Ice Cream Parlor

A Business Plan on Ice Cream Parlor Cream Dream In Bangladesh Context

Yeasir Hasan Malik

Table of Contents 1.

EXECUTIVE SUMMARY .......................................................................................................................... 5

2. INTRODUCTION OF THE REPORT .............................................................................................................. 8 2.1 Origin of the report ............................................................................................................................. 8 2.2 Objective of the plan........................................................................................................................... 8 2.3 Scope ................................................................................................................................................... 9 2.4 Methodology....................................................................................................................................... 9 2.5 Limitation ............................................................................................................................................ 9 COMPANY IN BRIEF ..................................................................................................................................... 11 3.1 Background ....................................................................................................................................... 11 3.2 Introduction to the service ............................................................................................................... 12 3.3 Vision................................................................................................................................................. 14 3.4 Mission Statement ............................................................................................................................ 14 3.5 Business objective ............................................................................................................................. 15 4. THE VENTURE .......................................................................................................................................... 16 4.1 Name and address of the project ..................................................................................................... 16 4.2 Location of business .......................................................................................................................... 16 4.3 Legal status ....................................................................................................................................... 17 4.4 The size of business........................................................................................................................... 17 4.5 Statement of financing need............................................................................................................. 18 4.6 Scope of Operations.......................................................................................................................... 18 5. AN INDUSTRY OVERVIEW........................................................................................................................ 19 5.1 Characteristics of ice-cream retail industry ...................................................................................... 19 5.2 Why some ice-cream business does well.......................................................................................... 19 5.3 Keys to success .................................................................................................................................. 20 2

5.4 SWOT Analysis of Business................................................................................................................ 21 5.5 Environment scanning ...................................................................................................................... 22 5.5.1 The Legal and Political Environment .......................................................................................... 22 5.5.2 Technological Environments ...................................................................................................... 23 5.5.3 The Social and Demographic Environment ................................................................................ 24 5.5.4 Economic Environments ............................................................................................................ 26 5.5.5 Natural Environments ................................................................................................................ 27 5.5.6 Threats of existing competitors ................................................................................................. 29 Other forces of competition ................................................................................................................... 32 Competitive strategy............................................................................................................................... 32 6. ORGANIZATION STRUCTURE ................................................................................................................... 33 6.1 The organization structure................................................................................................................ 33 7. OPERATIONAL PLAN ................................................................................................................................ 34 7.1 Distribution and Storage ................................................................................................................... 34 7.2 Resource requirement ...................................................................................................................... 34 7.3 Logistics ............................................................................................................................................. 36 7.4 Utilities .............................................................................................................................................. 37 7.5 Production......................................................................................................................................... 37 7.6 The menu .......................................................................................................................................... 37 7.7 Suppliers............................................................................................................................................ 38 7.8 Facilities............................................................................................................................................. 38 7.9 Hours of Operation ........................................................................................................................... 39 7.10 Employee Training .......................................................................................................................... 39 7.11 Bill-collection process ..................................................................................................................... 39 7.12 Controls ........................................................................................................................................... 39 3

8. MARKETING PLAN ................................................................................................................................... 40 8.1 MARKET ANALYSIS - Long term prospects and trends ...................................................................... 40 8.2 The Market ........................................................................................................................................ 40 8.3 Target marketing strategy................................................................................................................. 42 8.4 Demand analysis ............................................................................................................................... 42 8.5 The Marketing Mix ............................................................................................................................ 45 8.5.1 The product .................................................................................................................................... 45 8.5.2 Price ............................................................................................................................................... 50 8.5.3 Physical facility ............................................................................................................................... 52 8.5.4 Promotion ...................................................................................................................................... 52 9. FINANCIAL PLAN...................................................................................................................................... 56 9.1 Sales forecasting ............................................................................................................................... 56 9.2 Ongoing costs .................................................................................................................................... 57 9.3 Important Assumptions .................................................................................................................... 61 10. CONCLUSION ......................................................................................................................................... 61 11. Reference .............................................................................................................................................. 62

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1. EXECUTIVE SUMMARY The main items for sale will be hand dipped ice cream and yogurt cups/cones, sundaes finished with a variety of toppings such as hot fudge, caramel, butterscotch or fruit, banana splits shakes malts, and ice cream sodas and floats. Most of these items will be consumed immediately on the premises. The ice cream store will also sell ice cream cakes, traditional gourmet cakes, birthday cakes, and Cola products. The store provides extensive indoor seating for the food court customers and a kid’s corner with a small indoor playing ground for children. In addition to hand-dipped ice cream sales, the Shop anticipates doing a material business in the sale of both ice cream cakes and gourmet traditional cakes and birthday cakes. These cakes will be displayed for immediate sale at all times during business hours and can also be produced in quantity on a special order basis for caterers and parties.

Revenue will be primarily from the sale of hand-dipped ice cream and related products consumed. The store will be located in Dhanmondi. The store’s primary customers will be young people from the surrounding locality as well as shoppers who converge in the area from other parts of the town and who will have hand dipped ice cream and other products on an impulse basis during their shopping trip, or as a dessert treat upon completing a meal from nearby restaurants. The store owners also anticipate that over the long run many patrons will make the shop their primary destination due to name recognition and product quality.

Project costs are projected to be Tk 3000000 which includes advances and prepayments, equipment purchases, opening inventory, and working capital needs.

Products will be fresh daily and have a maximum shelf life of 3 days. Products will be displayed in glass cabinets. If a product is to be eaten at the store, it will be served on a glass plate. If it is to be taken home, the product will be placed into a bakery box, which bears the Cream Dream logo. Cream Dream will implement a strong advertising and promotion strategy. The store will mainly use the following promotional tools: Billboards in areas of competitors, newspaper 5

advertisements; sponsorship of community events; use of discount coupons. The store will be kept extremely clean and well stocked at all times. Glass counters will be used as well as clearly viewable kitchens to allow customers to view all steps in the preparation process. The store layout is important, as it will play a major role in influencing the patrons’ perception towards the physical state of the store. For example, the kids’ corner will be placed somewhere where it will be visible to the customers from the shop front. This will primarily attract the attention of passers by like children. The reasons why these marketing strategies have been chosen are that these types of marketing strategies are relatively cheap and are within the budget. They were also chosen on the belief that they are an informative and effective way of promoting the business, in order to enhance the business’s success.

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Part – A 2. INTRODUCTION OF THE REPORT 2.1 Origin of the report BBA academic program is the building up of the theoretical knowledge about business administration which is the base of practical knowledge. Project work is an attempt to provide business students an orientation to a real life business situation in which we can observe and evaluate the use and applicability of the theoretical concepts which were taught in the classrooms. This report is the out come of the work.

2.2 Objective of the plan The purpose of this business plan is to outline the parameters under which the principals will pursue the construction, development, and operation of an Ice-cream shop. The business plan will  Describe the business and service  Analyze the ‘ice-cream shop’ market  Analyze human resource and logistics requirement  Define “Cream Dream” target market  Analyze the marketing plan in terms of assessing the store’s competitive prospects, identifying the pricing objectives and methods and the distribution channel of the product and finally analyze the effectiveness of its promotional strategy  Analyze the type of organization, including forms of ownership, and management structure  Create a financial plan for the business, including sales forecasts, financial statements and cash flow projections  Assess the level of risk to be faced, including contingency plans 8

2.3 Scope The business plan will for a five year period from 2012 -2017. Here only Dhaka has been considered as the possible market and target market is only residents of Dhanmondi area. The business plan also tries to focus on the internal as well as the external forces that will influence the set up of an ice-cream parlor in Dhanmondi. Only the parlors located in Dhaka were identified to gain an insight to the parlor business.

2.4 Methodology The business plan has been prepared mainly based on primary research. The primary research is based on the interviews of the managers of ice-cream parlors such as Igloo Gelateria, Club Gelato, and MovenPick, American Soft Ice Cream, Rainbow, and other persons related to the ice-cream business. The questionnaire was basically open-ended and the information was both quantitative and qualitative.

Informal Focus Group Discussion was conducted among ten people, consisting of students as well as other people. The respondents were within the age group of 16-35 and different income groups. In-depth interviews with potential customers were also conducted in order to get an overview of their perception and come up with the market characteristics and opportunities related to it.

Secondary research has been used but not to such an extent. The secondary data from books, Internet, and journals was used to gain more detailed information about starting a venture.

2.5 Limitation  The business plan consists of data that covers only some of the areas of Dhaka city.  The business plan has been prepared mainly based on primary data and any inaccurate information given by the respondent may distort the plan. 9

 A proper scanning of the environment may not be possible due to lack of experience and ability.  The analysis may not be very accurate since only a few parlors have been studied.  The estimated budget costs, pro forma financial statements as well as inventory and sales may not be completely accurate.

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PART – B COMPANY IN BRIEF 3.1 Background This business plan has been written on the instructions of Professor MD. Al-Emran. The name of the “Ice-Cream shop” is Cream Dream. The name is in keeping with the ‘ultra-modern’ image of the store such that it appeals to the target group- which mainly includes children, young adolescents-both in their early and late teens, and adults below 30 years of age. Since people in this age group have a predilection for fun and parties, they tend to welcome unusual experiences and prefer exotic tastes, grandeur, and loudness. This is exactly what Cream Dream promises to deliver. Starting from its flavor, amenities to the exquisite atmosphere, Cream Dream parlor intends to make its mark in ice-cream selling business.

Modern living has created new demands for the younger, upscale population. As living styles of people in Dhaka city are changing, more and more people in the middle and upper-income range now consider eating out as a recreational part of their day-to-day life. Dhaka is now teeming with fast-food joints, Chinese-Italian-Thai-Indian restaurants; Ice-cream shops- all of which are popular hang-out places for the younger population. As living standards improve and the metropolitan life continues to prosper, the retail food industry will account for a greater proportion of consumer spending. To take advantage of this burgeoning market, a large number of ice-cream parlors- offering a varied assortment of services have already sprouted in different parts of Dhaka city.

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3.2 Introduction to the service The name of the ice cream parlor is “Cream Dream”. This parlor will be promoted as an ice-cream boutique. The ice creams offered here will be the highest quality with not only the typical ice cream flavors such as chocolate and strawberry but also include imported flavorsincluding tropical and Mexican flavored syrups- that cannot be found in other ice-cream parlors. The wide diversity of ice creams will distinguish Cream Dream from the other ice-cream parlors and suppliers.

Though there are certain ice-cream parlors operating in city, very few meet the customers’ expectations. Some may offer delicious ice creams but lack the proper environment; some provide the setting but not the taste. Cream Dream will provide a unique blend of quality, fun, and flavor. There will be a music system and spacious sitting arrangements with magazines and newspapers.

Cream Dream will obtain its supply from a local company and hence will be promoting product. Cream Dream also plans to provide games arcade for the young people. This will provide more entertainment for the customers and an additional earning for Cream Dream. There will also be a Kid's Corner offering a colorful maze of tubes, slides, and tunnels. Kids can climb, crawl, and swing within the indoor playground.

The main items for sale will be hand dipped ice cream and yogurt cups/cones; sundaes finished with a variety of toppings such as hot fudge, caramel, butterscotch or fruit, banana splits shakes malts, and ice cream sodas and floats. Most of these items will be consumed immediately on the premises.

Cream Dream

provides extensive indoor seating arrangements. Included among

the different imported tropical and Mexican flavored syrups that will be sold are: Wild Watermelon, Pine Colada, Pink Lemonade, Guava Grape, Cherry Jubilee, Root Beer, Kiwi, Strawberry, Blue Bubble Gum, Orange Mango, Raspberry Red, Luscious Lime, Bodacious Banana, Tamarind, Melon, and Papaya. There will be other flavors available as well such as 12

Spearmint, Black Cherry, Cinnamon, Blueberry, Peach, Red Apple, Tutti-Frutti, Coconut, Cola, Green Apple, Tangerine, and Vanilla. Also, more commonly found low-end products to be sold will include ice cream in vanilla and chocolate flavors.

It is important to note that in our health conscious society, many are moving to healthier alternatives. Normal soft serve contains 4.5-6.5% fat on average, while Low Fat alternatives contain less than 1% fat. They also contain much less calories per serve than regular Full Cream Soft Serve and are therefore classified as ‘Low Calorie’. Low calorie cones, sundaes & shakes can be sold at a premium price. The product cost per serve may only be 8-10 taka more expensive than the high fat alternatives. These will be sold as: Plain sundaes & cones; Flavored sundaes & cones.

In addition to hand-dipped ice cream sales, the chain anticipates doing business in the sale of both ice cream cakes and gourmet traditional cakes and birthday cakes. These cakes will be displayed for immediate sale at all times during business hours and can also be produced in quantity on a special order basis for caterers and parties. The Shop will have two 3-foot wide, 4-shelf display cases for cakes. One 3-foot display will be for frozen ice cream cakes, and the other will be refrigerated for display of traditional gourmet cakes and gourmet birthday cakes.

Other products will include soft drinks (Sprite, Coke, Mountain Dew, Fanta and Diet-Coke), and cappuccino.

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3.3 Vision Cream Dream hopes to become the most popular ice-cream parlor within the first year of its incorporation. It hopes to attract the most number of customers compared to any other icecream parlor in the city. Cream Dream also plans to open two more branches in Dhaka city (Gulshan and Uttara) by the end of 5 years and two outside Dhaka in Chittagong and Sylhet within the next 10 years.

3.4 Mission Statement The goals and objectives of Cream Dream are as follows: "To deliver a quality product in a consistent, courteous, and timely basis in order to have the customer return again for another satisfying, delicious treat; while at the same time earning a reasonable return on the initial investment”

For an organization to be successful, the organization must ensure that the customer continues to return to purchase the product, again and again. One way to ensure repeat business is to provide consistency in both the product and service. Cream Dream product speaks for itself; the service the shop provides will be a function of training, evaluation, and retraining in order to deliver the service as courteously and in a timely manner. In order to earn a reasonable return on the investment, along with the ability to repay debt, strict cost-control measures will be implemented. These measures will include proper and prudent purchasing practices, maximization of product distribution through strict adherence to weights, amounts and recipes (portion control), effective utilization of personnel, and the constant search for ways to reduce the cost of sales of our products without sacrificing quality and service.

The business will take care of its employees; that is, they will be paid well and given a share of profits. The people will be paid according to their skills and abilities. In addition, each employee will have the option of company-sponsored training courses. The store considers its customers as its most important asset, and relies on them for feedback. The store will gladly accept all in14

store suggestions and test them for results. Cream Dream has a plan and its goals are clear: To create a fun, entertaining, and respectful environment that generates sales of ice-cream and beverages.

3.5 Business objective Cream Dream Parlor will have these business objectives during its first three years of operation: 

Cash break-even by the end of its first year of operations



Cash reserves before taxes of about Tk 500000 by the end of its second year of operations.



To be able to establish an environment that is both friendly and pleasant to staff members and customers.



To expand the business within the food industry



To increase the number of stores by the end of the third year of operation

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4. THE VENTURE 4.1 Name and address of the project Name of the venture: Cream Dream

The reasons why this name was selected are that it will appeal to the target audience, easy to remember as it is eye-catching and unique. Furthermore, the name will appeal to the store’s target audience: children between the ages of 6 – 25 years.

The position strategy of Cream Dream will be that a trip to the ice cream shop should be fun and memorable. All communication of Cream Dream will highlight this concept in the tagline "Party in a Cone!" By focusing on entertainment, Cream Dream can create a party atmosphere that will resonate in teenagers and college-age young people.

4.2 Location of business Location is one of the most important factors that contributes to and distinguishes the success of a business. The owners had various options in deciding on the location. However, a number of factors played a dominant role in influencing their decisions. The predominant factors taken into account in deciding on the location are: 

Upscale commercial business district (office and residential mix)



High visibility location, near restaurants and theaters (popular tourist areas)



Strong foot traffic counts, evening and weekend traffic



Airports, Theme Parks, Hotel/Resorts, Universities

The owners of Cream Dream have chosen to establish their ice cream business in a place which experiences a high volume of traffic on a daily basis.

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Furthermore, the location of the business must be situated in a place that is accessible and to target consumers. Cream Dream Parlor will be a startup ice cream parlor located in a rented space at Dhanmondi 8/A Dhaka. In recent years this location has grown in popularity with food shops. It is adjacent to the classy restaurants and fast food shops: Al Baik, The Bistro, Spinach, Broccoli, and Fokhruddin Biriani House. Besides, it will attract not only residents but also a large number of people who frequent nearby schools, universities, offices, and shoppers. The exterior shop front presentation and originality of ice cream will also appeal to them, as it is different from the typical ice cream parlors.

4.3 Legal status Cream Dream will follow the legal obligations of single ownership. Initially, the chain will begin operation in Dhaka City. It will after some years expand and set up branches in Chittagong and Sylhet.

4.4 The size of business The size of the business is determined based on certain factors such as volume of business, number of employees, financial resources, ownership, or control of materials, facilities, sales territory, and nature of business activity etc.

In Cream Dream, the number of people employed will not be more than ten. The capital invested will be about 30 lakh taka. The business is independently owned and operated. The sales territory is not widespread and its business volume is also not that massive. Hence considering all the mentioned factors, it can be concluded that ‘Cream Dream’ is a small business concern.

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4.5 Statement of financing need The finance for the project will be provided by the entrepreneurs. A loan of Tk1000000 will be required. The owner will bear the remaining cost of the project. The total startup capital estimated for the project is Tk300000.

4.6 Scope of Operations Cream Dream will operate initially only in Dhaka. It aims to attract the locals mainly residents of Dhanmondi, Mohammadpur, Jhigatola, Mirpur. The Cream Dream parlor will offer dessert items: ice-cream and light beverages. The relationship with the suppliers is very important for Cream Dream. This is due to fact that the parlor does not produce its own ice-cream or beverages and is highly dependent on the local manufacturers of those items. The staffs employed have to be well qualified as the business is basically service related.

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5. AN INDUSTRY OVERVIEW 5.1 Characteristics of ice-cream retail industry 

It is service-oriented



It is a monopolistically competitive industry with every firm facing a downward sloping demand curve- since there are many competitors; the demand for the services of each firm is highly elastic.



Relatively low entry barriers. Though establishment costs are considerably high they are not significantly high to deter new entrants.



Low degree of technological sophistication



There is some scope for Economies of scale in particular for those with high fixed costs

5.2 Why some ice-cream business does well Though the location of a retail ice-cream business is the single most important element for its success - or lacks of it - there are other reasons why some ice-cream shops may not be doing well:

Lack of an effective marketing strategy: If one does not know how to attract customers when one first opens and how to sell ice-cream, ones revenues may be greatly reduced; it may take longer to return the investment and it will be harder to build a great number of loyal daily customers, which is the base of any successful ice-cream parlor business.

Improper shop design and equipment layout: In most shops, the work area is not designed for speed and efficiency of service, so it takes much longer to prepare the drinks, the customers are inconvenienced by waiting longer than needed, the sops sell less in a given time period, tire their employees sooner and irritate their customers. 19

Poor taste of the product: If the customers do not like the taste of the ice cream and espresso based drinks because of faulty preparation techniques (not equipment or coffee), they either won't order it again or won't come back. Not having a true standard of product taste comparison, most of the owners, managers, and employees of coffee bars/ice-cream parlors in this country have never tasted a properly prepared "cappuccino" or a waffle cone!

5.3 Keys to success The keys to success are: 

It will offer the largest variety of ice-cream and

dessert items available in town. Product quality will be high including a large variety of tropical flavored syrups. 

Business will be located on a major city highway,

next to several housing 

Developments,

schools

and

universities,

community centers, shopping malls, plazas (Anam Rangs Plaza, Rifles Square, Meena Bazar, Shop n save) and along major restaurants. 

Business has the potential for expansion into other prosperous areas of the city.



The area attracts a very large traffic from different parts of Dhaka city



The store will offer loss leaders and other promotions that bring customers into the store, to buy goods and to generate awareness of promotional events.



The business will provide for the satisfaction of 100% of customers. As customers are very valuable, the shop will design a customer care plan to manage complaints, implement employee and customer feedback, manage supplier accounts, and predict future conflicts.



Establish long-term relationships with great distributors

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5.4 SWOT Analysis of Business Strengths 

The business is situated in a popular location- right in the heart of Dhanmondi shopping vicinity.



The employees of the business are well trained, experienced and qualified.

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The product is unique and original made from the highest quality ice cream.

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The business’ dedication to the customers need through quality customer service.



Wide diversity of flavors along with special items for health conscious people.

Weaknesses 

Will not be able to offer enough parking space.



The capital is limited to the contribution of the owner and the bank loan. Initial financing will not be difficult due to solid credit and the low inventory depreciation rate, but ongoing financing will be more difficult to obtain.



Dependent on external source for supply for ice cream.

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Very high rental.

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High establishment costs.

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Likely to be considered as high-priced.

Opportunities 

The business will be able promote itself as a dessert joint for the nearby restaurants.



The market is far below saturation level and most of the competitors do little advertising. Most local competitors do very little in the way of marketing. This would give Cream Dream the opportunity to develop the market.



As ice cream parlors are popular, chances of expansion is higher.



Lots of schools and universities proving close proximity to target market.

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Threats 

Located near major competitors.



New fast-food outlets can emerge nearby.

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Social changes within the consumer market such as health conscience attitudes.

5.5 Environment scanning All business enterprises operate in a broader environment with forces and trends that shape opportunities and poses threats. The companies need to identify these “non-controllable” forces and respond to them accordingly. Identification of these forces will help the companies to deal with different kind of situations and reap as much benefit possible. The following external forces have considerable influence on any organization’s system. And a change in any one of them can cause changes in one or more of the others. One thing that is common among these forces is that they are subject to change and at an increasing rate. These forces are largely uncontrollable by management; but they are not totally uncontrollable. A company may be able to influence its external environment.

5.5.1 The Legal and Political Environment The political and legal environment refers to the nature of relationship between various areas of government and the business organization and hence affects the stability in which organizations can effectively plan and operate. The legal environment includes public policies, laws, government agencies, and pressure groups that influence and regulate various organizations and individuals in society, important areas include patents, trade marks, trade licences and taxes. High rate of tax rate may discourage an investor whereas a tax holiday or subsidy may encourage the investor to start that business. The tax imposition will be income tax at the rate of 25% and 15 % VAT will be charged on the products sold 22

The political scenario of Bangladesh is not very promising for business ventures due to the occurrence of regular ‘hartals’. The stores are kept closed during hartals in fear of vandalism.

The legal environment does not impose specifically any constraint on the ice cream business. The entrepreneurs will obtain a trade license to operate the parlor. Cream Dream will be following the Employment of Labor (Standing Orders) Act 1965 and also the Environment Conservation Act of 1995. Cream Dream also aims to follow the existing food regulation laws of the country and will maintain the international standard of food quality in absence of adequate local laws. Bangladesh also requires that every restaurant or food shop acquire the following licenses: 

Environmental License – issued by the Directorate General of Environment (DGE)



Sanitary License – issued by the Department of Public Health of the Dhaka City Corporation (DCC).

5.5.2 Technological Environments Manufacturing of ice-creams does not require very high levels of technology. Ice cream parlor such as Cream Dream will provide its service from manufactured ice cream, the involvement of technology is quite low. The few equipments or tools that will be used by the ice cream parlor are: 

Cone manufacturing machine



Machine to produce soft ice cream



Coffee manufacturing machine



Refrigeration system



Ice cream scoops



Video-game machines



Electronic cash register

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The use of technology in the manufacturing of cones, soft ice cream and coffee has reduced the time of preparation. Proper refrigeration system is a necessity; otherwise the frozen components will melt or deteriorate in terms of quality. The use of electronic cash register will reduce the time and paperwork on part of the cashier.

The ice cream parlor offers frozen desserts and beverages such as coffee, soft drinks (canned and fountain) etc. All the items require constant supply of electricity to run the machines, specially the refrigerator and preserve the condition of the food items. If the ice creams soften and re-freeze, the ice crystals, which affects the taste. Hence, the lack of stable power supply may affect the parlor tremendously. As load-shedding is a common problem, unstable power supply is likely to have some influence on the business’s performance.

The unstable supply of electricity or constant fluctuation of the voltage may also cause damage to the equipment used for parlor. To overcome the damaging effect of inefficient electricity supply, the entrepreneurs are often compelled to obtain expensive substitutes such as UPS and generators. Purchase of such items will increase the start-up costs of the parlor which may lead to an increase in price.

5.5.3 The Social and Demographic Environment Any business venture is much affected by the demographics and the values of the society within which it operates. The ice cream parlors present in Bangladesh are not so advanced and maybe considered to be in their infant stage. The existing diverse array of social phenomena often plays a significant role in influencing the growth of business enterprises.

National Culture The wide availability of media and globalization has a major impact on lifestyles and business of Bangladesh. The younger generation of Bangladesh is more willing to accept the changes and adopt the newer ways of living. It identifies eating out in restaurants and parlors as new sources 24

of entertainment. The price of ice creams is quite low in the ice cream parlors which attract customers.

Demography Demography refers to the measures of various characteristics of the people and social groups who make up the society. Population structure, education, migration are some examples of demographic characteristics.

Population structure The most populous age group in Bangladesh at present is 18- 45. This population structure provides a promising future for the different modern food sectors such as fast food shops and ice-cream parlors. This age structure is more open to new ways of living. They are fun loving and facilitates the adoption of modern ways which will promote the parlor business. Currently, children drive a large part of the ice cream industry. Households with children are the lead consumers of ice cream and this number is growing at an increasing rate. The preferences of consumers vary according to age and gender. According to consumer research children and teenagers from high-income households eat more types of ice-cream products.

Level of education The literate group of Bangladesh is increasing due to several factors. Government of Bangladesh has realized the importance of education and has taken several steps to improve the literacy rate in the country. Personal initiatives are taken by parents to send their children to school.

Education not only increases the knowledge base of a person but also helps in the overall improvement of a person’s thinking pattern and in building character. It makes it easier for people to appreciate different lifestyles, creates interest in trying out exotic items. The parlor business that was almost negligible ten years back, at present holds a potential future, with 25

improvements in education level playing a contributory role in increasing adaptation among the younger age groups.

5.5.4 Economic Environments The overall condition of the economic system in which the country operates comprises the economic environment. The economic environment is comprised of purchasing power, gross income, disposable income, discretionary income, prices, savings, credit availability, and general economic conditions. The general state of the economy-rapid growth, slow growth, recession, or stagflation- influences the willingness of consumers to spend on luxury items. A business unit can be much affected by employment, government revenue, balance of payments, inflation, and interest rate.

Improvements in living standards The income level of Dhaka city is growing at a staggering rate and there is an unprecedented increase in the demand for luxurious products among people in the middle and high income range. As industrial activity is on the rise and since employment is also increasing, the demand for luxuries like premium ice-cream products is also likely to increase.

Employment Generation Ice-cream parlors fall within the service sector and is also labor dependent. However, the existing ice cream parlors in Bangladesh are small in size and do not employ huge number of employees. Each ice-cream parlor may employ a maximum number of ten people hence the number of labor absorbed here is very less. Parlors which have more than one branch employ greater number of people. The emergence of numerous ice cream parlors in recent years resulted in an increase in employment in this sector.

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Foreign exchange earnings Most of the popular ice-cream parlors such as Move-n-Pick, Andersen’s, Club Gelato; etc imports ice-cream either in manufactured form or the ingredients. This causes outflow of currency. However, as Cream Dream will depend only on locally produced ice cream and very few imported machineries, it will have negligible effect on the foreign exchange earnings.

Devaluation of Currency Devaluation of the currency has a negative impact for certain ice-cream parlors as it increases the cost of import. Most of the popular ice cream parlors face an increase in the cost of production as they import the ice cream, either in the form of ingredients or prepared form. The owners try to overcome the cost effect by charging higher price for the ice-cream. Hence, parlors such as Cream Dream may face considerable difficulty in keeping prices competitive considering that most of the items will be imported.

Government The government does not offer any sort of economic incentive such as tax holiday for the icecream parlors. The companies have to pay income tax and VAT of 15%. They also have to pay the tax if they import materials from other countries. Moreover, the infrastructure base regarding power supply is still poor. The parlors are forced to purchase UPS and generators to prevent the huge wastes that it might otherwise endure. The parlors could have avoided the increased cost if government had tried to provide a solution to the load-shedding problem. Government can also help by providing small amounts of loan that will help the parlors to carry out their own ice cream manufacturing plant or research and development work. This may come as a part of government initiative to promote small and medium enterprises.

5.5.5 Natural Environments Shortage of raw materials Some of the flavors include natural ingredients such as nuts, fruits etc. Shortage of these resources locally will increase the cost of production, as they will then have to be imported. 27

Cream Dream employees will be kept informed about the shortage of water in the country and hence avoid the wastage of water during washing and cleaning.

Anti-pollution pressures Cream Dream will try to avoid those activities such as littering of wastes that damage the natural environment. It will also try to promote product recycling by using recyclable paper wrappings and paper napkins. Competitive Environment The market structure for ice-cream stores is monopolistic in nature. Demand depends on brand loyalty of respective customers and considering the potential of entry of new entrants is high, the market is likely to become more competitive. The ice cream parlors are quite competitive. There is competition mainly from foreign firms, especially from Move-n-Pick, Club gelato; Andersen’s who have been offering delicious ice-cream at high prices.

The customer’s buying characteristics play a significant role in determining the level of competition among the parlors. Some customers prefer those places whose past performance and the quality of the ice- creams have impressed them. Hence, even though the cost is very high, customers still tend to go to those parlors. The price-sensitive customers mainly go to parlors that ask for low prices. Some consumers believe that foreign products are better than the domestic ones and prefer the foreign expensive ice-creams.

Some restaurants and fast food shops offer ice-cream along with their main menu but usually they have very poor quality and taste. The difference is that the parlors offer a wider range of ice-cream products. Customers often taste the different ice creams in various parlors and then usually go for the lower price of similar quality of products.

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In addition to other ice-cream parlors, Cream Dream will be facing competition from any store that sells ice-cream and beverages- anything that may be considered to be in the category of desserts. Most ice-cream parlors offer basically two to three lines of food products: 

Ice cream and related products



Beverages (coffee, slush, soft drinks etc)



Pastry or other desserts (optional)

The items offered in ice cream parlors are often similar. The flavors are same such as chocolate, strawberry, pistachio etc. The syrups are imported and many varieties will be used to add exclusiveness to the product. Hence, differences do exist in the taste and also the type of sundaes and toppings offered by each ice cream parlor. Some of the sundaes can also be prepared based on the preference of the customer. Other points of differentiation will be emphasized like in terms of quality, quantity, arrangement, toppings, price, and surrounding environment.

5.5.6 Threats of existing competitors There are several ice-cream parlors operating in Dhaka at present. The size of ice-cream parlors is usually small. Some of the parlors operating currently in Dhaka city are:

BASKIN ROBBINS The US-based Allied Domecq International's Baskin Robbins is an American ice cream chain has four branches in Dhaka providing tasty and high quality ice cream. Baskin-Robbins has developed over 1,000 flavors of ice cream, sherbet, sorbets, and ices. Since it started operation, their mission was to create delicious ice cream concoctions with loads of ingredients and fanciful names. From the initial concept of 31 flavors - one for every day of the month - BaskinRobbins has become the largest chain of ice cream stores in the world. The branches are 29

located in Mohakhali, Gulshan Avenue (next to American Fried Chicken), Shantinagar, and Dhanmondi. Though they claim to offer wide variety of ice cream, very few are actually available.

CLUB GELATO One of the Dhaka's classy ice cream parlors, Club Gelato serves authentic Italian ice cream. It offers a wide range of flavors using the finest ingredients made from fresh milk and processed under hygienic conditions. Flavors range from milk based ice creams to fresh fruity ones. They also have an array of scrumptious fine pastry. The interior of the parlor is neat with an elegant design and stylish environment. However, the price is comparatively higher than any other ice cream parlors.

RAINBOW Situated in Dhanmondi and Gulshan, this local parlor provides good ice cream for all ages. Popular with teenagers in the area, it also has a gifts corner. Rainbow has as many as 22 flavors to offer and specials such as the Chocoholic – a combination of chocolate ice cream and syrup. It has been operating for a very long time and hence has gained in popularity with consumers.

SCOOPS ICE CREAM PARLOR Situated in Uttara at the Bailey complex, Scoops makes its own ice cream in eight flavors from plain chocolate to mixed fruit. It's one of very few quality ice cream parlors in the area.

IGLOO GELATERIA This is an outlet opened up by the popular Igloo ice cream company of Bangladesh. They provide many of their own flavors with catchy names such as the Ecstasy Waffle.

MOVENPICK Move-n-Pick is a premium ice-cream brand of the Move-n-Pick Foods based in Switzerland. It is one of the first foreign ice cream chains to be opened in Dhaka. The ice cream comes in from 30

their corporate factory in Singapore. Move-n-Pick has three ice cream parlors set up in Dhaka. The first parlor was set up a few years back in Gulshan 2. The other two parlors are both located in Dhanmondi.

AMERICAN SOFT ICE CREAM It provides machine-made soft ice cream with a choice of chocolate, vanilla, or mixed flavors. They also offer a variety of other drinks besides the ice cream. It is situated in Gulshan and Dhanmondi. Location-wise, Cream Dream is expected to face stiff competition from American Soft Ice-Cream, mainly because of the price-range of the ice-cream scoops served in the parlor. The parlor can offer ice-cream at very low prices because of low overhead costs. However, since variety is limited and because the seating arrangement is considerably congested, Cream Dream is likely to be at an advantage over American Soft Ice-Cream.

ANDERSEN’S of Denmark Andersen is not a separate ice-cream parlor but a part of Chicken King- a fast food shop. It imports the ice cream from Denmark. The prices are high and provides around twenty-flavors. There are at present two branches in Dhaka, one in Gulshan and the other in Uttara.

DOLCEVITA Situated in Banani and Dhanmondi, a premier in ice- parlors in Dhaka, it provides quality ice cream at a modest price. The Banani branch has a cyber café adjoining it for customers to have ice cream and browse the web at the same time.

HAPPY JOES A newly set low-price establishment in the vicinity with limited range of ice-cream scoops.

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Other forces of competition Threat of new entrants The amount required for setting up an ice-cream store differs depending on the size of the firms and its production plan. The parlor business is comparatively small and the start up cost is usually quite low if the parlor does not manufacture its own ice cream. Legal barrier is low since only a trade license needs to be acquired. The level of technology is low. As the investment is quite low, it possesses low exit barrier.

Threat from related products - which may be substituted for ice - cream Substitute products limit the profit potential of an industry be because they limit the prices that firms in an industry can charge. In case of the ice-cream business there are infinite numbers of substitutes- sweetshops, department stores selling chocolates, restaurants offering dessert items on their menu and hence the seller can have little control over prices.

Competitive strategy Cream Dream will initially consider only the parlors near its location in Dhanmondi as its competitors. There are at present over half a dozen ice-cream parlors. Some of them do offer good quality ice cream at competitive price. Although this presents an obvious challenge in terms of market share, it also indicates the presence of a large, strong potential. The newest competitors have to make their successful entry based on an innovative concept or novelty. Cream Dream will not only focus on the taste and quality of its ice creams but its uniqueness will also include the innovative sundaes; all being offered at a modest price. Its menu will comprise almost all the flavors that any ice-cream fan can think of.

The aggressive plans also include providing several sugar-free flavors for the diabetic; bigger sized scoops, and the wonderful ambience, lounge, availability of magazines and offering entertainment (video games). All these will provide an advantage to create a good market share 32

before the competition can adjust or similar concepts appear. Each of the competitors may offer one or more of the factors identified as requirements of the customers but Cream Dream will focus on all the attributes catering to their need. Once the customers of Cream Dream have tried its ice-cream, their experience will be reinforced by friendly and efficient service in a homely atmosphere.

6. ORGANIZATION STRUCTURE

6.1 The organization structure The organization structure refers to the ways in which the organization’s activities are divided, grouped, and coordinated between managers and employees. The structure is based on the organizational design and has to be appropriate to the strategy of the organization Cream Dream is a small business concern at present. It has a very limited line of products and needs to make efficient use of its resources. Based on its size and product offerings, the organization will adopt functional organization structure, which is the most basic and logical form of structure.

The structure will provide a slim management structure. There is one Managing Director who is also being responsible for financial aspect of the business. There are one general manager who is responsible for will look into administration, marketing side and human resource.

In Cream Dream, the senior-ranking managers are responsible for the operations of the entire organization. The chain of command is being maintain, that is who reports to whom. This will ensure better supervision of the employees through proper guidance and control.

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7. OPERATIONAL PLAN 7.1 Distribution and Storage Ice-cream is an item which requires careful handling and proper refrigeration system otherwise the frozen components deteriorates in terms of quality. Hence the process of distribution and storage of the ice cream is very important. Cream Dream initially plans to bring in its supply of its products to the parlor every month (presumably within the first week of every month). The local ice cream and the beverage supplier are the vital parts of the distribution process of Cream Dream. However, the store will also require importing many of its ingredients to be imported as well to live up to its promise of offering consumers with a lavish mouth-watering treat. The ice cream supplies will be sent by the supplier in ice-cream trucks, which have refrigeration systems installed to keep the ice cream at a specific temperature while delivery. It will be the responsibility of the management to avoid all sort of conflicts-vertical or horizontalbetween the suppliers and Cream Dream. The distribution system of Cream Dream is very simple, starting from the manufacturer and ending in the customers. The waiters will serve the ice creams to the customers in the parlor. The company plans to provide quality service by using trained staffs.

The ice-cream will be kept in large refrigeration system in the parlor. The stock will be used maintained using the FIFO system (First in First Out). The stock will be kept for a maximum of three months. The time and amount of stock that will be ordered will be forecasted based on the sales of the previous months.

7.2 Resource requirement The business will start its operation in Dhanmondi. The area available for the parlor is 1600 sq.ft. The monthly rent will be Tk 40000 and 500000 has to be paid in advance to the owner of 34

the premise. This would be a major drain on the financial resources of the business. It would also raise fixed costs thus subjecting the business to a high level of risk. It will take approximately one and a half month to decorate the place for the parlor.

Ice-cream dip freezers Dip freezers display 4, 8, 12 or 16 flavors in 3-gallon cans. Parlors usually use a combination of dippers depending on how many flavors they want to display. As far as display and storage goes, the 8-can dipper displays 8 flavors and stores 4 underneath for a total capacity of 12 cans. The 12-can stores 8 for a total of 20, and the16-can stores 12 for a total of 28. There are a few variables that need to be taken into account when determining the right combination of dip freezers for a parlor. The first is the space limitation as well as the planned layout. Next is finding out the available flavor variety offered by the company.

In most cases, a parlor's variety of flavors should be somewhere in the 24-48 range. A section of the parlor will be equipped to set up the game zone. Another section will be set aside for the kids’ corner. The rooms will have colorful walls and be brightly illuminated to attract the customers. The glass counter will display the different colored and multi-flavor ice-cream. There will be seating arrangement for 25 people. Trendy music will be played at the background.

A glass shelf displaying the beautiful crockery (bowls and glasses) will be kept behind the counter. There will be a separate section for storage that will be separated by partition.

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7.3 Logistics The logistic refers to the factors such as equipments, fixtures etc that are needed for Cream Dream to operate. Lists of such items are given below. Furniture and Fixture Tables

8

Chairs

30

Display counters

1

Air conditions

2

Sofa sets

2

Magazines racks

2

Toys for children

5

Equipment and Machinery Ice cream dip freezers

2

Coffeemaker

1

Cash Register

1

Cone Manufacturing machines

2

Fountain Machine

2

Refrigerator for drinks

1

Soft ice cream maker

1

Video game machines

3

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7.4 Utilities The utilities that will be needed: 

Electricity



Water



Telephone



Security maintenance

7.5 Production Cream Dream will not prepare its own ice-cream. It will obtain its supplies from a local company. It will only prepare the waffle cones using the cone maker. Cream Dream will basically present scoops and sundaes that may be prepared in front of the customer or the customer may sit down at one of the 25 seats in the room and get full service from a waiter after placing the order.

Cream Dream will provide coffee, milk shakes and soft drinks. The soft drinks will also be obtained from the local beverage companies. Strict standards of sanitation, quality production, and presentation will be maintained.

7.6 The menu The Cream Dream will offer a collection of different flavors of ice-cream along with certain special flavors that are not currently available in other parlors. It will also offer the fructosebased ice-cream for the diabetic and health conscious customers. The goal is to create the image of enjoyable fun flavors.

The sundaes will be made up of different combination of flavors. Some of the sundaes can be served according to the customers’ preference with flavors, number of scoops and toppings of

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their choice. The toppings will include chocolate sauce, strawberry sauce, wafer rolls, nuts, and fruits. The different types of sundaes will be: 

Single Scoop Sundae



Double Scoop Sundae



Waffle Cone Sundae



Chocolate Cone sundae

7.7 Suppliers Cream Dream would require suppliers for the following products: 

Beverages: Coca Cola, Sprite, Fanta



Water: Mum (Partex Beverages)



Ice-cream (Frosty Ice cream Factory, Igloo Ice cream Factory, Dhaka, Bangladesh)

The ice-cream and the beverages will be obtained from local companies. The cones and coffee will be prepared on the premises. The equipment used for preparing these items will have high standards of sanitary efficiency and will be cleaned regularly. The food will be bought on a twomonth basis and stored in refrigerators in the storage section. Supplies for toppings, cone ingredients, coffee, and beverages will be bought on a monthly basis. As the ice-cream is not manufactured by the parlor, the operations require very low level of technology.

7.8 Facilities The premise at Dhanmondi will be the only point of sale at present. The license and other papers will be all kept in order. Equipment and room furnishings will be purchased and installed. Customers prefer freshly baked cones and the equipments make it easy to serve giant waffle cones.

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7.9 Hours of Operation The parlor will be kept open 7 days a week. The service will begin from 9: 30 a.m. and end at 08:00 p.m. The parlor will have to be kept closed on days of strikes and May Day. No consideration on festival days will be given and the parlor will operate throughout the year as more sales take place on such events.

7.10 Employee Training Employees will be trained not only in their specific operational duties but also the philosophy and applications of the concept of the venture. The staffs involved with preparing the scoop will be given knowledge about the different ice cream flavors and the quantity of ice cream served in each scoop or sundae.

7.11 Bill-collection process The operational activities are very simple in the ice cream parlor. The customer places the order that is prepared according to the recipe. Each sundae has a fixed combination of flavors and will be prepared according to the recipe. The waiter then serves the item. The bill is collected before the patron leaves the store. The supervisor would ensure that the other staffs (waiters, guard, and server) are carrying out their work efficiently to achieve the goals of the organization.

7.12 Controls Cream Dream places a big emphasis into the quality and integrity of its products. They will constantly be tested for its own high standards of freshness and purity. Costs and inventory control will be handled by the computer system and checked daily by management.

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8. MARKETING PLAN A marketing plan is probably the most important but least thought about aspect of a business. It is the part of a company’s business plan that outlines the marketing strategy for the company and its products.

8.1 MARKET ANALYSIS - Long term prospects and trends The population and local businesses in Dhanmondi are increasing at a rapid rate. The location has been identified as a prime center for business activity especially in case of ventures related to food industry. Several high quality restaurants and almost all the top ice-cream parlors are located near the suggested location for Cream Dream.

Eating out has been chosen as a form of entertainment by the city dwellers as there is a lack of proper source of entertainment. People visit fast-food shops and ice-cream parlors more than they did few years back. They celebrate parties and this is now a widespread accepted way of enjoyment. Ice cream parlors are also chosen nowadays as an informal meeting place.

Market analysis is favorable toward the ice cream business within Dhaka. Ice cream is a popular indulgence, and people, mostly young people are willing to spend money for such a treat. Since Dhaka is catching up with Western trends it is reasonable to project that ice-cream business will be prospering in the coming decade and people will demand more variety and premium quality. It is also important to bear in mind that people are also becoming increasingly health conscious and hence quality and health should be the main criteria for positioning Cream Dream. Marketing “healthy” and “premium” ice cream will provide more options for the customers.

8.2 The Market Identification of the market segments is important for any business enterprise so that it can decide on its target market and create a more fine-tuned offering. This also helps to have a 40

clearer picture of its competitors. The customer base will come from two major segments: Local population - The target market will include mainly the residents of Dhanmondi, Mohammadpur, Jhigatola, and shonkor. Furthermore, educational Institutes– there is more than 25 schools and universities in the surrounding areas.

The food concept and product image of Cream Dream will attract 2 different customer profiles: More and more young people have developed interest in eating at places such as fast-food shops and ice-cream parlors.

Curious individuals who pass by and are attracted by the wonderful smells coming from inside are also potential customers. They will flow in and out all day, and are likely to peruse the store’s magazine rack for hours. This customer base is most lucrative, and is most likely to buy an ice cream before or after their short day hikes. These individuals have not visited the store before and are likely to make impulse purchases during their first visit. Most of these inquisitive people who are curious and open-minded about new things; through marketing, publicity, and word-of-mouth, people will seek out a new experience and learn that ice creams can be different, healthy, tasty, fun, convenient, and inexpensive.

Cream Dream will target all segments of the metropolitan population: though its main focus will be on children and teenagers. The purchase of hand-dipped ice cream and related products is basically an impulse-type purchase by a consumer relating to one of the following stimuli: 

Passing by the Shop on the way to another destination,



Visual contact with the Shop’s signs,



Observing someone else consuming one of the Shop’s products,



The final course (dessert) after a meal has been consumed elsewhere (considering there are many fast-food restaurants in the vicinity)

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8.3 Target marketing strategy The business will especially attract customers wanting a variety of new, creative and original ice-cream flavors that cannot be found in any normal supermarkets and ice-cream parlors. Another reason why the owners of Cream Dream have selected this target market is that they will be able to access a much wider market by extending the product line as well depth of their offerings and generally become more profitable through the greater sales. Thus, the success rate of the business will be enhanced.

However, most specialty target market will be considered the youth of this generation including teenagers and young adults. The customer group also includes young couples with several kids. This is because the youth are early adopters of exotic food products, and they like to experiment and tend to follow trends. Also, an alternative reason why the main target market will be youths is that ice cream is popular within this age group, as it is fun and most importantly delicious.

However, the secondary target market will be aimed at the older generation of today such as parents, adults and health-conscious people, either to buy the ice cream for themselves or for their children. This segment will also be attracted, as there will be items to cater their needs such as coffee. The health conscious people will also be attracted as certain flavors will be glucose-free to meet the demand of people suffering from diabetes and obesity.

8.4 Demand analysis There are several factors that influence the demand of a product of an industry. The factors linked to the ice cream industry are:

Seasonality of demand Seasonality refers to the distribution of business activity throughout the year. Seasonal industries have a disproportionate amount of activity in one part of the year and 42

correspondingly less in the others. Many people have this notion that ice cream parlors face the problem of seasonal demand and are able to do only 10% of their year's business in the winter months.

However, according to Mr. Gomes, the manager of Club Gelato, ice creams may face a seasonal demand in shops or supermarkets but not when provided in an ice cream parlor. He explains that during winter people may avoid buying ice cream boxes available in the shops, but the customers of ice cream parlor come not only for the ice cream but also to spend their time. Lack of entertainment place in Dhaka causes the customers to come to the parlor and have good time. However, the sale of ice cream may be a bit less during the winter than the other seasons. Nevertheless, as the country experiences 9-months of tropical summer heat, the demand for ice-cream in general remains fairly consistent throughout the rest of the year.

Competition Even though the business will specialize in normal ice cream, it will also offer the option of milk shakes and other types of ice creams such as sorbets, soft serve, and sundaes. This way, the business will be able to cater for a wider range of customers, satisfy their individual tastes, and fulfill their satisfaction of ice cream. Many ice cream parlors only offer ice cream and this does not comply with everyone’s wishes.

Cream Dream will be the new, modern, ice cream store that is situated conveniently in Dhanmondi where it can be easily accessed. The business will have a neat and creative exterior shop front that attracts the attention of passers by, particularly children due to the repetitive color schemes and animated characters that the business will employ. The color scheme will consist of pastel colors like pink, purple, and white. In addition, the business will provide a happy and comfortable atmosphere that is different from other businesses within the ice cream industry. There will be background music for customers to enjoy whilst being served and the 43

waiting line would not be long, as the business will employ sufficient staff to handle the customers. This will especially be beneficial for families with children. The business will also incorporate a self-service component where it will enable children to create their own toppings. This offer can be used with any product purchased. It will appeal to children as it is fun and they will be able to "make" their own ice cream.

Another factor feature that will distinguish Cream Dream from other ice creameries is the range of sizes. The ice cream will be served in a variety of sizes ranging from sundae cups, both large and small to cater for a wider range of customers, as well as the choice of either a waffle or wafer cone.

Thus, the business’ pricing strategy, range of types of ice cream, exterior and interior store presentation and large range of sizes will mainly be the principles that will distinguish Cream Dream from other competitors.

There are currently about 30 ice cream parlors operating in Dhaka some having branches in two or more locations. The most popular parlors such as Club Gelato, MovenPick, etc are all foreign franchises. The parlors have been around for some years and are more experienced than new ventures. Hence, Cream Dream is expected to face tough competition from the other ice cream parlors. Also customers of ice-cream parlors tend to be quite loyal and do not change their preferences very easily, which may create a problem for Cream Dream Parlor. There are three major ways in which advantage can be created over the competitors: product identity and quality, high employee motivation and good sales attitude and innovative options.

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8.5 The Marketing Mix 8.5.1 The product Ice Cream and Related Products Cream Dream Parlor will sell ice cream, yogurt, and sorbet products: vanilla, chocolate, Brazilian Coffee Crunch, Strawberry Surprise, and other ice cream and yogurt flavors; ice cream and yogurt sandwiches; blueberry and other sorbets; and a variety of Italian-style ices including lemon and lime. Lemon ice will be a featured product with its distinctive, sharp lemon flavor. The parlor and café features delicious treats and coffee prepared fresh daily from the finest ingredients available. From ice cream and frozen custard to milk shakes and smoothies to coffee and cakes, all will be offered under one roof. The parlor even features low-calorie ice cream, so even dieters can enjoy frozen treats.

The main items for sale will be hand dipped ice cream and yogurt cups/cones; sundaes finished with a variety of toppings such as hot fudge, caramel, butterscotch or fruit, banana splits shakes malts, and ice cream sodas and floats. Included among the different imported tropical and Mexican flavored syrups that will be sold are: Wild Watermelon, Pine Colada, Pink Lemonade, Guava Grape, Cherry Jubilee, Root Beer, Kiwi, Strawberry, Blue Bubble Gum, Orange Mango, Raspberry Red, Luscious Lime, Bodacious Banana, Tamarind, Melon, and Papaya. There will be other flavors available as well such as Spearmint, Black Cherry, Cinnamon, Blueberry, Peach, Red Apple, Tutti Frutti, Coconut, Cola, Green Apple, Tangerine, and Vanilla. Also, more commonly found low-end products to be sold will include ice cream in vanilla and chocolate flavors.

The customers will be given the option to make their own ice-cream and this will particularly appeal to the children. Once they have selected their desired flavor, the ice cream will then be scooped onto a frozen marble slab, where their choice of fruits, nuts, and candies will be blended in, until the whole mixture is pile high on the fresh waffle cone of their choosing.

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The shop also doing there business by selling ice cream cakes, gourmet traditional cakes and birthday cakes. These cakes will be displayed for immediate sale at all times during business hours and can also be produced in quantity on a special order basis for caterers and parties. The Shop will have two 3-foot wide, 4-shelf display cases for cakes. One 3-foot display will be for frozen ice cream cakes, and the other will be refrigerated for display of traditional gourmet cakes and gourmet birthday cakes.

Flavors Cream Dream aims to provide a wide range of ice cream flavors. The ice cream flavors will include the typical ice-cream flavors such as chocolate and strawberry and also unique flavors that cannot be found in normal supermarkets and ice-cream parlors.

Many companies have introduced and are marketing ice cream that has a lower carbohydrate content to meet the demand for the newest diet craze. Customers are also now able to find reduced-fat, fat-free, and no sugar added varieties at many local ice cream parlors.

The newest trend in the ice cream industry is the mix-in or “create your own” craze. Consumers are looking at indulging themselves when they go out for ice cream. They are looking for an environment that caters specifically to them, while making them feel special at the same time. Instead of going to the grocery store, customers customize their ice cream experience selecting specific types of ice cream in an ice cream shop, order a specific flavor, and then, add things to it. Candy bars, cookies, brownies, and fruit are the typical add-ins that is seen in most stores. The parlors then mix the creation together and spice it up with toppings. Ice cream shops are also beginning to make more ice cream on site rather than buying it from a supplier. Freshly made ice cream is a huge draw to customers.

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Customers can taste the difference in old vs. new ice cream and also in the different ingredients that are used. They are more into eating a higher quality product that is fresh and made specifically with them in mind.

Beverages and Other Products Coffee, tea, and related beverages will be purchased from a local wholesale food distributor. Other products will include soft drinks (Sprite, Coke, Mountain Dew, Fanta and Diet-Coke), and cappuccino.

Special ice cream suitable for diabetic and obese people for diabetics, prepared with fructose (fruit sugar which is easily digested) rather than regular sugar, will also available. Other items such as coffee, sorbets, and sundaes will also be offered. The ice creams will be the products that will distinguish Cream Dream from other ice-cream parlors and suppliers.

Cream Dream will also have a games corner. Here two games arcade machine will be kept with the latest and most popular games. This will attract the customers and will help to bring in a greater pool of customers.

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List of possible flavors: No.

Name

Description

1

Almond joy

Chocolate ice cream with almonds.

2

Banana

Fresh banana ice cream.

3

Banana Chocolate chip

Banana ice cream with chocolate chips.

4

Blueberry

Blueberry ice cream.

5

Blueberry White chip

Blueberry ice cream with white chocolate chips.

6

Boring White Chip

Vanilla ice cream with dark chocolate chips.

7

Butter Almond

Buttery ice c ream With chopped roasted almonds.

Presentation

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8

Butterscotch Vanilla

Vanilla ice cream with swirls of butterscotch.

9

Caramocha

Coffee-chocolate ice cream with caramel swirl.

10

Cherry Chocolate Chip

Black Bordeaux cherries and chocolate chips

11

Chip Frenzy

Vanilla ice cream with white, caramel

12

Chocolate Almond Chip

Chocolate ice c ream with almonds and chocolate chips

13

Chocolate covered pretzel

Vanilla ice cream with tons of choc covered pretzels.

14

Chocolate covered strawberry

Chocolate and strawberry ice cream.

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15

Strawberry

Strawberry ice cream

16

Tutti Frutti

Mixed fruits

Positioning This is fundamentally to appeal the customer’s so that they can see all the different types and flavors. This generally means that a popular ice cream such as Butter Scotch will be positioned next to a not-so-popular ice cream such as Tutti-Frutti, whereby the customer will take it into account.

8.5.2 Price The majority of the business’ sales will come from ice cream. Prices will be comparable for standardized traditional flavors like vanilla, chocolate and higher prices will be charged for the multiple flavored and delicious varieties. Once the initial outlay is recovered, the store will lower prices for most of its offerings. High prices will be required to be charged for offering the imported flavors and items that require a significant proportion of imported ingredients. However, customer feedback and ratings is being analyzed, measured so that the popular items can be chosen. Managers make decisions as to whether any item will be kept for the next 3 months will be based on customer feedback. This will not only ensure that unprofitable items are not included in the product line and at the same time it will ensure that the offerings are compatible with the tastes and preferences of the customers.

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Product costs and mark ups (i.e. sales price) Product cost formula Variable costs per unit + 90% of variable costs per unit = retail price

The prices of all ice-cream products that Cream Dream will offer are determined by using the formula stated above. The reasons for this formula are that the business aim is to fulfill the customers’ satisfaction and at the same time ensure that the business can maintain profits. In order to completely achieve this, the parlor will be offering ice-cream at reasonable and affordable prices and that will not only satisfy the customer but also the business requirements (i.e. profits). Although, 90% may seem a lot, the profitable margins are minimal. It can be noted this is mainly to cover the excessive fixed cots of the company. The Cream Dream business may however find its growth to be slower in the initial years mainly due to its high prices. Thus, take for example, a scoop of a delicious ice-cream with a waffle cone. Its cost price is Tk 13.

Variable costs per unit + 90% of variable costs per unit = retail price Tk 13+ 90% * 13 = Tk 24.7

Thus, the pricing strategy is reasonable, affordable and fulfils the customers’ satisfaction of low costs, and delicious high quality ice-cream. The business will generally increase sales through the use of promotional plans such as free giveaways, coupons, requesting a free taste test and so forth.

Representative prices are as follows: Tk 50 for a single scoop of ice cream, Tk 90 for a double scoop of ice cream (both single and double scoops include a cone or cup), Tk 115 for a double scoop in a chocolate waffle cone. While these initial prices are fairly compatible with the pricing of other ice cream stores and parlors. Volume costs include Tk 20 per scoop of ice cream, Tk 5 per 5 ½ oz. plastic cups, Tk 2 per plastic spoon, Tk 5 per sugar cone, Tk 15 per chocolate waffle cone. 51

8.5.3 Physical facility The store will be making use of colorful bags, boxes, and containers to attract curious passer-bys. Moreover, the parlor will use additional scents to make their store extremely fragrant. The windows will be decorated to provide a welcoming atmosphere and entice passers-by to stop in.

The managers of Cream Dream plans to promote the business through the use of:

Music: The use of music within the store will attract people’s attention and retain it, especially if it is their favorite type of music.

Seating: Seating within the store will provide accompanying customers with comfort whilst they wait. Also, it will be beneficial for parents whilst they supervise their children whilst they "make" their ice cream.

Bonuses for the Customers: This essentially means that by distributing free promotional coupons and samples, the store can increase the popularity of the business. It will attract customers, as the coupons will be distributed near the location of the business, where they will be persuaded to visit the store to receive their free promotional samples.

To increase the popularity of the business, Cream Dream will provide game zone. It will attract customers, and the young people.

8.5.4 Promotion Promotion is an attempt to influence the consumers. Cream Dream will design the promotional mix based on the target market, the product, the stage of its life cycle and budget for promotion. Its promotional mix will mainly include advertising and sales promotion. 52

Advertising Cream Dream will mainly use the print media (newspapers, magazines, and leaflets) for its advertisement. The other expensive forms of advertisement such as television or radio broadcast will be avoided. The advantage of using this media is that will enable the promotion of the business to have a widespread circulation either within the area or city; depending on which newspaper it is advertised in. As the business is located in Dhanmondi, and the surrounding shops are very popular, people will be able to recognize the location of the business easily. Newspapers used will be Daily Prothom Alo, Daily Star, and the Bangladesh Observer etc.

Magazines are largely read by the public for enjoyment so the advertisement will appeal to them. Newspaper such as The Daily Star and The Independent issue magazines that are popular in target market and also contain special food and entertainment section is which the ads will be placed.

Leaflets will be distributed to about 500 households (number based on cost calculation) along with newspaper and in chosen regions based on the target market. It will accompany those newspapers, such as the Daily Ittefaq, which have not been chosen for the ads. Rollout posters will be hung on the front of the shops to attract more customers.

However, Cream Dream will only use this advertisement technique in its initial stages, two month before starting its operation and two months after that, so that it can inform and educate its potential customers. Later it will depend on ‘word of mouth’ of its existing customers.

Cream Dream also plans to participate in fairs and exhibitions. Promoting the parlor through the use of fairs and various events such as Food Festivals that is held annually in an effective way in showing the customers what Cream Dream corner offers. Placing the business in such competitions at these venues will demonstrate and display the amount of confidence the 53

promoters have in their product, and also appealing to customers to buy the product. It will show that the product is trustworthy and worth their value. The fairs will obviously have many children and youth roaming the site that will be a great advantage to the business as the targeted audience are from this age group. Food festivals will undoubtedly attract lovers of food; thus, the parlor being promoted here will be of a great advantage.

Cream Dream Parlor will also be promoted with a variety of marketing methods: A grand opening will be held with free samples of food products and drawings for distinctive hats, Tshirts, and other clothing bearing the store’s logo.

According to a research conducted in India, most consumers talk about their favorite vanilla or strawberry flavor and not their favorite brand of ice-cream. Hence the advertising campaign will mostly stress on flavor rather than the brand. With the use of animation, the campaign has assigned a character to each flavor, which speaks for them as they pose for a photograph. These characters also feature in the kids’ corner and on special dishes and cups served to the kids. The company also plans to give away free tattoos and labels with images of the various ice-cream characters on them.

One way to draw customers into the shop is to offer “Buy One, Get One Free” coupons from the local newspapers, direct mailings, or the Internet. Consumers are drawn to places where things are advertised as being “Free”. Coupons are an easy way to determine just how affective the advertising message is in the community. Then, once the consumer has entered the ice cream shop, it may be possible to sell other products to them as well. Also, with coupons, consumers are more likely to bring their family or friends along with them.

Another program that may be introduced for the ice cream parlor is the use of loyalty programs. This program can be extremely effective in the ice cream market. It encourages customers to come back to the store each time they have a desire for ice cream because they 54

are trying to reach their free reward at the end. It is suggested that the number of visits required for getting the reward.

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9. FINANCIAL PLAN 9.1 Sales forecasting As ice-cream is a seasonal dessert, with sales being dependent on the weather, the sales figures vary throughout the year. Typically, sales of ice-cream would peak during the summer season as this is when ice-cream is most popular and favorable. With 9-months of hot-weather and with Dhaka city being relatively warmer, the slack period of 3-months in the winter need not be a cause for concern. Hence sales will be low throughout the winter and in some occasion the business is likely to incur a loss of profits.

Cream Dream aims to keep the customers satisfied. If a customer is unable to get the flavor of ice cream he/she was looking for, then it is very detrimental to the sales and its image. Keeping a high stock level may seem to be a better option but Cream Dream also has to be cost efficient. Ice cream has to be stored in freezers and keeping large inventory will involve huge costs as more freezers will be required as well as higher electricity costs will be incurred.

To be able to maintain the exact amount of inventory level, Cream Dream has to predict the level of future demand and hence forecasting demand will be a very essential element in the operations structure.

The demand for each flavor is different; thus forecasts have to be made separately for each flavor to maintain the varying level of inventory for each flavor. Initially Cream Dream will forecast its inventory based on its study of sales in competing parlors. To further enhance the forecasting technique, the factors that have impact on the demand of ice cream need to be determined and these have to be incorporated in the calculations.

After the operation has continued for one-year, Cream Dream will systematically combine its historical sales data to present its forecasts. This forecasting method can either be the weighted moving average or exponential smoothing. The ‘weighted moving average’ is an effective 56

technique as it places greater weights on the most recent data that compensates for trend or seasonality.

Demand for ice cream is unstable and is easily affected by several factors. During an economic slump demand of ice cream will be one of the first to fall. During economic instability consumers are reluctant to spend their money on luxury products such as super premium ice creams. Cream Dream needs an efficient forecasting technique that will help in dealing with high demand as well incurring a low inventory management cost.

9.2 Ongoing costs The outgoing costs for the business, Cream Dream includes rent payments, wages, advertising, insurance, repayments of installment for bank loan, bank charges, accountant fees, telephone bills, electricity bills and wages.

Preliminary Expenses Equipment: Basic equipment cost is estimated to be Tk 194000. This expense includes: dipping cabinets, refrigerators, tempering freezer, display freezers, holding freezer, three-compartment sink, ice machine, stove, and equipment installation.

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List of Machines and Equipment Details

Units

Total Cost

Refrigerator for ice-creams

2

80000

Coffee Maker

1

2000

Cash register

1

10000

Cone manufacturing machines 2

4500

Refrigerator for beverages

1

18000

Soft ice-cream maker

1

6000

Crockery

1

12000

Video-game machines

3

90000

Tempering freezer

1

22000

Total

244500

Real Estate The project will be accommodated in Dhanmondi. The monthly rent will be 35000 Tk and the annual rent is Tk 420000. There will be an advance payment of Tk 1000000.

Fixtures Fixture costs will total about Tk 150000 based on an estimate from OTOBI Fixtures Supply, Inc. These costs will include purchasing tables, chairs, and removable self.

Security Deposit Security and other deposits will include Tk 1000000 for taking possession of space.

Signs Cream Dream Ice Cream will have extensive signage on the building-front. Signage and installation will cost Tk 20000.

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Decorations and Improvements This estimate was provided by a local contractor and includes floor and wall coverings, window treatments, painting and decorating, window decorations, and miscellaneous minor improvements.

Details

Units

Total Cost

Electrification

40000

False ceiling

30000

Lighting

40000

Floor

35000

Toilet

2

50000

Generator

1

45000

Paint

10000

Total

250000

Furniture Details

Unit

Cost

Total Cost

Tables

8

10000

80000

Chairs

30

1000

30000

Display counters

1

40000

40000

Glass Shelf

2

15000

30000

Cabinet

1

25000

25000

Air condition

2

45000

90000

Sofa set

2

35000

70000

Magazine racks

2

3000

6000

Toys for children

5

4000

20000

Total

361000 59

Salary Expenses of the Year Post

No. of Employed

Monthly Salary

Annual Salary

Ice-cream arranger

2

4000

96000

Waiter

4

8000

384000

Accountant

1

10000

120000

Sweeper

1

3000

36000

Guard

1

5000

60000

Supervisor

1

15000

180000

(Bonuses)

50000

Total

926000

Utilities Expense Particulars

Cost (monthly)

Annual Cost

Electricity bill

20000

240000

Water bill

5000

60000

Telephone bill

4000

48000

Total

348000

Promotional Expense Print Media

Monthly Cost

Newspaper Add

100000

Magazine Add

70000

Leaflets

10000

Total

180000

60

Present Expense License fee

3000

Decoration

250000

Unallocated expense

20000

Furniture

361000

Equipment

244500

Advance

1000000

Promotional Expense

180000

Total

2058500

9.3 Important Assumptions Monthly sales are the largest indicator for this business. There are some seasonal variations with the months of March through September being the highest sales months.

10. CONCLUSION Cream Dream parlor will be successful. This business plan has documented that the establishment of Cream Dream parlor is feasible. All of the critical factors such as industry trends, marketing analysis, competitive analysis, management expertise, and financial analysis support this conclusion. It has been demonstrated that both product and business has a unique and appealing streak, which is capable of attracting customers. The marketing strategies, staffing needs and other aspects of business being shown in the above business plan can show that the future Cream Dream will undoubtedly be a successful small business. Cream Dream is hoping to expand its business when it is financially capable. That is, expand the business to other locations within the state and hopefully nationally. This is going to be achieved through franchises. 61

11. Reference 

Natural Ice Cream The ice cream parlour which began as a small by Rohini Anupriya, Yogesh Deora , Shubhada, Ankush Jadhav and Amit Vohra



Project paper on Davis's Ice Cream



http://www.cothivalebooks.com



www.squidoo.com/icecramtruckbusinessplan



www.wikipedia.com

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