Business Plan

Executive summary

The business plan relates to FriCo Incorporation which operates in the US food industry. The firm intends to venture the US coffee market by introducing a new variety of instant coffee. The plan details a comprehensive situational analysis of the US coffee industry. This is achieved by conducting a market research and market analysis which aid in understanding the characteristics of the coffee market.

Additionally, the plan also includes an analysis of the competitive environment. The situational analysis also integrates a SWOT analysis and critical success factors. The competitive analysis evaluates the competitive nature of the industry. In order to cope with the competition, the report illustrates the competitive strategies to be used by the firm. The firm’s mission statement, marketing objectives and target market are also indicated.

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Additionally, the plan also illustrates the operations and production plan to be used by the firm. In order to create market awareness, the report illustrates the marketing strategies which the firm intends to use. The plan also illustrates the firm’s financial forecasts. The conclusion illustrates the management’s position regarding the success of the venture.


FriCo is a private limited company which intends to venture the US beverages industry. In its operation, the firm will have a human resource base of 100 employees. In an effort to meet all the market need, the firm’s management team appreciates the fact that consumers have got diverse product preferences.

In an effort to meet the market demand, the firm’s management team has integrated the concept of product diversity. Some of the products which the firm will produce include fresh brewed coffee, hot chocolate and coffee. FriCo will attain this through incorporation of the concept of product innovation. In an effort to attain its profit maximization objective, the firms’ management team has come into a consensus to undertake development of a new variety of coffee known as Frico Instant Coffee.

Market research and analysis

The global beverage industry has undergone a significant transformation over the past 2 decades. This is evidenced by the emergence of ready to drink beverages. One of the sectors which are experiencing a significant transformation is the coffee industry. For a considerable duration of time, there were numerous inconveniences within the coffee industry. However, emergence of instant coffee within beverages sector is likely lead into a significant transformation within the sector leading into a high growth rate.

A market research conducted by the firm revealed that there is a high market potential within the sector. There is an increment in demand for ready-to-drink beverages amongst the consumers. A market research conducted by the firm’s marketing department revealed that consumers are increasingly shifting to consumption of instant coffee compared to other beverage products.

Findings of the market research conducted by the firm also revealed that the market for instant coffee is undergoing a significant growth. For example, in an effort to cope with the increment in consumer demand, convenience stores such as supermarkets are increasingly carrying varieties of instant tea and coffee products in their shelves (Randy, 2002, p.6).

Additionally, instant coffee is also being incorporated in non-traditional outlets for example, gas marts. This is likely to increase the efficiency with which consumer’s access instant coffee. The US is also experiencing a change in its demographic characteristic. This is evident in the fact that the US society is increasingly becoming a cosmopolitan society.

This means that there is a high market potential for the new product to be launched. Due to the industry’s profitability potential, there is a high probability of more investors venturing into the industry. This will culminate into an increment in the degree of rivalry within the industry.

SWOT analysis

The table below illustrates an analysis of the firm’s strengths, weaknesses, opportunities and threats.


-Through incorporation of the concept of new product development, the firm will attain competitiveness within the specialty coffee market.

-FriCo has implemented the current production technology. This will enable the firm to be effective in its production.

-The firm has incorporated the concept of customer centric. This will enable the firm to satisfy the customers by addressing their needs.

-The firm has a strong human capital which is conversant with the development of beverage programs.

– The firm has a strong research and development department which will enable the firm to be effective in its product innovation.

-The firm has a relatively strong financial base which will enable it to undertake investment effectively.


-The firm faces a challenge as a result of minimal product awareness within its domestic and foreign market.


–There is a high probability of the firm attaining a high market share. This is due to the fact that most consumers are increasingly considering consumption of coffee.

-The firm can increase its market share through integration of new product development. This will culminate into attraction of a large number of consumers.

-The firm can increase its market size through incorporation of internationalization strategy.

– The emergence of e-commerce also presents an opportunity to the firm to access a wider market.


–The firm faces a threat arising from intense competition by other firms already established in the market.

-Changes in consumer tastes and preferences with regard to beverage products. This could have the effect of reducing the firms’ productivity.

– The specialty coffee market also faces a challenge from the large number of substitute beverage products especially instant tea.


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