Gourmet Food Store Business Plan
Sarrica’s Market is a new business in downtown Moab, Utah. The store is an upscale international grocery and delicatessen with a menu that includes authentic, hard to find ingredients from around the country and the world. The facility will include a sixteen person capacity eating area, deli/kitchen with counter and check out area, grocery/gift area, and a public restroom.
The mission of Sarrica’s Market is to provide Moab, Utah’s residents and visitors with quality, authentic, hard to find grocery items and prepared foods, with good service and a pleasant atmosphere like an Old-World outdoor market. Our store motto is, “eat and enjoy.”
The deli will serve sandwiches, salads, specialty drinks, and picnic lunches. Gift items will complement the international theme of the store and include a limited selection of kitchen wares, cookbooks, picnic items, and original hand-sewn items and jewelry. Gift baskets will also be available in the store and online. The deli recipes will highlight the grocery items sold in the market.
The gourmet and specialty foods market is booming across the country. Consumers are seeking quality food and shopping experiences. Many large cities have entire sections dedicated to ethnic foods and culture. As rural America transitions to tourism as its main economy, people are flocking to areas like Moab, longing for the fine ingredients available in big cities. Moab’s residents and visitors want a local gourmet food store.
By making alliances with local farmers, restaurants, and international distributors, Sarrica’s Market will offer a combination of "shopping local" and a wide gourmet selection previously unavailable in this rural area. For residents, Sarrica’s offers a more convenient and appealing option than online ordering or traveling several hours to the nearest cities.
Sarrica’s projects increasing net profits over the first three years. The increasing profitability is based on expectations that seasonal sales differences in the first year will moderate as we strengthen our local clientele base. These forecasts are based on the performance of similar upscale stores in Moab and trends in the gourmet food industry.
To achieve our objectives, the owners of Sarrica’s Market are contributing $24,000 and seeking a $100,000 small business loan. These loans will cover start-up costs and will be repaid from the business’s cash flow within five years.
Sarrica’s Market is a upscale grocery store, gift shop, and delicatessen in Moab, Utah. Our mission is to provide residents and visitors with quality, authentic grocery items from around the world.
Our goals and objectives are as follows:
1. Obtain necessary funding ($24,000 in investor/personal loans and $100,000 in small business administration loans).
2. Exceed customers’ expectations and increase the number of repeat clients by at least 20% per year through superior performance and word-of-mouth referrals.
3. Become an established community destination with a 90% customer satisfaction rate within the first year.
4. Achieve cash flow self-sufficiency within the first year.
5. Achieve sales of $461,900 in the first year, with increasing sales in the second and third years.
6. Provide income for the founders by the end of the second year.
7. Repay debt from original financing by the end of the fifth year.
The keys to success for Sarrica’s Market include:
– Reputation: Every customer will want to return and recommend us to others.
– Superior Customer Service: Knowledgeable and friendly service is of utmost importance.
– Location: Provide a convenient location for customers, including walk-by and drive-by traffic.
– Product/Environment: Offer high-quality foods with domestic and international themes at a fair price in a clean, comfortable environment.
– Convenience: Customers will know they can get what they need at our market without the need to travel or order online.
Sarrica’s Market is an upscale international grocery and delicatessen located in downtown Moab. The facility includes an eating area, deli/kitchen, grocery/gift area, and a public restroom.
The deli will serve sandwiches, salads, specialty drinks, and picnic lunches. The gift shop will complement the international theme and include kitchen wares, cookbooks, picnic items, and original sewn items and jewelry. Gift baskets will also be available.
Start-up costs and financing are shown in the following table. The founders are seeking a small business loan of $100,000. The estimated start-up costs may be lower if used equipment is purchased and renovation labor is done by the owners.
Expenses during the three-month start-up period include insurance, rent, loan repayment, utilities, and salaries for two managers. Equipment and furniture needed include refrigeration units, display cabinets, kitchen equipment, tables, and chairs.
Start-up Requirements
Start-up Expenses
Legal Sarrica’s Market is a Limited Liability Company owned and operated by the founders Andy Boone, Cathy O’Connor, Rosie O’Connor, and Kenny VanStone. It will be registered with the country as Sarrica’s Market.
Books/Accounting $600
Marketing/Website $5,000
Licenses/Permits $1,000
Delivery/Transportation $1,500
Insurance $900
Rent $7,500
Loan Payment $3,000
Utilities $3,000
Deposits $500
Expensed Equipment $5,000
Building Renovations $20,000
Salaries $12,000
Payroll Taxes $1,800
Other $1,000
Total Start-up Expenses $63,300
Start-up Assets
Cash Required $15,700
Start-up Inventory $20,000
Other Current Assets $5,000
Long-term Assets $20,000
Total Assets $60,700
Total Requirements $124,000
Start-up Funding
Start-up Expenses to Fund $63,300
Start-up Assets to Fund $60,700
Total Funding Required $124,000
Assets
Non-cash Assets from Start-up $45,000
Cash Requirements from Start-up $15,700
Additional Cash Raised $0
Cash Balance on Starting Date $15,700
Total Assets $60,700
Liabilities and Capital
Liabilities
Current Borrowing $0
Long-term Liabilities $100,000
Accounts Payable (Outstanding Bills) $0
Other Current Liabilities (interest-free) $0
Total Liabilities $100,000
Capital
Planned Investment
Andy and Cathy $12,000
Rosie and Kenny $12,000
Other $0
Additional Investment Requirement $0
Total Planned Investment $24,000
Loss at Start-up (Start-up Expenses) ($63,300)
Total Capital ($39,300)
Total Capital and Liabilities $60,700
Total Funding $124,000
Products and Services
Sarrica’s Market offers the following products and services:
Groceries
We will offer high quality groceries from Italy, the Mediterranean, Mexico, Asia, Europe, Australia, and the United States (Wisconsin, the Southwest, and locally). Groceries will include items that represent the best known and desired foods from these areas. Items will include but will not be limited to: sauces, oils, spices, spreads, peppers, cheese, meats, pasta, rice, canned goods, drinks, chocolates, and hard-to-find desserts and candies. A selection of frozen meals (made in the store)will be available for home cooking, and will include items such as homemade Italian meatballs & sausage, pizza, and “holiday” tamales.
Gifts
Gift items will complement the international theme of the store and include a limited selection of kitchen wares, cookbooks, picnic items, and original sewn items and jewelry. Gift baskets will also be available in the store and over the internet.
Delicatessen
Sarrica’s Market will offer unique cuisine with an international flair. The deli will offer a limited menu for breakfast, lunch, and dinner. The rotating menu will feature sandwiches, soups, salads, drinks, and desserts. All menu items will be prepared fresh each morning and displayed for easy pick-up. We will offer picnic lunches and frozen meals as well as cheese, meats, and ethnic deli salads by the pound.
The breakfast menu will include items such as quiche, scones, and biscotti, and the lunch/dinner menu will consist of sandwiches, salads, homemade breads, frozen meals, and daily specials.
We will serve high quality coffee, tea, juice, and soda from around the world throughout the day.
Picnic lunches will be made available to visitors, specially packed to be carried into the numerous national parks and outdoor venues surrounding Moab. We will also make this service available to the many outdoor guiding services in Moab. These businesses include climbing, hiking, mountain biking, river rafting, and jeep touring companies.
Competitive Comparison
According to the Utah State Tax Commission, taxable sales in Grand County for “Food Stores/Eating & Drinking Establishments” was $47.9 million in 2002. We believe we can gain a portion of the current market share and capture a new market that has been largely ignored in rural America.
Moab is not a typical rural community in terms of population and tourism. It attracts a large number of domestic and international travelers throughout the year. In 2003, 787,578 visitors went to Arches National Park alone. Moab’s recreational activities, pleasant climate, and natural and cultural treasures make it a popular destination for people from all over the United States and the world. The population in Moab in 2000 was 4,779, with a diverse mix of residents. The community’s rural location and diverse demographics make it an ideal market for Sarrica’s Market, which will provide a grocery that offers cuisine not found in its established competitors.
The competition in Moab includes grocery stores, coffee shops, and some eating establishments. Moab has two chain grocery stores (Citi Market and Moab Grocery), but they do not offer an expansive selection of ethnic foods. The Moonflower Market Co-op carries health food but lacks an expanded ethnic food selection. The Meat Shop carries local meats and some cheese but does not have international varieties.
As for restaurants and coffee shops, there are many in Moab. However, we consider the majority of them to be indirect competition due to the vast differences in product quality and services. Our direct competitors include Arches Book Company, Bob & Shelly’s Moab Deli, Center Cafe, Citi Market, Eklecticafe, Knave of Hearts Bakery, Meat Shop, Moab Grocery, Moonflower Market Co-op, Mondo Cafe, Paco’s, and Red Rock Bakery & Cafe. While each of these competitors offers a component similar to what Sarrica’s Market proposes, none of them provide the same combination of services with international amenities.
We believe that our mix of gourmet products and high-quality services, combined with a pleasant atmosphere, will enable us to compete with existing small businesses. For larger grocery store chains, we will focus on providing a more intimate and educational shopping experience with unique products they do not carry.
Future Products and Services
As profitability allows, Sarrica’s Market plans to introduce new menu items and regularly evaluate which areas of the store are generating the most profits for enhancements.
Product and Service Description
The starting menu includes items such as:
– Quiche made with fresh ingredients and featured cheese from the market
– Fresh Bread including crusty Italian, wheat, and pumpernickel
– Scones/Muffins/Biscotti with international recipes
– Coffee, Tea, and Juice from around the world
Sandwiches:
– Roast Beef with sharp provolone cheese, red onion, lettuce, and tomato on dark rye bread
– Corned Beef/Pastrami with Wisconsin swiss cheese, red onion, shredded red cabbage, and Russian dressing on rye bread
– Turkey with sharp Wisconsin cheddar cheese, lettuce, and tomato on French bread
– Smoked Turkey with Havarti cheese, avocado, sprouts, cucumber, lettuce, and tomato on multi-grain bread
– The Boonero (daily special)
– The Day After Thanksgiving with turkey, herb stuffing, lettuce, and cranberries on a potato bread roll
– The O’Connor with turkey, Genoa salami, bacon, sharp Wisconsin cheddar cheese, lettuce, and tomato on Italian bread
– The BLT with bacon, sharp provolone cheese, lettuce, and tomato on Italian bread
– Veggie Deluxe with avocado, cucumber, sprouts, lettuce, tomato, red onion, and sharp Wisconsin cheddar cheese served on multi-grain bread
– Italian Veggie Deluxe with marinated Italian vegetables, artichoke hearts, olives, red onion, and fresh mozzarella cheese on Italian bread
– Tomato with Fresh Mozzarella & Basil on focaccia bread
– Grandma Sarrica’s Market Pizza made fresh and sold by the slice
– Bruschetta topped with ripe tomatoes, fresh basil, olives, and grated Italian cheese
– Fresh Gazpacho with ripe tomatoes, sweet white onions, jicama, cilantro, fresh jalapenos, and lime juice chopped and mixed for a refreshing taste
– Eggplant Chickpea Pesto, a combination of baba ganoush and hummus served with pita wedges
– Seven Layer Bean Dip with refried black beans, tomatoes, corn, onion, mixed fresh cilantro, and authentic Mexican cheese, served with sour cream, hot sauce, and corn chips for dipping
– Organic Soups made fresh
– Chili made with only the best ingredients
– A variety of specialty flavored chips
Salads:
– Caesar Salad with homemade dressing, bacon, croutons, and imported parmesan cheese
– Greek Salad with Rotelo pasta, tomatoes, spinach, cucumbers, red onion, feta cheese, and Greek olives
– Italian Salad with ripe tomatoes, cucumbers, fresh basil, and balsamic vinegar
– Tomato, Basil, & Fresh Mozzarella Salad tossed in a light olive oil and balsamic vinegar dressing
– Fresh Herb Salad with spring greens, dill, cilantro, basil, and Italian parsley
– Pasta Salad of the Day, always fresh and tasty
Beverages:
– Juice with high-quality flavors from around the world
– All-natural soft drinks
– Coffee with international and organic choices
– Tea with high-quality flavors from around the world
Sarrica’s Market will also offer a variety of hard-to-find frozen food items. Many of our frozen meals will be prepared at the store, following recipes that highlight items sold in the grocery and deli. Some examples include Italian meatballs, homemade pizza, and holiday tamales. We will also sell ready-to-bake bagels, ice cream, and other desserts.
Market Analysis Summary
Our main target markets are:
– People who live and work in Moab, seeking quality ingredients for their favorite international cuisine
– Surrounding businesses in need of tasty meals for their customers and staff
– Domestic and international travelers visiting Moab
– Families looking for quality, affordable, home-cooked meals to take home and prepare with ease
– Individuals seeking a comfortable environment to enjoy a cup of coffee, read a book, or shop
– Individuals in search of high-quality, unique gifts and kitchen supplies
Each market segment consists of people who either live, work, or vacation in the Moab, Utah area. These individuals are looking for an establishment that can meet their desire for authentic, healthy food, quality service, and a pleasant atmosphere.
Market Segmentation
The total potential market consists of the following:
– Approximately 175 businesses in Moab that could potentially be our customers, assuming a starting point of 20% with 10% annual growth
– Approximately 8,485 residents in Moab, with a projected 3% growth over the next ten years
– Visitors estimated based on the average annual visitation to Arches National Park from 1999-2003, which was 787,578 people. Visitations are expected to remain similar over the next five years
While visitors make up the largest market segment, local businesses are also important as they make purchases for the visitors using their services. The local population plays a vital role, as they can sustain the business during the low visitation months and determine whether Sarrica’s Market becomes a community destination.
Market Analysis
Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
Local Businesses 10% 35 39 43 47 52 10.40%
Residents 3% 8,485 8,740 9,002 9,272 9,550 3.00%
Visitors 0% 787,578 787,578 787,578 787,578 787,578 0.00%
Total 0.03% 796,098 796,357 796,623 796,897 797,180 0.03%
4.2 Target Market Segment Strategy
Over the past decade, Americans have shown an increased interest in foreign and gourmet foods. Celebrity chefs, international travel experiences, new diets, and improved access to once-scarce ingredients have all contributed to the growth of gourmet cuisine.
Moab has seen a rise in visitor numbers, which has led to an expansion in the variety of food options available. As a result, residents have developed refined palates and now seek out luxury and gourmet items, often traveling to larger cities to purchase them. However, they prefer shopping locally whenever possible and would appreciate a store that offers a combination of both.
Moab’s population is growing at a steady rate of 3% per year, allowing for increased business opportunities while maintaining the charm of a small town. The natural attractions in the area remain undisturbed and easily accessible, indicating continued market growth in the foreseeable future.
Our marketing strategies will target different market segments using various publications and media outlets. However, all campaigns will emphasize the value, quality, uniqueness, and diversity of our offerings, as well as our exceptional service.
4.2.1 Market Needs
Moab and Southeastern Utah lack a quality international market that offers products currently only found in larger cities or online. Many residents have resorted to traveling with empty suitcases to bring back specialty foods that are not available locally. The residents of Moab strongly value their small-town environment and prioritize supporting local businesses. They would be thrilled to have access to a wider range of food options in their own community.
Moab, Utah is a rural community with the nearest city, Grand Junction, Colorado, located 80 miles away and home to a population of 42,000. The closest major cities, including Salt Lake City, Denver, Albuquerque, and Las Vegas, are all situated 250-600 miles away. Moab’s popularity as a travel destination, thanks to its national parks, cultural sites, unique red rock landscapes, and recreational opportunities, presents an advantageous market for our products and services.
Both local residents and visitors desire high-quality, healthy food that appeals to their taste and aesthetic preferences. Additionally, they seek a pleasant shopping and dining experience that allows them to explore and purchase desired grocery items in a comfortable, friendly, and hassle-free environment. Our customers will also appreciate the option of taking home delicious, home-cooked meals on days when they lack the time to prepare quality meals themselves.
4.2.2 Market Growth
We believe there is a market for our products and services in Moab, and it has the potential for growth. Grand County’s population was 8,485 in 2000 and is projected to grow by 3% in the next decade. Moab is committed to maintaining its status as a popular travel destination while preserving its small-town atmosphere. Its unique appeal is likely to continue attracting vacationers for years to come, contributing to the growth of our business as customers become acquainted with our offerings.
U.S. Retail Sales of Gourmet Foods & Beverages 1998-2007 (in millions of dollars)
Compound Annual Growth Rate 1998-2002
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