Business Plan Project THEYNA

Table of Contents

1. Executive Summary
1.1. Highlights
1.2. Objectives
1.3. Mission Statement
1.4. Keys to Success

2. Description of Business
2.1. Company Ownership/Legal Entity
2.2. Location
2.3. Interior
2.4. Infusion Tea Pre-Market Research
2.5. Product
2.6. Supplier
2.7. Service
2.8. Manufacturing
2.9. Management
2.10. Financial management

3. Marketing
3.1. Market Analysis
3.2. Competition
3.3. Pricing
3.4. Advertising and Promotion
3.5. Strategy and Implementation

Reference list

Appendices

Table of figures

Figure 1: Financial Overview of THEYNA Company

Figure 2: The Company's Interior

Figure 3: Consumer's Needs for a New Product

Figure 4: New Product Features

Figure 5:The Type of Tea that People Buy the Most

Figure 6:The Percentage of Bought/Consumed Tea by Customers

Figure 7: Number of Bought Packs per Month

Figure 8: Manufacturing Process

Figure 9: Investment Cost

Figure 11: Respondents' Gender

Figure 10: Respondents' Age

Figure 12: Percentage of Consumers and Non-Consumers of Tea

Figure 13: Most Purchased Brands

Figure 14: The Consideration of Price/Quality Ratio by Customers

Figure 15: Acceptable Price by Customers for a Pocket of 20 Tea Bags

Figure 16: The Psychological Price

Figure 17: Most Attractive Advertising Media

Figure 18: The Company's Organizational Chart

List of Tables

Table1: Production Equipment

Table2: Office Equipment

Table3: Human Resources costs per month

Table4: Working Capital for the First One Month

Table5: Details and Investment Costs

Table6: Scale table FONAPRAM

Table7:Investment Costs Distribution

Table8: Repayment schedule and financial charges FONAPRAM

Table9: Bank credit repayment table

Table10: Operating expenses for 1 year

Table11: Profit Calculation

1. Executive Summary

1.1. Highlights

A business is considered lucrative when its sales’ income covers its expenses. In addition, it has to be profitable over the years .In other words, its net profit is increasing year by year. THEYNA company has an estimated financial overview that allows it to create some balance between its income and expenses and to have an increasing net profit. Figure (1) shows the financial overview of THEYNA's business over five years:

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Figure 1: Financial Overview of THEYNA Company

1.2. Objectives

Short term goals:

- To satisfy customers’ needs for flavored infusion green tea.
- To cover the expenses of the startup and make some profit
- To gain customers’ loyalty
- To establish brand recognition
- To encourage customers to consume Tunisian infusion tea brands like THEYNA

Long term goals:

- To expand the business and recruit more labor force.
- To enlarge the product line.
- To enrich the Tunisian tea-culture.
- To export our product internationally.
- To build a foreign customer base.
- To create products with reference to foreign customers’ needs.
- To contribute to the economic development of Tunisia.

1.3. Mission Statement

The mission of THEYNA company is to have a Tunisian infusion tea brand in the market that responds to the different needs of infusion tea consumers nationally and internationally. The company seeks to produce a high-quality infusion tea with natural flavors and to be the leader in Tunisian tea production.

1.4. Keys to Success

What will make THEYNA company a successful business is its leadership in the infusion green tea industry worldwide as infusion tea products remain limited in the market till now. In addition, THEYNA company offers a high quality product which will satisfy its customers' needs.

2. Description of Business

THEYNA Company is specialized in manufacturing and conditioning green infusion tea with multiple natural flavors. It seeks to cover the need of the Tunisian market for infusion flavored green tea as well as customers’ needs for a new and different tea-culture. This company introduces to the market infusion tea with natural flavors and without any additional chemical substances. The company's primary goals are to make its products locally known, to satisfy the customers' needs for green infusion tea with its flavors and to establish a customer base. In the long run, the company aims to work on the international customer base. Therefore, THEYNA company is the first Tunisian industry that targets infusion tea consumers and offers them a large variety of flavor blends.

2.1. Company Ownership/Legal Entity

THEYNA Company is a new independent business and a sole proprietorship. It is an industry specialized in manufacturing and conditioning infusion tea. The company will be registered in the commercial register and will have a legal publication in the Official Journal of the Republic of Tunisia (JORT). Besides, before launching the products, I am working on obtaining the following licenses and authorizations:

- Authorization from the ministry of health
- Authorization from the ministry of industry and commerce
- Authorization of release for consumption

Because I am still in the first step of the company creation, all authorizations and documents will be prepared after the validation of the business plan.

2.2. Location

The company is located in Manzel chaker km 48, which is an industrial zone. It is easily accessible to public transportation. Besides, this area belongs to the second group of regional development zones. In fact, the Tunisian government allocates a specific budget for investors in these zones to help them grow their businesses and reduce unemployment. The government has also offered exceptional encouraging benefits for investors in these zones. As a new small business, THEYNA company intends to enjoy these benefits that could help it with the following offers:

- Regional development bonus: 15% of the total investment
- 5 years of exemption from employers' contributions to the CNSS
- 5 years of exoneration from the Value Added Tax (T.V.A)
- Added value tax becomes 6% for imported machinery that has no similar in Tunisia
- Total exemption from tax / income

Taking into consideration the fact that THEYNA company is an industry that manufactures a product and distributes it to the market through supermarkets, grocery shops, and restaurants, the need for clients to easily reach the place to try or sell the product is not necessary. Added to that, the added value taxes for industry down towns reached 30 percent in the last few months. Although it is a distant place that requires a particular budget, the amount of money the company will have to provide for the different taxes and employees’ contributions in CNSS will exceed the amount provided for transportation. So, THEYNA company will enjoy these benefits which will reduce its charges and contribute to the development of small and big businesses in the industrial zone of Menzel Chaker.

2.3. Interior

In addition to the details identified prior to the choice of THEYNA company location, specific details have been taken into consideration to design the industry interior. The interior counts 250 m2.It is composed of: a storage unit for the row material, a mixing unit, a conditioning unit, a store of final products, a distribution unit (reception), cloakroom, W.C, and office. The mixing unit will include five containers where the tea will be mixed with a set of flavors. For the packaging unit, it will contain an automatic tea packing machine. Also, the store of final products is meant to conserve the packs of tea bags which are ready to be sold. Figure (2) describes in details the company’s interior as designed by an urban design architecture.

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Figure 2: The Company's Interior

2.4. Infusion Tea Pre-Market Research

In this section, I investigate the need of customers for a new product of infusion tea. This investigation is conducted prior to the manufacturing and processing of the current product in order to make a decision about carrying on or stopping the launching of this industry.

In order to test the receptivity of Tunisian customers to the new infusion tea intended to be manufactured by THEYNA Company, a number of data elicitation methods have been designed and implemented.

Unstructured interviews

I tried to generate data related to the need of customers for a new infusion tea product by immersing myself in interactions and conversations about Tunisian tea-culture in general, the willingness of Tunisians to try a new product, and about possible things that are missing in infusion tea market and that THEYNA industry can provide. These interactions took place in supermarkets (CARREFOUR, MONOPRIX, MG supermarkets) with buyers to inquire about the most popular infusion tea and approximate number of sold items. They also took place in some female gatherings where infusion tea is distributed and in conversations with families and friends. These conversations and interactions took the form of an unstructured interview where the questionsasked have not been prepared before; they emerged from the conversations and varied according to the situation and the speaker.

This made my sampling more of a purposive type of sampling where the major goal is to investigate the need of customers for a new infusion tea product. The selection of respondents was based on their knowledge about the pre-market research topic and their abilities to answer the questions. (see Appendix A)

Questionnaire

I have also designed a questionnaire with both closed and open-ended questions to identify the target market population, the features of the product, its price, and the promotion media strategies that could be used. The questionnaire was designed through GOOGLE FORMS and administered to 100 people following a convenience sampling. The questionnaire contains 18 questions broken down into four sections: frequency, product, price, place and promotion. The major criterion taken into consideration in the choice of a questionnaire for data elicitation is ease of data collection.

The findings of the data collected and the way they helped me in designing and manufacturing the product and in analyzing market targets and needs will transpire through the different sections of the business plan.(see Appendices B and C)

2.5. Product

This section describes the features of the product and the estimation of sales. In the pre-market research data, I tried to investigate whether Tunisian customers need a new infusion tea product or not and if yes how they would like it to be .Figure (3) presents respondents’ answers to the question on the need of a new product.

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Figure 3: Consumer's Needs for a New Product

The figure shows that 86 percent of the respondents need a new infusion tea product. This explains that consumers are still feeling the need for a better tea product with new characteristics. Additionally, when asking them what they are seeking from a new tea product, their answers were as follows:

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Figure 4: New Product Features

The bar chart presents the advantages that people wish to obtain if they are going to try a new tea brand. First, having a bunch of different flavors is their first choice. So, THEYNA company will offer them a large variety of infusion tea in order to cover their needs for new tea blends. Second, they are likely to consume more bio products. Thus, THEYNA company will guarantee a 100% bio product with neither artificial flavors nor chemical substances. Third, 43% of the respondents opted for a lower price. As a result, THEYNA company will offer a tea product with a competitive price.

The questionnaire has also revealed the type of tea that people buy the most. Figure 5 shows that 67% of respondents buy green infusion tea while 30% of them buy green flavored infusion tea. Moreover, people are more likely to buy green tea other than any type of tea. illustration not visible in this excerpt

Figure 5: The Type of Tea that People Buy the Most

The flavors mixed with infusion green tea, however, remain limited in the market. That is why THEYNA Company will offer a large set of green flavored infusion tea in order to satisfy its potential customers.

THEYNA Company, therefore, manufactures green infusion tea. Many flavors are produced in order to respond to all the tastes and needs of our customers. The customers will enjoy the natural flavor of our infusion tea bags. These natural flavors are not only delicious and tasty, but also have many benefits for the health. The formula of the infusion tea is designed by the owner of the company with the help of an agro biologist. We will make sure that we offer the best taste and price in addition to the promised quality and the 100% bio product. The packaging, the formula of the infusion tea, and the brand name will be registered in the National Institute of Standardization and Industrial Property in order to protect them from imitation.

Estimation of sales

In this section, I will demonstrate the plan to obtain the estimation of sales according to the questionnaire's results. The following pie chart illustrates the percentage of bought/consumed tea by customers. 28% of them are infusion tea consumers:

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Figure 6: The Percentage of Bought/Consumed Tea by Customers

Moreover, respondents have been asked about the number of times they buy infusion tea packs. The results are presented in the following graph:

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Figure 7: Number of Bought Packs per Month

If we consider that in a population of one million residents in Sfax, 28% of them are infusion-tea consumers, these 280,000, therefore, consume different brands of tea. We suppose that, during the first year, I will be able to take 3% of the market share. So, the customer base of THEYNA brand will count:

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In addition, our 8400 customers are divided as follows:

72% buy from 0 to 3 packs per month

28% buy at least 4 packs per month

Suppose that we consider only those 28% who buy four packs per month, we obtain the following results:

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In addition to the estimated number of packs consumed by a particular number of consumers, the company has to consider the variable of machine bags’ production and its relationship to the production capacity in general. In order to test the significance of this relationship, the following equation is generated and computed:

The machine releases approximately 40 bags/min. With five working hours per day and five working days per week for the machine, our production capacity will, therefore, count:

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To conclude, the company production capacity will be able to cover the estimated sold packs per month as the company production capacity is bigger that the estimated total packs per month (12000>9048).

2.6. Supplier

Because of feasibility and availability reasons, I have contacted foreign tea suppliers. In other words, resorting to foreign tea suppliers comes as a result of the absence of Tunisian tea suppliers. I have obtained several offers and then compared them to each other with regards to quality and price. At the end, I have chosen a Chinese tea supplier. After reading his customer's feedback, I knew that he offers a good green tea quality with a suitable price. The supplier company's name is Hubei Zhongxing Food Co., Ltd.

For the herbs, I have chosen Nasria market for different trades (فضاءالناصريةللتجارةالمختلفة). He is a wholesaler. He offers fresh herbs with a wholesale price. In addition, he has a large variety of herbs from all over the world.

For the dried fruits, I will make them myself using a dehydrating machine. This will allow me to save money as dried fruits are usually expensive and most importantly to make sure that the fruits I am using are of a good quality.

For the packages, Louati printing house is my supplier. I have already contacted them and negotiated the packaging price. They are also the one who will create the packaging design along with business cards and flyers.

2.7. Service

THEYNA Company provides services during and after sales. First, it transfers the orders to its clients in a predetermined duration. Second, it collects information and feedback from its customers and consumers in order to improve its products and figure out its strengths and weaknesses as a company. Third, the company provides an after sales service: if the merchandise does not respond to the required and agreed quality, the client will be refunded or the merchandise will be changed. The services we provide will help us attract more customers.

2.8. Manufacturing

As mentioned earlier, THEYNA company manufactures infusion tea with multiple natural flavors. For this purpose, a manufacturing procedure is required. First, each flavor will be put in a wooden container. For example, after weighing tea and Jasmine with respect to the dosage set, they will be mixed in a wooden container. As a result, we obtain a Jasmine green tea mixture.

Second, the mixture will be poured in the container of the automatic tea bag packing machine. After regulating the machine parameters and putting the desired weight for the bag, the machine releases tea bags which are ready to be packed. Third, the bags are ready to be put in packages of 10 and 20 bags. Finally, the packages will be stored in the storage units in cardboards of 10 packs each.

To better understand the manufacturing process, the following experiments are conducted and conclusions are drawn, accordingly. With the help of an agro biologist, I have obtained the following dosages for five tea flavors:

1. Flavored tea with Chouch El-ward: 1gram of green tea + 1 gram of chouch El-ward
2. Flavored green tea with Jasmine: 1 gram of green tea + 1 gram of dried Jasmine
3. Flavored tea with Cinnamon: 2 grams of green tea + 1 gram of cinnamon
4. Flavored green tea with Marimiya: 1 gram of green tea + 1 gram of marimiya
5. Flavored green tea with dried Lemon pieces: 1 gram green tea + 2 grams of dried lemon
6. Flavored green tea with Dried pineapple pieces: 1gram of green tea + 2 grams of dried pineapple

The following figure presents the manufacturing process from raw material supply to storage of final product.

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