Lauching and developing a new product and brand

It will serve fresh beverage like orange juice, sugar-cane juice, lemon juice and nutritious dish or convenient foods such as Vietnamese fast foods, Euro foods, US fast foods in the best

Confirmed by:

Hoàng Văn Việt

I would like to acknowledge that this project has been done by my self with support and help of my tutor and mentor

I would like to express my special thanks to Dr Trần Anh Tuấn and Professor Jean Pierre Baeyens – the co-Directors of the MBMM program for the establishment of this program I am particularly indebted to all the professors of Solvay Business School and of Ho Chi Minh City Open University who were so devoted to deliver their knowledge, experience, ideas and suggestions during our courses Also many thanks to the coordinators of the program: Ms Bùi Phan Bảo Trân and Mr Serge Bywalski, who have stimulated and advised us during the two years of the course

I also owe a great deal to my tutor – Pr Dr Hồ Đức Hùng – the Director of Institute of Development Economics Research – University of Economics Ho Chi Minh City who has worked so hard to help me to finish this final project I

am so grateful to Ms Hạnh – Branch manager of Trung Nguyen Company who has helped and supported me to complete my final duty

Sincerely thanks to my family who gave me lots of material and moral support Without their love and support, I cannot complete this useful program

Final Project Maker

Hoàng Văn Việt

Ho Chi Minh City, date………/………/………

(1) The Topic that the Author selects for his M.B.A thesis obviously has both meanings of current events and values of the theoretical research

(2) The Structure of the thesis is logical and compatible with the topic title already specified Meanwhile, this also target at answering the objectives that mentioned in page 3 So based on these objectives I think the thesis has provided the main fundamental solution for these posed objectives

But the data has been more than required classified into a set of quantificatious and underlying themes So the paper moderately discuss the sources of omissions and biases arising from interview / data collectors and the conditions

in which the data was collected

The thesis, on the whole, is eligible for the M.B.A Degree

Commenting Tutor:

Pr Dr Hồ Đức Hùng

Ho Chi Minh City, date 24 / 05 / 07

(1) The Topic that the Author selects for his M.B.A thesis obviously has both meanings of current events and values of the theoretical research

(2) The Structure of the thesis is logical and compatible with the topic title already specified Meanwhile, this also target at answering the objectives that mentioned in page 3 So based on these objectives I think the thesis has provided the main fundamental solution for these posed objectives

But the data has been more than required classified into a set of quantificatious and underlying themes So the paper moderately discuss the sources of omissions and biases arising from interview / data collectors and the conditions

in which the data was collected

The thesis, on the whole, is eligible for the M.B.A Degree

The project mark: ……… /40

Commenting Tutor:

Pr Dr Hồ Đức Hùng

1 EXECUTIVE SUMMARY 1

1.1 Objectives 3

1.1.1 Introduction of the topic 3

1.1.2 Problem statement .3

1.1.3 Rational of the research 3

1.2 Mission 4 1.3 Keys to success .4

1.4 Scope and limitation of research study .4

1.5 Research methodology 4

2 COMPANY SUMMARY .4

2.1 Company ownership 4

2.2 Start – up summary .4

2.3 Company Location and Facilities 5

3 PRODUCTS 5 3.1 Product Description 5

3.1.1 Description of foods .5

3.1.2 Description of drinks .6

3.2 Competitive comparison 6

3.3 Material Sources 7

3.4 Technology 7

3.5 Future Products 7

4 MARKET ANALYSIS SUMMARY 7

4.1 Market segmentation 7

4.2 Target Market Segment Strategy 8

4.2.1 Target Market needs .8

4.2.2 Target Markets trends .9

4.3.1 Competition and Buying patterns 10

4.3.2 Main competitors and comparison 10

4.3.2.1 International fast food chains .10

4.3.2.2 Vietnamese national fast food brands 11

4.3.2.3 Vietnamese traditional restaurant 11

4.3.2.4 Specialty coffee shops .12

5 STRATEGY AND IMPLEMENTATION SUMMARY 12

5.1 Cafes: design, locations and atmosphere strategy 12

5.2 Service Style Strategy 13

5.3 Products Development Strategy 13

5.4 Marketing and Sales Strategy 13

5.4.1 Marketing strategy 13

5.4.1.1 Positioning 14

5.4.1.2 Pricing 14

5.4.1.3 Distribution strategy 15

5.4.1.4 Marketing programs 15

5.4.1.5 Brand: “HOME” 15

5.4.1.5.1 Brand name: “CNM – Convenient & Nutritious Meal” .16

5.4.1.5.2 Slogan: “I LOVE YOU!” .16

5.4.1.5.3 Distinctive Logo .17

5.4.1.5.4 Mobile Cafes 17

5.4.1.5.5 Advertising and promotion .18

5.4.2 Sales strategy .18

5.4.2.1 Sales forecast .18

5.4.2.2 Sales programs .18

5.4.2.2.1 Meal Ticket or Leaflets 18

5.4.2.2.2 Regular or Special Guest Coupons .19

5.4.2.2.3 Customer list .19

5.5 Mobile cafes strategy: 20

6 MANAGEMENT SUMMARY 21

6.1 Organizational structure 21

6.2 Management team relations and responsibilities 21

6.3 Personnel plan 21

7 FINANCIAL PLAN .22

7.1 Important assumptions and resources 22

7.2 Key financial indicators 22

7.3 Break-even analysis 22

7.3.1 Monthly break-even: 22

7.3.2 Cafe break-even: .23

7.4 Projected Profit & Loss 23

7.5 Projected cash flow 24

7.6 Business ratios 24

7.7 Exit strategy 25

7.7.1 Scenario One 25

7.7.2 Scenario Two .25

8 CONCLUSION 25

APPENDIX

Appendix 1: Questionnaire & Research Result

Appendix 2: Some Vietnamese Convenient Food Menus

Appendix 3: Some Articles about Convenient Food

REFERENCE

1

HOME is a brand name of “Convenient and Nutritious Meal” It will serve fresh beverage like orange juice, sugar-cane juice, lemon juice and nutritious dish or convenient foods such as Vietnamese fast foods, Euro foods, US fast foods in the best service and time-efficient way:

HOME will offer good quality products and high class service in the industry At first, HOME will focus on office customers or people around there, in the next steps HOME will open more cafes in heavy traffic areas All of these products or services are for refreshing their people by nutritious and convenient meals after their hard working and prepare for their next effort It will produce and sell only natural, fresh beverage and fine, green meals Moreover, it also supplies some fast food in some special cases HOME also serves some modern fast foods like KFC, Lotteria, Chicken Town and so on

Ho Chi Minh is a tropical city, this will easily cause people feeling hot and tired Especially, when people travel around by motorcycles they will be very uncomfortable, hungry, thirsty so they will feel very tired to have lunch or dinner after their hard working HOME will focus on refreshing them with fine and natural products in fresh and cool environment so that after enjoining meal in HOME they will have more energy and interest to work or study

HOME will concentrate on serving three main target markets: First, people who are working in modern and professional companies, this requires them to make real effort to work hard in offices or travel around So after their hard working, they need

a place for their refreshment and energizing Of course, these people have a good income (more than 4 millions VND) and they are ready to pay well if there are some good places to refresh them best in their short break time Second, HOME tries to satisfy the consumers who are with their modern and young family They have good

jobs, high salary, active children and they have not much time to prepare a complete meal at their home or they want to have an outside atmosphere so they take their family to HOME to enjoin a family-like and fresh meal Third, HOME offers door to door service or using mobile cafes to serve events or organizations These door to door services are not only for sales but also good direct marketing tools When its mobile cafe is moving around in the city it will attract much of attention from surrounding people This is quite new service and business in Viet Nam and HOME will develop it as one of the most important advantages

HOME will firstly penetrate the office customers or young working people by looking for a places where are near business centers with many offices and companies around After that, HOME will develop its brands in heavy traffic streets

or crowded residential areas in order to attract their young family customers

In order to create a famous brand name, HOME will focus on two successful factors:

The first one: To offer different, high quality products and service: HOME will serve Vietnamese convenient food in new style It hopes to introduce and develop the meals in over the world Food is sensitive and competitive industry Its customers are quite difficult and also loyal In order to attract more customers, HOME has to research and develop a new taste and style

Second one: To set up an effective and outstanding marketing program: In the long term marketing strategy, HOME will have strong and different from its competitors One of the most important marketing programs is that HOME will corporate with other cafes as many as possible, especially corporation with famous coffee companies so that it can sell its products by delivery or prepare availably in the places Second of marketing program, HOME will focus on direct marketing HOME will also corporate with some organization to make events and support for young and children generation

About finance; HOME will open only one cafe so it will not require much of first investment HOME plans to use 572.000.000VND (35.000USD) for initial investment

to carry out the business without any need for equity or dept investment After this first success HOME will start calling for outside capital for enlarging program First it will call for some support of capital from some capital organization, banks or investors Second, it will corporate with other point of coffee sales or franchising

How about employees matter? There are some positions which are the most important for company as the cook, marketing and business managers At first, HOME has to find out talented people for these positions and consider how to help them develop and devote most their ability to the company HOME can share a part of company for them so that they will understand that they are working for themselves Other positions, their managers will know how to manage, develop and train them How does company start and develop? After the first one is successful, HOME will open its about more 10 Cafes in Ho Chi Minh City in next two years, these ones will

be placed in central streets and be allocated reasonably Each of these Cafes will be responsible to take care of its market Besides that, HOME also develops mobile cafes which would serve exhibitions, events or entertainment centers like parks, stadiums or central residential areas Mobile cafes can deliver to customer cafes or door to door As plan, HOME will have 5 mobiles cafes in two years, and the teams will start after the preparation time (first 06 months)

Objectives

With a purpose to introduce a menu of foods and drink which are good for both refreshment and health The Home will introduce Vietnamese traditional foods and develop modern foods to in place of the present fast food which are considering bad for health The Home have long term objective to expand these products and brand not only in over Viet Nam but on the world also

There are some difficulties for the new business when it starts business:

i Products and technologies in this industry

ii Competition and market share iii Experience in management and marketing is not much

Viet Nam is developing quickly and the modern generation has become more active and busy They have no time for time-taking meal that is why fast food companies are more and more popular in Viet Nam Anyway, there is a problem that people are worried about their health, feeling or their convenience and nutrition

HOME will have three main missions for customers and society:

provide customers the finest quality and the freshest meal in the most convenient way

building up a good and wide awareness in its clients This mission is related to sales and marketing strategy

building a scholarship budget for poor students It will be difficult to convince customers to accept and joint the program

With above three missions, HOME also has three keys to success But the most important here is how to achieve the objectives and perform the missions Other good advantage which can bring much of benefit and create a strong successful factor

The research limitation is in Ho Chi Minh City in the first period After this time, HOME will develop the research in much larger area in Viet Nam and over the world

The research uses analytical method, audiovisual method, statistical method, analytical method, scientific method in order to analyze and synthesize the research

2

“

HOME’s first investment total is about 572.000.000VND, most of these funds will

be used to build the first facility, pay deposits, and provide capacity for six months of operating expenses Another part will be used for the initial inventory and other on-time expenses

Unit: 1000VND

I

8 Website Development & Hosting 12.000

9 Marketing and promotion 24.000

IV

A

HOME will open the first cafe in central street in District 1 where is near office buildings or at least it should be in a heavy traffic two-way street like Nguyen Thi Minh Khai, Vo Van Tan, Hai Ba Trung and so on in fresh and clean environment

3

In the cafe system, HOME will have three main food groups: first is food with water (or water separate) such as Pho, Bun Bo, Hu Tieu Each of meals will have different part and nutrition so that it can satisfy customer with different tastes and nutrition The second group is including Vietnamese and foreign daily meal with rice, bread or something like that And the third group consists of fast food in Viet Nam or foreign ones Each of group must have enough parts to supply nutrition, vitamin or any other natural ones, and they will have different taste, smell and feeling so that customers can select a meal which satisfy best their need and feeling

After the preparation time, HOME will have mobile cafe, delivery door to door, supply to event or organizations This means that, HOME has to have more research how to keep their products in the finest condition or status after a long distance of moving, and how to save most cost and avoid any bad service

HOME’s main drinks are from nature like juice drink, vitamin drink It will produce

by them selves At first, the production may be small so HOME has to by from the market When it expands production it will have coordination and relationship with some farms to supply the natural and fresh fruits for their system Besides the main drinks, it also serves coffee, tea or other instant drink like coke, soda, soft beer

HOME serves Vietnamese traditional meal and modern convenient food including offering natural and fresh drink in frinedly and professional way to bring its customer refreshment and pleasant In Vietnamese traditional meal market, they have many competitors as Pho 24, Pho 5 Sao, Pho 2000, Com Viet Nam, Com Thuong Hai and hundred of cafes and restaurants In modern convenient food, its competitors are KFC, Lotteria, Rita and so on In natural drink, it has some new and active competitors are Ong Tien, Nuoc Mia Sach, Tra Chan Chau and other cafes Moreover, it has some internationally competitive juice manufacturers like Tribeco, Coca-Cola, Pepsi, Kinh Do, Trung Nguyen and many other local producers

Most of the Vietnamese traditional food restaurants serve a large range of dish but their service is still traditional For some professional brand name like Pho 24 they sell only noodle Pho 2000, Pho 5 Sao… they focus on tourists and rich market mainly HOME’s long term competitors are KFC, Lotteria, Rita or more international fast food brand names HOME should look for a different path to exist and develop HOME will serve Vietnamese traditional meal and natural drink to avoid them and supply the same fast food to attract more clients Moreover, fast food has got many complaint and bad reputation in over the world recently This may be HOME’s advantage to compete with them

At first, HOME will purchase its material from supermarket or big wholesales which are reliable for the initial cafe When it becomes a system HOME will look for original resources in farms or gardens

This is really a new and important factor and it requires much more research The main directions HOME needs to learn: First, how to keep the material and product in the finest condition and status in stock Second is how to produce the best quality products And third is how to deliver its products to customers fastest and safest

In the first period, HOME will offer a larger range of meal including fast food also Anyway, it will change step by step and focus on natural products which are good for health, development and refreshment of people, especially for young generation HOME will get more information in the market, and listen to customers’ suggestion or ideas day by day to improve its products and service to satisfy most its clients

4

HOME has three segments; all of these are related to modern and active society: Business customer market; Family client market; Event and organization market The world is developing quickly people become busier and busier, especially when they are working in international and modern environment But they also pay more attention to their daily meal which does not only supply energy but also offer them a good feeling and refreshment So the first segment of HOME will be working people who are in modern and pressure environments with good income We call them as business customers How are their behaviors? How potential this segment is? In present society, these people have less time for break or meal they even spend lunch

or break time for business or meeting They also need a convenient meal which is good for their health and provide enough necessary vitamin and nutrition for their work and refreshment So they need a place which can satisfy both of their requirements HOME define them as business customer because they come there for break for their work or to do business These people should have good income about more than 300USD/month And they are ready to spend 1-2USD for lunch or break time: “As research: at present in Ho Chi Minh City, the average price of a lunch meal

is about 20.000VND Usually, each people pay 20.000-30.000VND for their lunch and coffee on time” Customer behavior: they are in modern business and professional so they also require from HOME professional service, fine and natural meal, cool and

fresh environment and view Moreover, most of them spend lunch in a good cafe They spend at lest 5 times per week In Ho Chi Minh City, this segment is going up quickly so it is really a potential segment.

HOME’s second segment is family market They are also young and modern families; they have less time to prepare meal at their home so they take their family

to HOME to have a quick meal and enjoin outside environment This market also includes teenage with their friends In some special occasions they gather together and find a place for meal, drink and relax together In order to satisfy these customer HOME not only offer fine and natural meal but also create warm and pleasant environment to improve their relationship and love Family target are people who want to share their love and heart together with their family or friends

The next step, HOME will serve new markets which are events and organizations With mobile cafes system, HOME will focus on this segment including events, exhibitions, conferences, organizations and schools Mobile cafes are quite new in Viet Nam market so it will take much time and effort to train customers to get familiar with this Every year, there are hundred events, exhibitions and conferences

in Ho Chi Minh City so this is really potential market

Ho Chi Minh City in particular and Viet Nam in general is developing quickly Young and modern generation become busier and more active so they need a place where they can get a refreshment and nutrition in a convenient way They more and more understand that healthy food is very important; they should not think of taste, fastness only So the market of a fast food with nutritious parts in professional service will increase quickly

Most people in over the world like fast food from a famous brand such as KFC, Lotteria, Jollibee, Dilma, Chicken Town, Rita Ho Chi Minh City or Viet Nam is also the same; fast food is becoming more and more popular Fast food is very convenient for busy people but it is really not good for consumers’ health and make user become more and more fat Moreover, Vietnamese people have different taste and hobbies They also usually eat Vietnamese traditional foods These foods are good for health and fresh but it usually takes much time to prepare and it is a lingering meal Surely,

in this modern and active society, people do not want to spend so much time for their lunch or break They want to have a fine and healthy meal in convenient and fresh environment HOME will try to satisfy both of their demands

Ho Chi Minh City is center of business; number of company grows very fast And there are more and more young and modern people working in the environments Their eating habits are also becoming changed day by day and fast food has become more and more popular and developed in Viet Nam Example: KFC Viet Nam, in

2006 they have totally 17 restaurants in Viet Nam after 10 years here, its growth in

2005 is 80% of sales; as their plan they will open much more points in Viet Nam and have about over 100 restaurants in 2010 (VNECONOMY updated: 03/04/2006 – Saigon times) Lotteria has had 9 points in 2006 and it has a plan to open more in coming time Especially, McDonald, the biggest corporate fast food in American, has made plan to come to Viet Nam after Viet Nam becomes WTO member

Besides above international fast food companies, there have appeared some Vietnamese professional brand names in this field as Pho 24, Pho 5 Sao, Pho 2000, Rita There are also hundred of Vietnamese traditional fast food shops like Hoang Ty, Hong Phat, Nhu Lan bread, Com Viet Nam, Com Minh Duc, Sai Gon bread

Moreover, most of specialty coffee shops in Ho Chi Minh City service both fast food and drink At present there are thousand of cafes like this in Ho Chi Minh, they have a very big advantages of very good view and wonderful atmosphere like Window Cafe, Dau An Cafe, Chot Nho Cafe, Panoma Cafe, Manna Cafe, Bo Gia Ice Cream, CIAO Cafe, Star Cafe, Trung Nguyen Cafe

Many big international food groups have had research and investment in Ho Chi Minh City in particular and in Viet Nam in general There are also more and more Vietnamese cafes and food companies open to serve HOME’s target market This show that Ho this is a potential market and food industry is high – profit field All of them have created a very severe fighting and competition in the potential market HOME has decided to joint in the severely competitive segment so it has to do much

to prepare for its unfair fighting with other big guys Anyway, HOME will try to avoid any direct fighting and look for its own path to exist and develop

HOME also pays much of attention on setting up more and deep relationship with suppliers, customers and competitors also This will be one of the most important business strategies in development of HOME

In business and family segments, HOME has four main competition groups in Ho Chi Minh City market Each of them has their own advantages which HOME must invest much of time and money to study In the event and organization market with HOME mobile cafes, there are not many companies Anyway, it is clear that in the near future there will be many big brands in the industry Its main competitors in this market are local mobile sales or some Vietnamese

restaurants, they have advantages of products

First group, they are international companies

coming from foreign countries These competitors

have a very strong capital and they are ready to use

money to kill any small new entrants and potential

competitors They also are very experienced in food industry and service management Especially, their brands are one of unconquerable factors such as KFC, Lotteria or McDonald So it seems to be impractical for HOME to compete directly with them “KFC is the leader in fast food industry in Ho Chi Minh City with nearly

20 points and a plan of opening 100 cafes in 2010 in Viet Nam”

Even they are strong competitors with power in financial, experiences in products and management, a global brand name HOME believes it has a significant competitive advantage over these chains because of following benefits:

service

• Community benefit

• Mobile cafes

• Fresh and nutritious product

• More large dish menu

• Vietnamese traditional delicious meals

They are new entrants in the market with strong development and impressive marketing and advertising program such as Pho 24, Pho 5 Sao, 4 Lunch, Rita They are professional and direct competitors with strong even they can be weaker than the first group Pho 24 has a plan to open about 100 restaurants in over Viet Nam and also in

other countries like Japan, Indonesia, Philippines and United States They also have mush of advantages of capital and management experiences But they have a disadvantage which HOME can serve in the empty segment: they offer Pho only, and their target market seems to serve top high-class only HOME will produce different products and create marketing programs:

• More large menu

• Direct and active marketing

target

• Community activities

• Differentiated service and styles

• HOME has mobile cafe systems

• A better price list

Vietnamese people are very good at cooking and they have many traditional meals such as Hoang Ty, Hong Phat, Pho Hoa and so on Some of some are quite famous in the market Their strong advantage is that they are much of experiences in products and long term experiences They have many regular customers or nearly their member Anyway, they do not have much of marketing or sales program and they seems not to plan to be national or international Anyway, HOME has to study much product experience from them HOME’s main advantage in comparison with them is effective sales and marketing program HOME also try to focus on a different segment:

• Direct and active marketing

market

• Community activities

• Differentiated service and styles

• HOME has mobile cafe systems

• Convenient cafes

Ho Chi Minh is also a city of coffee Most of people in this city use coffee every day So specialty coffee shop is very popular here There are thousand of coffee shops in Ho Chi Minh City They specialize in offering coffee but they also serve fast foods They have a very good advantage of atmosphere and view Customers are easy to be attracted by these factors They are quite direct and hard competitors for HOME Anyway, HOME specializes in meal mainly, it is some different Moreover, HOME will be a professional and national system so its target and strategy will be different:

Special in meals

Community activities

HOME has mobile cafe systems

Convenient meals

5

How to create a different and impressive style is one of the most important missions

of HOME First, it is important tool to attract passing customers This brings customers

a first impressive and bring them feeling of being pleasant or unpleasant It means that it just decides the first value of HOME and if the customers come back next time and become a regular members of HOME or not Second, it makes HOME difference and brand name Each factors in design such as lines, colors, lighting, styles, view, atmosphere, directions will devote part in creating HOME brand So it is extremely important to have the most suitable and convenient view or design This will be the first and also the most important strategy of HOME when open the first cafe

Where to be located is also very important, especially for the first cafe HOME must find out a location in trade and office center where there are many companies and staffs It must be in a heavy street and to visible The area must be large enough

to create a differentiated space and it must be very open and fresh

Service is one of advantages of HOME in the market So HOME will build up a combination service style between internationalization and tradition which is specific and impressive Every detail such as uniform, hat, greeting, smiling, speaking, order, asking, recommendation and so on will be take care very carefully so that it is suitable for convenient and fresh environment and HOME will become a destination

of young and modern generation Moreover, HOME has to create some thing specific and impressive style in service such as consultancy about health, nutrition, information; taking notes of regular customers; getting advice from customer openly with heartfelt gratitude It is necessary to learn and get experience from many other competitors and customers The improvement, updating and change of service are essential for HOME service to have a better and better style

In comparison with Vietnamese traditional competitors, product is a disadvantage for HOME But for other three competition groups, product is the most important successful factors of HOME It will focus on food and drink which not only bring customer convenience, refreshment but also supply them with nutrition, vitamin for their health and development Especially, in HOME long term plan, it will develop its business in oversea At that time, the research and development of products are essential for HOME

Marketing strategy is one of the strongest advantages of HOME It will launch many effective marketing programs to create HOME brand name and to compensate for disadvantages of HOME about products, experience, finances and so on Its marketing strategy will focus on mainly direct marketing to try to avoid any direct fighting with other strong competitors if there are not complete preparations for success HOME long-term target is to become a national and international brand so marketing is not only important but also long-term:

The first strategy in marketing program is positioning In order to define what and how to build up other strategies such as product strategy, advertising strategy, cafes strategy, price strategy HOME has to identify its target market and research for information about their characteristics, behaviors, income portion for meal and drink, habit, hobbies and so on

HOME will position it self in medium to high class (from common and professional people to more high class ones) They are modern and active generations who have good income and less time for long meal They are ready to pay for their good meal but also consider if the meal is worthy or not These people would like to have convenient meal (fast food) but they also pay attention to nutrition and health matter

In Ho Chi Minh City, there are not many cafes or brands name in this position The international brands focus on fast food mainly and customers also consider them as industrial foods For the Vietnamese international brand like Pho 24, Pho 5 Sao they seem to focus on the top high class customers They offer the same product and service but the price is much higher

HOME will build a price strategy based on positioning In positioning strategy, HOME is set in medium to high class market, and its main customers are young and modern generation This target market will not accept a high price because they come here for convenient and fresh meal, not for entertainment or for guest meal So they will consider carefully the real value of product and service and compare HOME value with HOME’s competitors So if customers see that HOME value is lower than its competitors there will be a danger that HOME loss the customers On the contrary, HOME will attract more customers from their introduction by marketing with of words

of mouth Even if HOME has a too lower price than customers expect they will think that this brand is low class This will make young and proud clients unhappy with their appearance in HOME

Moreover, HOME will loss profit if it set up a too low price list Especially, it must spend much of money for the first investment and to make product and market research, for advertising and sales promotion in first period

Based on this, HOME has to consider carefully and research widely to build up the best price structure In comparison with HOME’s four competition group, HOME’s price list will be lower than international group and Vietnamese international group but it will be higher than Vietnamese traditional group and cafes specialty group (there may be an exchange between international group and cafes group)

For cafes, customers will get their meals at the places so distribution is not very important Maybe, it is related to service so HOME will have some preparation for how to bring to customers Anyway, related to cafes, HOME will open at least 15 ones in Ho Chi Minh City in long term strategy They will be allocated reasonably so that any clients who want to have meals in HOME can come there in the best time and distance Delivery strategy is really important for events and organizations customers We can use mobile cafes to serve this segment or not And how to deliver

to customers in the best time and keep the products in the finest conditions

HOME’s events and organizations customers are schools, companies, businesses, events, exhibitions and so on HOME has to answer the following questions: If it can deliver with only one set? Or how is minimum quantity? How is the maximum

distance? How about the cost of delivery? How to discount for big quantity? How is about technology, facilities and people?

“HOME” means a family A place you have peace of mind and feel happy and comfortable when you come there When you joint in HOME you will be taken care

as you are at your own home HOME hopes that it can bring every customer the best feeling And whenever they are so busy to prepare a good meal at their home they can enjoin an open meal with their family at HOME in place of their home Usually, Vietnamese people have thinking that having meal outside is a not good meal for their atmosphere, for their health or their money HOME will try to compensate for these disadvantages or misunderstandings Whenever, they joint with HOME they will feel the same with when they are at HOME; and their meal will be prepared carefully in every detail so that HOME customers will have the most convenient and nutritious meals The second reason to choose the brand is for long term strategy and international business I would like to choose a brand which is easy to remember and impressive It is in English so it can be used in every countries and the word may be not affect any cultures, regions or ethnic matters In general, it can become an international brand for food industry

In Viet Nam market, there have been many fast food brand names like KFC, Lotteria, Chicken Town, Rita or Dilma, Pho 24 and so on These brand names have become popular to Vietnamese customers and some of them are international

CNM will also build up a brand name which will be popular for Vietnamese customer and become an international brand name in long term

In the long term plan, CNM will be not only a cafe or restaurant but also a group of growing farm, processing food, and selling meal So CNM will have a brand name as

“CNM” to supply and focus on cafes and restaurants industry This name will be built with a purpose to remind people about a meal which bring them convenience, comfort and goodness for their health

So far, most of fast food brand names serve their customer with industrial products which seem to be bad for people’s health Even if fast food is more and more popular and used but with two following factors it will get some bad reputation and reduce

sales: first, it is industrial or means not natural and second is that it is not good for health CNM hopes to fight with these big guys by this tool It will try to bring customers a convenient meal it means a fast meal but CNM show that its products are not only convenient but also nutritious, the products are natural and good for health It

is also very short and easy to remember So for the long term strategy, CNM hopes to develop this brand name to become international one

Slogan is one of the most important of marketing program HOME has to create a slogan which satisfy the following standards:

It must be outstanding, impressive

The meaning can describe all the factor and contents of HOME

It is easy to remember and popular to every ones

HOME decides to choose the sentence “I LOVE YOU!” for its slogan This sensitive word can satisfy the above requests:

It is very impressive and outstanding Surely, any people who hear these words will

be attracted and surprised They are the most wonderful words and every people have desire to hear them any time

This sentence can describe well the messages which HOME wish to transfer to its customers: “My valued clients, I LOVE YOU” Moreover, this also help its customer

to express their love and heart to their family, their lover, friends or any partners who they take to HOME “Love” is the most valuable treasure which all people want to have even they are rich or poor, old or young

Obviously, it is the most popular in human being dictionary and easy to remember

In conclusion, this is very special slogan which can help HOME to have a words of mouth marketing It also has a disadvantage It can be too sensitive in some culture, region and ethics There may be many strict customers who do not accept a so feeling-open slogan The most serious result is that there will be some bad reputation Anyway, I trust that this slogan is the best one and it will become more and more loved by customers or even strict people because every people need love as a saying

“nobody can live without love”

Logo is also one of the most important of marketing program, it must also satisfy the following standards:

It must be outstanding, impressive

The meaning can describe all the factor and contents of HOME

It is easy to remember

Mobile cafe is an important and new marketing tool in Viet Nam HOME will develop this system for sales and marketing target Anyway, it will be analyze in detail in Mobile Cafe part

Promotion is one of the most important tools in marketing strategy in the long term strategy Anyway, in the first period, HOME will not pay much money and effort for promotion but for sales promotion or sales program to increase sales and advertising also In the first period, HOME will focus on direct marketing mainly This is the time HOME prepare for the next step to build up and develop a brand in food industry Its marketing promotion is to get customers’ awareness of this kind of product and service The budget for this period is 100USD per month

In the long term, HOME will have a continuous budget for strong marketing program It will have a portion of sales investing for marketing and promotion The planed portion is about 5% of turnover

The main media which HOME will consider to use most are some famous magazines such as Sai Gon Times, Tiep Thi Gia Dinh, Marketing, Doanh Nhan Magazine and so on HOME tries to take the most advantages from its relationship to look for support of media It also joints and organizes events to make attraction from magazines, newspaper, or others HOME also uses public internet and yellow page for introduction activities

In the first cafe, HOME hopes to have revenue of 1.8 million VND It means that a daily average sales is 5 million VND (this is the average sales of a medium cafe as observation) or 150 million per month After six month to one year, when HOME has become much better

At first, HOME will deliver Tickets for introduction and discount to all potential customers There are two purposes for this program First, HOME will introduce potential customers for the opening of a new style cafe which can satisfy them much better than the present ones Second, on the occasion of opening, HOME would like

to offer a discount for the first coming customers

In the first cafe, the quantity of Tickets will be suitable for the present capacity And the discounts are some products or service valued about 5 to 10% of fee This discount applied for all tickets and leaflets also

When HOME open more cafes and it becomes a system There will a difference between Tickets and Leaflets At this time, only Ticket is used for discounting and it will be sent officially to much more potential customers They can be officers or family Leaflet will be delivered in public area without selection

When customers come to HOME they will get other Coupon for regular or special guests This discount will offer more support for the customers They will have the ticket discount and get one more discount equal to 10% of meal for their next coming These coupons are also use at fundraising events for schools and corporate events

We will be giving away drink coupons as door prizes or awards This encourages the person to come in for their free beverage and bring a friend

In sales promotion, HOME will make a customer list through any resources First, HOME can use all of its relationship to collect information about potential customers Based on this information it will send invitation tickets to these clients Second, when

we offer Regular Coupons for customers we can collect their information for next invitation Or when every a customer has a suggestion or advice, HOME will offer him a gift, collecting information By using customer list, HOME hopes to have more and more regular customers and to improve its service and image

HOME will have three kinds of partners to build relationship or alliance For the long term, it will become one of the most important strategies First, HOME will have relation with suppliers This alliance is very important because it guarantees the finest quality and the best price for HOME’s input Second, HOME will make alliance with its customers such as events, exhibitions, companies or schools This coordination

helps HOME to develop sales The third one is its alliances with other specialty cafes HOME will cooperate with them to supply meals for their customers So that HOME can expand its brand name and increase sales

Milestones

The Milestone table reflect critical dates for launching the first Cafe and subsequent Cafes, development of the mobile units, building relationship and alliances, as well as occupying headquarters and start business in oversea HOME also defines our break-even month, our website launch and subsequent visitor interaction function, and other key markets that will help us measure our success, cost, capital in time and accomplishment

Plan & Preparation 15 June, 07 15 July, 07 $1.000 GM Com Open first Cafe 01 Aug, 07 22 Sep, 07 $45.000 GM Com First Break-even month 01 Dec, 07 31 Dec, 07 $0 GM Com Open Second Cafe 01 Mar, 08 01 May, 08 $50.000 GM Com Launch Website 20 May, 08 31 May, 08 $2.000 GM Com Open Third Cafe 01 Aug, 08 01 Sep, 08 $50.000 GM Com Receive First Mobile Unit 01 Nov, 08 15 Nov, 08 $30.000 GM Com Starting strong marketing program 15 Sep, 08 01 Dec, 09 $30.000 GM Com Open Fourth Cafe 01 Feb, 09 01 Mar, 09 $50.000 GM Com Receive Mobile Units 2 nd , 3 rd 01 June, 09 01 July, 09 $60.000 GM Com Occupy Headquarters 01 Sep, 09 22 Sep, 09 $15.000 GM Com Open Cafes 5 th , 6 th , 7 th 01 Dec, 09 31 Feb, 10 $150.000 GM Com Setting up alliances with partners 01 May, 10 01 Sep, 10 $20.000 GM Com Open more 13 cafes in Viet Nam 01 June, 10 01 Dec, 10 $650.000 GM Com Receive Mobile 7 Units 01 July, 10 01 Nov, 10 $210.000 GM Com Open more 30 cafes in Viet Nam 01 Feb, 11 01 Dec, 12 $1.500.000 GM Com Receive Mobile 5 Units 01 May, 11 01 Nov, 12 150.000 GM Com Open First Cafes in oversea 01 July, 11 01 Dec, 12 $125.000 GM Com

The Mobile cafes will be not only important sales facilities but also a key marketing tool It is important sales facility because in Viet Nam, events and organizations are very potential market, but there are not many companies use mobile cafes to serve this market It the near future this segment will develop very quickly and there are not much of competition so it seems to be attractive for HOME It is a key marketing tool because when they are moving it will attract people’s attention to transfer information

and messages more Moreover, the areas of operation of mobile cafes are much more large and active so it will be very useful for advertising For the important role of mobile cafe, the similarities between mobile cafes and cafes are first important The quality and prestige of mobile cafe must be paid much of attention

6

In order to minimize the cost and increase profit, HOME will try to simplify its organizational structure In the first period, its organization is flat with three departments which are Marketing and Sales, Production (or cook) and General Department (Accounting, Administrative ) Cook is also in charge of product developing Marketing & Sales dept must take care of service improvement When the business develops more, this structure will be reorganized to fit new condition

In the first period, the organization and business is still simple so this work is not important This will be considered carefully in long term plan But HOME will be a fresh, open and friendly environment for every people

HOME will try to use its relations for the first and second cafes like family company When the business develops more it will look for outside candidates At that time the business will require more talented people with many different experience and knowledge One of the most important strategy in personnel plan is that the VIP position will get some share in the system about 10% totally in order to courage them contribute to HOME When the system become big, CNM will be organized as head quarter and branch cafes as international company

7

The financial plan depends on general assumptions: Current Internet Rate,

Long-term Internet Rate, Tax Rate, Other related factors are not changed much

In the preparation time, HOME looks use its own money to reduce cost and avoid any financial risk When it has more experiences and open more business it will call for out site resources such as from relations, banks and share holders

In order to access HOME business and sales it has to have some financial indicators such as turnover, gross margin, operating expenses, inventory turnover, profit HOME will try to keep the sales of 3 million VND per day per cafe

In order to evaluate the business and set up the best strategy for next period, HOME will analyze its point at which its gross margin can compensate for the fixed cost, it is break-even As information from Trung Nguyen Cafe, HOME will compare some following dimensions Monthly costs include land cost but not include depreciation

8.000 28.000 20.000 150.000.000 7.500Unit 8.000 20.000 12.000 63.000.000 5.250Unit 105.000.000

f1: Sales or Turnover

f2: Total Cost

f3: Variable Cost

f4: Fixed Monthly Cost

So the break-even in HOME is 5.250 units

per month It means that every month

HOME has to sell 5.250 units or 175 units

per day And its sales must be more than

105.000.000VND per month or

3.500.000VND per day This is the level to

cover variable cost or monthly cost only

We will check the café break-even

X (Unit)

5.250

(f1) (f2)

(f3)

(f4)

If we include cafe depreciation and other cost such as marketing the break even will be changed This is also very important to analyze the market and set up a suitable sales and marketing strategy such as price, advertising, promotion As estimation, the first investment for fixed cost per one cafe is about 360.000.000VND CNM assume that this depreciation is flat and in two years So the monthly cost is about 10.000.000VND CNM also spend 10.000.000 per month for marketing and sales promotion So total monthly cost is 83.000.000VND

8.000 28.000 20.000 150.000.000 7.500Unit 8.000 20.000 12.000 83.000.000 6.917Unit 138.340.000

f’1: Sales or Turnover

f’2: Total Cost

f’3: Variable Cost

f’4: Fixed Monthly Cost

The above number is a minimum sale CNM has to reach to cover its cost and investment Of course, it has to plan to increase sale much more than that to develop the system in over Viet Nam and the world

Expansion strategy and marketing strategy depend on the effectiveness of HOME business In the first period, if HOME does business well and get profit it will be the background or motivation for next expansion or call for more investment And with

Y

X (Unit)

6.917

(f’1) (f’2)

(f’3)

(f’4)

So the break-even in HOME is 6.917 units

per month It means that every month

HOME has to sell 6.917 units or 231 units

per day And its sales must be more than

138.340.000VND per month or

4.610.000VND per day

the profit, HOME can spend more for marketing activities and advertising program

Of course, HOME will have many difficulty and cost for the first investment in this period Anyway, it is a practical time for HOME to get more information and experience in the industry, and in order to a check if this industry and this segment are potential or not Price strategy also has direct affect on profit & loss result When building up price strategy HOME has to balance between profit and market level As price strategy, HOME will build popular price level which is acceptable for its target market It is equal to the average price in cafe market

When the first cafe opens, CNM hopes to get sales of 200.000.000VND per month

or 2.400.000.000 per year with a margin of 50-60% For the next 10 cafes and five mobile cafes, from the second year the balance sheet estimates a net value of 15billion – 20billion VND, gross margin is about 50-60% and net profit of (10-15%) This rate can be not low in comparison with the other industry or other companies, the reason is that a big part of earning will be reinvest in product research and marketing program to increase the value of the brand name In the initial investment, this rate is low because: CNM must spend much of money for marketing and sales promotion; depreciation of fixed cost; developing and improving of product and management Especially, this is brand building period so the profit is not the first priority

This factor is very important for HOME business It helps the business more effective and swimming Some indicators related to cash flows such as operating capital, initial investment, inventory and so on Anyway, its first cafe is quite simple

in activities and organization so it can save much of cash About dept from sales, this business can get cash directly so there will not much of dept from sales Payment for purchase, it will try to cooperate with suppliers or make a close relation with them to get their support about payment or price In general, with about 50.000.000VND cash flow for one cafe all the time, HOME can operate well and effectively

The ratios show a plan for balanced, healthy growth HOME’s position within the industry is typical for a heavy growth startup company

HOME’ s return on net worth and net worth number differ from the Industry Profile due to the lack of overhead when compared to a typical walk-in cafe Cafe and

Mobile business model is lean thus allowing for increase return ratio and providing a lower net worth

HOME becomes extremely successful and it can operate as its plan or milestones It also has many requests from other communities for HOME operations to be opened there It can create a new segment and to be different from the other competitors This opens the door for franchising opportunity Anyway, as its first plan it will not do franchising but manage directly In this situation, HOME will have much of danger of strong competition or being bought by its competitors

The segment is not attractive enough to develop or get much profit or HOME can not create much of difference So HOME will become a normal cafe system as many other ones HOME will not get much profit and development if it is in this situation Anyway, it must accept the result or change its target At present, there are thousand

of cafes or restaurants like this, they are still operate well and get profit This is the scenario which HOME does not hope

8

This is a general structure to develop a new company and brand In its operation, there will be many matters happening which require much more research and considering When building this project, I have had general research by observation and collecting information I believe that my knowledge in this marketing course will bring me many advantages in marketing activities and management work comparison with my competitors Anyway, in order to be successful in marketing program I need

to have more practical case and experiences for applying these theories in my work One of the most important successful factors for HOME is product Products are one

of my disadvantages which require me and my partners to have much more study

1 Research in internet for related information: Foods and Meal:

And there are many other websites to search for information and picture

2 Tiếp Thị Gia Đình Magazine; (năm 2007 – nhiều số khác nhau)

3 Getting Information from Trung Nguyen: Ms Hanh – branch manager

4 Checking Information from Real Cafes: Window, Dau An, Chot Nho, Pho

24, Pho 5 Sao, KFC, Lotteria, Rita, Com Viet Nam, High Land and so on

5 Đài Truyền Hình Việt Nam (năm 2006); “Người Đương Thời”; Nhà Xuất Bản Trẻ

6 Nguyễn Quang Huy (2006); “Dưỡng Sinh và An Toàn Thực Phẩm”; Nhà xuất bản Văn Hóa Thông Tin

7 Mỹ Nga (Năm2006); “Kinh Doanh Nhà Hàng”; Nhà xuất bản lao Động Xã Hội

8 Lan Hương – Cẩm Vân (năm 2002); “Nghệ Thuật Nấu Aên Những Món Aên Ngon Bổ Dưỡng”; Nhà xuất bản Đồng Nai

9 Pr Fascal Khroouz; “Management Accounting & Control Subject”; Slide 34-54 in Cost Accounting part (Direct & Indirect cost; Break – Point)

10 Philip Kotler, Gary Armstrong, John Saunders, Veronica Wong:

“Principles of marketing”; P314-389 (Market segment & Positioning)

11 Pr JP Aerts; Business Marketing Planning

12 Michael R.Solomon: “Consumer Behavior – Buying, Having and Being”; P186-222 (Personality and Lifestyles)

13 Pr Claude Boffa (2007) “Distribution & Retailing” Subject