51%

32%

Year 3

29%71%

100%33%

67%

10.39%0.03%0.77%0.26%0.02%0.14%2.01%1.24%0.08%0.01%0.06%0.01%0.14%0.08%2.65%5.13%0.02%0.01%0.13%0.20%0.01%1.60%6.60%0.03%

32%35%0.21%

35%

Year 4

4%96%

100%46%

54%

4.61%0.01%0.17%0.10%0.00%0.02%1.29%0.83%0.02%0.00%0.01%0.00%0.03%0.02%0.43%2.05%0.00%0.00%0.17%0.02%0.00%0.41%4.65%0.00%

15%39%0.02%

39%

Year 5

1%99%

100%46%

54%

1.49%0.01%0.11%0.04%0.01%0.01%0.97%0.73%0.01%0.00%0.02%0.00%0.05%0.02%0.28%0.89%0.00%0.00%0.16%0.01%0.00%0.28%4.64%0.00%

10%44%0.01%

44%

Revenues:Retail Sales

Wholesale Sales

Net SalesCost of Goods Sold

Gross ProfitOperating Expenses:

Advertising & Promotion ExpenseApperal

Bad batchBenefits

Corporate Permit & RegistrationCredit Card Fees

DeliveryDeprecitation

Employment IncentivesIncorporation

InsuranceLicense Tax: Botetourt

MaintenancePhone Line

RentSalaries

Sale DiscountSecuritySupplies

Travel ExpenseUniversal Code

UtilitiesWages

Website Expense

Total Operating ExpensesEarnings Before Interest

Interest Expense

Earnings After InterestPayout Ratio

Earnings Available to C.S.Shares Outstanding

Earnings per Share

Year 1

$163,543 $47,892

$211,435 $78,132

$133,303

$21,442 $400 $12,000 $1,500 $260 $779 $- $19,242 $1,240 $175 $863 $147 $1,000 $840 $40,095 $30,000 $360 $515 $1,150 $3,000 $750 $21,460 $21,822 $1,399

$180,439 $(47,135)$3,877

$(51,012)$- $- 500

$-

Year 2

322,387 378,347

700,734 176,233

524,501

36,440 420 12,000 3,500 263 1,535 26,823 19,242 1,240 100 889 151 2,000 1,248 40,095 70,000 360 108 2,024 3,090 150 22,560 49,127 1,199

294,564 229,936 3,595

226,342

$- 500

$-

Year 3

446,909 1,111,094

1,558,003 517,546

1,040,458

161,918 441 12,000 4,000 265 2,128 31,330 19,242 1,240 100 916 156 2,140 1,248 41,298 80,000 360 111 2,085 3,183 150 24,919 102,833 543

492,604 547,853 3,289

544,565

$- 500

$-

Year 4

520,386 13,637,247

14,157,633 6,531,256

7,626,377

653,312 926 24,000 14,500 536 2,478 182,716 116,939 2,480 100 1,886 321 4,580 2,571 61,298 290,000 360 230 24,195 3,278 158 58,490 658,549 -

2,103,902 5,522,475 2,958

5,519,518 50%2,759,759 500

$5,520

Year 5

572,425 42,288,636

42,861,061 19,894,922

22,966,138

636,915 3,890 48,000 19,000 2,164 2,725 417,395 312,333 4,960 100 7,771 1,324 19,601 10,284 122,137 380,000 360 460 69,741 3,377 165 118,956 1,987,655 143

4,169,454 18,796,685 2,599

18,794,086 75%14,095,564 500

28,191

Income Statement


64 65

Assets: Current Assets: Cash Inventory Total Current Assets Fixed Assets: Administrative Equipment Bathroom Equipment Intellectual Property Kitchen equipment Office equipment Remodeling Sign Storefront Equipment

Less: Accumulated DepreciationTotal Fixed Assets

Total AssetsLiabilities & Stockholder’s Equity

Long-Term Liabilities: Long-Term Loan Total Long-Term Liabilities Total Liabilities Stockholders Equity: Common Stock Retained Earnings Total Stockholder’s Equity

Total Liabilities & Stockholders’ Equity

Year 1

$71,321 $8,810 $80,131

$1,086 $549 $2,600 $67,980 $729 $50,000 $2,500 $9,252 $19,242 $115,454 $195,585

$46,597 $46,597 $46,597

$200,000 $(51,012)$148,988 $195,585

Year 2

292,833 29,197 322,030

1,086 549 2,600 67,980 729 50,000 2,500 9,252 38,485 96,211 418,242

42,912 42,912 42,912

200,000 175,329 375,329 418,242

Year 3

816,929 64,917 881,846

1,086 549 2,600 67,980 729 50,000 2,500 9,252 57,727 76,969 958,815

38,921 38,921 38,921

200,000 719,894 919,894 958,815

Year 4

2,480,443 589,901 3,070,344

2,726 2,667 2,600 559,586 11,743 225,000 5,000 9,252 174,666 643,908 3,714,252

34,599 34,599 34,599

200,000 3,479,653 3,679,653 3,714,252

Year 5

4,922,884 1,785,878 6,708,762

6,006 6,903 2,600 1,542,798 33,771 575,000 10,000 9,252 486,999 1,699,331 8,408,093

29,918 29,918 29,918

200,000 8,178,174 8,378,174 8,408,093

Balance Sheet Projected Revenue Calculations

Daily CommutersFarmers’ Markets

Web MarketingDirect Mailers

Number of Customers1,3501501,02794

Number of Pies Sold4,0005,4003,082282

In year one, Lawson’s will wholesale a total of 5,200 pies. Homestead Creamery composed 100% of wholesale ventures for the first year. In the second year, Lawson’s expects to sell 5 pies a day to 19 Kroger locations equaling 41,080 pies per year. Lawson’s will continue to wholesale to Homestead Creamery with an increase volume of 125 pies per week accounting for 15% of total wholesales and Kroger 85%. In the third year, Lawson’s expects to sell 120,640 pies per year to Kroger’s Mid-Atlantic region. In the fourth year, Lawson’s will be selling 5 pies a day to all 556 Kroger stores in the Mid-Atlantic Division totaling 1,480,700 pies a year. In the fifth year, Lawson’s will begin to sell to Kroger’s Atlanta Division totaling 315 new stores and 4,591,600 pies per year.

Retail Sales: Year 1

Wholesale Sales


66 67

Maximum Capacity Breakdown by Year

Maximum Capacity

At maximum capacity, Lawson’s can produce 208,000 pies a year. This number was calculated by multiplying the number of pies that can be produced each day, 800, then calculating the number of pies per week, 4,000; then multiplying the number of production weeks year, 52, by the amount produce each week. There are 200 pies produced in each batch and four batches can be produced each day. This results in total revenue of $2,246,400. Within this situation, wholesale and retail are both selling an equal number of pies. The percentages of classic pies, signature pies, and dessert pies from year 2010 sales were used to calculate how many pies were sold at the various prices. Within wholesale, classic pies are sold for $9.00, signature pies for $10.00, and dessert pies for $8.00. For retail sales, classic pies will be sold for $11.95, signature for $13.95, and dessert for $12.95.

208,000 Pies

Total Revenue $2,246,400

Year 1

The conservative estimate for year 1 is that Lawson’s will produce and sell approximately 21,550 pies. This calculation is a conservative estimate based on market research and focus group responses. Wholesale is predicted to constitute 77% of pies sold and retail 23% of pies sold; this is based on the current percentages of 45% wholesale and 55% retail. Using this prediction, Lawson’s will accumulate a total net income of $211,435 in the first year.

Year 2

Based off industry trends in year one, the conservative estimate for the second year is roughly 67,058 pies sold. This is a production increase of 70%. This is possible because of increased awareness within the area as well as consistent marketing and advertising efforts. It is predicted that wholesale will constitute 54% of sales and retail 46% of sales, marking an increase in wholesale activity. With 67,058 pies estimated to be produced, this will result in net sales of $700,734.


68 69

Breakdown by Year

Year Three

In year three, the conservative estimate is an increase of 60% from the previous year due to marketing efforts. Wholesale will continue to increase and reach 71% of total pies sold and retail would constitute 29% of pies sold. At this production level, 156,652 pies would be made; this would result in total sales of $1,558,003.

Year Four

The conservative estimate for year four is functioning at a of production capabilities of 1,522,633 pies. This would be a production increase from year three to year four of 30%. Wholesale will continue to increase reaching 96% of pies sold, while retail would decrease to 4% of pies sold. This would result in $14,157,633 in sales for that year.

Year Five

The conservative estimate for year five is 4,637,726 pies, which is a production increase of 10 fold. Wholesale and retail see little change in pie distribution and constitute 97% and 3% of total pies sold resulting in 12,734,126 pies sold equaling $42,861,061 in net sales.

Break-Even Analysis

The first year’s estimated operating cost totals $211,348. To find the breakeven point, the total operating cost must equal gross profits. To find the number of pies that must be produced to match the total operation cost, the sales from the number of pies, minus the cost of goods sold provides the gross profit. If cost of goods sold accounts for a margin of 48%, the equation $211,348= .4(x) was used, finding x to equal $440,308 in sales. On average, Lawson’s would have to sell approximately 101,610 pies to breakeven.


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ITEM

Wages

Marketing

Insurance

Rent

Telephone/Internet

Utilities

Licensing, Permits, Registration

Credit Card Fees

Maintenance

Security

Supplies

Equipment

Travel

VA Sales & Meal Tax

Website

Signage

Intellectual Property

Remodeling Construction

TOTAL START-UP COSTS

COST (3 MONTHS)

$7,771

5,161

863

10,024

210

5,365

583

626

250

515

1,150

56,103

3,000

1,417

1,399

2,500

2,600

50,000

$149,536

EQUIPMENT

Administration

Bathroom

Kitchen

Office

Storefront

TOTAL

COST

$1,086

549

67,979

729

9,252

$79,596

KITCHEN EQUIPMENTPie Cut-Out

Freezer ShelvingMesh StrainerBoning Knife Cooks Knife

All-Purpose Food Pans Stainless Steel TongsAluminum Sheet Pans

Cutting BoardsSteam Kettle

Pot RangeHood Vent

Meat ShredderMeat Shredder Blades

Dough SheeterDough Mixer

Walk-In freezerStorefront FreezerStainless Steel Pots

Electronic ScaleDish Washer

3-Compartment Sink Sink Faucet/Pre-Rinse Unit

Handwashing Sink Sheet Pan Racks

Vacuum SealerStainless Steel Work Tables

Vegetable DryerMop BucketWet Mops

BroomWet Floor Sign

Fire ExtinguisherLarge Trashcan Small Trashcan

TOTAL

COST$501,15314028561631718012219,0001,6256,0002,7951102,2784,0009,00010,5002401793,9955251782981991,1791,5921,7727520682429511014

$67,980

Start-Up Costs


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Operational Expenditures

Cost of Goods Sold

To find the costs of goods sold, Lawson’s needed to find the number of pies produced yearly and how much these pies cost to produce. First, the projected yearly number of sales was divided into two categories, retail and wholesale. These two categories were created because the profit margins for each category differ. After finding the total number of pies for each category, retail and wholesale were then divided into three subcategories: classic, gourmet, and dessert. To find the total projected sales for the year, the numbers for each subcategory for wholesale and retail were multiplied by the cost of each pie. The projected total sales are based off of increased demand for Lawson’s Gourmet Chicken Pies™ as a result of advertising. The cost of goods sold for year one is $78,132. This number will decrease when purchasing is transferred from Wal-Mart and Sam’s Club to U.S. Foodservice. The cost of goods sold in year two is $176,233. This increases in year three to $517,547. In year four, cost of goods sold is $6,531,256. This number increases to $19,894,922 in year five, but can expect to save 5% each year per pie due to the purchasing of economies of scale. These calculations are based off of yearly sales projections.

Licensing and Permits

The cost to register as an S-Corporation is $175 and only needs to be done once. This cost is from www.incorporatetime.com and includes the filing of all necessary documents through a third party. Renewing incorporation expenses costs $100 each year. To become a corporation in Virginia, Lawson’s must register on two levels, state and local. All registered corporations must pay an annual fee to the State Corporation Commission. For any stock issuing corporation, the annual fee paid to the SCC is calculated by the number of shares the corporation has issued. In Botetourt County, the local level, businesses are required to have three separate permits: alarm, fire, and fictitious name registration. The total cost of registering a business in the state of Virginia and operating in accordance with local permit and registrations in Botetourt County equals $260. The cost of a business license within Botetourt County is an additional $148 annually. This results in a total cost of $508 for the first year and $248 for subsequent years. In year 5, the corporation will have to expense an addition $260 permit and registrations and $148 for county tax for the production facility.


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Credit Card Processing

Credit card processing involves monthly fees. An estimate of this for a business the size of Lawson’s is 1.7% of each bill in addition to $0.20 per card swipe (www.forbes.com). This will cost $779 in year one, $1,535 in year two, $2,128 in year 3, $2,478 in year four, and $2,725 in year 5.

Website

Lawson’s Gourmet Chicken Pies™ website will consist of 5 pages and a company email address as well as links to Facebook and Twitter. The start-up cost is $200 with a yearly fee of $1,200. This includes professional design and updates. Year 2 has an operation fee of $1,200, which continues professional design and updates. In year 3, professional services will be dropped and the website will be updated by an employee. Dreamweaver will be purchased in order to update the website, costing $399. The website operation for years 3 and 4 will cost a total of $143 for a 2 year package. Lawson’s will continue with the same package in year 5, costing $143 for two years.

Packaging

Custom paperboard, sealable packaging will be ordered in bulk and will initially cost $0.12; the price will decrease as sales increase.

Embroidered Potholders

Lawson’s will be utilizing custom, embroidered potholders as a promotional item. Prices were estimated using the numbers at www.epromos.com. The first year, 150 potholders would be ordered costing $2.49 each and totaling $374. In years two through five, 300 potholders will be ordered per year costing $2.39 each and totaling $717 each year.

Direct Mailers

Direct mailers will be sent five times a year to inform customers about seasonal items and promotions. During the first year, 250 mailers will be sent out five times a year costing $840, including postage. During years 2 through 5, 500 mailers will be sent out 5 times a year costing $1,245, including postage. In order to estimate pricing, www.psprint.com and www.usps.gov were utilized. Lawson’s will also send out pop-up calendars each January. In the first year, 250 will be sent out, costing $597.50, including both envelope and postage. In years two through five, 500 will be sent out, costing $975, including both envelope and postage. Lawson’s will get targeted consumers from a mailing list broker. This will cost $500 per 5,000 names. One list will be ordered in year 1, costing $500. In years 3 and 4, 3 lists will be ordered, costing $1,500 per year. In year 5, 7 lists will be ordered, costing $3,500.



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The Roanoker Magazine

Lawson’s will place a 1/4 page ad (3.5”x4.8125”) in The Roanoker Magazine. It will appear four times a year costing $540 per ad totaling $2,160 per year. This price includes free production, a free “hotlink” on theroanoker.com to Lawson’s Gourmet Chicken Pies™ website, and free copies of the magazine for marketing and PR efforts. The bill can be paid monthly at $180 per month.

Newspaper Inserts

Ads will be placed in community newspaper inserts in order to further reach the target market. These ads will appear in SWoCo, The Botetourt View, and So Salem. Since all three publications are community based, many families (the target market) within the area read them for updates on schools, activities, and events. Ads will rotate within the three inserts each week. This will cost $87 a week, which totals $4,493 a year. The ads will be continued during years 2 through 5.

Water Bottles with Custom Labels

Custom labeled natural spring bottled water will be purchased to hand out during summer markets and festivals as well as trade shows. It will cost $779 for 72 cases (1,728 bottles). The label will feature Lawson’s logo and purchasing information. They will be purchased twice for a total cost of $1,558. They will be purchased from Sam’s Club. Water bottles are ordered twice a year, costing a total of $1,558.

Professional Organization Membership

Lawson’s plans on joining professional organizations in order to break into the wholesale industry on a larger scale. The two organizations selected are the American Frozen Foods Institute and The United Fresh Produce Association. These organizations were chosen because they offer both educational opportunities as well as provide an annual venue for networking. Both organizations have an annual membership fee. AFFI costs $250/year and United Fresh costs $865/year. This totals $1,115 each year for both organizations.

Convention and Travel Expenses

The American Frozen Foods Institute has a yearly convention in February that provides the opportunity to network as well as stay updated on changes within the industry. All costs will be based on the 2011 Convention that occurred in San Francisco, CA. The convention lasts for four days and costs $500 for AFFI members. Some sponsored meals are included in the registration cost. An additional $120 will be budgeted (8 meals at $15) for food costs. The hotel is $219/night and will cost $876 for four nights. The estimated cost of a flight (from Roanoke to San Francisco, using www.orbitz.com) is $480. The total cost of this convention is estimated to be $2,000.



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Trade Show Promotional Materials

Lawson’s will bring 250 pens each year as a promotional item. The pens will be brightly colored and feature Lawson’s logo, standing out in the crowd. This will cost $0.36 per pen totaling $90 each year when ordered from www.pensrus.com. Promotional brochures will also be handed out. These will cost $0.34 each when 500 are ordered from www.printplace.com, costing a total of $170. The embroidered potholders will be utilized for this event and will be sent in advance to specific corporations that Lawson’s would like to speak to during the tradeshow. Custom koozie can holders will be ordered from www.imprint.com costing $173 for 250. They will be used to hand out sodas during trade shows. The additional cost of soda is approximately $120 for a total of $293. There will be a giveaway in order to entice customers to stop by the booth that will feature a year of free Lawson’s pies.


Trade Show and Travel Expenses

The United Fresh Trade Show is an annual trade show that features vendors, wholesalers, and retailers including Kroger. Government agencies such as the USDA also attend. The show is four days long and usually occurs during late April/early May. All costs are based on the 2011 show that occurred in New Orleans. A 10’x10’ corner booth costs $2,975 and comes with five free registration passes. The booth includes a backdrop, side drapes, and a company ID sign. Breakfast is provided every day and dinner is provided once, so an additional $105 ($15 per meal) will be budgeted for food. The average cost of a hotel near the convention center in New Orleans is $200 per night, totaling $800. The cost of a flight (according to www.orbitz.com) would be roughly $430. The total cost is estimated to be $4,310.


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Utilities

The total cost of utilities in year one is $20,660. Water and sewage will each cost roughly $730; this number was estimated from the rates listed on the Botetourt County website. The approximate cost of electricity and gas is $19,200. This number was derived using an expense calculator through Appalachian Power as well as discussing operational costs with local area businesses. The cost of utilities is estimated to inflate by 3% each year. This results in a total cost of utilities of $21,294 in year two. This number increases to $21,948 in year three. The cost goes up an additional 3% in year 4, resulting in a total cost of $22,622. By year 5, the total annual cost of utilities increase to $672,483 due to the move to the Production Facility.

Lease

Lawson’s Gourmet Chicken Pies™ will lease a retail space at The Shops at Cedar Ridge in Daleville. The space is 2,430 square feet and costs $16.50 per sq ft. This totals $40,095 each year. A five year lease would be signed, so Lawson’s would be committed to paying $40,095 rent per year. In year five lease expense increase by an additional $19,000 to cover the Production Facility


Insurance

Lawson’s Gourmet Chicken Pies™ has received a quote from the United States Liability Insurance Company. The company is an A++ A.M. Best Rating, with the term quoted annually at $753. The policy covers property liability, fire department service charge, medical liability, value plus endorsement, and also terrorism coverage for an additional $100 per year. The total yearly cost of insurance is $853. In year 5, the insurance expense doubles to 1,943 due to the move into a Production Facility for wholesale.

Office Expenses and Supplies

The initial start-up cost of purchasing store supplies, which includes cleaning, office, and point of sale supplies, equals $1,150. For each year, Lawson’s will budget an additional $200 to replenish these materials, which includes soaps, mop heads, trash/vacuum bags, pens, paper, and other miscellaneous supplies.In year 5 the office and supplies expense increase to $12,162 due to the move into a Production Facility for wholesale.


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Year 2

For the second year Lawson’s projects that operational increase in the total number of pies produced from 21,822 the first year to 67,058. Although there is an increase in the number of pies being produced yearly, Lawson’s will not feel the pressure of this increase in production until October. In October Lawson’s will hire a seasonal worker that will work until February of 2013. Also, Lawson’s employees will be eligible to receive a $.50 raise each year depending upon the past years performance. The total cost of wages for year two is $49,127 Lisa still remains the CEO and manager now earning $40,000, a second manager will be hired at $30.000. The total wages plus salaries for year 2 totals $119,127.

Year 3

For the third year Lawson’s will increase operational productivity with an increase of pies from 67,058 to 156,652. Again, Lawson’s will not feel the strain of this demand until October, but in this year the employee hired will work through the month of April of 2014. In year 3 the C.E.O and managers roles will be split amongst two people, the new manager will make a salary of $30,000 and the CEO will earn $50,000, the returning manager will recieve $35,000. The year’s total wages and salary pay out totals $182,883.


Employee Operations

Year 1

At the opening of Lawson’s Gourmet Chicken Pies’™ storefront, Lisa Helmick will have hired 2 store front employees at a rate of $9.00 per hour and 2 kitchen employees at a rate of $10.00. The front employees will work a total of 25.5 hours a week to cover all the front of store shifts. Lisa will be named the CEO and Storefront Manager of the corporation and will be earning a salary of $30,000. The kitchen workers will work shifts of 4 hours to produce one batch and the number of batches per month will vary depending on seasonal demands. Kitchen operation hours were determined by monthly pie needs. The seasonal trends from sales in 2010 of retail and wholesale provided the information needed to derive the percentage of total sales for each month. For example, for the first year Lawson’s projected that the number of pies sold would equal 21,550. In this year, the number of sales for January equal 9% or 1,939 pies. Because it is estimated that January sales would equal 1,939 pies, the necessary amount of shifts would be schedules to produce this number of pies. The total cost of employee wages in year one is $21,822. The total wages plus salary for the year totals $51,822.


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Dividend Information


Year 4

For the fourth year Lawson’s will increase productions from 156,652 to 1,522,633 pies per year. An additional warehouse will be constructed with its own employees and managers to meet pie demands. Lawson’s CEO will now receive $55,000 a year and the total wages and salary payout for both locations will be $948,549.

Year 5

For the fifth year Lawson’s will increase the productivity of the number of pie produced yearly from 1,522,633 to 4,637,726. An additional employee and managers will be hired to meet demands of opening 2 more production facilities. In the fifth year, the CEO will now earn $70,000 and each returning manager will earn another $5,000 raise; the total wages plus salary totals $2,367,655.

CORPORATE STRUCTURE

OPERATIONS

MARKETING

FINANCIALS

STRATEGY & ANALYSIS EXTERNAL ENVIRONMENTINDUSTRY ENVIRONMENT PORTER’S FIVE FORCES MODEL DRIVERS OF CHANGEINDUSTRY LIFE CYCLE VALUE CHAIN ANALYSISEXIT STRATEGY

889095979798

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Political Factors

The FDA has passed a new regulation called the Food Safety Modernization Act, which will require agricultural producers to conform to a common standard. Some of the requirements of this act are that all food producers must have a Hazard Analysis and Critical Control Points and Sanitation Standard Operating Procedures. Food producers will then be asked if they use dry cleaning or wet cleaning for the business’ laundry. Dry cleaning is preferred because a wet environment has a higher risk of microbial contamination. Lawson’s currently has a HACCP and SSOP plan, so the cost associated with this FDA regulation will affect Lawson’s solely based on their cleaning procedures. While most of the costs explained above negatively impact Lawson’s, there are current changes in Virginia that could benefit the business in a positive manner. For example, Virginia Governor Bob McDonnell is currently working on new reforms that would make Virginia businesses more competitive. These reforms are still in the early stages, but could be beneficial to Lawson’s Gourmet Chicken Pies™.

External Environment Analysis

Economic Factors When dealing with the use of agricultural supplies, there is always the potential for crop loss or contamination. The availability of capital is a primary economic factor. As a result of the current economy, banks are nervous and uncertain about whom they lend to because of recent defaults.

Social Factors

Lawson’s pies are much healthier than the average chicken pie, which has become very important to many American’s. Many parents are focused on providing their children with a healthy and nutritious meal. All of the chicken used is hormone-free and no fillers or preservatives are used. These attributes convey to the public that Lawson’s is making every attempt to provide the healthiest product possible.

Technological Factors

Technology will help Lawson’s Gourmet Chicken Pies™ to save money. The implementation of a credit card reader will ease the purchasing process for Lawson’s customers. While this device is initially costly and a percentage of sales will be taken out to pay service fees, it will ultimately increase sales by allowing customers to use different forms of payment. For example, when a customer makes a purchase with a card, they are more likely to purchase a higher quantity than if they were carrying a limited amount of cash.


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Differentiation of Products and Services

Lawson’s differentiates itself in the pies that the company produces. It is not just a standard chicken or dessert pie that customers are buying, but Lawson’s taste, along with health benefits, make it stand out among the competition. A perfect example of a pie that differentiates itself would be the Spinach and Asiago pie. This pie features a variety of gourmet ingredients like spinach, bacon, asiago cheese, chicken, and light gravy. This pie is a new and unique product that customers will enjoy. Many large retail stores today dehumanize the purchasing process whether it is through the use of self-check-out machines or unenthusiastic staff. At Lawson’s, the customer comes first. Customers know that when they walk through the storefront doors that they become part of the Lawson’s family. Service to customers is what defines the company within the market. Lawson’s goal is to have the highest quality product along with the highest quality service; this dual focus on the customer and the product will set Lawson’s apart from the competition.

Industry Environment Analysis

Market Growth Rate and Life Cycle

Expansion from the Daleville area, with a population of approximately 32,000, to the Roanoke Valley, with a population of 300,399 marks the completion of the intro stage of the product life cycle. Once the product reaches the growth stage within the life cycle, Lawson’s will introduce the product to more retailers and distributors. This will expand the market from the Roanoke Valley to the Commonwealth of Virginia, increasing the growth rate by 26 fold. By entering a large retail store such as Kroger, the product will be in the maturity level of the product life cycle.

Number of Rivals

The largest rival and one that contains the largest market shares is Nestle SA; this includes competitors such as Stouffer’s, DiGiorno, and Lean Cuisine. Nestle SA, The Schwan Food Company, ConAgra Foods Inc., and H.J. Heinz Company have 49% of the market share. There are other rivals present, including ready-to-eat food sold in grocery stores as well as local specialty stores.


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Learning Curve Effects

There are three major learning curves that Lawson’s will face: the education of employees, working with suppliers, and selling to major retailers like Kroger. First, the education of employees will consist of teaching individual employees how take an assortment of ingredients and turn them into the finished product. This process will initially create more work for the owner, but in a short period of time, trained employees will be able to educate new employees on the production process. The education of employees will be one of Lawson’s primary concerns. Lawson’s produces a gourmet product and it is necessary that it is consistently produced in order to maintain corporate image and high sales. The second learning curve that Lawson’s will face is how to work with suppliers. Lawson’s will need a clear understanding of pricing as well as quantity needed in order to effectively negotiate with suppliers. Inventory techniques will also need to be established to make ordering and receiving occur systematically. Lastly, Lawson’s will need to learn how to meet the demands of major retailers such as Kroger. Kroger has a very specific list of requirements that must be followed in order to become a vendor. For example, there are strict requirements on packaging such as a registered GS1 bar code and accurate description of the quantity and variety of each delivery to the Kroger distribution center. Also, Kroger requires that all deliveries made to the Kroger distribution center be at the sender’s expense. Learning how Kroger operates will allow Lawson’s to improve efficiency in the delivery process along with improving business to business relationships.


Economies of Scale and Scope

With increased production to meet the demands of customers and wholesalers, more ingredients, supplies, and labor will be necessary to meet pie quotas. Increasing the quantity of ingredients in each purchase will allow food suppliers to offer lower prices per unit. The need for more labor will also increase productivity by allowing employees to take on more specialized tasks, which will increase efficiency and quality of the product. As production of pies increases, the fixed cost associated with the production decreases, paying out higher dividends to shareholders. Within the scope of the frozen foods industry, it is possible to expand the products available in the Lawson’s line. Additional foods could be added in the long-term. Some examples of this could be other frozen meals, soups, etc.

Resource Base Availability

Food service distributors such as U.S. Foodservice have a close location in Salem that will be available to Lawson’s for all their supply needs. Lawson’s main ingredients include, but are not limited to, chicken, spinach, mixed vegetables, cheeses, seasoning, and bouillon cubes. Within this supply market, there exist several competitors; this provides Lawson’s with supply options as well as the ability to negotiate prices.


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Porters Five Forces Model

Industry Profitability

In 2011, the frozen food industry is expected to be worth 28 billion dollars, which is a 0.9% decrease from the previous year. In 2012, revenue is projected to decline 1.3% as consumers switch over to more fresh foods because they are focusing on healthier meals. While revenue is decreasing over these 2 years, it is expected to grow at an average annual rate of 0.4%, 28.5 billion dollars, between 2011 and 2016. The frozen food industry is expected to remain profitable over the next 5 years, with a net profit estimating about 15% of revenue by 2016. (IbisWorld Industry Report 31141)

Threat of New Entrants

There is diversity of products within the frozen food industry and that trend is expected to continue. Many new and innovative products will enter the market and it will be one of Lawson’s main goals to maintain the highest quality possible in order to differentiate from those products. New companies may enter the frozen food industry with healthier or less expensive products, encouraging customers to switch brands. Due to low start-up costs when compared to other industries, the frozen food industry has cost advantages for new companies, which encourages new entrants.

Threat of Substitutes

It is possible that someone could have a similar concept, but Lawson’s recipes are protected by a trade secret, so it would not be possible for another company to recreate the product. Existing companies in the industry are well-established with strong customer loyalty. Customers may be more inclined to purchase generic brands of frozen pies because of their low cost. Although the competitor’s products are less expensive, they are often unhealthy and contain fewer servings.



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Porters Five Forces Model

Drivers of Change

A recent change in the industry has been caused by people choosing healthier options for both themselves and their families. Obesity is an epidemic in America and many people are making the conscious decision to buy lower fat, calorie, and sodium meals. Another force of change often comes with government regulations. Standards exist for packaging labels, what constitutes as low fat, low sodium, etc., and how nutrition must be presented to the consumer. Many changes have occurred within the United States food industry in the past few years and that trend is expected to continue.

Industry Life-Cycle Considerations

The frozen food production industry is in its mature life cycle. U.S. GDP is expected to grow by 1.9% causing the industry to decrease slightly. Sales to food service customers have been declining, but convenience stores and mass merchandisers have become larger and more sophisticated. Demand has been stimulated by new product introductions that focus on health and convenience. (IbisWorld Industry Report 3411)

Threat of Substitutes

It is possible that someone could have a similar concept, but Lawson’s recipes are protected by a trade secret, so it would not be possible for another company to recreate the product. Existing companies in the industry are well-established with strong customer loyalty. Customers may be more inclined to purchase generic brands of frozen pies because of their low cost. Although the competitor’s products are less expensive, they are often unhealthy and contain fewer servings.

Bargaining Power of Customers

When doing business with large retail corporation such as Kroger and Fresh Market, they have the advantage in negotiating prices. Lawson’s plans to combat this by cutting down on production costs and ordering in bulk to increase the profit margin. In the future, as Lawson’s product quality becomes more well-known, bargaining powers will begin to equalize.

Bargaining Power of Suppliers

It is possible for Lawson’s to bargain when making purchases of raw goods from companies such as Sysco and U.S. Foodservice. Lawson’s will have even more leverage once purchasing volume is significantly increased when increasing wholesale.

Drivers of Change and Industry Life-Cyycle


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Value Chain Analysis

In order to add value to the Lawson’s brand, proper training must be provided for everyone at the store who will come in contact with customers, not just the sales force. Providing each customer with the best personal service will make them feel welcomed, comfortable, and remind them of the family values of the corporation. Through Lawson’s employees, the sincerity, enthusiasm, and pride of Lisa, will be seen by all customers, encouraging them to come back and become regular loyal customers. Lisa’s personal interactions with retailers such as Kroger will help achieve greater product and business quality. With Lisa’s sincere personality and focus on consumer loyalty and happiness, strong professional and personal consumer relations will be formed. Managers will perform strategic distribution and quality insurance practice to make sure each of Kroger’s deliveries meets their exact desires and expectations. Managers will also be in charge of arranging each delivery and doing final checks to ensure each delivery was properly filled and distributed within the allotted time frame.


Primary

Inbound Logistics

Inbound logistics will consist of receiving orders and stocking the store. Order receiving will be handled by a manager. First, orders will be placed with food suppliers such as U.S. Foodservice or Sysco. When the food is delivered by the supplier to the store, these orders will be reviewed to ensure the correct quantities were delivered. This process will be conducted using paper and pencil initially, but as production increases, this process will be conducted electronically using barcode scanners. It is important to keep meticulous records of orders to ensure that cash is not lost in shipping transactions. When the production facility is open, it will function as an assembly line. This will not only increase efficiency, but it will help to protect the trade secret. Personnel will have one part of the process that they complete and they will never be trained in the other processes. Also, batches will be scheduled so that one type of pie is made at a time in order to prevent errors from occurring. Marketing will direct to ensure that the target demographics are receiving information about Lawson’s products. Mailers will be sent to potential customers who fall within Lawson’s target market. Various forms of advertising will be used to reach a diverse array of clientele. For wholesale endeavors, conventions and trade shows will be attended. At these events, promotional items and product samples will be handed out in order to inform potential retailers about Lawson’s various products.


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Outbound Logistics

Outbound Logistics will include shipping to Kroger’s distribution center in accordance with all Kroger policies and procedures. Such procedures include distribution to the warehouse at Lawson’s expense, packaging, labeling, a universal barcode, and an NAICS code. All business operations will be done within an appropriate time frame.

Secondary

Corporate Culture

The corporate culture will have a family feel where coworkers are friendly. This will create a cohesive workplace with open lines of communication. Rewards will also be given for work that exceeds expectations. Employees will be encouraged to celebrate their successes. There will also be holiday parties and other social events made available in order to network within the company.

Human Resources Management

In order to reach Lawson’s goals, the happiness and commitment of employees is essential. This will be achieved through open lines of communication. If an employee has a concern, they can anonymously speak to human resources without fear of retaliation. Human resources will aim to create a work environment that feels safe and free of any kind of prejudice. Human resources will initially be handled by the CEO until the company is large enough to warrant a separate employee to handle those issues.


Exit Strategies

The owner, Lisa Helmick, intends to exit the business when it can be sold for a substantial profit. She also intends to step back as an operator and become solely the face of the company. If wholesale and expanded endeavors are not as successful as she anticipates, she will continue to run the business in the way that it currently functions.

Exit Strategy


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Appendix A Appendix B


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Appendix C

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