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Business Plan: Jade Tea Shop
Transcript of Business Plan: Jade Tea Shop
Jade Tea Shop will offer high quality Taiwanese tea leaves and teapot sets to customers.
In the 1980s, tea drinking population and tea consumption increased sharply in Taiwan.
Our potential customers are local residents and tourists.
The owner, Chao Hui Wu, will invest $110,000 and our conservative sales forecasts project over $544,900 in the first year . Executive Summary In Taiwan, people think "jade" is a precious stone and its color is dark green. Our teas are as precious as jade and their original leaves color are dark green just like those of jade. Jade Tea Shop will be located at 45 Shi Fu Road Xinyi District Taipei City, Taiwan.
The place where the Taipei 101 Shopping Mall is located. Location Company Name Jade Tea Shop Jade Tea Shop About Taipei 101 Taipei 101 opened in December, 2004.
Taipei World Financial Center is its formal name
It includes the Taipei 101 Tower and the Taipei 101 Shopping Mall.
The Taipei 101 Tower comprises 101 floors above ground and 5 floors underground. It is 508 meter (1,671 feet) and the second tallest building in the world. The Taipei 101 tower held the first time New Year Eve fireworks show for celebrating New Year of 2005.
Since then, fireworks launched from the Taipei 101 tower features noticeable in international New Year's Eve broadcasts
The Taipei 101 Observatory is on the 89th floor of the Taipei 101 tower. It offers 360 degree view and attract visitors from around the world.
The entrances are located on the 5th floor of the Taipei 101 Shopping Mall.
The Taipei 101 Shopping Mall is a five floor building. It is a part of Taipei 101.
In the Taipei 101 Shopping Mall, there are upscale boutiques which offer the international fashion brands and labels.
The Taipei 101 Shopping Mall also has restaurants to provide Chinese and Western cuisine. To be the most successful tea shop in Taiwan.
In doing so, Jade Tea Shop will provide authentic and high quality tea leaves, good standing teapots and good services to meet customer expectations of higher quality with competitive price. Mission Statement Within five years, Jade Tea Shop wants to open second tea leaves shop in Kaohsiung City which is the second largest city in Taiwan, locates in southern part of Taiwan.
Jade Tea Shop wants to build our brand name and generate our customer loyalty. Vision Statement To build a trustworthy brand image and reputation for our products and services.
To become one of most famous stores in the Taipei 101 Shopping Mall.
To realize what customers want and satisfy what customers need. Goals and Objectives Goals Objectives To offer four kinds of high quality tea leaves and provide good standing teapots for our customers.
To respond to customers' demands quickly for increasing customers' good impression with our tea shop.
We will employ two employees for the first year of operation. Product quality Keys to Success Excellent customer services Location is in the most famous shopping mall in Taipei Well-trained and efficient employees Jade Tea Shop is a start-up business in the most well-known shopping mall in Taipei.
Jade Tea Shop primary focuses on four most famous types of Taiwanese tea leaves.
They include Wenshan pouchong tea, Oriental Beauty Tea, Sun-Moon Lake black tea and Alishan oolong tea.
We will sell the above four types of tea canister, tea bags and tea canister gift sets.
We will also sell teapot sets. Company Summary As a limited liability company in Taipei, Taiwan. Company Ownership Chao Hui Wu is Jade Tea Shop's owner. The owner will invest $110,000 conservatively. Start-up Summary The said amount covers total start-up expense $20,080. The remainder $89,920 is for owner's equity $20,080 + $89,820 = $110,000 Four most famous types of tea leaves that produce in Taiwan. They are Wenshan pouchong tea, Oriental Beauty Tea, Sun-Moon Lake black tea and Alishan oolong tea. We will offer tea canisters, tea bags, and tea canister gift sets. We will also provide various teapot sets Products and services Each type of tea has its own unique flavor and characteristics. Therefore, each type of the four tea leaves we sell contains its own taste, aroma and characteristics. Growth at Wenshan district in Taipei City.
The degree of oxidation is about 10%.
The color is a bright yellow-green with a touch gold.
The taste is light, refreshing flaavor and floral aroma. Wenshan Pouchong Tea Oriental Beauty Tea Growth in Hsinchu County.
The harvest season is only in summer. The tea leaves do not grow after the summer.
The degree of oxidation is about 50%-60%.
The color is orange yellow.
The taste is sweet with a unique aroma of ripe peaches and honey. Sun-Moon Lake Black Tea Growth at Sun-Moon Lake area.
It is full fermented tea.
The color is dark brown.
The taste is smooth fragrance. Alishan Oolong Tea Growth tea at Alishan area.
The degree of oxidation is about 15%.
The color is jade green to light golden.
The taste is fragrant, rich and lingering in terms of smell and taste. Tea canisters are which contain tea leaves freshly packed and vacuum-sealed in a bag. We use metal canisters to preserve the flavor. Tea Canister Tea Bag Our tea bags will be manufactured by collecting the whole tea leaves to keep high quality and the real taste. Tea Canister Gift Sets We will offer a selection of tea canister gift set.
We will work with our customers to create the tea canister gift sets what they choose. Teapot Set In general, tea drinkers in Taiwan have many teapot sets for drinking various Taiwanese tea. They like to collect different types of teapots.
We will offer various teapot sets which are suitable to brew different types of Taiwanese tea. In the 1980s, the tea drinking population and tea consumption rose obviously in Taiwan.
The Taiwan tea industry began to focus on the domestic market, and local government in tea-producing areas and their local Farmers' Association started cooperation to improve the quality of tea.
As a result, the domestic market for local high quality tea has been increased because consumers interested in the quality tea have largely grown.
In Taiwan, tea consumption have increased from 1 pound in 1980 to 3 pounds in 2007. In 2008, Taiwan each population consumed average 3.97 pounds of tea leaves.
However, since 2008, the total squares for tea leaves farm in Taiwan have decreased due to land slide and government policy for soil preservation.
Now there are about 25,000 tea farmers working across 16,000 hectares which provide 20,000 metric tons of tea in Taiwan.
Taiwan's tea output has been unable to meet domestic demand in tea market, therefore Taiwan has forced to import tea from abroad. Market Analysis Summary In 2010, Taiwan imported 31,000 metric tones of tea. 87% came from Vietnam and China.
The imported tea does not threat to Taiwanese high quality and high price tea because they are simply to meet the low-priced demand and are mostly used in the manufacturing of cheap bottled tea drinks.
However, Taiwanese high quality tea is threatened by the imported tea with the label of Taiwan-grown tea.
The result affects the credit of Taiwan high quality tea in Taiwan tea market and cause customers to be cheated for buying counterfeit Taiwanese high quality tea.
In 2011, in order to help consumers to distinguish authentic Taiwanese high quality teas from those of counterfeits, the Council of Agriculture (COA) provide verified local tea growers with labels to show authenticity of production.
Jade Tea Shop will provide high quality Taiwanese tea leaves which are verified by COA for customers. The Tea Market The Tea Market Taipei Residents Market Size At the end of 2010, the population of Taipei reached 2,618,772. Among them, 72.67% of population is between the ages of 15 and 64. They are main consumer group in Taipei. Foreign Tourists There are average 159,561 tourists per month visit in 2011. After visiting the Taipei 101 Observatory, they usually go shopping at the Taipei 101 Shopping Mall. Based on the above information, we estimate our potential market of at least 3,600 Taipei residents and 14,400 foreign tourists for our first year business. Jade Tea Shop is planning to serve products to Taipei residents and foreign tourists. Market Segmentation Taipei has 2,618,772 populations at the end of 2010. The working population is 72.67%, they are between the ages of 15 and 64.
In 2010, the average disposable income of population in Taipei is USD$24,703.
Therefore, our primary target age will focus on middle and high level income. In 2010, 1,914,730 tourists visited the Taipei 101 Observatory. There are average 159,561 tourists per month visit it last year.
Jade Tea Shop also wants to focus on tourists as its target customers. Jade Tea Shop estimates potential customers in the first year of operation to be 18,000. Customers will be increasing yearly. To provide excellent services for Taipei residents and tourists with four most famous types of Taiwanese tea leaves which are verified by COA.
At Jade Tea Shop, customers will gain the knowledge of the Taiwanese tea and understand each type of the Taiwanese tea has its own unique flavor, aroma and characteristics.
Customers will have a free taste of the unique flavor of the Taiwanese tea and enjoy the subtle fragrance of the Taiwanese tea. Target Market Segment Strategy In Taiwan, many tea leaf stores established either in urban areas or rural areas to run their businesses. Most of tea leaf stores are family-own businesses and there are some existing stores which are heritage stores. They rarely expend their stores to different local areas. Service Business Analysis In Taipei, many tea leaf stores are heritage stores. Most of them are located at the Dadaocheng area of Taipei. They are far away from Taipei 101. Taipei also has many individual tea stores and chain tea stores such as TenRen Tea Company. Although many individual tea stores or Ten Ren's tea stores sell various kinds of tea, however, the quality of tea leaves they sell has never been considered by Taipei residents as high quality tea leaves. It is a famous tea company in Taiwan.
It has more than 10 Ten Ren's tea stores and more than 20 Cha for Tea restaurants in Taipei.
Ten Ren's tea stores sell tea products such as tea canisters, tea bags.
Cha for Tea offers many meals, tea desserts and tea beverages. TenRen Tea company Tea drinking is very popular in Taiwan.
It becomes a part of Taiwanese life style and Taiwanese culture.
Taiwanese drink tea, always sniff for aroma, slurp for taste and carefully watch the color.
In recent years, foreign tourists know Taiwanese high quality tea have premium taste and flavors.
Especially, Chineses tourists prefer the flavor of Alishan oolong tea. Service Business Analysis Jade Tea Shop will sell high quality tea canisters and tea bags which purchase from top 10 tea farmers who win the contest held by jointly local government and local Farmers' Association. In the tea market, competition depends on the quality of teas, particularly on the color, flavor, fragrance and fermentation of tea leaves.
Offer consumers high quality with reasonable price will surely attract them to come back to buy tea leaves at Jade Tea Shop.
Some tea stores nearby Taipei 101, are not our direct competitors, since their main products are food and beverage. Even if they also sell tea leaves, the tea leaves are different flavor and different type of foreign teas Competition Tea stores nearby Taipei 101 are Eslite Tea Room, Cha Lounge and TenRen's Tea. One possible indirect competitor is Cha for Tea restaurant. Cha Lounge It locates at a book store.
The distance is 0.41 miles away from the Taipei 101 Shopping Mall.
It serves flavored tea, herb tea and coffee. Eslite Tea Room It locates at Grand Hyatt Taipei.
The distance is 0.21 miles away from the Taipei 101 Shopping Mall.
It serves teas, coffees and sandwiches.
It is a European style coffee house. It is far away from Taipei 101.
The distance is 1.72 miles away from the Taipei 101 Shopping Mall. Ten Ren's Tea Cha for Tea It locates in a department store.
10 minutes walk distance from the Taipei 101 Shopping Mall.
It mainly serves food and beverages. Local Tea Drinker Buying Patterns In Taiwan, tea drinkers are divided into regular tea drinkers and tea connoisseurs.
Regular tea drinkers usually not look for a specific brand of tea leaf. They only care about the quality of tea leaf.
Tea connoisseurs always choose quality and not price or convenience. They look for whole-leaf and top level quality of tea. Every tea connoisseurs has his or her own personal favor, such as some like Oriental Beauty Tea and some prefer Alishan oolong tea. Tourist Tourists always want to seek high quality items as gifts for their family and friends at the Taipei 101 Shopping Mall. Strengths SWOT Analysis We invest our store by cash. We will not require a loan from bank.
We will purchase our products from top 10 tea farmers who have attended the contest of tea leaf.
Our products will bear the labels verified by COA. Consumers can trace the origin and the growing process on the tea through the barcode oon the label. Weakness SWOT Analysis Jade Tea Shop is a new tea leaf store in tea market of Taiwan, so we need to spend time to build our brand name.
We do not have large capital to invest the plantation of tea, therefore we need to keep strong relationship with tea farmers. Opportunity SWOT Analysis Medical reports indicated tea leaves are helpful to health of people. This will reinforce the tea leaf consumption.
The domestic demand of tea leaves is growing because the tea consumption increased in Taiwan.
The Taiwan government helped tea farmers to improve tea quality.
Lots of tourists visit The Taipei 101 Observatory. The entrance of the Taipei 101 Observatory is located at the 5th floor of the Taipei 101 Shopping Mall.
Alishan oolong teas are very popular for Chinese tourists. Threat SWOT Analysis A major competitor, TenRen Tea Company has a 15% of market share in the industry. It operates Ten Ren's tea stores and has its own brand name.
Large amount of tea leaves imported from Vietnam and China, some imported tea has been sold with the label of Taiwan-grown tea.
In Taiwan, typhoons occur frequently in summer. They caused the land slide so many times in the past years. The land slide causes not only the tea productivity shrinks but also adversely affect the quality of tea leaves. Strategy and Implementation Summary Tasting is essential to let customers know the quality of the tea.
Jade Tea Shop will brew a small cup of free sample tea for each customer to taste at our business hours.
Our employees will serve customers to understand our products. key Competitive Strengths Competitive Edge Jade Tea Shop will hire employees who have the knowledge of tea.
Jade Tea Shop will sell those tea leaves which awarded rank within top 10 of the contest.
We will give customers a newly brewing sample tea and give them primary knowledge about how to taste different tea.
Contain brochures in tea canister to tell each customer how to make a good taste tea. Competitive Weakness Jade Tea Shop is a new tea leaf store in Taipei.
We have to compete with many small size tea leaf stores and chain tea leaf stores.
People don't know how great our products are until they taste our products. To advertise our products at metro stations and bus booths in Taipei.
To provide flyers at the Taipei 101 Observatory, Taipei City Hall, Taipei World Trade Center and hotels nearby the Taipei 101 Shopping Mall.
To brew different tea sample for customers to taste when they come into our store at our business hours.
To create an e-mail list of customers.
To collaborate with the Taipei 101 Shopping Mall events. Marketing Strategy To gain customers trust, confidence and business, our products will bear label verified by COA.
Customers will be treated as distinguish guests at Jade Tea Shop.
To design brochures to describe how to brew each type of tea.
To brew different type of tea when customers ask for. We will interpret the tea brewing process for customers. Sales Strategy Sales Forecast We expect that sales will be as what we estimated.
We also expect sales start first conservatively and then increase extensively.
Jade Tea Shop expects average sales of just over $25,000 per month for the first year.
In the second and third year, we predict to gain increased sales of roughly 4% per year when we subsequently build up our name and reputation in Taipei. Tea Canister Pricing Wenshan pouchong tea- $65 for 5.3 oz./150g.
Oriental Beauty Tea- $40 for 3.5oz./100g.
Sun-Moon Lake black tea- $40 for 5.3 oz/ 150g.
Alishan oolong tea- $70 for 106 oz./300g. Tea Bag Wenshan pouchong tea, Sun-Moon Lake black tea and Alishan oolong tea are at $8 for per box contain 18 tea bags.
Oriental Beauty Tea is at $8 for per box contain 15 tea bags. Our management style reflects the participation of the employees.
To encourage all employees to learn as much as possible about all aspects of the business.
The company respects the community of employees, treat and deal with all employees equality. Management Summary Tea Canister Gift Set The price depends on the different tea canisters selection.
The price are at $80, $105, $110, $130 and $135. Teapot Set The price are at $100 and $200. In the first four year, the personal plan is at least 2 employees and a shop manager.
The salaries of employees are higher than labor regulations and increase the salary every year.
To provide benefits on the base of Taiwan labor law. Personal Plan We will select our supplier from the contest of tea held by local government jointly with local Farmers' Association.
Our suppliers will be good tea farmers who have been ranked top 10 tea farmers of the said contest. Supply Management Our financial plan is based on researches in similar business situations to estimate the sales and cost.
The estimated operation expense include equipment, rent, insurance and other operating expense.
We expect the sales will increase 17% from the second year of operation.
Some not-financial assumptions guiding our forecasts. Financial Plan Stores nearby the Taipei 101 Shopping Mall Threat