January 2001

This sample marketing plan has been made available to users of Marketing Plan Pro, marketing planning software published by Palo Alto Software. Names, locations and numbers may have been changed, and substantial portions of text may have been omitted from the original plan to preserve confidentiality and proprietary information. You are welcome to use this plan as a starting point to create your own, but you do not have permission to reproduce, publish, distribute or even copy this plan as it exists here. Requests for reprints, academic use, and other dissemination of this sample plan should be emailed to the marketing department of Palo Alto Software at marketing@paloalto.com. For product information visit our Website: www.paloalto.com or call: 1-800-229-7526.

Copyright Palo Alto Software, Inc., 1995-2002

Confidentiality Agreement
The undersigned reader acknowledges that the information provided by _______________ in this marketing plan is confidential; therefore, reader agrees not to disclose it without the express written permission of _______________. It is acknowledged by reader that information to be furnished in this marketing plan is in all respects confidential in nature, other than information which is in the public domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to _______________. Upon request, this document is to be immediately returned to _______________. ___________________ Signature ___________________ Name (typed or printed) ___________________ Date This is a marketing plan. It does not imply an offering of securities.

Table Of Contents
1.0 2.0 Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 .1 .2 .2 .3 .3 .4 .4 .4 .5 .5 .5 .5 .7 .7 .7 .7 .8 .8 .8 .8 .9 .9 .9

Situation Analysis . . . . . . . . . . . 2.1 Market Summary . . . . . . . . 2.1.1 Market Demographics 2.1.2 Market Needs . . . . 2.1.3 Market Trends . . . . 2.1.4 Market Growth . . . . 2.2 SWOT Analysis . . . . . . . . . 2.2.1 Strengths . . . . . . 2.2.2 Weaknesses . . . . . 2.2.3 Opportunities . . . . 2.2.4 Threats . . . . . . . 2.3 Competition . . . . . . . . . . 2.4 Services . . . . . . . . . . . . 2.5 Keys to Success . . . . . . . . 2.6 Critical Issues . . . . . . . . . Marketing Strategy . . . . . 3.1 Mission . . . . . . 3.2 Marketing Objectives 3.3 Financial Objectives 3.4 Target Marketing . . 3.5 Positioning . . . . . 3.6 Strategy Pyramids . 3.7 Marketing Mix . . . 3.8 Marketing Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3.0

4.0

Financials, Budgets, and Forecasts 4.1 Break-even Analysis . . . 4.2 Sales Forecast . . . . . . 4.3 Expense Forecast . . . . . Controls 5.1 5.2 5.3 . . . . . . . . . . . . . . Implementation Milestones Marketing Organization . . Contingency Planning . . .

. 10 . 10 . 10 . 11 . 12 . 12 . 13 . 13

5.0

Fressen Catering
1.0 Executive Summary
Fressen Catering is a kosher catering company that serves the Philadelphia market. Fressen offers creative, colorful, and unusual food options for kosher, as well as the traditional kosher standbys. The service offerings are quite a change relative to the existing kosher catering market which is quite stagnant. Most people make the incorrect assumption that kosher means ordinary, boring food. This assumption prevails throughout the Jewish community so there is not much demand for new offerings. Fressen catering will inject new life into the kosher catering market, leveraging Chef Susan Cheflly's culinary skills to develop creative new catering options. Susan's advanced skills, industry insight, and a great market opportunity will allow Fressen Catering to reach profitability by month 11.

2.0 Situation Analysis

Fressen Catering is a start-up company. Marketing is critical to its success and future profitability. Fressen offers creative, gourmet kosher catering for a wide range of events. The basic market need is a high quality, creative kosher catering company servicing the Philadelphia Jewish population. Fressen will meet this demand with an ever expanding innovative repertoire of kosher meals.

2.1 Market Summary

Fressen possesses good information about the market and knows a great deal about the common attributes of our most prized and loyal customers. Fressen will leverage this information to better understand who is served, their specific needs, and how Fressen can better communicate with them.

Target Markets

Middle class kosher customers Upper class kosher customers

Page 1

Fressen Catering

Table 2.1: Target Market Forecast Target Market Forecast Potential Customers Middle class kosher customers Upper class kosher customers Total Growth 9% 8% 8.60% 2001 120,547 80,457 201,004 2002 131,396 86,894 218,290 2003 143,222 93,846 237,068 2004 156,112 101,354 257,466 2005 170,162 109,462 279,624 CAGR 9.00% 8.00% 8.60%

2.1.1 Market Demographics

Geographics The immediate geographic target is the city of Philadelphia with a population of 3.5 million. A 60 mile geographic area is in need of Fressen's services. The total targeted population is estimated at 201,000. Demographics Families. A household income over $55,000. Jewish. Behavior Factors Attend synagogue a minimum of five to 10 times a year. Practice kosher inside the home. Do not eat out much because of the difficulty of finding kosher meals at restaurants. Appreciate high quality, innovative food offerings.

2.1.2 Market Needs

Fressen is providing its customers with a progressive menu offering of kosher catering. Typically kosher foods are bland, traditional, and far from innovative. Fressen is meeting the market need of a wider menu offering for events that require kosher catering. Fressen seeks to fulfill the following benefits that are important to their customers. Selection: A wide selection of kosher menu items. Accessibility: Fressen prepares all of the meals in their certified kosher kitchen and can cater events within the greater Philadelphia metropolitan area. Customer Service: Customers will be impressed with the level of attention that they receive. Competitive Pricing: All of the offerings will be competitive relative to the true competitors found in NYC.

Page 2

Fressen Catering
2.1.3 Market Trends
The market trend for kosher catering is headed toward a more discriminating customer. The catering patron today is more sophisticated in a number of different ways: Food quality: The preference for higher-quality ingredients is increasing as customers are being subjected to better kosher food. Innovative creations: More innovative items are being demanded as people recognize that food does not have to be dull just because it is kosher. The reason for this trend is that within the last few years there have been progressive caterers and restauranteurs in larger cities that have begun to apply their culinary skill to kosher offerings, recognizing that market demand could be developed. Now that people are trying this fare, they are recognizing there is no need to be complacent with the status quo.

Market Forecast

300,000 250,000 200,000 150,000 100,000 50,000 0 2001 2002 2003 2004 2005

Middle class kosher customers Upper class kosher customers

2.1.4 Market Growth

In 1999, the kosher catering industry reached $16 million in sales nationally. As more options begin to be offered, market growth is forecasted to increase. This is because people are demanding more choices now that they recognize choice is a feasible option. For years, people that practiced kosher were duped into the belief that kosher food was stagnant, boring, and unflavorful.

Page 3

Fressen Catering

Target Market Growth

9.00%

8.00% 9.00% 7.00% 8.00% 6.00% 7.00% 5.00% 6.00% 4.00% 5.00% 3.00% 4.00% 2.00% 3.00% 1.00% 2.00% 0.00% 1.00%

0.00% Middle class kosher customers Upper class kosher customers

2.2 SWOT Analysis

The following SWOT analysis captures key strengths and weaknesses within the company and describes the threats facing Fressen.

2.2.1 Strengths
Strong relationships with many different congregations. Excellent staff who are highly trained and very customer attentive. Superior service offerings. High customer loyalty.

2.2.2 Weaknesses
The struggle to build brand equity. A limited marketing budget to develop brand awareness. The difficulty finding someone with enough culinary skill to support Susan.

Page 4

Fressen Catering
2.2.3 Opportunities
Growing market with a significant percentage of the target market still not aware that Fressen exists. The steep learning curve that kosher food can be creative. The ability to develop many long-term customers because of a close-knit Jewish community.

2.2.4 Threats
Competition from similar service providers in NYC. Local, established competitors that wake up and realize that there is a huge market in Philadelphia. The inherent high cost of kosher food production. A slump in the economy that will decrease customer's budgets for parties.

2.3 Competition
There are four other kosher caterers that serve the low to middle end of the market. These caterers compete to some degree on price (due to budget constraints of some clients), more so on service. The quality of the food and the serving of the food are the main areas of service that the caterers compete on. There is one high-end caterer who will compete with Fressen. This caterer, while serving the upper-end market, often does not offer an upper-end service. Their business has been declining over the last few years. People with knowledge of the industry recognize that this company is not a strong competitor because of their overpriced service offerings relative to the service provided. Lastly, one competitor for the high-end market is kosher caterers from New York City. When cost is no object, there are many people that are willing to pay the additional cost of bringing in the caterer from NYC.

2.4 Services
Fressen Catering will provide Philadelphia with high-quality kosher catering. The catering service will be for weddings, Bar/Bat Mitzvahs, and other assorted parties. Kosher or kashruth is a specific, ritual/set of rules that applies to certain sects of Judaism in regards to food/drink preparation and consumption. A kitchen or catering service must be specially set up to provide kosher meals. The explanation below regarding the prohibition of dairy and meat served together, or made in the same kitchen by the same pots and utensils, is the reason that Fressen Catering will require two sets of everything, including two stove top ranges and ovens. The Hebrew word kosher means fit or proper as it relates to dietary (kosher) laws. It means that a given product is permitted and acceptable. The sources for the laws of kashruth are of Biblical origin and expounded in Rabbinic legislation. These laws are codified in the Shulchan Aruch (Code of Jewish Law). Though a hygienic benefit has been attributed to the observance of kashruth, the ultimate purpose and rationale is simply to conform to the Divine Will as expressed in the Torah. Kosher and non-kosher meat, poultry and fish: Page 5

Fressen Catering
The Torah (Leviticus Chapter 11) lists the characteristics of permitted mammals and fish, and indicates the forbidden fowl. The only mammals permitted are those which chew their cud and are cloven hoofed. The Torah does not list specific characteristics to distinguish permitted from forbidden birds. Instead, it details 24 forbidden species of fowl. The Torah establishes two criteria in determining kosher fish. They must have fins and scales. All shellfish are prohibited. One, however, should not eat fish with meat. Another element of kosher meat consumption applies to the way in which the meat is slaughtered. There are several different methods: Shechita: Only a trained kosher slaughterer (shochet) certified by rabbinic authorities is qualified to slaughter an animal. The trachea and esophagus of the animal are severed with a special sharp, perfectly smooth blade causing instantaneous death with no pain to the animal. Bedika: After the animal has been properly slaughtered, a trained inspector (bodek) inspects the internal organs for any physical abnormalities that may render the animal non-kosher (treif). Glatt Kosher: Some Jewish communities or people only eat of an animal that has been found to be free of all adhesions. "Glatt" means smooth, that the meat comes from an animal whose lungs have been found to be free of all adhesions. "Glatt Kosher" is used more broadly as a consumer phrase meaning kosher without question. Koshering: The Torah forbids the eating of the blood of an animal. The two methods of extracting blood from meat are salting and broiling. Meat once ground cannot be made kosher, nor may meat be placed in hot water before it has been "koshered." Salting: The meat must first be soaked in salt. After the salting, the meat must be thoroughly soaked and washed to remove all salt. Broiling: Liver may only be koshered through broiling, because of the preponderance of blood in it. Both the liver and meat must first be thoroughly washed to remove all surface blood. They are then salted slightly on all sides. Then they are broiled on a perforated grate over an open fire, drawing out the internal blood. One of the main tenants is the prohibition of meat and dairy in the kitchen together. The Torah forbids cooking meat and milk together in any form, eating such cooked products, or deriving benefit from them. As a safeguard, the Rabbis extended this prohibition to disallow the eating of meat and dairy products at the same meal or preparing them on the same utensils. One must wait up to six hours after eating meat products before any dairy products may be eaten. Fressen Catering will serve a wide variety of dishes. This is offered for two reasons. 1. 2. The larger repertoire of menu items is a benefit to the customers. A large selection is required because meat and diary cannot be mixed within the meal, therefore, in essence you have to have two different menus, one with dairy and one with meat.

Some of the menu offerings will be traditional Kosher/Jewish meals such as beef brisket with potatoes and vegetables and a roasted chicken with rice and spinach. More inventive meals will also be offered to appeal to the higher end, more discriminating customers such as chicken pesto dishes or a red pepper couli sauce, or maybe salmon with curry couli and plum chutney. Kosher catering is not cheap. The ingredients cost more, as well as the additional equipment that is needed to eliminate the mixing of dairy and meat products. Per person costs range from $45110.

Page 6

Fressen Catering
2.5 Keys to Success
Generate repeat business. Increase transaction amount per person. "Knock" the socks off customers with impressive food quality.

2.6 Critical Issues

Fressen Catering is still in the speculative stage as a caterer. The critical issues will be handled by: Taking a modest fiscal approach; expand at a reasonable rate, not for the sake of expansion, but because it is fiscally wise to. Continue to build brand awareness which will drive customers to increase their usage of Fressen as well as be vocal to their friends about the positive experience they had.

3.0 Marketing Strategy

Fressen's marketing strategy will be based on developing visibility among Philadelphia's kosher community. This will be accomplished through two ways. The first method is a targeted advertising campaign. Advertisements will be placed in various Jewish newsletters. There are a couple of Philadelphia-wide newsletters. Additionally, Fressen will advertise in a few Synagogue's specific newsletters. These advertisements should yield a decent amount of service inquiries since they are fairly targeted toward the target population that utilizes kosher catering. The other marketing strategy which is less formal is a networking campaign among the Philadelphia Jewish population. Susan has been an active member of the Philadelphia Jewish community for five years. While the Jewish population is of decent size, numbering around 350,000, it is a close-knit community where people tend to know each other. Susan will leverage her contacts within the Jewish community to raise awareness for her catering activities. While the networking might not cast as large of a net as advertisements will, it costs far less and the relationships that it builds will be far stronger because of the trust relationship that has already been established.

3.1 Mission
Fressen Catering's mission is to provide the customer with the finest kosher catering. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers.

Page 7

Fressen Catering
3.2 Marketing Objectives
1. 2. 3. Maintain positive, steady growth each month. Experience an increase in new customers who are turned into long-term customers. Decrease the market expenses as a percentage of sales.

3.3 Financial Objectives

1. 2. 3. A double digit growth rate for each future year. Reduce the variable operating costs. Increase the profit margin per event.

3.4 Target Marketing

The target market segment strategy will not be significantly different to address the two groups. Both groups, regardless of income, typically belong to the same group of religious congregations. Therefore, to reach the different groups does not require a distinctly different strategy. What differentiation it will require is different menu offerings are needed to satisfy the different groups. The upper end menu items are simply cost prohibitive for the middle class target segment. Fressen Catering has two distinct target populations: 1. Middle-class kosher clients: This group of people does not have huge amounts of disposable income, recognizes that it is costly to sponsor a kosher dinner party, and is willing to incur the expenses, but will try to minimize them. Upper-class kosher clients: This group has intertwined kosher values throughout their lives and is willing to spend whatever it takes to throw a high-end kosher dinner function. Typically, this group is characterized by a wealthy one income family where the male works and the female does not. The female of the household typically enjoys the planning of these events.

2.

3.5 Positioning
Fressen will position itself as an innovative, high-quality kosher caterer. Philadelphia Jews who keep kosher will recognize the unique, high-quality service offerings of Fressen. Fressen's will leverage their competitive edge: Fressen Catering's competitive edge is based in their customer attention and inventive approach to kosher cuisine. Fressen's customer attention differentiates them in the world of kosher catering which is dominated by several companies that have plenty of demand. The consequence of having a lot of demand is a decreased pressure to accommodate customers. When you have a lot of customers, you have to modify your business plans less to deal with them. Fressen is approaching the market as if there was significant competition between the different service providers. By making customer satisfaction a priority, over time, local customers will come to appreciate the attention that their needs are given and form a long-lasting relationship with Fressen Catering.

Page 8

Fressen Catering
Fressen's other competitive edge is their nouveau cuisine approach to kosher food. Traditionally, kosher food has remained stable and unimaginative for a long time. Most people believe that there are large compromises that must be made when serving kosher. These compromises need not be made however, and Fressen is changing these misperceptions. Just because there are strict rules regarding the types of foods that may be used and the way it must be prepared does not eliminate creativity. Fressen is taking their knowledge of nouveau cuisine and creating inventive, colorful, and delicious kosher alternatives.

3.6 Strategy Pyramids

The single objective is to position Fressen as the premier kosher caterer in the Philadelphia area, commanding a majority of the market share in five years. The marketing strategy will seek to first create customer awareness regarding their service offerings, develop a customer base, and work toward building customer loyalty and referrals. The message that Fressen will seek to communicate is that Fressen offers the highest quality, most innovative catering offerings for people who observe kosher. This message will be communicated through two methods. The first method is by way of advertisements placed in various Jewish newsletters. Additionally, Fressen will advertise in several synagogue specific newsletters. The second method is by developing a networking campaign among the Philadelphia Jewish community. The networking activities will leverage Susan's five years of active participation in the community.

3.7 Marketing Mix

Fressen's marketing mix is comprised of the following approaches to pricing, distribution, advertising and promotion, and customer service. Pricing: Fressen's pricing scheme is based on a per plate, or per person charge. Distribution: Fressen serves the greater Philadelphia area in any type of facility. Advertising and Promotion: This will be done through ads in various newsletters as well as a networking campaign. Customer Service: Obsessive customer service is the mantra. Fressen's philosophy is whatever needs to be done to make the customer happy must occur, even at the expense of short-term profits. In the long term, this investment will pay off with a fiercly loyal customer base who is extremely vocal to their friends with referrals.

3.8 Marketing Research

During the initial phase of the marketing plan development, several focus groups were held to gain insight into a variety of people that observe kosher. These focus groups provided helpful insight into the decision making processes of potential customers. An additional source of dynamic market research is a feedback mechanism based on a suggestion card system. The suggestion card has several statements that customers are asked to rate in terms of a given scale. There are also several open ended questions that allow the customer to freely offer constructive criticism or praise. Fressen will work hard to implement reasonable suggestions in order to improve their service offerings as well as show their commitment to the customer that their suggestions are valued.

Page 9

Fressen Catering
4.0 Financials, Budgets, and Forecasts
This section will offer a financial overview of Fressen as it relates to the marketing activities. Fressen will address break-even analysis, sales forecasts, expenses forecasts, and how those link to the marketing strategy.

4.1 Break-even Analysis

The Break-even Analysis indicates $23,566 will be need in monthly revenue to reach the breakeven point.

Target Markets

Middle class kosher customers Upper class kosher customers

4.2 Sales Forecast

The first month will be used to set up the kitchen and office. There will be no sales activity during the first month. The second month will see a few catering jobs, but still will not be a significant source of income. Months three and four will see a steady increase in sales. Word will have gotten out from the advertising as well as networking that Fressen is the new kosher caterer in town and offers a high-quality service. Throughout the year it is forecasted that sales will incrementally grow in size until profitability is reached toward the end of year one.

Page 10

Fressen Catering

Target Markets

Middle class kosher customers Upper class kosher customers

4.3 Expense Forecast

Marketing expenses are to be budgeted so they peak several months before a busy period, providing visibility at a time that people are scheduling future parties.

Monthly IMC Budget

$1,400 $1,200 $1,000 $800

Advertising
$600 $400 $200 $0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Networking

Page 11

Fressen Catering

Table 4.3: Budget Budget Advertising Networking Total Budget 2001 $9,600 $1,200 -----------$10,800 2002 $14,000 $1,500 -----------$15,500 2003 $18,000 $2,000 -----------$20,000

5.0 Controls
The purpose of Fressen's marketing plan is to serve as a guide for the organization. The following areas will be monitored to gauge performance: Revenue: monthly and annual. Expenses: monthly and annual. Repeat business. Customer satisfaction.

5.1 Implementation Milestones

The following milestones identify the key marketing programs. It is important to accomplish each one on time and on budget.

Evaluation Programs

Marketing plan completion

Jewish newsletter ad capaign

Synagogue newsletter ad campaign

Networking activities

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Page 12

Fressen Catering

Table 5.1: Evaluation Programs Evaluation Programs Marketing plan completion Jewish newsletter ad capaign Synagogue newsletter ad campaign Networking activities Totals Plan Start Date 1/1/01 1/1/01 1/1/01 1/1/01 End Date 3/1/01 12/31/01 12/31/01 12/31/01 Budget $6,930 $6,930 $2,900 $16,760 Manager Susan Susan Susan Susan Department Marketing Marketing Marketing Marketing

5.2 Marketing Organization

Susan Chefly is responsible for the marketing activities. This is in addition to her other responsibilities. Susan will rely on outside help for graphic design and general creativity.

5.3 Contingency Planning

Difficulties and risks: Problems generating visibility. Lower than forecasted demand. The entry of another already established competitor that recognizes the market potential. Worst case risks may include: Determining that the business cannot support itself on an ongoing basis. Having to liquidate equipment to cover liabilities.

Page 13

Appendix: Fressen Catering

Table 4.3 Budget Budget Advertising Networking Total Budget Jan $400 $50 -----------$450 Feb $1,200 $150 -----------$1,350 Mar $800 $100 -----------$900 Apr $400 $50 -----------$450 May $400 $50 -----------$450 Jun $1,200 $150 -----------$1,350 Jul $1,200 $150 -----------$1,350 Aug $800 $100 -----------$900 Sep $800 $100 -----------$900 Oct $800 $100 -----------$900 Nov $800 $100 -----------$900 Dec $800 $100 -----------$900

Page 1