3. CHICKEN TEAM Kristina M. Kasic Patrick Johnson Bernard Kanjoma Erik Larson Rob Killius Raghad Khamou Dragan Kosanovic

4. Agenda  Overview – Kristina Kasic  Situation Analysis – Raghad Khamou / Dragan Kosanovic  Marketing Strategy – Rob Killius  Marketing Mix – Bernard Kanjoma  Financials – Erik Larson  Controls – Patrick Johnson

5. Overview

6. Company Overview  Founded in 1946 by S. Cathy Truett  Privately held company  Expands through franchising  Currently operates:  1700 + locations  39 states, including 1 in Michigan

7. Product Mix  Breakfast  Chicken biscuits  Chicken, egg and cheese bagel  Chicken breakfast burrito  Lunch / Dinner  Chicken sandwich  Chargrilled chicken sandwich  Chicken strips

8. Product Mix (cont.)  Sides  Waffle potato fries  Fruit cup  Breast of chicken soup  Salads and Wraps  Grilled chicken wrap  Asian salad  Grilled market salad

9. Healthy Alternative  Most entrees under 500 calories  Lean frying oils  Wheat buns grilled sandwiches  Light dressings

10. Franchise Layout Options  Company offers various options  Express  Stand-alone  Drive through only  Available in unique locations:  High traffic business buildings  College campuses  Hospitals

11. Proposal  Open 10 Chick-fil-A locations in Southeast Michigan over 5 years  Year 1 – University of Michigan and Birch Run  Year 2 – Michigan State and Genesys Hospital (Grand Blanc)  Year 3 – Detroit Metro Airport and Detroit Medical Center  Year 4 – Ikea (Canton) and Lakeside Mall (Sterling Heights)  Year 5 – Cabela’s (Dundee) and Great Lakes Crossing (Auburn Hills)

12. Situational Analysis

13. Chick Competitors Indirect CompetitionDirect CompetitionPossible Threats National Coney IslandMcDonald’sLocal restaurants SubwayBurger KingPizza Specialties Jimmy John’sWendy’sLocal Grocery Stores SonicChipotle Denny’sQdoba White CastleBaja Fresh Tim Horton’sKentucky Fried Chicken (KFC) Taco-Bell Popeye’s

14. Competitor Graph

15. Market Growth

17. Macro Environment  Trends and situations impact the success  Christian beliefs integrated in business  Competitive fast food environment  Changes in demographics

18. SWOT  Strengths  Industry recognition  Steady revenue growth  Over 1700 locations in 39 states  Healthy alternative to beef and other meats  Established online presence  Strong brand  Weaknesses  Fewer locations in Michigan than competitors  Weak presence in Michigan  Closed on Sundays

19. SWOT (cont.)  Opportunities  Expansion of menu offerings  Further expansion of locations throughout Michigan  Leadership Scholarship Programs  Threats  Competitors with similar menu offerings  Bird related diseases  Rising costs of raw materials

20. Marketing Strategy

21. Value Proposition  Healthy alternative to beef and other meats  Treat every customer with utmost respect  Offer a good value

22. Financial Objectives  Financial Objectives  First year sales  In-line / mall – $1.1M  Stand-alone – $2.1M  Gross margin of 35%

23. Marketing Objectives  Maintain a gross margin of at least 35%  Generate a sales average of $4,500 each business day  Realize an annual growth of approximately 10% for each year after the opening year of each store

24. Target Market  Teens – 14 to 18 years of age  Have part-time jobs  Looking for good value  Young Adults – 19 to 25 years of age  Usually in college  Have full or part time jobs  Choose to not cook for themselves  Looking for good value

25. Target Market (cont.)  Adults – 25 to 55 years of age  In careers  Working long hours  Choose not to cook for themselves due to time challenges  Looking for healthy alternatives to beef and other meats  Seniors – 55 + years of age  Fixed incomes  Looking for healthy alternatives to beef and other meats

26. Target Market (cont.)  Travelers – all ages  Families with children  Traveling through Michigan  Looking for good value

27. Critical Issues  Closed on Sundays  Competitive chicken products  Strong display of Christian values and beliefs

28. Marketing Mix

29. Marketing the Chick Overview  4 P’s: (product, price, place, and promotion)  3 P’s: (people, physical evidence, and process)  4 C’s: (customer value, cost, convenience, and communication)

30. Chick Menu  Product Marketing: The restaurant only serves chicken no beef or steak Special Menus: Build Your Own Meal Being a Chicken Satellite/Lunch-Counter

31. Getting the Chick-fil-A Word Out  Pricing  Promotion  Advertising channels (various counties)  Public relations  Direct marketing

32. More Chicken Marketing  Web planning  Website goals  Service

33. Marketing Strategy  Introduce healthy menu offerings through:  Social media  Coupons  Loyalty programs  Basic cable advertising

34. Financials

35. Income Statement

36. Balance Sheet

37. Sales Forecast

38. Break-Even Analysis

39. Controls

40. Keys to Success  Create repeat customers  Generate new customers  Annual sales of $1.1 million at public locations  Uphold the values and traditions  Philanthropic contributor in the community  Host and sponsor community events  Increase profits at each location by 8% annually

41. Controls  Sell each item at a profit margin of at least 5.1%  Annual income for stand alone restaurants of $2.1 million  Annual income for mall/in line restaurants of $1.1 million  Continue to pay down the lines of credit by $40,000 per year  Provide at least 3 $1,000 scholarships per year per location for employees to further education  Employees participation in profit sharing at each location  Locations will be closed on Sundays to allow staff to spend time with their families and observe Christian Sabbath

42. Implementation  Meet daily goals  Monthly meetings with managers and assistant managers  Quarterly ownership and management business plan reviews

43. Risks  Negative feedback from customers  Nontraditional franchise locations too exclusive for general public  Scholarships and donations are given at a rate that significantly reduce profits  Management does not comply with corporate values

44. Risk Mitigation  Change management leadership  Lessen donations and scholarships for eligible individuals/organizations.  Close non-revenue generating locations

45. Marketing Research/CRM  How did you hear about Chick-fil-A?  How frequently do you/your family eat out in a month?  On a scale of 1-10 (1 lowest, 10 highest):  How was your overall experience at Chick-fil-A?  How would you rate the cleanliness of the restaurant?  How was the service provided at Chick-fil-A?  Do you have any suggestions for improvements that can be made to Chick-fil-A?

46. Summary  Chick-fil-A:  Healthy option  Good value  Profitable company  Invest in their people and the community

47. References  Chick-Fil-A 2013524 Company Fact Sheet)Chick-fil-A. (n.d.). Company Fact Sheet. Retrieved May 24, 2013, from http://www.Chick-fil-A.com/Company/Highlights-Fact-Sheets  Folgate, E. (n.d.). Eating Healthy for Cheap at Chick-fil-A. Retrieved June 8, 2013, from Money Crashers Web site: http://www.moneycrashers.com/eating-healthy-for-cheap-at-chick-fil-a/  Grantham R 28 Chick-fil-A model helps it lead)Grantham, R. (28). Chick-fil-A model helps it lead. Retrieved May 24, 2013, from http://www.ajc.com/news/business/Chick-fil-A-model-helps- itlead/nQPpn/  Hayden Stewart. (2012, May 26). United States Department of Agriculture. Retrieved June 7, 2013, from United States Department of Agriculture: http://www.ers.usda.gov/topics/food-markets- prices/food-service-industry/market-segments.aspx#.UbIv8Pm7KBI  National Health Council. (2012, June 28). Retrieved May 7, 2013, from American Heart Association: http://www.heart.org/HEARTORG/GettingHealthy/WeightManagement/LosingWeight/EatMore- Chicken-Fish-and-Beans-than-Red-Meat_UCM_320278_Article.jsp  SDIinvest 31 Chick-Fil-A Owner/Operator Model)SDIinvest. (31). The Chick-fil-A Owner/Operator Model. Retrieved May 24, 2013, from http://compoundingmachines.wordpress.com/2009/01/31/theChick-fil-A-owneroperator-model/