business plan introduction for milk tea

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After years of expanding, it seems that the era of bubble tea/milk tea is over . The market seems to be so crowded, but there’s still so much room for new players to come in. The main demographic is growing, with gen-z driving the majority of this market’s growth . Also, the push to diversify into healthy drink models (milk tea + other teas) has made them an appealing choice.

In this article, we will guide you through all the steps of starting your own bubble tea/milk tea shop and how to create an effective marketing strategy to compete in this cut-throat market.

What to include in your milk tea/bubble tea business plan?

From years of helping beverage start-ups build their brands, and dealing with investors, we helped countless companies formulate their business plan from scratch. In our article, we will discuss 7 important bullet points in a milk tea/bubble tea business plan:

• Executive summary
• Company description
• Product and services
• Market analysis
• Marketing plans
• Logistics and operation plan
• Financial plan

We are in the process of crafting a detailed sample business plan for a milk tea/bubble tea shop. So make sure to bookmark this page, we will update it here as soon as possible.

1. Executive summary

An executive summary can provide an overview of your business and give a good first impression to the intended reader. Whether you are trying to secure a bank loan, find investors or hire employees, a good executive summary inspires great credibility for your business. To truly make your business stand out from the get-go, you need to include the following points:

• Business concepts and mission statements : Clearly state if you franchise the shop from a major bubble/milk tea brand (like Sharetea, Koi Thé, etc.); or it is your own, original brand. You also need to briefly outline your business model, and state the company’s mission to bring values to customers.
• Products and services offered : Give the loan officer/investor a little more about your business models. Explain how elements of your business work together to provide customer values.
• Competitive advantage: What is it that makes your franchise/independent shop stand out from competition in your area? Is it your location, or shop design? Or maybe you can offer a unique bubble tea recipe/topping that nowhere else has? A strong competitive advantage can hook readers to find out more.
• Target market : Great products wouldn’t sell if there are no buyers. Especially You must demonstrate that the market you’re selling to has great potential
• Financial projections : Bubble tea franchises cost money. Building your own brand does too. You need to provide your current financial situation, how much you need to spend, future projections and an ask to help you grow.

Provide a clear overview of your milk tea business with an executive summary

2. Company description

This section allows you to dive deeper into your business model, operations, and personnels . Dive deeper and thoroughly explain your business, to make sure no one misunderstands what you do. Here are a few tips for this section

• Clearly lay out your business goals , both short and long term. In the next year, how much will your business grow? In the long run, are you opening more shops in the area, or developing more business divisions (selling in supermarkets, for example)?
• Give a clear picture of your order fulfillment system , how you source your ingredients, how the drinks and toppings are made, how the recipes are developed, etc.
• Talk in-depth about your competitive advantage . You need to include everything that makes your business unique.
• Provide an organizational chart to define your day-to-day operations. Highlight key personnels that can make your business successful.

3. Products and services

Now, provide a detailed look at your suite of products and services. Keep in mind that this not only includes your drinks menu, like which type of tea and toppings served, but also the accompanying snacks, the additional service in the shop, customer engagement points (check-in spots, etc.)

You need to describe each aspect of your business in detail, and provide a pricing model to accompany each.

4. Market Analysis

In this section, you can explore your target market in greater detail. It must include all the latest statistics about your target audience, their size, interests, spending habits, etc . If your bubble/milk tea business is focused on serving local customers, it’s best to create local surveys and provide a detailed analysis of the customers in that area . You must remember to only include credible data and provide accurate citations where necessary.

Find out what your customers are demanding for

Next, you must execute a competition and market analysis. Your competitors will directly affect your business model. For this part, we recommend using a SWOT (Strength – Weakness – Opportunity – Threat) analysis to identify your niche among the competitors.

5. Marketing plans

Marketing strategies are some of the most important factors to the success of your tea drink shop. Knowing where and how to market your products to consumers can drive massive in-store traffic and explode your order count. We will discuss in much greater length in the section below.

6. Logistics and Operations plan

Having a well-optimized and strong supply chain and operation plan allows you to cut unnecessary costs and ensure consistent qualities across all your products offering.

Be sure to detail:

• Transparent and qualified supplies for all materials (sugar, milk, tea, pearl, etc) and equipments (labeling machine, pearl making machine and so on) 
• A clear process at your service counter , describe how your customers are served, how the orders will be processed and mixed. This can help you design a proper work flow that satisfies customers.
• Back end operations regarding material preparation, managing inventories and staff rotation schedule.

You may also consider partnering with some delivery services or offering a take-away scheme of your own. Be sure to include them in your plan.

7. Financial plan

A good financial plan can paint a picture of a solid business with positive margins and stable operation . If you are looking to attract any external investors , a good financial plan is THE place to start. These are the details that you need to include:

• Income and revenue statements 
• Cash flow statement
• Funding and investment

That’s the short version of what we’d like to give you, regarding the business plan for a bubble tea/milk tea business. We are in the process of crafting a detailed sample business plan for a milk tea/bubble tea shop. So make sure to bookmark this page, we will update it here as soon as possible.

8 marketing strategies for your milk tea/bubble tea business

When all the gritty aspects are out of the way, now you can get down to getting your brand across the market. By applying different marketing channels and strategies, you can maximize brand awarenes, and boost in-store traffic . 

A good marketing strategy brings you closer to your target customer 

Here are the 8 marketing strategies that you can apply to get as many customers to know about your business as possible, while working within a limited budget. But be warned: these are long-term strategies that will require a significant amount of effort and time.

1. Invest in designing and building up your brand

Before we get into how we can do this more cheaply, let’s talk about why it’s essential.

Customers and potential customers for your milk tea business must understand who you are and what you stand for. The best way to accomplish this is to have a distinct brand identity.

Branding is the first impression you make on customers, and it helps you stand out in the world’s saturated milk tea industry.

You can improve your business’s overall brand by taking a few steps

Branding your milk tea business provides you with several advantages, including:

• Credibility comes from having a distinct and well-established brand that makes you appear to be an expert.
• An opportunity to establish yourself as a professional and thus charge accordingly
• Elevating your company so that it can rely on loyalty and recognition
• Delivering on your brand promises so that customers remember you and return
• An opportunity to maintain consistency and improve decision-making time
• Assisting you in attracting your ideal customer persona
• Facilitating the introduction of revolutionary milk tea products and services

2. Create personal marketing campaign

There is no such thing as a one-size-fits-all marketing strategy for every company. Each company caters to a specific market niche. So you’ll need a marketing strategy for a milk tea business that is tailored to the goals and needs of your target customers.

When reviewing your store’s label, the first step should be to identify your customer. If you create a business plan, the information may already be in front of you. Based on your store’s location, you can tailor your brand to the area’s age, gender, education level, and general lifestyle behaviors. 

For example, if your milk tea store is in a college town, attracting students will most likely benefit your brand. Perhaps your shop can provide student discounts or Wi-Fi for those who want to stay longer, but connecting with your target customer should always be a priority.

Knowing your target customers help you in developing an effective overall marketing strategy

Besides, once you’ve determined who you’ll be serving, you can start thinking about other ways to differentiate your image. Are other beverage shops charging exorbitant prices for their wares? Do the majority of your current customers prefer on-the-go drinks over a sit-down experience? 

Examine what works and does not work for your competitors, assess the ease of operation of your store, and determine the benefits of your milk tea products. Identifying these characteristics can help you with your branding statement and differentiating your shop from the competition.

Before deciding on a strategy and tactic, milk tea owners must first understand their ideal customer by determining:

• Your customer base’s demographics
• Your customers’ ages
• Your customers’ residences
• The online services they use
• How they search for your products

Knowing these facts about your customers will assist you in developing an effective and targeted overall marketing strategy for a milk tea business that focuses on the channels that produce the best results.

3. Engage in local and map SEO

If you do not already have a Google Business profile for your company, you can create one at business.google.com. You can then add business photos, posts, and other content.

Create a Google Business profile you’ll see which keywords people are using to find your company. You can even obtain a direct link to send to your customers to leave you a Google Review.

You can use these tools to register your business on Google Maps, and obtain real customers reviews there . A bubble tea/milk tea business relies mostly on local residents for sales, and a clear position pin with detailed reviews are the best ways to spread the world about your business, whenever people look for a place to hang in the local area .

4. Be active on Social Media

Using social media to promote a milk tea business is practically unavoidable. Social media is an essential tool for any small business looking to reach a larger audience and engage with customers regularly.

Over 70% of adults use social media. Social media apps are used for at least 144 minutes per day by users. These statistics may appear intimidating at first glance, especially if you intend to spread yourself across all platforms. Instead, concentrate on your ideal customer.

Use your customer data to determine where they spend the most time, what type of content they prefer, and how to have the most significant impact.

Be active on Social Media to concentrate on your ideal customer

Some platforms to consider, depending on your specific customer requirements, are:

• Facebook: Ideal for sharing status updates, amusing photos, and customer success stories.
• Pinterest: Useful for disseminating visual content, such as blogs, about your milk tea products.
• Instagram: A fantastic platform for sharing high-resolution imagery of your boba teas.
• Twitter: Appropriate for sharing news and responding to customer questions in real-time.
• YouTube: A good platform for dominating branded and user-generated video content.

If you’re doing it yourself, this will take some time. Managing social media is a full-time job.

5. Create an incredible website

A website serves as the foundation for your marketing strategy. It’s also the best place to tell your brand’s story . Create a website with information about the product, purchase, ingredient information, and contact information . Before we get too far into this, it’s important to note that even for the smallest businesses, a website is an expensive investment when you consider hosting, purchasing templates, and, especially, hiring someone to build it.

Creating your website as part of the milk/bubble tea business marketing plan

As famously stated by Simon Sinek , ‘people don’t buy what you do, they buy why you do it’. This is your chance to tell you ‘why’.

Fundamental Marketing also helps you better communicate your product and store features with customers

If your milk tea business does not have a website yet, it is easy enough to:

• Purchase a domain name related to your company’s name, checks if it is available, and pay a yearly or monthly fee for domain ownership.
• Sign up for web hosting, usually available through the same company that provides your domain name.
• Using free or paid templates, use a content management system (CMS) to create and update your website.

However, you cannot simply create a website and expect it to generate traffic. You’ll need to tweak it so that it’s as helpful to your customers as possible. The following section will assist you.

6. Leverage the Power of SEO

Besides creating an eye-catching website, search engine optimization (SEO) is an effective strategy for milk tea businesses. SEO entails optimizing your site and its content with keywords so that search engines and customers can easily find your business.

SEO is an effective strategy for the milk tea businesses

The higher your Google ranking, the more likely you will drive traffic and customers to your website and business. Therefore, you must take every precaution to ensure that your company appears in a Google search.

Rather than delving too deeply into SEO and scaring you away, there are a few things you can do, mainly if you’ve built a website for your business.

 7. Employ loyalty programs to retain customers

After attracting customers with basic promotional methods, you can begin taking your business marketing to the next level with the goal of patron retention. For several reasons, customer loyalty is critical to the success of your business. They not only return for repeat visits, but they are also more likely to make larger purchases, refer friends, or sign up for other services . 

Collaboration with a milk tea influencer can help you increase your brand’s online presence

After attracting customers with basic promotional methods, you can begin elevating your business marketing to the next level with the goal of patron retention. Customer loyalty is critical to the success of your business for a variety of reasons. They not only return for repeat visits, but they are also more likely to make larger purchases, recommend friends, or sign up for other services.

Using an application-based loyalty program, such as Belly or FiveStars, is a great way to offer incentives to customers while also opening up a channel for marketing via email. Reward apps frequently assist business owners in tapping into their customer database better to understand their intended market and behavioral patterns. 

8. Take your marketing to the next level

If you currently have a loyal clientele but want to grow and take your milk tea store to the next level, you can use advanced marketing tactics if your budget allows it. If used correctly, business marketing tools like paid social advertising, paid search, getting involved in B2B settings, as well as partnering with local events can help your milk tea business soar to new heights.

Paid digital advertising can give your milk tea store national exposure, especially if you pay for local and mobile ads. Paid searches, as opposed to SEO content, which organically drives customers to your website, allow business owners to target potential customers searching for keywords related to their business to increase traffic to your website.

Taking part in events near your store’s location, such as providing milk tea for student organizations, fundraisers, concerts, and/or festivals, can offer an unforgettable experience for customers while promoting a better image. Taking part in other bubble tea-related activities, such as catering or attending a specialty food industry trade show, can also help you expand your network while attracting the right demographic to your shop.

9. Collaborate with Food Delivery app

Limited store seating can sometimes limit a company’s ability to expand. Milk tea shops can collaborate with food delivery apps to reach a more extensive customer base to serve more potential customers. It’s also a platform for businesses to offer promotional deals to attract new customers.

The milk tea business is on the rise and has enormous potential because it meets the expectations of the sharing economy and the social media (social influencer) market; a detailed marketing strategy for a milk tea business will assist bubble tea store owners in reaching new heights.

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A Bubbly Biz: Milk Tea Business Plan Guide and Examples

Jay Pagkatotohan

It’s no wonder why milk tea is a big industry here in the Philippines. The country is in the tropics, which explains Filipinos’ need for thirst quenchers. On top of that, this beverage also satisfies our innate sweet tooth. 

Various international milk tea brands, mostly from Taiwan, have flocked to the Philippines, giving enthusiasts a wide range of options. The industry also teems with local shops that provide equally refreshing and delicious concoctions. 

You, too, can join the bubble tea market as a shop owner. It’s a huge and serious undertaking, but you can increase your odds of success if you have a sound and practical strategy. Get the ball rolling by drafting your milk tea business plan. 

Why Milk Tea is a Good Business Idea 

There are plenty of reasons to start a milk tea business in the Philippines, such as the following:  

✔️ There Will Always be Demand for It 

As mentioned, the Philippines is a tropical country. There will always be people looking for ways to cool themselves down. The market size of milk tea in the Philippines typically increases during the hot, dry season. 

Moreover, the beverage has been ingrained within the country’s food culture due to its sweetness and compatibility with Filipinos’ palates.  

✔️ It’s Easy to Prepare

Unlike other offerings in the food biz, milk tea is easy to make. You can steep the tea or boil the tapioca on your own. You can easily source milk tea powder mixes through a number of suppliers you can find online and offline. And if you have a preparation system in place, you can make your operations efficient.  

✔️ It Offers Room for Creativity 

Love exploring and sharing new flavors? A milk tea business gives you opportunities to experiment with ingredients and create new concoctions. 

✔️ It’s Scalable 

A milk tea shop is a highly scalable business. You can even start your own shop at home. Once you generate huge sales, you can expand your business by opening kiosks or even shops in various locations. 

Read more: Selling and More: Business Ideas with 50K Capital in the Philippines

How Much Does It Take to Start a Milk Tea Business? 

Milk tea costing in the Philippines will greatly depend on the size of your business. If you’re starting a shop at home, you may need a milk tea business capital of at least ₱30,000. But if you’re setting up your beverage business in a profitable location, the milk tea business capital is roughly around ₱250,000 to ₱350,000. 

 💼 Launch or Expand Your Small Business With an #UNOnow Loan

Ready to start or grow your small business? If you're planning to secure funds to buy inventory, pay for a bigger space, or hire employees, check out what UNO Digital Bank has to offer.

With an #UNOnow Loan , you can borrow funds starting at ₱10,000 up to ₱200,000 with a low monthly interest rate of 1.79%. You can pay it back in six, 12, 18, 24, or 36 monthly installments. 

Apply for an UNONow Loan via Moneymax now! 

How Much is the Potential Income of a Milk Tea Shop? 

Is a milk tea business profitable? Generally, yes, but it will still depend on a few important factors, such as your location and the quality of your product. 

If you scan various milk tea shops in your community, you may find that on average, a cup costs between ₱85 to ₱120. Factoring this average milk tea price in the Philippines, you can get expected daily sales of milk tea worth ₱4,250 a day if you sell at least 50 cups. That’s around ₱127,000 a month, assuming your shop is also open during weekends. 

But don’t get excited yet. That’s just the gross income. To compute the net profit, you have to deduct the expected daily expenses of milk tea shop operations, such as manpower, ingredients, packaging, rent, and electricity.  

How to Write Your Milk Tea Business Plan: 4 Steps to Take

What is a milk tea business plan? It’s a proposal that covers all the details of your milk tea business. It shows the feasibility and profit potential of your enterprise. In other words, it shows you, your lender, and your investors that your business can actually happen. 

A business plan breaks down your grand vision into actionable steps. It also includes your short-term and long-term goals. Think of your business plan as a compass. 

It’s important that you know how to write this document. Here’s how to draft your milk tea shop business plan in the Philippines. 

Step 1: Know the Industry and Your Competition 

Before finalizing your business concept, you need to check if your idea has a chance of surviving and thriving in the competitive milk tea industry. You need to conduct market research. 

Get the right answers by asking the right questions. The data that you’ll get from the following questions will help you come up with practical steps for establishing your foothold in the industry: 

• Is the milk tea industry in your community increasing or declining? 
• Who are the top competitors in your community? 
• What is the prevailing milk tea price in the Philippines, especially in your community? 
• How much do your competitors earn on average? 
• What types of customers do your competitors serve?
• What do the customers love about your competitors?
• What do the customers dislike about your competitors?
• Do your competitors offer products other than milk tea?
• How is your competitors’ customer service? 
• Who will be your milk tea equipment supplier in the Philippines?

The good thing about market research is that you can do it on your own. You can buy products from your competitors, read feedback on their social media pages, and even talk to their customers.  

Step 2: Pin Down Your Business Concept 

Now that you know the industry landscape, you can come up with a feasible business idea.  Your business idea goes beyond building a storefront; you have to add some depth and purpose to it. Your business concept should include the following: 

• Mission and vision – This should explain the reason you’re starting your milk tea business. 
• Target market –  Your business will flourish if it serves the right customers. Check out your target market, their needs, their wants, and even the things they thought they would never need. 
• Product – This will be the core of your business. Invest time and money in developing a product that will keep customers coming back. 
• Value proposition – Other than marketing your product’s strengths, you should also highlight its unique selling points to make it a better choice than your competitor’s. 
• Branding – Your business should have an image that customers can relate to. Branding efforts include the creation of the business name, logo, tagline, and your brand’s tone and voice in marketing materials. 

Read more: Top 5 Business Bloggers: Advice for Budding Entrepreneurs

Step 3: Write Down Your Actual Business Plan 

At this point, you’re going to flesh out your actual business plan. The Department of Trade and Industry (DTI) has developed a simple template that micro, small, and medium enterprises (MSMEs) can use. [1]  

👉 Executive Summary

This part should give an introduction to your milk tea business, its practicality, and the landscape of the milk tea industry. You should also discuss your competencies and qualifications as a milk tea shop owner. 

👉 Marketing Plan 

Under this section, discuss your main product and all the relevant details to promote it. Take note of the following: 

• Your milk tea’s comparison with your competitors’ offerings in terms of quality and price
• The location of your milk tea shop
• The areas covered by your milk tea shop
• The market share that your milk tea shop is projected to capture
• The number or amount of the products that the shop will sell
• The marketing and promotional strategies to achieve your projected sales
• The marketing and promotional budget 

👉 Production Plan 

In this section, discuss how you’re supposed to produce your product. Cover the following: 

• The production process
• The costs of your machinery and fixed assets
• Sourcing of machinery 
• Maintenance of machinery
• Sourcing of raw materials
• Costs of raw materials
• Cost of labor

To give you an idea of how to build your own shop, here’s a milk tea equipment list in the Philippines: 

• Tea brewers
• Stoves 
• Sealing machines
• Shaking machines
• Pearl or boba cookers
• Measuring cups
• Ingredient containers
• Plastic sealing film
• Milk tea cups
• Water dispenser
• Utensils 
• Cash register 

👉 Organization and Management Plan 

This part of your business plan includes the details of your milk tea shop’s operations, such as the following: 

• The structure of the business (e.g., ownership, partnership, etc.)
• How the milk tea shop will be managed and operated
• The qualifications of the business owner
• Pre-operating expenses and activities
• Administrative costs 

👉 Financial Plan 

Discuss how you’ll fund your milk tea business. In your financial plan for a milk tea shop in the Philippines, cover the following items: 

• Total capital amount of milk tea shop and sample costing for milk tea
• Will you need a loan or self-fund your business? 
• The collateral in case of getting a secured loan
• Schedule of loan repayment 
• Projected return on investment (ROI)
• Projected break-even point (BEP)

Read more: Money-Saving Tips for Entrepreneurs

Step 4: Provide Supporting Documents 

Your business plan for milk tea is almost done. If you want to convince your partners, lenders, and banks, you need to include the following documents to substantiate your operational plans and forecasts.  

• Resumes of your employees
• Permits and licenses
• Contracts 
• Bank statements 

Sample Milk Tea Business Plans: 3 Examples for Aspiring Entrepreneurs

If you want to know what a milk tea business plan looks like, here are some milk tea business plan examples to consider. Keep in mind that no two business plans are alike. You're free to tweak some areas depending on your vision. 

• Milk Tea Business Plan Sample #1 [2]
• Milk Tea Business Plan Sample #2 [3]
• Milk Tea Business Plan Sample #3 [4]

My Milk Tea Business Plan is Complete. Now What? 

Say you’ve submitted your business plan to your partners and lenders. What should you do next? How to start and how to promote a milk tea business?

Here are the stages you may need to undergo: 

• Phase 1 (Product development) – Develop recipes for your milk tea. Scout for suppliers. Test products with your target audience and get feedback. 
• Phase 2 (Shop building and marketing planning) – Build your shop and storefront. While you’re at it, you may start drafting your marketing strategy for a milk tea shop in the Philippines (e.g., designing flyers, setting up social media pages, etc.)
• Phase 3 (Forecasting and plan development) –  Create a 90-day plan that includes your short-term goals, projected sales, and relevant strategies. 
• Phase 4 (Launch) – You may choose to do a soft launch where you’ll offer some of your products to get feedback from actual customers. Eventually, you can have a hard launch, open the shop with a blast (i.e., event), and offer your whole range of products. You may also run a week-long discount promo to draw customers in. 

Final Thoughts 

A milk tea shop is a good business idea given the demand for it in a tropical country like the Philippines. But when launching such a venture, you should follow a strategy to minimize costly mistakes along the way. 

A milk tea business plan makes your ideas and tactics concrete, feasible, and workable. Drafting it takes time, but it’ll ultimately help you achieve your goals. 

Sources: 

• [1] DTI Business Plan Template
• [2] Milk Tea Business Plan Sample #1
• [3] Milk Tea Business Plan Sample #2
• [4] Milk Tea Business Plan Sample #3

Jay is a marketing communications professional who specializes in short-form and long-form content. He has written ads for TV, radio, print, and digital. He has also produced corporate blogs, magazine features, white papers, product listings, reviews, and press releases for clients here and abroad. When he’s not writing, Jay plays the piano or takes pictures for his visual diary. Follow Jay on LinkedIn.

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Building Bridges, Cultivating Success

Everything You’ll Need to Start Your Own Milk Tea Business

• October 24, 2020

For the past few years, milk tea –– also known as boba tea or bubble tea –– has become a worldwide craze. There are plenty of milk tea shops on the market. It’s amazing how all of them stay alive even with all the competition. The great thing about milk tea is that you can customize it and create hundreds of different flavors. It’s also not that hard to make. If you’re looking to start your own business, maybe you should hop on the milk tea craze too! Here’s how you can start:

Do some market research.

It’s important to market research before starting up any business. You can’t just start a business without doing some research first. Market research allows you to understand your target market. You get an in-depth idea of their various wants and needs and their consumer problems. Conducting market research also allows you to understand your competition. This will help you identify what you can do to set yourself apart from others.

When conducting your market research, you have to define your goals and objectives first. What do you want to know about your market? Something as simple as knowing how much your target market is willing to pay for your product, or what kind of design and packaging they would prefer? You could even ask what flavors they would like. You could also use this research to pinpoint your competition’s weaknesses. Conduct a survey and ask people what they think most milk tea shops lack and see if you can provide that service or product –– things like that.

Pick a niche

After you’ve done your market research, you should have enough data to determine your target market’s expectations and how you can set yourself apart from other businesses. Maybe you want your business to have a certain theme. Think of something that will make your business stand out. Maybe it’s the aesthetics, the number of flavors on your menu, the customization of the drinks, the size of your products, or the ambiance of your store.

Handle your finances

A key factor in starting your own business is having enough capital to do it in the first place. Capital is the amount of money that will help you start your business. This includes the budget for your store location, equipment, employees, and marketing. Do you have enough capital? If not, maybe you should look into  what loans you can get  for your business. Usually, when it comes to getting a loan, you would have to prepare a business plan to present to the lenders or investors. Having a good business plan and cash flow analysis will make lenders feel safer lending their money.

Look for a location

The next thing you need to do is find a store location. That is unless you decide to start your business from home. Starting a business at home is great for various reasons. First of all, you save money because you won’t have to spend leasing a commercial space. You also get a wider reach of customers when you sell online. It would also be much safer to sell from home while the pandemic is ongoing.

Fix all your permits and licenses

You must get your business registered. Starting a food and drink business also requires that you get a permit from the Health Department. These are the different permits and licenses you will need:

• Business license
• Personnel permits or licenses
• Tax registration
• Trade name registration
• Employer registration
• Business name and logo

Figure out the equipment and supplies you will need

For the equipment, the most common equipment and supplies used in a milk tea shop are:

• Tea Brewing Machine
• Stove or Table Burner
• Cooking Pot
• Tapioca Container
• Measuring Scoop
• Cup Sealing Machine
• Shaking Cups
• Water Dispenser
• Refrigerator
• Cash Register
• Cups and Lids
• Oversized Straws

If you set up your business from home, you wouldn’t have to spend so much on the equipment because most of this can be found at home, such as the brewing machine, stove, cooking pots, strainers, containers, scoopers, dispensers, refrigerators, and other utensils. The only things you would actually have to spend on are the packaging equipment and supplies.

A great eco-friendly packaging design for milk tea entails using glass bottles instead of plastic cups. Instead of buying a cup sealing machine and using up so much plastic, you could opt to use glass bottles and a  liquid filling machine  instead. Investing in liquid filling equipment can allow you to fill the bottles faster and accurately; no struggle, no stress, and no waste of milk tea. What’s great is that people could reuse the bottles for personal use, instead of throwing them away.

Market your business

After you’ve set up all the legal stuff, the equipment, and supplies, you can now market your business. Using social media and digital marketing is the easiest, most cost-effective way to promote your business. If you’re clueless about how to do your own marketing, there are plenty of  guides on the internet . You could even hire professional digital marketing services online.

Now that you’ve got an idea of starting your milk tea business, all you have to do is make it happen!

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• 1 . MING CHUAN UNIVERSITY A business plan for opening take-out milk tea shop in Vietnam Ming Chuan University _ IBT4 Võ Văn Minh Tuấn 4/1/2014
• 2 . 1 | P a g e Table of contents Chapter 1: Introduction ..............................................................................................8 1.1 Motivation............................................................................................................................................ 8 1.2Background........................................................................................................................................... 9 1.3 The Introduction about Caramel Shop .................................................................................................... 9 1.3.1 The main field of industrial ............................................................................................................. 9 1.3.2 The organizational structure .......................................................................................................... 10 1.4 Caramel shop business overview.......................................................................................................... 10 1.4.1 Store location ............................................................................................................................... 11 1.4.2 Products and services.................................................................................................................... 12 1.4.3 Facilities, Equipment, and Technologies ........................................................................................ 13 1.4.4 Supplier or Partnering Relationships .............................................................................................. 14 1.5 SWOT Analysis of Caramel shop:........................................................................................................ 14 1.5.1 Strengths...................................................................................................................................... 14 1.5.2 Weaknesses.................................................................................................................................. 14 1.5.3 Opportunity.................................................................................................................................. 14 1.5.4 Challenges ................................................................................................................................... 14 1.6 STP analysis....................................................................................................................................... 15 1.6.1 Segmentation: .............................................................................................................................. 15 1.6.2 Targeting: .................................................................................................................................... 17 1.6.3 Positioning................................................................................................................................... 18 Chapter 2: Literature review.....................................................................................21 2.1 Overview ........................................................................................................................................... 21 2.1.1 Vietnam overview ........................................................................................................................ 21 2.1.2 Ho Chi Minh City overview .......................................................................................................... 22 2.2Analysis business environment in Vietnam Market ................................................................................ 23 2.2.1 Political environment.................................................................................................................... 23 2.2.2. Social and demographic environment ............................................................................................ 23 2.2.3 Economic Environments ............................................................................................................... 23 2.2.4 Cultural environments................................................................................................................... 24 2.3 Beverage market................................................................................................................................. 25 2.3.1 Hot Drinks ................................................................................................................................... 25
• 3 . 2 | P a g e 2.3.2 Soft Drinks................................................................................................................................... 26 2.4 Vietnam milk-tea market..................................................................................................................... 28 2.5 Government law for starting a new business ......................................................................................... 29 2.5.1 The steps to complete business registration..................................................................................... 29 2.5.2 Some noteworthy other legislations in Vietnam Enterprise Law....................................................... 30 2.6. Definition of the Business Model Canvas ............................................................................................ 30 2.7. Contents of the Business Model Canvas table (source: Business Model Generation book) ..................... 31 2.7.1 Value Propositions........................................................................................................................ 31 2.7.2 Customer Segments ...................................................................................................................... 32 2.7.3 Channels ...................................................................................................................................... 32 2.7.4 Customer Relationships ................................................................................................................ 33 2.7.5 Revenue Streams.......................................................................................................................... 33 2.7.6 Key Partners................................................................................................................................. 34 2.7.7 Key Activities .............................................................................................................................. 34 2.7.8 Key Resources.............................................................................................................................. 34 2.7.9 Cost Structure............................................................................................................................... 35 2.9 The Business Model Canvas of Caramel milk-tea shop.......................................................................... 36 Chapter 3: Research methodology.............................................................................37 3.1 Research design.................................................................................................................................. 37 3.2 Sampling............................................................................................................................................ 37 3.3 Data collection.................................................................................................................................... 37 3.4 Data analysis ...................................................................................................................................... 38 3.5 Structure ............................................................................................................................................ 38 Chapter 4: Marketing plan........................................................................................39 4.1 Product and product strategy................................................................................................................ 39 4.2 Product feature and benefit.................................................................................................................. 41 4.2.1 Bubble milk tea ............................................................................................................................ 41 4.2.2 Vietnamese traditional coffee ........................................................................................................ 41 4.2.3 Tea.............................................................................................................................................. 43 4.3 Competition........................................................................................................................................ 49 4.4 Promotion and promotional budget ...................................................................................................... 50 4.4.1 Preparation time ........................................................................................................................... 50
• 4 . 3 | P a g e 4.4.2 Operation time.............................................................................................................................. 51 4.4 Proposed Location:............................................................................................................................. 55 4.5 Distribution Channels.......................................................................................................................... 55 4.6 Sales Forecast..................................................................................................................................... 57 4.6.1 Best scenario................................................................................................................................ 57 4.6.2 Worst scenario.............................................................................................................................. 58 Chapter 5: Operational Plan .....................................................................................59 5.1 Production.......................................................................................................................................... 59 5.1.1 Quality control .................................................................................Error! Bookmark not defined. 5.1.2 Product development .................................................................................................................... 59 5.2 Location............................................................................................................................................. 60 5.4 Personnel ........................................................................................................................................... 62 5.4.1 How to recruit the person for the job.............................................................................................. 62 5.4.2 Salary expenses............................................................................................................................ 62 5.5 Inventory............................................................................................................................................ 63 5.5.1 Types of stock.............................................................................................................................. 63 5.5.2 Stock control method .................................................................................................................... 63 5.5.3 Stock control systems – inFlow Inventory Software........................................................................ 66 5.7 Organization and Management ............................................................................................................ 73 Chapter 6: Startup Expenses and Capitalization......................................................75 6.1 Sources of capital................................................................................................................................ 78 6.2 Startup Expenses................................................................................................................................. 78 6.2.1 Buildings or Real Estate................................................................................................................ 78 6.2.2 Capital equipment list. .................................................................................................................. 78 6.2.3 Location and admin expenses. ....................................................................................................... 79 6.2.4 Advertising and promotional. ........................................................................................................ 79 Chapter 7: Financial Plan..........................................................................................80 7.1 12-Months Profit and Loss Projection .................................................................................................. 80 7.1.1 Best scenario................................................................................................................................ 80 7.1.2 Worst scenario.............................................................................................................................. 82 7.2 Breakeven point analysis ..................................................................................................................... 84 7.2.1 Best scenario................................................................................................................................ 84
• 5 . 4 | P a g e 7.3 Projected Cash Flow ........................................................................................................................... 85 Appendices.................................................................................................................87 I. Logo and Advertising materials ...................................................................................................... 87 I.1 Symbol............................................................................................................................................ 87 I.2 Logo ............................................................................................................................................... 87 I.3 Banner............................................................................................................................................ 87 I.4 Billboard ......................................................................................................................................... 88 II. Menu........................................................................................................................................... 89 III. Maps and photos of location........................................................................................................ 90 III.1 Map of location ............................................................................................................................. 90 III.2 The drawing bench ........................................................................................................................ 91 IV. Detailed lists ofequipment owned or purchased.......................................................................... 91 IV.1 Sugar Syrup Dispenser Machine..................................................................................................... 91 IV.2 Sealer Machine ............................................................................................................................. 92 IV.3 Shaker.......................................................................................................................................... 93 IV.4 Measuring Scoop........................................................................................................................... 93 IV.5 Thermo blocks pot......................................................................................................................... 93 IV.6 Paper cup...................................................................................................................................... 94 References:................................................................................................................95
• 6 . 5 | P a g e List of tables Table 1: Caramel basic menu....................................................................................................................12 Table 2: Table of target market buying criteria .........................................................................................19 Table 3: Map buying criteria against competitive positioning..................................................................19 Table 4: Ranking Caramel product's strengths..........................................................................................20 Table 5: Points for 5-D dimension model of some countries (http://www.geert-hofstede.com/) .............24 Table 6: Hot Drinks Volume Sales – Historical Data & Forecasts, 2010-2017........................................25 Table 7: Soft Drinks Value/Volume Sales – Historical Data & Forecasts, 2010-2017 ............................26 Table 8: The Business Model Canvas .......................................................................................................31 Table 9: Caramel milk-tea shop’s business model....................................................................................36 Table 10: The List of Caramel's product ...................................................................................................40 Table 11: Evaluate competitors .................................................................................................................49 Table 12: Preparation cost (Unit: 1,000 VND) .........................................................................................50 Table 13: Promotional leaflet cost (Unit: 1,000 VND) .............................................................................50 Table 14: The product price table (Unit: 1,000 VND) ..............................................................................51 Table 15: The product price of gold time strategy ....................................................................................51 Table 16: Promotion price (Unit: 1,000 VND) .........................................................................................52 Table 17: 12-month promotion forecast for "Gold time" strategy ............................................................52 Table 18: Table of special day during year in Viet Nam ..........................................................................53 Table 19: 12-month promotion forecast for "Gratefulness" strategy........................................................53 Table 20: 12-month promotion forecast for "Good partner forever" strategy, stage 2 .............................54 Table 21: Best scenario of sales forecast...................................................................................................57 Table 22: Worst scenario of sales forecast ................................................................................................58 Table 23: Types of stock ...........................................................................................................................63 Table 24: The advantage and disadvantage of stock control methods ......................................................63 Table 25: Material inventory.....................................................................................................................64 Table 26: WIP inventory...........................................................................................................................65 Table 27: Finished goods inventory ..........................................................................................................65 Table 28: Consumable products inventory................................................................................................66 Table 29: Supplier's information ...............................................................................................................68 Table 30: Months Profit and Loss Projection (Best scenario)...................................................................81 Table 31: Months Profit and Loss Projection (Worst scenario) ................................................................83 Table 32: Breakeven analysis of best scenario ..........................................................................................84 Table 33: Projected Cash Flow..................................................................................................................86
• 7 . 6 | P a g e List of figures Figure 1: Caramel organizational structure ...............................................................................................10 Figure 2: The chart shows the ratio of the population by age group in 2009 ............................................15 Figure 3: The pie chart shows proportion of each age group in target group ...........................................15 Figure 4: The percentage of male and female in each age group ..............................................................16 Figure 5: The chart shows the monthly income of Vietnamese in 2009 ...................................................17 Figure 6: Hot drinks 2010-2017 ................................................................................................................25 Figure 7: Soft drinks 2010-2017................................................................................................................27 Figure 8: Distribution channel...................................................................................................................55 Figure 9: Flat organization structure .........................................................................................................73 Figure 10: Caramel's structure...................................................................................................................74
• 8 . 7 | P a g e List of pictures Picture 1: Ho Chi Minh City district 10 map ............................................................................................11 Picture 2: Sugar Syrup Dispenser / Fructose Machine ..............................................................................13 Picture 3: Sealer Machine..........................................................................................................................13 Picture 4: A typical sugar level chart ........................................................ Error! Bookmark not defined. Picture 5: Chuan Dai company and their products....................................................................................69 Picture 6: Trung Nguyen's distribution agent............................................................................................70 Picture 7: Highland Honey Bee Co., Ltd...................................................................................................71 Picture 8: Distribution agent of Vietnam Dairy Products Joint-Stock Company......................................72 Picture 9: Product of Ngoc Diep shop .......................................................................................................73
• 9 . Chapter 1: Introduction 1.1 Motivation Milk tea(also called bubble tea) is an extremely popular drink in most of Asian countries. It originally started from Taiwan in 1988. Milk teas specialist drink increasingly being offered in cafes, coffees shops and bars.It originates from Asia and is made up of hot or cold tea, milk, sugar and giant black tapioca balls. Ice is then added and the drink shaken to create the bubble effect. Bubble tea is often referred to as pearl shake, tapioca ball drink; bob ice tea and bubble drink among other things. The term "bubble" refers to the tapioca balls in the drink. These chewy tapioca balls, or "pearls," are consumed along with the beverage through a wide straw. Bubble tea is especially popular in many East Asian and Southeast Asian regions such as Taiwan, Brunei, China (including Hong Kong and Macau), Malaysia, the Philippines, Singapore, South Korea, Thailand, Indonesia, Vietnam and Australia populated by urban professionals with high disposable incomes and an interest in alternative eating and drinking venues. Compared to opening a full size restaurant, the startup costs to open a bubble tea cafe are low. The wide range of our contacts & relationships mean we will open a bubble tea cafe with minimal investment ensuring we get the biggest bang for our buck. A bubble tea cafe is not labor intensive, is simple to operate and does not necessitate that the owner be on site. The key is to get things set up correctly in the early stages and to use effective operating systems to save valuable time, effort, and money. We wish we could calculate the total amount of English breakfast tea I consumed over the past year. While working on our thesis, tea drinking was an integral part of the process. There is something about that piping hot and cold beverage that inspires thought, creativity, focus, and hard work. In the modern life, a lot of company employees leave their job because they do not find job interesting. They feel pressured and boring. A section of young people today do not like working for the company after graduated, they like to challenge themselves. They wanted to establish their own company where they can show all their best skills and personal passion. We are people belongs to this part. We learn business and we have passion for business. It goes without saying that necessity is the mother of invention, so merchants created the business to make good use of people’s need of drinking water. In the past, we would drink plain water or tea to quench our thirst. Nowadays, there are much more competitions as more and more prosperous tea cafes spring up. To appeal to more customers, the increased sorts of beverages followed the increase of innovative ideas. Then, bubble tea came into being. Modern people drink beverages instead of plain water. Among that, Bubble tea is a drink in great demand. Imagine this, on a hot summer day; you’re having a cup of refreshing Bubble tea. When having a sip of it, the chewy pearls are full of your mouth. It’s fantastic!
• 10 . 9 | P a g e 1.2 Background One of trends which attracts most of the youth is chain of coffee and milk-tea shops. Because they have air conditioning and free Wi-Fi so now they become ideal rendezvous spaces. Many famous milk-tea trade-names appear in recent years such as: Sun flowers shop, Alo tea, -18C, so on. They have a lot of subsidiaries around country. Each year, in Ho Chi Minh area, they also have from 3 to 4 new shops. Especially, around university zones, they usually have about 5 big or small milk-tea shops. This proves that milk-tea is one of favorites drinking of youth community, particularly pupils and students. And we who are Vietnamese students studying in Taiwan are not exception. However, these convenient milk-tea shops still arrears many shortcomings such as: (1) Waiting time too long: Customers who buy take out cups must wait about 10 minutes after they make order then they can get their glasses. At busy time, customers must wait more than 20 minutes. Even when shop is too crowded customers, customers should not wonder why staffs forgot their orders. It is very popular. Customers should learn how to accustom themselves to this problem instead of getting angry. (2) Uncomfortable space: Having a part of community does not like milk-tea shop’s space. Some people want to enjoy milk-tea at home with their family or in the park with their friends. Someone wants to bring milk-tea to their office. But they do not want spend a lot of time for waiting. Besides that shop’s services are not really worthy as they were paid by customers. (3)High price: Because the shop provide air conditions and free Wi-Fi for customers using at shop so these expenses were count on the price of each glass. This makes the price always expensive. But have some customers are not willing to pay for these unworthy services. (4) Take-out milk-tea services do not develop and do not take care. It is still elementary and does not hygienic. Starting from individual favorite, business passion and faults which are still in bubble-tea market, our group decides to make a take-out milk-tea business plan. We will apply Taiwanese’s service style and service system and combine with new flavors from other countries which we learned from foreign friends in 2 years we study in Taiwan. We hope we can bring convenience to consumers. Besides that we also hope with new processing formula, milk-tea not only a beverage but also a nutrition drink for all ages, from kindergarten to the workers or employees working in large firms, especially females. 1.3 The Introduction about Caramel Shop The idea to establish Caramel shop stems from general interests of 4 students who are looking to be challenged themselves after school in the group. We are confident that we will become the first best beverage quality products supplier and professional service style in Vietnam. With the motto to maximize customer satisfaction, Caramel is always striving to bring products and services with excellent value to our customers, confirmed Caramel brand in Vietnam. 1.3.1 The main field of industrial The business: We provide the traditional beverages and beverages come from many countries around the world.(See more our productson menu in Appendices)
• 11 . 10 | P a g e 1.3.2 The organizational structure Figure 1: Caramel organizational structure Member of executive board - Mr. VõVăn Minh Tuấn (Alyosha): Executive directorwho initiated idea and makes the shop’s development orientation. - Miss. TrangHồngNgọc (Mizhu): Financial, personnel andmarketing director. - Mr. Nguyễn Cao Chung (David): Supply and processing director and designer. 1.4 Caramel shop business overview The business sector of this thesis belongs to entertainment - beverage field. This kind of business is quite popular in the Vietnamese current market, from popularly level to premium level. Living standards and income of each person, each household is increasing. In recent years, the number of Vietnamese enterprises as well as foreign enterprises and colleges, universities rose quickly. It makes work and study intensity of people becoming higher, it also makes their free time been gradually narrowed. The take-out milk-tea shop was launched which can meet this need. This type of business model has been appeared for a long time and has been growing in developing countries such as USA, UK, Singapore, Australia, and Taiwan. It is for all social grades and has been gotten population interested. In Vietnam market, this business model also has been existed for 10 years but it has not worked efficiently. They lost consumers’ interest because of their service style and unfocused quality. Executive Board Bartender Bartender Salesman Manager
• 12 . 11 | P a g e 1.4.1 Store location Because Caramel’s main revenue comes from beverages and target customers are people from 16 to 30 ages so our shop must close to school and official, service and entertainment areas. With above address we think it can meet basic requirements of shop. Shop is located on the busy road (Bac Hai Condominium, Ward 15, District 10, Ho Chi Minh City, and South of Vietnam) that has many peoplegoes around andthere are 3 schools, 1big national university, entertainment areas and hospitals near. The area of shop is 20 square meters which enough to meet the sales and product processing. Picture 1: Ho Chi Minh City district 10 map
• 13 . 12 | P a g e 1.4.2 Products and services The main products are milk tea with delicious taste, Vietnam traditional coffee-milk along with fruit smoothies for refreshment and vitamin supplements during hot days in Ho Chi Minh City. Specially, customers can chose how many percentage of ice and sugar (25% - 50% - 75%) and they can mix drinks with extra foods. Table 1: Caramel basic menu Bubble tea flavor (19,000 vnd) Coffee-Milk (11,000 vnd) Tea (12,000 vnd) Fruit juice/smoothies (15,000 vnd) Extra foods (5,000 vnd) Taro Coffee 100% Ginger (Hot) Orange Pudding + Egg + Chocolate Kiwi Coffee-Milk 50-50 Lemon Pineapple Honeydew Coffee-Milk 75-25 Honey (Hot) Lemon Peach Coffee-Milk 25-75 Herbal Kumquat Yogurt Papaya Milk 100% Chrysanthemums Grapefruit Honey Strawberry Fresh milk (Hot) Papaya Ice-cream + Mango + Vanilla + Chocolate + Strawberry Watermelon Red apple Grape Banana Red tea Strawberry Coconut Watermelon Lychee Apple Almond Passion fruit Jelly Chocolate Tomato Bubble (small/big) Passion fruit Pineapple Milk Raspberry Avocado Blackberry Green Apple Grape Oreo cookie The services: We apply the hygienic and best quality services. In addition, there will have delivery milk-tea service for bulk buyers.
• 14 . 13 | P a g e 1.4.3 Facilities, Equipment, and Technologies Sugar Syrup Dispenser / Fructose Machineand Sealer Machineimported directly from Taiwan. Picture 2: Sugar Syrup Dispenser / Fructose Machine Picture 3: Sealer Machine Milk tea makingtechnology will follow Taiwan technology.
• 15 . 14 | P a g e 1.4.4 Supplier or Partnering Relationships The main raw materials(milk, tea, sugar, pudding …) suppliers comefrom Vietnam. Specially, milk tea flavorand bubble willimported directly from Taiwan. 1.5 SWOT Analysis of Caramel shop: 1.5.1 Strengths Although we are not the first take out milk tea shop but our strengths are professional service style and cheaper prices, it lower from 30 to 50% compared to other milk tea brands. We grasp well customers’ interests and tastes. 1.5.2 Weaknesses A young and new business, which was established from the students, having limited capital resources such as the founders are people who going to graduate; we use our part-time job salary as our main capital. And a small part of our capital is from borrowing our family. 1.5.3 Opportunity Bring Asian’s culture echoes; Vietnam taste is sweeter than the Western nations. Take-out style in professional service is our advantage compare with other milk-tea shops. Meeting customers’ demand in this sector, specify in district 10 where have many our target customers (students, official employees and the busy people). 1.5.4 Challenges The first, competitor is available from our weaknesses, along with the growth of competition from direct competitors. We must be wise. Our store has more shortcomings than other milk tea stores in the same areas such as: small investment capital and new young brand. Secondly is the Vietnam consumers taste. Customers are stricter in choosing drink for themselves. Flavor issue is more concerned, but to ensure health requirements. This is a major challenge in the flavor issue as well as improvement of Caramel store’s hygiene during processing drinks.
• 16 . 15 | P a g e 1.6 STP analysis 1.6.1 Segmentation: Segmentation is concerned with identifying different groups of purchasers in a market in order to target specific products and services for each group or segment. According to a research-level there are four major ways of segmenting a market such as: “a Priori segmentation”, “usage segmentation” (also known as declines analysis or pare to analysis), “attitudinal research and cluster analysis” and “needs based segmentation”. We will use the “A Priori segmentation” method. It means the market is split according to pre-existing demographic criteria such as age, sex or social economic status. Age and sex segmentation: The analytical results from the survey of population census in 2009 showed that, the proportion of people aged from 15 to 34 is the highest (for both gender), about 37.4%. This is Caramel target customers. Figure 2: The chart shows the ratio of the population by age group in 2009 (Based on the statistics of page http://www.gopfp.gov.vn/) In the 15-34 ages group, we can see, people from 15 to 19 ages are most crowded, occupied 28%. The second is the group from 20 to 24 ages; it is accounted about 26%. Two remaining groups 25- 29 and 30-34 have proportions respectively are 24% and 22%. Figure 3: The pie chart shows proportion of each age group in target group 0 5 10 15 20 25 30 35 40 45 0-14 15-34 35-54 55-74 75+ Male Female Both gender
• 17 . 16 | P a g e (Based on the statistics of page http://www.gopfp.gov.vn/) Meanwhile, the number of men and women in each age group are about equal in the proportion, the difference is not significant. Figure 4: The percentage of male and female in each age group (Based on the statistics of page http://www.gopfp.gov.vn/) Monthly income segmentation: When segmenting customer by monthly income,Vinaresearch Company made clearly four phrases such as low income, average income, pretty income and high income. Firstly, people who have “low income” that means each month their salary below 4,500,000 VND (equivalent to 6,207 NDT). They are usually students who work part time jobs and poor workers or farmers in remote areas. This group is about 4.4%. The second is “average income” group; they have proportion about 13.5%. They are usually new official employees, students working part time jobs in big city. Their salary is from 4,500,000 VND to 7,500,000 VND (equivalent to 6,207 – 10,345 NDT). Pretty incomer is a person who has salary from 7,500,000 to 15,000,000 VND (equivalent to 10,345– 20,670 NDT). And high income group belongs to people who have salary higher than 15,000,000 VND for each month. These two groups have the highest percentages, respectively 39.4% and 42.8% 28% 26% 24% 22% 15-19 20-24 25-29 30-34 0 10 20 30 15-19 20-24 25-29 30-34 Male Female
• 18 . 17 | P a g e Figure 5: The chart shows the monthly income of Vietnamese in 2009 (Based on the statistics of page www.vinaresearch.jp) 1.6.2 Targeting: We use concentrated marketing. It is a marketing approach that is aimed at connecting with and selling products to a specific consumer group. This strategy calls for taking steps to identify the target market that is highly likely to be attracted to the products, and developing a marketing plan that is unique to reaching that group of consumers. The process also normally includes planning the delivery of products in a manner that is likely to generate repeat business from those consumers. In many cases, concentrated marketing is an ideal approach for smaller businesses with limited resources, since it does not rely on the creation and use of mass marketing, production, or distribution to reach a wide range of potential consumers. Applying this model in the case of Caramel shop, our concentrationsare middle class who meet these factors: age from 15 to 30, income from 4,500,000 to 10,000,000 VND and busy. We have our own model below: 4% 14% 39% 43% Low income Average income Pretty income High income
• 19 . 18 | P a g e While a concentrated marketing approach can help Caramel shop makes the most of a small advertising budget, there are some potential drawbacks with this type of marketing. We will mention more detail in chapter 4. 1.6.3 Positioning The goal of product positioning is to keep our product on top of our customers’ mind when they’re considering a purchase. To be successful, product positioning must achieve three objectives: (1) Differentiate your product from the competition’s (2) Address important customer buying criteria and (3) Articulate key product (or company) characteristics. We use positioning triangle for analysis this part. Firstly, we must know clearly what is buying criteria our target customer uses to evaluate milk- tea products. We also already assign a quantitative weight to each criterion based on opinion of the people surveyed. Caramel's targetcustomers Busy Middle -class 15-30 year olds
• 20 . 19 | P a g e Table 2: Table of target market buying criteria No. Percentage Target market buying criteria (prioritized and weighted) 1 10% The origin of bubble 2 10% Short waiting time 3 10% Quality of product components (tea, milk, pudding, fruit and jelly) 4 10% Convenient and delivery services 5 10% Hygiene 6 15% Location and decoration 7 30% Price 8 5% Innovation The second, by using primaryresearch, we find out some famous milk-tea shop in Ho Chi Minh City such as: Sunflower, Tapi tea and Alo tea. They are big competitors of Caramel. Next, by doing secondary research, we can map buying criteria against competitive positioning. These competitors have already success in some criteria. For example: Sunflower, Tapi tea and Alo tea are famous about their decoration of shop. They are all clean shop and when come to those shopscustomers feel comfortable and relax a lot. Those brand all famous because they have many shops in center of each district in big cities.In 3 mentioned brand, pricing of milk tea in Tapi tea is the cheapest and suitable for almost students. But two most important criteria do not have any brand success and have good feedback from customers. Table 3: Map buying criteria against competitive positioning No. Percentage Target market buying criteria (prioritized and weighted) Competitor 1 10% The origin of bubble 2 10% Short waiting time 3 10% Quality of product components (tea, milk, pudding, fruit and jelly) Sunflower 4 10% Convenient and delivery services Sunflower , Tapi tea, Alo tea 5 10% Hygiene Sunflower, Tapi tea, Alo tea 6 15% Location and decoration Sunflower, Tapi tea, Alo tea 7 30% Price Tapi tea 8 5% Innovation After considering overview milk-tea market, we recognize our shop strengths such as the origin of bubble (we can contact with Taiwanese bubble supplier for the best quality), price (we commit our product will cheaper than price on market about 30% but still keep best quality), location (in the middle of residential area) and short time waiting (because we realize that Taiwanese style service more professional that our recent style service. So we believe we can reduce waiting time for customers).
• 21 . 20 | P a g e Table 4: Ranking Caramel product's strengths No. Caramel product’s strengths Percentage Target market buying criteria (prioritized and weighted) Competitor 1 5# 10% The origin of bubble 2 10% Short waiting time 3 4# 10% Quality of product components (tea, milk, pudding, fruit and jelly) Sunflower 4 2# 10% Convenient and delivery services Sunflower , Tapi tea, Alo tea 5 10% Hygiene Sunflower, Tapi tea, Alo tea 6 3# 15% Location and decoration Sunflower, Tapi tea, Alo tea 7 1# 30% Price Tapi tea 8 5% Innovation
• 22 . 21 | P a g e Chapter 2: Literature review 2.1 Overview 2.1.1 Vietnam overview Vietnam officially the Socialist Republic of Vietnam, is the eastern most country on the Indochina Peninsula in Southeast Asia. With an estimated 90.3 million inhabitants as of 2012, it is the world's 13th-most-populous country, and the eighth-most-populous Asian country. (wikipedia.org) Vietnam, a one-party Communist state, has one of south-east Asia's fastest-growing economies and has set its sights on becoming a developed nation by 2020. Vietnam struggled to find its feet after unification and tried at first to organize the agricultural economy along strict collectivist lines. But elements of market forces and private enterprise were introduced from the late 1980s and a stock exchange opened in 2000. Foreign investment has grown and the US is Vietnam's main trading partner. In the cities, the consumer market is fuelled by the appetite of a young, middle class for electronic and luxury goods. After 12 years of negotiations the country joined the World Trade Organization in January 2007. (BBC News) Vietnam is a densely-populated developing country that has been transitioning from the rigidities of a centrally-planned economy since 1986. Vietnamese authorities have reaffirmed their commitment to economic modernization in recent years. Vietnam joined the World Trade Organization in January 2007, which has promoted more competitive, export-driven industries. Vietnam became an official negotiating partner in the Trans-Pacific Partnership trade agreement in 2010. Agriculture's share of economic output has continued to shrink from about 25% in 2000 to less than 22% in 2012, while industry's share increased from 36% to nearly 41% in the same period. State-owned enterprises account for roughly 40% of GDP. Poverty has declined significantly, and Vietnam is working to create jobs to meet the challenge of a labor force that is growing by more than one million people every year. The global recession hurt Vietnam's export-oriented economy, with GDP in 2009-12 growing less than the 7% per annum average achieved during the previous decade. In 2012, however, exports increased by more than 12%, year-on- year; several administrative actions brought the trade deficit back into balance. Between 2008 and 2011, Vietnam's managed currency, the dong, was devalued in excess of 20%, but its value remained stable in 2012. Foreign direct investment inflows fell 4.5% to $10.5 billion in 2012. Foreign donors have pledged $6.5 billion in new development assistance for 2013. Hanoi has oscillated between promoting growth and emphasizing macroeconomic stability in recent years. In February 2011, the Government shifted policy away from policies aimed at achieving a high rate of economic growth, which had stoked inflation, to those aimed at stabilizing the economy, through tighter monetary and fiscal control. In early 2012 Vietnam unveiled a broad, "three pillar" economic reform program, proposing the restructuring of public investment, state-owned enterprises, and the banking sector. Vietnam's economy continues to face challenges from an undercapitalized banking sector. Non-performing loans weigh heavily on banks and businesses. In September 2012, the official bad debt ratio climbed to 8.8%, though some financial analysts believe it could be as high as 15%. (Index Mundi)
• 23 . 22 | P a g e 2.1.2 Ho Chi Minh City overview Ho Chi Minh City formerly named Saigonis the largest city in Vietnam. Ho Chi Minh City is located in the southeastern region of Vietnam, 1,760 km (1,090 mi) south of Hanoi. The average elevation is 19 meters (62 ft.) above sea level. It borders TâyNinh Province and BìnhDương Province to the north, ĐồngNai Province and BàRịa–VũngTàu Province to the east, Long An Province to the west and the South China Sea to the south with a coast 15 km (9 mi) long. The city covers an area of 2,095 km2 (809 sq. mi) (0.63% of the surface of Vietnam), extending up to Củ Chi District (12 mi (19 km) from the Cambodian border) and down to CầnGiờ on the South China Sea. The distance from the northernmost point (PhúMỹHưng Commune, Củ Chi District) to the southernmost one (Long Hòa Commune, CầnGiờ District) is 102 kilometers (63 mi), and from the easternmost point (Long Bình ward, District Nine) to the westernmost one (BìnhChánh Commune, BìnhChánh District) is 47 kilometers (29 mi) The result of the 2009 Census shows that the city's population was 7,162,864 people, about 8.34% of the total population of Vietnam, making it the highest population-concentrated city in the country. As of the end of 2012, the total population of the city was 7,750,900 people, an increase of 3.1% from 2011.As an administrative unit, its population is also the largest at the provincial level. The majority of the population is ethnic Vietnamese at about 93.52%. Ho Chi Minh City's largest minority ethnic groups are Chinese with 5.78%. Cholon – in District 5 and parts of Districts 6, 10 and 11 – is home to the largest Chinese community in Vietnam. Other ethnic minorities include Khmer 0.34%, Cham 0.1%. The inhabitants of Ho Chi Minh City are usually known as "Saigonese" in English, "Saigonnais" in French and "dânSàiGòn" in Vietnamese. A varying degree of English is spoken especially in the tourism and commerce sectors where dealing with foreign nationals is a necessity, so English has become a de facto second language for some Saigonese. Ho Chi Minh City is the economic center of Vietnam and accounts for a large proportion of the economy of Vietnam. Although the city takes up just 0.6% of the country's land area, it contains 8.34% of the population of Vietnam, 20.2% of its GDP, 27.9% of industrial output and 34.9% of the FDI projects in the country in 2005. In 2007, Ho Chi Minh City's contribution to the annual revenues in the national budget increased by 30 percent, accounting for about 20.5 percent of total revenues. The consumption demand of Ho Chi Minh City is higher than other Vietnamese provinces and municipalities and 1.5 times higher than that of Hanoi. In 2007, the city received over 400 FDI projects worth $3 billion. In 2008, it attracted $8.5 billion in FDI. In 2010, the city's GDP was estimated at $20.902 billion, or about $2,800 per capita, up 11.8 percent from 2009. By the end of 2012, the city's GDP was estimated around $28,595 billion or about $3,700 per capita, up 9.2 percent from 2011. Total trade (export and import) reached $47.7 billion, with export at $21.57 billion and import $26.14 billion. In 2013, GDP of the city grew 7.6% by Q1, 8.1% by Q2, and 10.3% by the end of Q3. (wikipedia.org)
• 24 . 23 | P a g e 2.2Analysis business environmentin Vietnam Market 2.2.1 Political environment In other to have a political stability, Vietnamese law is accumulating and adding international law: the antitrust laws, intellectual property rights and the patent invention … Vietnamese law, which is improving gradually, creates a healthy competition between domestic and foreign companies. Presently, position of Vietnamese consumers is growing rapidly. The State’s support policies to promote economic development through fiscal policy and monetary policy to ensure high growth rates, encouraging investment is essential due to the preferential policies: taxes, land, consultancy and support services. We know opportunity isscaling up nationwide production thanks to loans from state banks. And also still have challenges is fierce competition from other corporations. 2.2.2. Social and demographic environment Vietnam's population is currently about 86 million people, ranked 13th in the world, with increasing levels average 947 thousand people per year. Population concentrated in two major cities of Hanoi and Saigon. The Vietnamese population structure is in the period of "The golden population structure"in which population of working age groups are approximately higher two times than the population of dependent age groups. Its advantages are the young people make up the majority, appropriate vibrant and dynamic business activities. It also has some difficulties such as causing pressure on employment, education and high unemployment issues. Average income figures indicate the average income of Vietnam by the end of 2012, approximately 1749 in one year. Predicting by 2013 the Vietnam’s average income reached to 1900 USD. Vietnam’s incomes increases leading to consumers have more choice to ensure their level of satisfaction. 2.2.3 Economic Environments The economic growth of Vietnam reached a high intraday in 2005-2007, but in 2008-2009 the growth rate decreased about 2% by the deflationary policies of the state. In 2010, the economy was soon out of deterioration and gradually recovery and rapidly growth (6.78%). So economic recovery and growth will make customer’s spending for basic needs much more. According to Professor Pham Song, chairman of Vietnam Medical Council "Vietnam is one of the non-alcoholic beverages markets that has the fastest growth rate in the world. The survey figures showed that an average each Vietnamese person drinks about 3 liters of non-alcoholic beverages per year. Predicting to 2015, the total amount of drinks in Vietnam will increase nearly 50% compared to 2007 in other to serve the consumers’ beverages needs”. This is an advantage for market development of Caramel.
• 25 . 24 | P a g e 2.2.4 Cultural environments Vietnamese cultural environment has some characteristics such as: power distance, individualism, masculinity or femininity, uncertainty avoidance and long term orientation. Vietnam has a longstanding agricultural culture for thousands of years.Vietnamese people generally are friendly and diligent. People in the north are considered politically sensitive, hardworking and always seek to avoid risk.The Northern greatly influenced by Chinese culture, due to over 1000 years under the domination of feudal China.In addition, Vietnam and China have come together in the socialist path for many decades.According to the assessment of Professor Hofstede (in1980), Vietnam culture belongs to the kind of high power distance, follow the trend individualism and the rate of uncertainty avoidance is average. Table 5: Points for 5-D dimension model of some countries (http://www.geert-hofstede.com/) Countries Power distance Individualism Femininity Uncertainty avoidance Long term orientation Vietnam 70 20 40 30 80 China 80 20 66 30 118 Japan 54 46 95 92 80 Thai 64 20 34 64 56 USA 40 91 62 46 29 Denmark 18 74 16 23 (does not have) Recently, Vietnamese have a new trend in eating that is focusing on healthy. Their eating habits are changing. Besides having a delicious meal, Vietnamese consumers also concerned about food or drink which can to keep healthy. So Caramel need to make strategies which assure about product quality and safety - taste of Vietnamese, especially Southerners like sweet and sour drink. Vietnam consumers have high psychological nationalistic pride. Caramel is taking advantage of the 100 % owned capital Vietnam Company. Vietnamese youths interesting in explore new things, they like to experience themselves.
• 26 . 25 | P a g e 2.3Beverage market 2.3.1Hot Drinks Table 6: Hot Drinks Volume Sales – Historical Data & Forecasts, 2010-2017 Hot Drinks Volume Sales – Historical Data & Forecasts, 2010-2017 2010 2011 2012f 2013f 2014f 2015f 2016f 2017f Coffee sales (‘000 tonnes) 39.19 42.36 45.42 49.87 54.21 58.78 63.49 68.18 Tea sales (‘000 tonnes) 208.40 220.38 233.24 248.69 266.03 284.81 308.73 322.73 (Note: f = BMI forecast. Source: General Statistics Office,Company information, Trade press, BMI) Figure 6: Hot drinks 2010-2017 (Note: f = BMI forecast. Source: General Statistics Office,Companyinformation, Trade press, BMI) Vietnam’s sturdy economic growth over the next few years will continue to fuel demand for higher value food and beverage products, such as coffee. Vietnam’s massive youth population, for whom visiting cafés and drinking coffee is a growing lifestyle choice, is another major positive. As this group of young, aspirant consumers enters the workforce, the accordant rise in their level of incomes will serve to further buoy the demand for higher-value coffee products. The tea sector is also set to experience strong growth over our five-year forecast period, buoyed by rising incomes and increasing domestic demand. 0 50 100 150 200 250 300 350 2010 2011 2012f 2013f 2014f 2015f 2016f 2017f Hot Drinks 2010-2017 Coffee sales (‘000 tonnes) Tea sales (‘000 tonnes)
• 27 . 26 | P a g e These dynamics will continue to attract the sights of multinational coffee producers, in turn imbuing the sector with greater dynamism over our forecast period. As a case in point, Masan Consumer has acquired a 50.1% stake, valued at around VND1.07trn (US$51mn), in the Vietnamese coffee producer Vinacafe Bien Hoa Joint-Stock Company. By acquiring a controlling stake in Vinacafe, Masan clearly wants to put itself in a strong position to leverage on the exciting demand dynamics in the Vietnamese coffee sector. Reflecting Vinacafe’s strength in the Vietnamese coffee sector, the coffee producer recorded an impressive 30% CAGR in its headline sales between 2006 and 2010. Also looking to capitalize on Vietnam’s coffee potential, Nestlé plans to increase its coffee sourcing from local farmers in Vietnam and has committed to a new coffee factory in the country. The US$270mn factory will be constructed in the south-east province of Dong Nai and will produce Nescafé-branded products for the domestic and international markets from 2013. Meanwhile, Philippine food major Jollibee Foods Corporation in early 2012 announced it was to acquire a 50% interest in Superfoods Group, which will give it a 49% stake in SF Vung Tau Joint Stock Company in Vietnam and a 60% share in Blue Sky Holdings in Hong Kong. The acquisition of a majority interest in the SuperFoods Group could expedite Jollibee’s international push given the former’s reach across the coffee markets of Macau, Hong Kong and Vietnam. 2.3.2Soft Drinks Table 7: Soft Drinks Value/Volume Sales – Historical Data & Forecasts, 2010-2017 Soft Drinks Value/Volume Sales – Historical Data & Forecasts, 2010-2017 2010 2011 2012f 2013f 2014f 2015f 2016f 2017f Soft drinks sales (MNliters) 1,694.54 1,820.11 1,937.14 2,087.21 2,226.31 2,382.92 2,523.34 2,712.36 Carbonated soft drink sales (MNliters) 846.38 905.34 948.96 1,026.30 1,111.06 1,201.26 1,295.74 1,391.62 Soft drink sales growth, liters (% chg. y-o-y) 20.37 7.41 6.43 7.75 6.66 7.03 5.89 7.49 Soft drinks sales (VNDmn) 48,430,761 58,936,203 69,720,789 79,057,398 90,567,804 103,254,858 117,311,874 132,630,353 Carbonated soft drink sales (VNDmn) 7,102,612 9,016,364 10,246,674 11,619,255 13,270,648 15,065,525 17,062,862 19,241,779 Soft drink sales growth, 21.76 21.69 18.30 13.39 14.56 14.01 13.61 13.06
• 28 . 27 | P a g e VND (% chg. y-o-y) Soft drinks sales (US$mn) 2,531.14 2,853.60 3,314.51 3,800.84 4,403.98 5,078.94 5,836.41 6,631.52 (Note: f = BMI forecast. Source: General Statistics Office,Company information, Trade press, BMI) Figure 7: Soft drinks 2010-2017 (Note: f = BMI forecast. Source: General Statistics Office,Company information, Trade press, BMI) We are witnessing a rapid emergence of competition in the Vietnamese soft drinks market. The opportunities provided by a rapid middle-class emergence in Vietnam are firmly within the sights of domestic drinks producers such as PepsiCo Vietnam, Tan HiepPhat and Coca-Cola Beverages Vietnam, and the companies’ aggressive initiatives in terms of product innovation, portfolio expansion and advertising will only instill greater dynamism into the sector. The maturation of a massive youth population and rising consumer affluence are translating into a burgeoning appetite for soft drinks. As consumers move up the income ladder over the coming years, an accelerating premiumisation momentum in the sector means that value sales are expected to increase more dynamically over our forecast period. An intensifying influx of sector investments will provide another major impetus to drive industry growth. In particular, we expect domestic soft drinks manufacturers to ramp up their initiatives in terms of product innovation, portfolio expansion and marketing. In the regard of portfolio expansion, local soft drink manufacturers are gradually calibrating their portfolio towards healthier and functional beverages such as fruit juices and ready-to-drink teas as they look to tap into a growing health awareness trend in the country. 0.00 1,000.00 2,000.00 3,000.00 4,000.00 5,000.00 6,000.00 7,000.00 0.00 500.00 1,000.00 1,500.00 2,000.00 2,500.00 3,000.00 2010 2011 2012f 2013f 2014f 2015f 2016f 2017f Soft Drinks 2010-2017 Soft drinks sales (mn litres) Soft drinks sales (US$mn)
• 29 . 28 | P a g e Reflecting a shift of consumer preferences towards healthier beverages, PepsiCo Vietnam and Coca-Cola Beverages Vietnam have been losing market shares in recent years due to declining sales of carbonates, according to anecdotal reports. However, with the health awareness trend remaining well-entrenched over the coming years, we expect more domestic soft drinks manufacturers such as PepsiCo Vietnam and Coca-Cola Beverages Vietnam to expand their non-carbonates offerings going forward. As a case in point, Big C recently introduced its private label fruit juice range Casino Bio to cater to the burgeoning domestic demand for health and functional beverages. As competition intensifies in the Vietnamese soft drinks market, domestic producers are also looking to differentiate themselves through branding and marketing initiatives. Coca-Cola Beverages Vietnam and Tan HiepPhat have executed some of the biggest advertising campaigns in Vietnam through various formats such as print advertisements, television and the internet. These initiatives have not only bolstered consumer awareness of the different soft drinks brands but also encouraged greater soft drinks consumption in the country. Moreover, domestic soft drinks manufacturers will continue to engage in product innovation by offering different bottle formats and sizes in an attempt to cater to the varying consumer tastes and preferences. For instance, Coca-Cola Beverages Vietnam and PepsiCo Vietnam produce their soft drinks in varying sizes, and this has facilitated their reach to the end-consumer market. As more companies hop on the product innovation bandwagon, this will bring about greater dynamism in the sector and further fuel sales growth. 2.4Vietnam milk-tea market Bubble Tea was introduced into Vietnam by the end of 2002 and the fastest growing since 2008. Bubble Tea is a beverage originating from Taiwan with a very strange flavor combinations mild flavor of tea, with delicious pearl and fatty flavor is a phenomenon for teenager and it has quickly became a favorite snack in Vietnam Most of the business model in Taiwan milk tea sold close small glass style brought while in Vietnam developed a lot of different forms of business such as business chain , sale or sold in place to bring on or delivery to suit every customers , and includes many ongoing promotions . We can say the profits from this business model are very large and very large market now, so here is the investment destination for many business enterprises. The attractiveness of pearl milk tea is not embedded in the education of clients and students, but also spread to all workers and employees in many occupations, ages. It is easy to catch the milk tea shop adjacent to the school gate, watching the dorm walls, in the streets, in markets, supermarkets,dormitories,condominiums, office buildings...
• 30 . 29 | P a g e 2.5Government law for starting a new business To establish a new business in Vietnam, any individual or organization needs to understand clearly and comply with strict legal regulations in the state of Socialist Republic of Vietnam. 2.5.1 The steps to complete business registration The first thing should be noted is “Enterprises of all economic sectors shall be entitled to conduct any business lines that are not banned by law”(based on Article 7- Chapter 1-Vietnam Enterprise Law) Secondly, we need to follow these steps to establish enterprises and have business registration:  Step 1: To make the business registration (according to Article 15 - Chapter 2 -Vietnam Enterprise Law) 1. Persons decided to establish an enterprise must submit a complete business registration dossier as provided for by this Law to a competent business registration office and shall be responsible for the truthfulness and accuracy of information contained in the dossier. 2. The business registration office shall examine the business registration dossier and issue a business registration certificate within ten working days as from the date of receipt of the dossier; if refusing to issue a business registration certificate, it shall notify the applicant thereof in writing. The notification must clearly state the reason for refusal and requirements for amendment or supplement. 3. The business registration office shall examine and be responsible for the validity of the dossier when issuing a business registration certificate; and shall not be allowed to ask applicants for any document other than those provided for by this Law. 4. The time limit for issuing business registration certificates associated with specific investment projects shall comply with the law on investment.  Step 2: Preparing business registration dossiers of private enterprises (according to Article 16 - Chapter 2 -Vietnam Enterprise Law) 1. Business registration application, made according to a form set by competent business registration offices. 2. Copy of the people's identity card, passport or other lawful personal certification. 3. Written certification of legal capital issued by a competent agency or organization, for enterprises conducting business lines which are required by law to have legal capital. 4. Practice certificates of the director and other individuals, for enterprises conducting business lines which are required by law to have practice certificates as provided for by law.  Step 3:Submitting dossiers and waiting to get certificate of the business registration.
• 31 . 30 | P a g e 2.5.2 Some noteworthy other legislations in Vietnam Enterprise Law 2.6.2.1 Article 21Contents of business registration applications 1. Enterprise name. 2. Address of the enterprise's head office; telephone number, fax, email address (if any). 3. Business lines. 4. Charter capital, for companies, or start-up investment capital of the enterprise owner, for private enterprises. 5. Capital share owned by every member, for limited liability companies or partnerships; number of shares owned by every founding shareholder, types and par value of shares, total number of shares of each type eligible for sale offer, for joint-stock companies. 6. Full name, signature, permanent address, nationality, number of the people's identity card, passport or other lawful personal certification of the owner, for private enterprises; of owner or his/her authorized representative, for one-member limited liability companies; of every member or every member's authorized representative, for limited liability companies with two or more members; of every founding shareholder or every shareholder's authorized representative, for joint-stock companies; of every general partner, for partnerships. 2.6.2.2 Article 24 Conditions for the grant of business registration certificates Enterprises shall be granted business registration certificates if they fully meet following conditions: 1. Registered business lines are not prohibited; 2. The enterprise name complies with Articles 31, 32, 33 and 34 of this Law; 3. There is a head office that complies with Clause 1, Article 35 of this Law; 4. Business registration dossier is valid as provided for by law; 5. Business registration fee is fully paid as provided for by law. Business registration fees shall be determined on the basis of the number of registered business lines; specific fee rates shall be stipulated by the Government. 2.6.Definition ofthe Business Model Canvas The Business Model Canvas is a strategic management template for developing new or documenting existing business models. It is a visual chart with elements describing a firm's value proposition, infrastructure, customers, and finances. It assists firms in aligning their activities by illustrating potential trade-offs. (http://en.wikipedia.org/)
• 32 . 31 | P a g e Table 8: The Business Model Canvas 2.7. Contents of the Business Model Canvas table (source: Business Model Generation book) 2.7.1 Value Propositions a. Definition This block forms the central spine of the whole model. Business Model Generation summarizes the role of this block as follows:describe bundles of products or services that create value for a specific customer segment. It also value delivered to the customer (benefit or cost) and value propositions assigned to customer segments. To understand value propositions clearly, managers can solve customers’ problem smoothies and easily to meet customers’ needs to make them satisfied. b.Attributes A good customer value proposition will provide convincing reasons why a customer should buy a product, and also differentiate your product from competitors. Gaining a customer's attention and approval will help build sales faster and more profitably, as well as work to increase market share. Understanding customer needs is important because it helps promote the product. A brand is the perception of a product or service that is designed to stay in the minds of targeted consumers.
• 33 . 32 | P a g e Business Model Generation provides this list of attribute-adjectives:newness, performance, customization, full service, design, brand or status, price, cost reduction, risk reduction, accessibility and convenience or reusability. In conventional push-marketing, almost all of these will lead to a ‘race to the bottom’. By contrast, in pull-marketing, all of these can lead to strong differentiation and perceived high-value – but only if linked to the shared-vision of the shared-enterprise. Any value-attribute that doesn’t align with the values of the shared-enterprise – for example, an emphasis on price or cost-reduction within a luxury- oriented market – will probably cause more harm than good. 2.7.2 Customer Segments a. Definition Customer segment block defines groups of people or organizations that your business aims to reach and serve. Customer segments have needs that justify a distinct offering. They are reached though different Distribution Channels and require different types of relationships. They have different levels of profitability and may be interested in a sub-set of the Value Proposition. b. Types Segmenting your customers into groups according to their needs has a number of advantages. We can sort customer segment in many ways such as mass market (for example, fast-moving consumer- goods), niche market (for example, anglers, doll’s-house collectors, dental supplies), segmented within a market (for example, low-end versus high-end fashion), diversified from an organization’s perspective (for example, Amazon Retail versus Amazon Kindle versus Amazon Web Services)and multi-sided market (for example, newspaper advertising, web-based search) 2.7.3 Channels a. Definition The Channels block is shown in the center-right region of the Business Model Canvas. The book asserts that this block: describes how a company communicates with and reaches its Customer Segment to deliver a Value Proposition. It has some functions such as: raising awareness among customers about a company’s products and services,helping customers evaluates a company’s value proposition, allowing customers to purchase specific products & services, delivering a value proposition to customers and providing post-purchase customer support. b. Types Direct Indirect Owner - Sales Force - Web Sales - Own Stores Partner - N/A - Partner Stores - Wholesaler
• 34 . 33 | P a g e c. Phases There are some phases we need to note when building this block: awareness, purchase, delivery, and after sales. For each phrases, manager must proposed the proper strategy. 2.7.4 Customer Relationships a. Definition The Customer Relations block is shown towards the upper right on the Canvas. The book states that this block: describes the types of relationships a company establishes with specific Customer Segments. A comment about motivations, which the book summarizes as: customer acquisitions, customer retention and boosting sales (upselling). b. Types Moving on, the book summarizes typical roles of relationship-types – I’ve added a descriptor to indicate the interaction type in each case: personal assistance (human to human), dedicated personal assistance (human to human), self-service (human to self), automated service (machine to human), communities and co-creation (partners).The organization may also need ‘hands-off’ relationships with some of its stakeholders – for example, knowledge-management community-of-interest, brand-related fan-club, or product discussion forums. 2.7.5 Revenue Streams a. Definition The Revenue Streams block is shown on the lower-right of the Business Model Canvas. The book summarizes this block as follows: the cash a company generates from each Customer Segment and represents the Customer Segment’s quantification of the Value Proposition. Which, bluntly, is likely to give a lethally-incomplete description of the ‘value-returns’ flows of a business-model… b. Types The book suggests the following means to generate value-streams: sale of assets, usage fee, subscription fee, leading or renting or leasing, licensing or royalties, brokerage and advertising. All of which, again, implies the specific subset of transactions that can be mapped or transformed directly into monetary form, which is often dangerously-incomplete. All of this needs mapping of pre- and post- ’monetization’, with an explanation of each transform – and maintenance of any non-’monetisable’ value! Beside that we also have 2 other types such as: periodicity (one-time and recurring) and pricing mechanism (fixed list price, bargaining, auction, market dependent, volume dependent and yield dependent).
• 35 . 34 | P a g e 2.7.6 Key Partners a. Definition On Business Model Canvas, the block is shown over on the far left. The book summarizes this block asdescribes the network of suppliers and partners that make the business model work. And main motivations are optimization and economy of scale, reduction of risk and uncertainty and acquisition of particular resources and activities. b. Types The book suggests four different types of partnerships:strategic alliances between non- competitors, competition (strategic alliances between competitors),joint ventures to develop new businesses and buyer-supplier relationships to assure reliable supplies. We might note also that an ordinary ‘hands-off’ or contract-only buyer-supplier relationship actually is also a type of partnership – just not as explicit in its form as a relationship of partners in business. As motivations for partnership- type relationships, the book suggests: optimization and economy of scale, reduction of risk and uncertainty (and also enabling of shared-opportunity) and acquisition of particular resources and activities. 2.7.7 Key Activities a. Definition This block is shown in the upper center-left of the Business Model Canvas. It describes the most important things a company must do to make its business model work. b. Types They categorize key activities as production, problem solving and platform or networkwhich is a very incomplete subset, even for a summary of this type. 2.7.8 Key Resources a. Definition The Key Resources block is shown on the center-left of the Business Model Canvas. It describes the most important assets required to make a business model work. It allows an enterprise to create and offer a Value Proposition, reach markets, maintain relationships with Customer Segments and earn revenues. b. Types We can categorizes assets as follows: physical (material, facilities, equipment), intellectual (brand, IP, partnerships, data), human (people and skills) andfinancial (cash, line of credit, loans). Some time we also can categorize assets as ownership (owned, leased, licensed and acquired from key partners).
• 36 . 35 | P a g e 2.7.9 Cost Structure a. Definition This block is shown on the lower-left of the Business Model Canvas. It describes all costs incurred to operate a business model.The book suggests just two business-model cost-structure types:Cost-driven business models focus on minimizing costs whenever possible, aim for lowest-possible cost-structure(e.g. budget airline). Value-driven business models are less concerned about cost, focusing instead on value creation,emphasis on perceived-value such as premium service (e.g. luxury hotel). Such costs can be calculated relatively easily after defining Key Resources, Key Activities and Key Partnerships. b. Types For cost-structures themselves, the book suggests the following characteristics: fixed-cost, which will (usually) be same regardless of scale (e.g. manufacturing-plant); variable-cost which linked to volume, scale, consumables etc.; economies of scale which costs reduce with increasing scale and economies of scope which re-use in other contexts.
• 37 . 36 | P a g e 2.9 The Business Model Canvas of Caramel milk-tea shop Table 9: Caramel milk-tea shop’s business model Key partner - Buyer-supplier relationships to assure reliable supplies: we build relationship with Taiwanese bubble supplier and Mongolia flavors supplier. We also have good relationship with reliable domestic suppliers (milk company, tea company and ice-cream company) Key Activities - Production - Problem solving - Network - Marketing Value propositions - Brand: Caramel - Apply Taiwanese services styles more professional, quicker and friendlier. -Price is cheaper than other milk-tea shop in the current market (less than 30%- 50%). - Diversity in flavors and sizes of bubble. - New kind milk- teas from others countries. Customer relationships - Personal assistancecustomer service. - Our first customers begin from our old classmates, school- mates and acquaintances. Customer segments - We chose mass market but we focus on the group people from 12 to 30 years old (students and workers) Key Resources - Physical - Intellectual - Human - Financial Channel - Direct channel - use Sales force - Customers come shop to buy directly (buy less than 5 cups) or they can purchase through telephone and we will deliver product to them (if they buy more than 5 cups) Cost Structure - Fixed costs - Variable costs Revenue streams - Periodicity: we chose recurring, every 2 months. - Form of generation: asset sale milk-tea products. -Pricing mechanism: fix list price and yield management.
• 38 . 37 | P a g e Chapter 3: Research methodology The four purposes of this chapter are (1) To describe the research methodology of this study; (2) To explain the sample selection; (3) To describe the procedure used in designingthe instrument and collecting the data and (4) To provide an explanation of the statisticalprocedures used to analyze the data. 3.1 Researchdesign To identify possible strategies Caramel can adopt, the research will take a quantitative analysis approach; it will focus on descriptive analysis. The descriptive approach will give systematic procedures the caramel can focus to increase quality and quantity of customer. 3.2 Sampling Our participants from specific location (District10, Ho Chi Minh City) will be selected randomly. To request an opportunity to conduct an interview with the relevant persons, the researchers will send survey to the random people in park, school, office and supermarket.The aim of the researcher is they will fillingallquestionnaires or interview these people that are involved in planning strategic development for the Caramel store. 3.3 Data collection Data collection will focus on both primary and secondary data. Secondary data is information obtained from previous researches on a subject. Scholars collect and analyze data in most researches; therefore, collecting secondary data is simple and does not call for a technical approach for analysis. In this case, secondary data will mainly come from articles and different materials written about milk-tea article, beverage survey. Plans that are strategically prepared by the government and individuals will contribute significantly in completing the study Primary data is the fresh data collected from the field by a researcher. It contributes significantly in situation analysis because it shows the status quo. The researcher will use quantitative methods of data collection to collect primary data: questionnaires and interviews. The researcher will prepare for interviews or send a questionnaire to the people who’s is target strategy in providing solutions to the challenges. The researcher will formulate clear research questions in both the interviews and questionnaires to help the respondent answer the questions clearly.
• 39 . 38 | P a g e 3.4 Data analysis Data will be collected in two weeks. The data collected will be analyzed with relevant data analysis methods and presented in the final stage of strategic planning. Quantitative research methods will be used for data analysis. 3.5Structure This study will have different sections including introduction, literature survey, methodology, results, and interpretation of study results, recommendation and conclusion. Each of the sections mentioned will be provided with relevant information about creating a strategy to open a milk-tea store in take-out style properly.
• 40 . 39 | P a g e Chapter 4: Marketing plan 4.1 Product and product strategy A product strategy is the ultimate vision of the product, it as a map guide direction for our shop’s development. As we mentioned above, our target customers are students and official employers, so our products need to be diversify. In the first year, we focus on 3 main antlers as bubble milk tea, coffee-milk and tea. We make sure that the product quality always the best and not change our special flavors. Vietnamese customers are afraid ofunidentified products so we must ensure with customers, all bubble export directly from Taiwan. When opening shop, we have total 12 original flavor bubble tea such as: blueberry, chocolate, green apple, honeydew, taro, passion fruit, raspberry, strawberry, vanilla, mango, lychee and peach. In Vietnam traditional coffee-milk antlers, we have some featured products as: 100% ice coffee, ice coffee-milk 50%, ice coffee- 75% milk, fresh milk and honey milk. About tea antlers we have ginger tea (just use in hot), honey tea, herbal tea, lychee black tea, yoghurt black or green tea and lemon tea. In this period, we have some special products which help our shop different from other bubble tea shop are Taiwanese black tea and bubble tea ice cream. Combine with these drinks we deliver extra foods such as circular glass bead, tube glass bead and pudding (see the table below). Every 3 months, we will launch new product to meet diversity demand of customers as well as bring freshness for our shop.
• 41 . 40 | P a g e Table 10: The List of Caramel's product Follow this orientation, in the first 3 months after opening time; we will launch some new products like brown rice green tea, kumquat green tea, bubble tea with flavor black tea and papaya. We also add more 2 flavors ice cream as oranges and mango and some extra foods flavor so customers will have more choice for their mix. Next 3 months, peanut and banana bubble milk tea and chrysanthemums tea are launched to market with one new circular glass bead flavor. 3 last months in the first year, we add a series of 4 new flavors for bubble milk tea product (red bean, watermelon, cherry and coffee) and 2 kinds of tea like red apple and black tea latte. Beside we also continue to supply new favor for glass bead product. In conclusion, after one year open shop, we total have 20 kinds of original bubble milk tea, 6 kinds of ice-cream can combine with original milk tea, 3 kinds of coffee-milk, 12 kinds of tea and more than 10 kinds of extra foods.
• 42 . 41 | P a g e 4.2 Product feature and benefit 4.2.1 Bubble milk tea Milk tea is also known as pearl milk tea, boba milk tea, boba tea, tapioca tea, bobanai cha, pearl tea, bubble tea, bubble drink,珍珠奶茶, tapioca pearl drink, momi, momi milk tea, QQ, or any combination above. The oldest known milk tea consisted of a mixture of hot Taiwanese black tea or green tea, small tapioca pearls, condensed milk, and syrup. Many variations were created, the most common of which is served cold rather than hot. Milk tea is generally offered in two distinct ways as a fruit-flavored cream drink and a sweetened fruit drink. Most fruit-flavored cream drink includes powdered non-dairy creamers to "cream" the drink, but some shops also offer fresh milk, ice cream, soy milk, or lactic milk as an alternative. These creamed drinks may or may not include tea as its base liquid. A sweetened fruit drink usually includes crushed-fruit smoothies with tapioca pearls to add fun. Milk tea comes in a variety of different flavors, the most popular being the fruity and creamy ones. Some widely available fruity and creamy flavors include strawberry, green apple, passion fruit, mango, lemon, watermelon, grape, lychee, peach, pineapple, cantaloupe, honeydew, banana, avocado, coconut, and kiwi. Other popular non-fruity and creamy flavors include taro, chocolate, coffee, mocha, black milk tea, thai tea, lavender tea, and rose tea. Some cafes and shops offer non- creamy drinks by using fruit pulp syrups like passion fruit, honeydew, strawberry, and lychee. There are now 250 varieties of flavors and choices of a milk tea drink. 4.2.2 Vietnamese traditional coffee Vietnamese iced coffee is a combination of concentrated coffee brew, condensed (very sweet) milk(do not use evaporated milk; always condensed milk). To brew Vietnamese iced coffee as authentically as possible (though with a specialty coffee twist), we need something
• 43 . 42 | P a g e called a phin (one kind of filter). A phin is the name for the little coffee brewer used for this brewing style. A phin is small filter coffee pot. It looks like a hat and sits upon the top of a coffee cup. Inside is a chamber for coffee and room for hot water. It is very basic and simple, and works. Coffee is a very popular drink in many countries. Perhaps no one stimulant is used widely and legally worldwide as coffee. Coffee is sold in many forms, granules, powders or instant bag. You can purchase at any time and buy as much as you can. Ha Vo - Vietnamese herbalist told that “Drinking one to two cups of coffee per day can help your body fresh and flexible”.He is also mentioned in his research that due to stimulate nerves, coffee increased the stress hormones like adrenaline, cortical so be able to enhance the ability to "fight back or run away" help us dynamic, flexible and temporary relief of fatigue. Coffee can help relieve boredom and sleepiness monotonous tasks such as driving, watchman, childcare and sick caregivers.For diabetes, used to have an official popular research on Annals of Internal Medicine journal that drink coffee may reduce the risk of diabetes in healthy people, who does not have cancer, diabetes and cardiovascular. Especially, a recent study by scientists at the University of South Florida showed that coffee has the ability to significantly improve symptoms of Alzheimer’s disease, amnesia disease and occur in the elderly. How to make Vietnamese Iced Coffee-milk by using phin? Step 1: Preparing tools and materials. All you need are 1 phin, 20 grams ground coffee, condensed milk, 1 cup and ice.
• 44 . 43 | P a g e Step 2:Adding materials: Condensed milk and coffee. We put condensed milk into glass, depending to your taste, you can use ratio 1:1,1:2 or 3:4 for coffee and milk. This is a 120ml brewer and can hold a max of 15g of coffee. We're adding around 14g for our brew. Step 3: We adding the spreader then add about 20ml of 90C water. After that letting it sleeps a bit, allowing the coffee to expand. We call this period is pre-infusion time. Step 4:Adding another 100ml of brewing water after letting the pre-infusion take place for 20 seconds. Then add the lid to keep the heat in and let the brew take place. The brew may start off slowly at the start but when the brew is about 2/3 of the way,it is speeding up a bit. Step 5:When finish we have a cup with rich, concentrated coffee and the layer of condensed milk. We stir the coffee vigorously to mix the condensed milk layer with the coffee brew.At this point, most of the condensed milk is mixed in with the brewed coffee, but it is still hot, so time to add ice. 4.2.3 Tea According to statistics, tea is the second most popular beverage in the world after water only. That's true, because a part can drink the tea in the form of heat, cold; other parts are also many kinds of tea suit individual preferences. In the world we have more than 1,500 varieties of tea. People drink tea from hundreds of years ago by the great benefits of it. A. Green tea Written in Medical New Today, green tea has may form such as available bottled and sweetened with sugar or an artificial sweetener, in single tea bags, loose-leaf, and in instant- powder. Green tea supplements are sold in capsule form or liquid extracts.
• 45 . 44 | P a g e According to the National Cancer Institute, in countries where green tea consumption is high cancer rates tend to be lower, but it is impossible to know for sure whether it is the green tea that prevents cancer in these specific populations or other lifestyle factors. We also have a 2006 study published in the Journal of the American Medical Association concluded that green tea consumption is associated with reduced mortality due to all causes, including cardiovascular disease. Other studies have found that green tea is helpful in preventing dental cavities, stress, chronic fatigue, treating skin conditions and improving arthritis by reducing inflammation.Not only that many studies indicate green tea can fight many diseases, even increased longevity. In large concentrated tea antioxidants called polyphones, it has the ability to fight cancer, osteoporosis and cardiovascular disease-related. B. Lemon tea Lemon tea is a mixture of tea and lemonade. You can use fresh tea, dried tea or instant tea bag to make tea. Cooling tea then cut lemon and squeezed it to get juice, per 500ml of tea we can squeeze 1 lemon. Add a few slices of thinly sliced lemon to decoration. If you like sweet drink, you can add honey in this mixture. Combined the benefits of tea and lemon, lemon tea helps drinkers reduce anxiety. Research has shown that lemonfragrance helps relaxing effect, reducing fatigue, dizziness, nervousness and suspense. As a sharing on privacy blog clairekcreations.com atFebruary 12, 2013, Claire wrote “I have the juice of half a lemon in my tea (some people just have a slice) which filled one cube perfectly. I zested all the lemons first so there was absolutely no wastage and now I have a nice little supply in my freezer ready for baking and cooking”. And she has received 18 comments agreed with her opinion. In addition, in Tracey Roizman’sarticle onhealthyeating.sfgate.com, he use the research of Purdue University to talk about drinking green tea with lemon improves the health benefits of the tea that citrus juice brings out green
• 46 . 45 | P a g e tea's antioxidants, making them more available for your body to absorb. Catechins, which prefer the acid environment of the stomach, become degraded in the more alkaline conditions of the small and large intestine, where nutrient absorption takes place. Lemon juice can increase the amount of catechins your body extracts from green tea by up to six times. While compounds in tea can inhibit iron absorption from foods in your diet, drinking your green tea with lemon reduces that effect. C. Ginger tea Ginger tea is a mixture of tea with fresh ginger, some time you can add honey or lemon as your own taste.Ginger tea is now very popular in the world, especially in cold climates.The way to make it is simple and you can do it at home. Firstly, peeling the ginger root and slice it into thin slices. Next, boiling water then add the ginger into saucepan and waiting for 15-20 minutes. After that you can use it. Ginger tea’sflavor characterized by warm and spicy.If you add honey and lemon, it will have a little sweet of sugar and sour taste of lemon. According to Dinh Dung pharmacist’s research (Ha Tinh Pharmaceutical Joint Stock Company),ginger has been used as medicine since more than 5000 years ago because of its valuable medicinal properties. In Burma, China and India, ginger tea is used to prevent and treat the normal flu. In Vietnam, ginger is used to prevent colds, nausea and motion sickness and it is very effective in treating cough. Thank for containing Cineole, ginger can help relieve stress, migraine treatment, and help to refreshing and having a good sleep.Ginger can help to reduce Cholesterol, and reduce heart disease and high blood pressure. In reality, scientific has proven that ginger tea not only increases blood pressure for people with low blood pressure but also help to prevent and reduce high blood pressure for people withblood pressure. Ginger has affection to enhances blood flow to the genitals so the Western countries and North America nowadays, people tend to use ginger instead of Viagra to treat physiologically impotence in male and female. Take one cup of ginger tea before bedtime is not just to protect the health but also can add flavor to the private emotional life of each person.
• 47 . 46 | P a g e D. Herbal tea Drinking tea is a habit of many Vietnamese, especially herbal tea. Each type of tea has a distinct aroma gives a different feeling and great taste for customers. There’s nothing nicer on a cold midwinter’s day than a soothing cup of herbal tea. But besides being a tasty, warming, caffeine-free pick-me-up, herbal tea has lots of wonderful health benefits. From soothing a troubled tummy to easing insomnia and calming a troubled mind, herbs have all sorts of healing powers. Drinking herbal tea can also be a great source of vitamins and minerals. The research on Thuc Pham Thuoc newspaper online (Vietnam medical newspaper), they said herbal teas contain antioxidants and they list out all the benefits of herbal tea such as: it can help reduce the risk of heart attack and stroke, protects your bones, give you a sweet smile, support protecting the immune system, helping the body hydrated and enhances metabolic processes.Beside that having a study based on 4,400 women showed that for 6 years, drinking herbal tea regularly reduces the risk of breast cancer in half. E. Brown rice green tea Brown rice tea, known as "Genmaicha" in Japanese, is a special blend of green tea and roasted brown rice. Brown rice tea contains flavonoids, antioxidants, trace minerals and vitamins. The health benefits of brown rice tea are comparable to that of green tea. Brown rice tea has a nutty aroma and flavor, and you can serve it warm or use it to make iced tea. It’s very good for health because it’s rich in Polyphones and lower risk of cancer. Roasted brown rice tea purifies the liver, causing the blood is cleaning. Red blood cells are round and serums are clear. In addition, it also gives you bright ruddy and beautiful complexion, cleaning the blood, not toxic. Less or no longer aches when it's cold.
• 48 . 47 | P a g e F. Chrysanthemums tea Chrysanthemum tea is made from chrysanthemum flowers, belonging to the Chrysanthemum morifolium or Chrysanthemum indicum species, which is extremely popular in East Asia, specifically China. Chrysanthemum flowers are usually dried and boiled in hot water in a teapot, cup or glass, to prepare this tea. Sugar or honey is also added to chrysanthemum tea and occasionally, wolfberries are included. The tea that is prepared is transparent and can be bright yellow or pale in color, exuding a floral aroma. In China, after a pot of chrysanthemum tea is emptied, hot water is again added to the flowers. This produces a tea that is less strong than the previous one. The process is repeated several times, until the flowers lose their aroma completely. Traditional Chinese medicine practices still use chrysanthemum tisane for treating conditions such as sore throat and fever. Since long time, people consider chrysanthemum as a kind of herbal tea, which can anti- inflammatory, analgesic and anti-ulcer. Furthermore, compared with other herb teas have heat effect; chrysanthemums also help brighten the eyes, making mental clarity, lowering blood pressure. Chrysanthemums can consistent with both children and adults. In particular, efficient cooling effect of these flowers will be very good for those who regularly have high temperature, heat due to office work, often sitting at a computer, facing stress due to work pressure, less time campaigning and conditions not eating enough nutrients.Additionally, based on information in report of Dan Tri online newspaper, we can summarize the benefits of chrysanthemums tea including as stomach cramps treatment, migraine treatment, reducing dark circles under eyes, improving sleep and treating cramps during menstruation.
• 49 . 48 | P a g e G. Kumquat green tea Kumquat green tea is a famous beverage. It is not only a beverage, Kumquat green tea has many health benefits as:Kumquats are low in calories (8 kumquats have little more than 100 calories) and they are full of antioxidants, vitamins, minerals (copper, calcium, potassium, iron, selenium, zinc, manganese), and lots of fiber. Kumquats have polyphenols in them like green tea and beta-carotenes important for your immune system, and even great zeaxanthines, and lutein that are important for eye health. Kumquats contain vitamins A, B’s, C, and E which are important for keeping way degenerative diseases. H. Red apple tea Red apple tea although do not have tea components in raw materials but is still considered as a good cooling tea is for summer. In addition to red apple tea has many health benefits such as: anti-allergy, curing low blood pressure and anti-cancer. Red apple tea in combination with ginger tea will become a suitable tea in cold winter days. Ginger has moisturizing effect, cold treatment, the sweet ofred apple soothes the throat, and apple juice is very good for those with sore throat in cold season.
• 50 . 49 | P a g e 4.3 Competition We use the scale from 1 to 5 to evaluate the strengths and weaknesses of competitors as table below: Factor Me Alo Tea Sun Flower Api tea Product 4 3 4 3 Quality 4 3 4 3 Service 4 3 3 2 Selection 3 2 5 2 Price 5 3 2 2 Location 3 3 5 5 Company Reputation 1 2 5 3 Appearance 3 3 5 5 Table 11: Evaluate competitors As you can see the table, Sunflower is taking advantage about the quality. Alo tea is one of the first brands that have been sold the milk-tea but they cannot keep their performance when they began. The quality of Api tea is low too because their target customer are for the one who want cheap product so the customer cannot expect too much their quality The service of our competitors is about the same. It is the Sai Gon culture because in the south of Viet Nam, we always focus on service. We have a statement: “Customer is the god”. So if any store in Ho Chi Minh City doesn’t treat customer like that. They are going the wrong way. In Alo tea and Api tea, the customer don’t have too much the selection to choose for themselves. Contrast to Sunflower, they selection is diversified .Their menu have many kind of milk-tea favor, juice favor and the coffee favor also. But this is the disadvantage of Sunflower also because they don’t have their unique flavor to attract more customers. About the price, the Sunflower is higher than the other competitors. About 20-30% cost compare with Api Tea and Alo Tea. The location is very importance for the business, the location of our competitor is very good. The location of Sunflower is on the street which has many people go on this every day. The Alo Tea is near the Sunflower and the Api tea is near the school.

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Bubble Tea Shop Business Plan Template

MAR.21, 2018

Do you want to start bubble tea shop business?

Starting a bubble tea shop business is very easy and extremely profitable as well. If you don’t know how to open a bubble tea shop, just go through this milk tea business plan template. It will guide you through everything which you need to know for starting this venture. The first thing you should do is to develop a comprehensive plan for your tea room business model . The business plan will not only help you in startup but it will also help you in taking important decisions for your company over the next years. In case you don’t know how to write a good milk tea business plan, we are providing a detailed milk tea business plan template of a bubble tea shop startup ‘Sam’s Stop’ to help you avoid the trouble of making a plan yourself.

Executive Summary

2.1 the business.

Sam’s Stop will be a licensed and ensured tea shop located in Downtown Manhattan. We will be strategically located in the most suitable place for opening a bubble tea shop business plan.

2.2 Management

The business will be solely owned and operated by Sam Kin who is a graduate from Harvard University and is known for his sharp business acumen and exceptional management skills. Sam will hire a small team comprising of chefs, waiters, assistants and cleaners for operating and managing the shop.

2.3 Customers

Our customers will primarily be the residential community living near our shop. We will offer high-quality and healthy tea latte, milk tea, fruit flavored tea, brown sugar milk, macchiato and slush to our esteemed customers.

2.4 Target of the Company

Our primary target is to become the best tea shop in the New York City within next 3 years of our launch. Our secondary target is to achieve the net profit margin of £10k/month by the end of the first year, £15k/month by the second year, and £25k/month by the third year.

Company Summary

3.1 company owner.

Sam is a business graduate of Harvard University. After completing his Bachelor’s, he worked with a couple of fast food restaurants at executive positions. He is known for his sharp business acumen and exceptional management skills.

3.2 Why the Business is being started

The main motive behind Sam starting a bubble tea business plan is his intense passion for tea room business model . Sam has exceptional business skills and this venture is just his first step into the business world. Within next three years he plans to open five more bubble tea spots in different cities, and after that, he will move towards business plans for restaurants . So, this venture is where Sam will enter the corporate sector.

3.3 How the Business will be started

Sams’s Stop will be launched in a 200-square-feet shop located in the main commercial market of Downtown Manhattan. The shop was previously used as a grocery store, so a lot of work needs to be done for turning it into a tea shop. The company’s financial experts have forecasted following costs for the start-up:

Services for customers

It is wiser to plan your services or menu before you think about how to start a milk tea business plan template. You can only plan subsequent things after you know what you will be providing to your customers. Sam’s Stop will offer following products to its customers:

• Milk Tea: Bubble Milk Tea, Brown Sugar Milk Tea, Almond Milk Tea, Hazelnut Milk Tea
• Tea Latte: Black Rose Latte, Oolong Latte Float, Matcha Latte, Tie Guan Yin Latte
• Fruit Flavored Tea: Peach Green Tea, Mango Green Tea, Honey Green Tea, Fresh Lemon Green Tea
• Brown Sugar Milk: Black & Yellow Milk, Black Babo Milk, Red & Yellow Milk
• Macchiato: Rose Tea Macchiato, Jasmine Green Tea Macchiato, Milk Tea Macchiato
• Slush/Milk Shake: Oreo Milk Shake, Mango Slush, Passion Fruit Slush, Ice Cream Shake

Marketing Analysis of bubble tea shop business

The most important component of an effective milk tea business plan is its accurate marketing analysis that’s why Sam acquired the services of marketing experts to help him through this phase. It is only after this stage that a good bubble tea business plan template could have been developed. After identifying the local market trends in Manhattan, the marketing experts and analysts also helped him in developing the bubble tea marketing plan.

5.1 Market Trends

As for a general trend, the market demand for bubble tea businesses is on the rise. Bubble tea is one of the most popular drinks with Americans. The biggest reason behind the popularity of this bubble tea shop business plan template is that people are becoming more health conscious day by day.

As a result, people have started avoiding carbonated drinks and have leaned towards healthy alternatives such as smoothies, slushes, milk and fresh fruit juices. That’s why the number of bubble tea shops has been increasing during the last few years. In short, this industry has a lot of potential and even a small bubble tea shop can yield immense profit provided that you successfully plan it and target your customers.

5.2 Marketing Segmentation

Our marketing experts have identified following type of target audience which can become the potential customers of our tea shop.

The detailed marketing segmentation comprising of the company’s target audience is as follows:

5.2.1 Working Community:

The first category includes the workers and employees who work in the businesses or offices located in the vicinity of your milk tea business plan template. This group leads a strenuous life, burdened with plenty of work and thousands of matters to think upon. It has been observed that this group often takes soft drinks, especially coffee and bubble tea to take a break from their hectic routine. Our tea shop will be the perfect place for them to rest while on their way home.

5.2.2 Residential Community:

The second group of our target customers will be the community residing in the vicinity of our restaurant. Bubble tea is one of the favorite drinks of American teens so we hope to have a lot of sales due to them. Not only teens, adults and middle-aged people also love smoothies, slushes and fresh tea due to health benefits, that is why we classify this group as our second target group.

5.2.3 Passers-by:

The third category includes those people who do not live or work near our tea room business model but have come to the area for any business purpose or commercial activity. We also hope to attract these passers-by with our economical and delicious smoothies, milkshakes and tea.

5.3 Business Target

Our business targets are as follows:

• To become the best bubble tea shop in Manhattan within next 3 years of our launch
• To recover the initial investment within next 1 year of launch
• To open two more tea shops by the end of the second year and three more shops by the end of the third year

5.4 Product Pricing

After considering the market demands, we have priced all our products in the similar ranges as of our competitors. Our product pricing is as follows:

• Small Serving: £3/serve
• Regular Serving: £4/serve
• Large Serving: £5/serve

OGScapital was great working with.

OGScapital is the company I had recently worked with on business plan development. The assigned project manager was very diligent, hard-working, clearly understood set tasks. The project was done before set deadlines, which was even more pleasant for me. I definitely recommend OGScapital as a team of real professionals.

Sales strategy is also an important component of a bubble tea shop business plan template and hence it must be developed with great care and attention must be paid to every detail.

6.1 Competitive Analysis:

We have a really tough competition because bubble tea shops are nearly everywhere in Manhattan but none of our competitors is offering as much high quality and delicious drinks as ours. Our high-quality, healthy and economical drinks, combined with the unparalleled customer service of our staff will give us an advantage over other tea shops in the region.

6.2 Sales Strategy

We will target our customers by following three ways:

• Conducting seminars, webinars, and workshops in different institutions to emphasize the health benefits of bubble tea and other similar drinks.
• Advertising our tea shop in food magazines, newspapers, TV stations, and social media.
• Offering a 20% discount on all drinks for the first three months of our launch.

6.3 Sales Monthly:

6.4 sales yearly:, 6.5 sales forecast.

Our forecasted sales pattern is given in the following column chart:

Personnel plan

It is highly advisable to prepare a personnel plan before you think about how to start a milk tea business plan templated bubble tea shop since it is one of the biggest contributing factors of the success of any business. The personnel plan of Sam’s Stop is as follows:

7.1 Company Staff

Sam will act as the CEO of the company and will initially hire following people:

• 1 Manager to manage the overall operations
• 1 Cashier to receive cash from the people
• 2 Accountants to maintain financial records
• 4 Sales Executives responsible for marketing and advertising the tea shop
• 10 Chefs for preparing drinks
• 10 Waiters to serve the customers
• 8 Cleaners to clean dishes and other facilities at the tea shop

Financial Plan

The final thing to do before you think about how to open milk tea room business model is to develop a comprehensive financial plan which will cover the detailed costs of startup.

8.1 Important Assumptions

8.2 brake-even analysis, 8.3 projected profit and loss, 8.3.1 profit monthly, 8.3.2 profit yearly, 8.3.3 gross margin monthly, 8.3.4 gross margin yearly, 8.4 projected cash flow.

The following column diagram shows the projected cash flow.

Download Bubble Tea Shop Business Plan in pdf

OGScapital also specializes in writing business plans such as a business plan for a sandwich shop , business plan of coffee shop , business plan of a butchery business startup , donut shop business plan , business plan for a grocery store , restaurant business plan templates and etc.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than £1.5 billion in funding, and they can do the same for you.

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Member:  Table of Content

Introduction… ✓

Executive Summary…

Environmental Analysis…✓

Business Description… ✓

Organizational Plan… ✓

Production Plan…

Operational Plan… ✓

Marketing Plan…✓

Financial Plan…  Introduction

Milk Tea (also called Bubble Tea) is an extremely popular drink in most of Asian countries. Itis originally started from Taiwan in 1988.

Milk Tea or Bubble tea is specialist drink increasingly being offered in cafés, coffees shops and bars. It originates from Asia and is made up of hot or cold tea, milk, sugar and giant black tapioca balls. Ice is then added and the drink shaken to create the bubble effect. Bubble tea is often referred to as pearl shake, tapioca ball drink; boba ice tea and bubble drink among other things. The term "bubble" refers to the tapioca balls in the drink. These chewy tapioca balls, or "pearls," are consumed along with the beverage through a wide straw.

Proposed name of the business

The proposed business name is milk tea break., address of the business, baranggay hawan grande, virac, catanduanes, name of the owner or owners, description of the business.

Milk Tea Break is a typical take-out restaurant where customers order foods and drinks at the counter, as opposed to sit-down restaurants that provide table services. We will also offer online delivery.

Location of the business

Hawan Grande, Virac is a growing area, with continued growth in the area, opportunities to serve is also increasing.

Funding requirement and source

Compared to opening a full size restaurant, the start-up costs to open a Milk Tea (Bubble Tea) business are low. The funds will be provided mainly by investments. The equipments, materials, ingredients etc will be bought in a supermarket or any establishment.  Executive Summary

The business vision is to establish a very good Milk Tea Shop business to stand as a one stop location Milk Tea business patronized by all near citizen. Also, we will try our possible best to offer products and services at affordable prices.

The mission statement of Milk Tea Break Business is to become the first choice of Milk Tea at Baranggay Hawan Grande area.

(1) Establishing a business that goes beyond the expectations of its clients. (2) To generate positive cash flows from operations. Business and product position

There is an increasing demand for snack-type fast food, to be consumed for merienda or to alleviate hunger.

Milk Tea Break will entice youngsters with our unique flavors of milk tea and other retail snacks. The drinks would be served in colorful cups with straws.

Wealth improvement approaches

Consumer Analysis

The main market segments is young and adult age group which in terms of purchase order, typically make larger orders.

Competitor Analysis

So far, the Milk Tea Break have no competitors in barangay Hawan Grande. The Milk Tea Break will offer a good high quality product at a reasonable price.

Market Position

Our Milk Tea shop offers quality Milk Tea at a cheap price.

Marketing Strategy

Marketing strategy is based on social media marketing. Marketing themselves in the

Production Description

The Milk Tea Break will offer a wide variety of Milk Tea.

Equipment/Materials Needed:

 Kitchen tools  Blender  Raw Materials (Milk Tea ingredients)  Plastic cups and other materials Size of the Business

Small business

Personnel Requirements

The Milk Tea Break will have the following:

 Manager  Delivery staff  Kitchen staff  Cashier  Organizational Plan

Form of the Business Organization

Our business is built through partnership and the person who has the greater share/contribution will puts its name as the manager but the all members will hold its liability in the entire business.

Organizational Structure

Roles and Responsibilities

The Manager is the one who has greater share and has to check all teams in order to make sure the efficiency and efficacy of the business. The business has three teams, operation team, marketing team and finance team. In every team there is an executive head chairman who is liable for their operations, with the help of executive vice chairman and executive secretary. First, the operation team is responsible for operation of the business especially in transactions between the supplier and the customer. Second the marketing team is responsible for marketing strategy, promoting and positioning the business service. Next, the finance team is responsible for financial statements and payment transactions to the supplier.  Production Plan Production Schedule

Initial Demand Regular Overtime Subcontracting Total

Production Process

Raw Materials Work in Process Assemble

Customer place deliver finished good.

Equipment Required

 Kitchen tools   Blender  Raw materials (Milk Tea ingredients)  Plastic cups and other materials Source of Materials

 Market Estimated Production Cost: ₱2,000.00

Operational Plan

Evaluation of Suppliers

In order to improve the evaluation process for every suppliers, we will evaluate the raw materials we receive from suppliers, and will make sure all of the raw materials are clean and have a very good quality.

Materials Requisition and Receiving Procedures

To know whether there are some needed raw materials during the operation, we will check and manage the stock raw materials, in this way, it will prevent out of raw materials incident. We will also prepare a report for the capacity of raw materials.

Storage and Inventory Control

To store the materials, we have ideal space for them in particular room. The room is safe and well protected so that they are far from theft and losses. We will ensure to keep the inventory clean and sanitized in order to maintain their freshness. When transferring the materials we will make sure we are following some health protocol to avoid contamination.

Shipment System and Control

This business support Covid-19 prevention so that we must comply to health safety protocol of the government.

There are two ways to deliver the service to the customer, it’s either through the counter or through delivery.

Functions of Support Services

The operation team is responsible for operation of the business especially in transactions between the supplier and the customer. The marketing team is responsible for marketing strategy, promoting and positioning the business service. The finance team is responsible for financial statements and payment transactions to the supplier.  Marketing Plan

Varieties of Milk Tea flavors and retail snacks.

Hawan grande barangay, virac, catanduanes, we will offer two sizes :, small – 15.00 php, large – 30.00 php.

We will utilize social media such Facebook to advertise our business products. We will also post tarpaulin near our business address to attract possible customers nearby.

Fast friendly service. Delivery crew members carries basic operation of a shop and ensure customer satisfaction.

It would be serve in a clean and colorful plastic cup with straw

Positioning:

We serve quality Milk Tea with cheap price.

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Complete Guide on Starting Your Own Milk Tea Business Now!

Are you intending to set up your milk tea business in the Philippines? There are many things you need to consider before running the business . Let’s check this article out!

Milk Tea Business Trend on the Philippines

Who doesn’t love milk tea? In the past few years, milk tea or bubble tea has been really popular not only in the Philippines but also in other countries. Milk tea is one of the popular businesses that people run nowadays in the Philippines.

For your information, milk tea originated from Hong Kong and bubble tea originated from Taiwan. The Philippians are really in love with these beverages. That’s why there are many milk tea or bubble tea stalls you can choose in the Philippines.

Choosing the Right Name for Your Milk Tea Business

When you are interested in setting up your own milk tea business, you need to think and prepare several things and one of the important things you need to consider is your milk tea business name and also the logo for milk tea business. If you are running a new brand of milk tea, you need to work harder to compete with the other popular brands.

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You can start thinking about your milk tea recipe that is different from others. To make it easier, you can try to find milk tea business plan examples so you can write all your business data. But if you don’t have any idea about your business name or recipe, you can franchise and try to find a milk tea business package that is suitable for you.

Creating Your Milk Tea Business Plan

Are you looking for a business plan about milk tea? The way to write a milk tea business plan is just the same as how you write other business plans. You have to write down your milk tea business description completely. Here are several things you need to write in your business plan .

Create Your Best Milk Tea Recipe

First you need to create your milk tea recipe for business. Make sure it is original and different from others. You can create something new by using other ingredients like soymilk, fruits and nuts for toppings or even ice cream. Make sure it tastes good before selling it to your customers.

Be Original

Your business brand originality is important. It helps to make you different from your competitors. That’s why you need to think about what makes you unique and different from other milk tea businesses. You can start from your business concept and also recipes.

Understand Your Market

Before starting your business, you need to understand your market by doing market research. By doing the market research you will know what people like and dislike, who is your target market and so on.

Read also: How a Business Creates Awareness in the Market? Find Out!

Hire A Good Staff

Your staff will be the one who helps you to serve the customers. You need to be selective when hiring a staff. Make sure they are fast, clean and good at speaking and also smiling.

Register Your Business

Another important thing you need to prepare is your legal documents to register your business. You need to find documents you need to submit so that your business will get the permits.

What Are the Equipments for Milk Tea Business

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Of course you can! You can handle multiple stores from all marketplace just by single dashboard. Cut your Business’s cost, and Boost your Efficiency at the same time.

When you are selling milk tea, there will be milk tea business equipments you need to prepare. The common equipment you need such as Tea Brewing Machine, Stove, Cooking Pot, Blender, Measuring Scoop, Cup Sealing Machine, Refrigerator, Cups and many more.For making your milk business tea unique, you can design your cup and straw differently. You can use the eco-friendly theme.

Step by Step on Starting Milk Tea Business

Here are the steps you need to take if you want to start your milk tea business such as:

Do Market Research

First of all, you need to do market research before you set up your milk tea business. By doing the market research, you will get a lot of information about the business you want to set up. You will understand how the business works and also your target market. What things they like the most and not. You will also understand the competition in the business too.

Pick a Niche

Once you have done the market research completely, then you need to make your business theme which is unique and different from others, often called as niche. You can apply it in your stall, menu or also product size.

Read also: 7 Ways to Target the Best Keyword Niche for a Good SEO

Handle Your Finances

Financials also play important roles when setting and running a business . Before starting your business, you need to prepare the capital. Capital is the amount of money that you need to set up a business. 

Look for a Strategic Location

After that, you also need to find a good location for your business to set up. Find a place where your target market is. If your target market is teenagers, you can find a location near schools. You can also find the strategic location where many people are passing by.

Prepare All Your Permits and Licenses

You also need to prepare all your legal documents before running up your business. You need to make sure that you have received the permits and license before selling your milk tea products. Here are several permits and license you need such as:

• Health Department permit.
• Business license, name and logo.
• Personnel permits or licenses.
• Tax registration.
• Trade name registration.
• Employer registration.

Market Your Business

Once you have all the licenses, permits and also your business equipment, now you can run your business already. Make sure to market your business. You can market it through social media marketing . Don’t forget to offer a promotion too like buy 1 get 1 and so on. It really helps to increase your business sales.

When you are interested in setting up your own milk tea business, you need to think and prepare several things such as your business name, location, capital, permits and licenses, recipe and many more. You can try to find the information by doing market research.

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Tea Shop Business Plan Template

Written by Dave Lavinsky

Tea Shop Business Plan

Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their tea shops.

If you’re unfamiliar with creating a tea shop business plan, you may think creating one will be a time-consuming and frustrating process. For most entrepreneurs it is, but for you, it won’t be since we’re here to help. We have the experience, resources, and knowledge to help you create a great business plan.

In this article, you will learn some background information on why business planning is important. Then, you will learn how to write a tea shop business plan step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What Is a Business Plan?

A business plan provides a snapshot of your tea shop as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan

If you’re looking to start a tea shop or grow your existing tea shop, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your tea shop to improve your chances of success. Your tea shop business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Tea Shops

With regards to funding, the main sources of funding for a tea shop are personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for tea shops.

    Finish Your Business Plan Today!

How to write a business plan for a tea shop.

If you want to start a tea shop or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your tea shop business plan.

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your executive summary is to quickly engage the reader. Explain to them the kind of tea shop you are running and the status. For example, are you a startup, do you have a tea shop that you would like to grow, or are you operating a chain of tea shops?

Next, provide an overview of each of the subsequent sections of your plan.

• Give a brief overview of the tea shop industry.
• Discuss the type of tea shop you are operating.
• Detail your direct competitors. Give an overview of your target customers.
• Provide a snapshot of your marketing strategy. Identify the key members of your team.
• Offer an overview of your financial plan.

Company Overview

In your company overview, you will detail the type of tea shop you are operating.

For example, you might specialize in one of the following types of tea shops:

• Loose leaf tea shop: This type of tea shop specializes in selling a variety of blends of loose leaf tea. Customers can often sample the tea before purchasing some to take home.
• Tea room or cafe: This type of tea shop sells food, tea, and other beverages in a dine-in setting.
• Tea bar: This type of tea shop offers a variety of tea to drink at the bar or to-go, similar to a coffee shop.
• Online tea shop: This type of tea shop sells a variety of different kinds of tea through an ecommerce site.

In addition to explaining the type of tea shop you will operate, the company overview needs to provide background on the business.

Include answers to questions such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include the number of customers served, the number of drinks sold, and reaching $X amount in revenue, etc.
• Your legal business Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry or market analysis, you need to provide an overview of the tea shop industry. While this may seem unnecessary, it serves multiple purposes.

First, researching the tea shop industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.

The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your tea shop business plan:

• How big is the tea shop industry (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential target market for your tea shop? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your tea shop business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individuals, schools, families, and corporations.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of tea shop you operate. Clearly, individuals would respond to different marketing promotions than corporations, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.

Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.

Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other tea shops.

Indirect competitors are other options that customers have to purchase from that aren’t directly competing with your product or service. This includes other types of cafes, beverage retailers, or coffee shops. You need to mention such competition as well.

For each such competitor, provide an overview of their business and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as

• What types of customers do they serve?
• What type of tea shop are they?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you make it easier for your customers to acquire your products or services?
• Will you offer products or services that your competition doesn’t?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

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Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a tea shop business plan, your marketing strategy should include the following:

Product : In the product section, you should reiterate the type of tea shop that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you provide loose leaf tea, in-shop dining, or tea accessories?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the products and/or services you offer and their prices.

Place : Place refers to the site of your tea shop. Document where your company is situated and mention how the site will impact your success. For example, is your tea shop located in a busy retail district, a business district, a standalone shop, or purely online? Discuss how your site might be the ideal location for your customers.

Promotions : The final part of your tea shop marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:

• Advertise in local papers, radio stations and/or magazines
• Reach out to websites
• Distribute flyers
• Engage in email marketing
• Advertise on social media platforms
• Improve the SEO (search engine optimization) on your website for targeted keywords

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your tea shop, including answering calls, greeting customers, taking orders, collecting payments, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to acquire your Xth customer, or when you hope to reach $X in revenue. It could also be when you expect to expand your tea shop to a new city.  

Management Team

To demonstrate your tea shop’s potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally, you and/or your team members have direct experience in managing tea shops. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing a tea shop or successfully running a small medical practice.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.

Income Statement

An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenue and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you expect to serve 20 customers per day, and will you offer discounts for repeat customers? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets

Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your tea shop, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your cash flow statement will help determine how much money you need to start or grow your business, and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a tea shop:

• Cost of equipment and supplies
• Payroll or salaries paid to staff
• Business insurance
• Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your tea shop location lease or testimonials from happy customers.

Writing a business plan for your tea shop is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the tea shop industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful tea shop.  

Tea Shop Business Plan FAQs

What is the easiest way to complete my tea shop business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily write your tea shop business plan.

How Do You Start a Tea Shop Business?

Starting a tea shop business is easy with these 14 steps:

• Choose the Name for Your Tea Shop Business
• Create Your Tea Shop Business Plan
• Choose the Legal Structure for Your Tea Shop Business
• Secure Startup Funding for Your Tea Shop Business (If Needed)
• Secure a Location for Your Business
• Register Your Tea Shop Business with the IRS
• Open a Business Bank Account
• Get a Business Credit Card
• Get the Required Business Licenses and Permits
• Get Business Insurance for Your Tea Shop Business
• Buy or Lease the Right Tea Shop Business Equipment
• Develop Your Tea Shop Business Marketing Materials
• Purchase and Setup the Software Needed to Run Your Tea Shop Business
• Open for Business

Learn more about how to start your own tea shop business .

Don’t you wish there was a faster, easier way to finish your Tea Shop business plan?

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success. Click here to see how Growthink’s business plan advisors can give you a winning business plan.  

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