EXECUTIVE SUMMARY
Incline Village, Nevada, is a
typical North Lake Tahoe town. There
are a large number of second homes
and the economy is tourist based. It
has all of the amenities of any,
destination town, as well as, the
thrill of 24 hour gambling. What
Incline Village lacks is a true
pizza delivery business. We, the
partners of North Shore Pizza,
believe that now is the time to give
Incline what it wants.
In short, North Shore Pizza is
aiming to become Lake Tahoe's first
chain of delivery-only, pizza
restaurants covering the North
Tahoe/Truckee area. North Shore
Pizza wishes to raise $40,000 from a
private investor(s) to take
advantage of the opportunity
explained in the plan.
North Shore Pizza will become
Incline Village’s first, fast
and free delivered pizza. For quite
a while, Incline Village has had
only one pizza deliverer who charges
for a delivery which takes an
average of one hour. It is time the
residents and visitors of Incline
have access to a pizza that is made
fresh, hot and delivered free.
This is not a new concept. Every
town in the country has some form of
"Domino's". They all earn large
profits; the reason being the lack
of necessary space and overhead
required to operate a DELIVERY-ONLY
business.
Incline Village is not only ready
for a true pizza delivery operation,
Incline needs it. An operation that
will focus on quality, price and
convenience.
Money ($40,000) is needed by North
Shore Pizza to properly insure a
successful enterprise. How the money
will be used is covered in detail in
the balance of this business plan.
OBJECTIVES
We, the three partners of North
Shore Pizza, plan on being open by
December 15, 1993. A location will
be agreed upon by the end of
October, 1993. For the first
two years of operation, we will be
working managers drawing small
salaries. This will enable the
profits to be used for future
expansion. By 1996, new locations
will be investigated and will
require our total attention.
By 1998, we intend to have a
4 location pizza delivery chain
throughout the North Tahoe and
Truckee area. We are confident we
can do so because a) pizza delivery
is the #1 growth business in the
United States, b) the Tahoe/Truckee
area is rapidly growing, and c)
competition is virtually
non-existent.
In summary, the primary North Shore
Pizza objectives are as follows:
1. Achieve over $360,000. in
gross sales by end of first year of
operation.
2. Begin work on a second location
in the early part of 1996.
3. By 1998 we intend to have a
fourth location underway.
4. Be the number one growth bus1ness
1n the Tahoe/Truckee area.
MARKET ANALYSIS
Incline Village, like every town
in the Tahoe/Truckee area, has a
tourist based economy. The key to a
successful business in this
area is the ability to capture a
healthy local clientele.
Target market. The most recent
demographic study of Incline
Village/Crystal Bay shows a
permanent population of 9,193
growing at a rate of 6% annually
(Exhibit #1). During peak winter and
summer months,
the population more than doubles.
Here lies the bonus of a pizza
delivery business; Everyone of all
ages loves PIZZA! Our target market
is not a segment of the whole, but
indeed the whole. Every single
person in the Incline Village
area is a potential customer and a
target of our marketing campaign.
We conducted a market survey of some
of the Incline residents (Exhibit
#2). The results were not so
surprising...
- 76% do take-out food.
- 90% eat pizza.
- 38% would have pizza delivered 4
times per month. (theoretically,
14,000 pizzas per month)
- 31% would have pizza delivered
twice per month. . (theoretically,
6,000 pizzas per month)
Of course, the theoretical numbers
are excessive but good sign
non-the-less.
Intermediate influences. The
influences on the local market will
differ somewhat from those on the
tourist end. Our local market wants
quality pizza at a franchise price
and free, prompt delivery. The
tourist
market wants convenience above all
else. We can satisfy all of the ~
above needs which is explained in
detail later in the
business plan.
Competition. Present direct
competition is Mofo's pizza.
Primarily an eat-in pizza restaurant
that also delivers. They, at
present, are the only deliverers of
pizza in the Incline area.
Their hours of delivery are from 5pm
to 8pm. Delivery time averages one
hour and at a $2.00 surcharge. Your
average 3 item pizza, delivered,
costs over $17.00.
The indirect competition includes
Bar Bar Bar and China Chef. Bar Bar
Bar sells pizza at a very reasonable
price, but, they do not deliver and
you bake it yourself. Their dough is
pre-made and not hand tossed. The
china Chef is a Chinese restaurant
that delivers. Again, they charge
for delivery ($4.00), and only until
10pm nightly.
Any anticipated future competition
would be in the form of our
present competition playing
catch-up. We figure that free
delivery will be the first move by
the others. Then, possibly a price
war with Mofo's. Our advantages
being lower fixed expenses, a
superior ad campaign, a better pizza
and the best service.
As far as pricing, overall, our
prices will be comparative to ~ the
franchise delivery outfits that
operate in larger areas.
Along with low prices, free toppings
and free soda are effective sales
boosters (exhibit #3).
The break even analysis works out to
874 pizzas per month or $10,925 in
sales (exhibit #4).
PRODUCTION
Location.
There are two ways to go: Either
find a great location and build the
kitchen from scratch, or find an
existing kitchen to lease. Although
building a kitchen would allow for a
layout designed to our
specifications, this option is cost
prohibitive. Construction/renovation
costs would exceed $45,000. So, an
existing kitchen is the answer and
we have found one. This kitchen is
currently in limited use and is
located in one of Incline's drinking
establishments. The owner has agreed
to $1.80 per square foot in rent
($900/mo.) and will include garbage
pickup and water. utilities will be
based on use.
This location is on Hwy 28, the main
road through town, allowing for
excellent exposure. Specific terms
of the lease have yet to be
discussed.
Equipment.
The kitchen is fully equipped but
lacks a pizza oven, large mixer, and
a few misc. items. Also, we will
need to purchase a computer. The
total equipment costs will be
$9,800., which includes maintenance
expenses. (Exhibit #5)
Variable Items.
The variable costs involved are for
the flour, cheese, vegetables, etc.
Including the carry-out box, each
pizza will cost us
an average of $2.85 (Exhibit #6).
Quality control is important, so
each . topping will be weighed to
specified amounts. This will also
help in cost control.
MARKETING
In the pizza delivery business,
aggressive marketing is the key. For
the most part, having a pizza
delivered to your home is an impulse
purchase. So, a lot of reminders are
needed to trigger the need for a hot
pizza delivered whenever desired.
We will have a complete marketing
package which will include extensive
advertising, strong resort/condo
relations, computerized sales and
sponsorship of local sports teams &
events.
Advertising.
The advertising campaign will
consist of a mass mailing program
and print ads.
The mass mailing will cover every
box holder in Incline Village. There
will be a flyer style menu with a
circular, fridge magnet affixed to
the bottom portion (Exhibit #7). The
magnet will look like a pizza and
will have our name and phone number
printed on it. This will be the
perfect constant reminder. The
bottom 1/2 inch of the flyer will
always be blank. This will enable us
to stamp a coupon with one of four
different rubber stamps. Each stamp
will have a special deal or price
break written on it, saving on added
printing expenses. There will be
four mailings in the first year of
operation: The first, in December,
will announce our grand opening and
the others will occur in January,
July and August.
Corresponding with the mass mailing
dates, we will have an insert in the
Tahoe Bonanza, a local bi-weekly
newspaper with a distribution of
9,000. The insert will be similar to
that of the mailing but larger and
without magnet. Also, on a weekly
basis there will be 3 " print ads in
the Bonanza and the North Tahoe
Weekly, a free magazine dealing with
local events and news. The Weekly is
popular both with locals and
tourists, and has a distribution
from 18,000 to 30,000 (depending on
the season). (For advertising cost
break-down see exhibit #5)
Television ads have been considered
but have yet to be proven effective
in the area due to limited cable
subscribers.
Resort relations.
Our collective background in the
resort arena is going to be a big
plus with Incline's large number of
condo vacation rentals. Of course
the competition puts out menus at
the few well known, hotel type
establishments, but untapped are
management companies and Realtors
who deal in short term rentals.
These people cater to a large chunk
of the tourist trade of Incline. Our
strategy is to develop a
relationship with these businesses
by offering an incentive program of
free pizza and special, preferred
rates. If we treat them right they
will be more than happy to supply
their clients with our menus and I a
positive recommendation. This will
be an ongoing relationship that will
not only increase tourism sales but
boost our image within the
community.
Local relations.
This brings us to the sponsorship of
locals teams and events. of course,
the free publicity and local
recognition factor goes without
mentioning, but another benefit is a
positive image within the community.
If they know you... like you... they
will buy from you. This is true for
any small community and we plan to
take full advantage.
Computerized sales.
The computer is going to be one of
our great marketing tools. To
capture the office lunch crowd, we
will take orders by fax. Also, we
will advertise with the fax by
hooking up a modem to the computer.
Everyday at 11am the computer will
fax the day's specials with an order
form to be faxed back to us. We will
also have a complete database of our
customers. So complete, it will aid
in creating charge accounts for
local businesses and personalize our
relations with our customers. When
someone calls to order a pizza, and
11-he has done so at least once
before, we will have all the
information of this customer logged
by their phone number. Their name,
address, ordering history, preferred
method of payment, etc. will
instantly appear on the computer
screen. Here is an example of how a
typical order would be taken:
N.S.P.: Thanks for calling North
Shore Pizza, may I have your phone
number please?
Customer: 831-1234
N.S.P.: Thank-you. (the number is
entered and the customer's file
appears) Is this Mr. smith?
Customer: Why yes.
N.S.P. : Would you like to order
your usual large
pepperoni & olive pizza and charge
it to your visa card?
Customer: Sure, why not.
N.S.P.: Thanks for your order Mr.
Smith, we'll see you in I a little
while.
Also, the database will aid in
forecasting, accounting and
inventory.
Product features.
Of the great selling points our
product will have, hand tossed dough
and the secret sauce are going to be
the biggest. The other top selling
points are the price, free delivery,
available wheat dough and flavored
crust.
Everyone agrees that the best pizza
comes from out East: New York,
Chicago, Boston. As of yet, there
are not many great pizzas made in
this area. Along with our desire to
succeed, we are bringing tried and
true recipes into this business.
Recipes that have launched some of
the biggest pizzerias on the East
Coast.
Price is going to surprise many. Our
average large pizza will be priced I
between $13.00 -14.00, delivered.
The competition can not deliver a r
large pizza for less than $17.00.
Along with the great prices, there
is the free delivery. Until every
other deliverer follows suit, this
will be a large selling point.
More and more, people today want to
eat healthier. So, as an option, we
will offer wheat dough at no
additional charge. Along those same
lines, there will be an added choice
of five crust flavors. They will be
called "crust toppings": Garlic,
butter, cheese, poppy and sesame
seed. This I will be a unique
feature to North Shore Pizza, and
again, offered at no extra charge.
As well as delivery, we will provide
slices on premise in conjunction
with bar sales. Our hours of
operation will be between llam until
midnight (2am on week-ends).
Sales results.
Earlier in the plan, we mentioned
the results of our ~ market survey
which were quite impressive.
Although those numbers would be more
than welcome, we do not foresee
selling 4,000 pizzas in a month
during our first year. To achieve a
more realistic picture of sales, we
based our numbers on the 2,963
permanent residential households in
I Incline Village. The following is
a projection of pizza sales per
household:
(These numbers do not account for
the added tourists during the peak
months.)
-
5% will order 1 pizza per week
7,704 per year
-
8% will order 2 pizzas per month 5,689
-
15% will order 1 pizza per
month.
5,333
-
9% will order 6 pizzas per year
l,600
-
63% will order no pizzas
0
20,326 pizzas/year or 56 pizzas/day
