Final Presentation 4.22

B2 Team 5: Veronica Cadavid, Matthew Fineberg, Michael Gates, Catherine Gatto,

Richard Marine, Kinnery Patel, Andrew Reiter, Justina Sung, and Shangjiu Yang

BasilThymeOregano

Basil

Thyme

Oregano

BasilThymeOregano

Shang’s Simple Seasonings

What is Shang’s Simple Seasonings?

3 popular herbs with

innovative packaging

Competition:● Traditional Dried Seasoning

● Pre-portioned Seasoning Mixes

● Fresh Herbs

Funding

Fixed Assets: $43,179

Cash: $102,907

Operating Expenses: $155,474

Raw Materials and WIP: $18,727

Finished Goods: $929

We are requesting: $321,216

Market Segmentation

“Busy

Young

Adults”

“Middle-Aged

Convenience

Seekers”

Always Fresh. Always Simple.

Events Cost: $55,545

Awareness:

Segment 1: 2.22%

Segment 2: 1.11%

Consumer Events:

● Philadelphia TASTE (Celebrity Chef)

● NYC Food and Wine Festival

● Green Festival (4 cities)

● Boston Marathon Sport & Fitness Expo

Trade Expos:

● Natural Products Expo

○ East and West

Online Cost: Year 1: $63,036

Year 5: $134,184

Google Adwords

Sponsored Social Media

Featured Blog Posts

Costs and Awareness

Total Cost

Year 1 $308,416

Year 5 $665,795

Awareness Segment 1 Segment 2

Year 1 8.13% 6.83%

Year 5 20.32% 14.77%

Distribution Channels

Independent Grocery

StoresChain Stores Mass Merchandisers Online

California

Washington

Massachusetts

New York

Pennsylvania

*Channel Conflict starting in Yr 3.

ACV Year 1 Year 2 Year 3 Year 4 Year 5

Independent Grocery Stores 2.40% 4.22% 4.49% 3.49% 3.03%

Chain Stores 7.70% 10.78% 10.78%

Mass Merchandisers 12.85% 17.99%

Online 12.00% 12.00% 12.00% 12.00% 12.00%

Overall 14.40% 16.22% 24.19% 39.12% 42.59%

Pricing Strategy

● Competition Orientation: o McCormick: $2.48 per 0.75 oz bottle → $12.40

Distribution Channel Discount Price

Online & Independent

Grocery Stores

N/A $9.99

Chain Stores 15% $8.50

Mass Merchandisers 20% $7.99

Factory Location

● Mound House, Nevada

○ 5,400 Square Feet

○ Rental Cost $22,680/Year

○ Benefits:■ No State Corporate Income Tax

■ No Personal Income Tax

■ Close to raw materials

Materials/Suppliers

Quality Control

Inspect Raw Materials

Process control

Monitor finished goods

Continuous improvement

Costs/Margins

Financial Results

Terminal Value

● CAGR: 4.8%

● CAPM Discount Rate: 12.24%o 1.14 Beta

o 1.920% Risk Free (10-Yr Treasury)

o Excess of 9%

● Declining Perpetuity after Year 8

● Terminal Value of $2,008,489

Comparables

Sensitivity Analysis

Risks

Why Invest?

Healthy NPV/IRR

Excel off growing health and convenience trends

Company Culture

Differentiated product in a homogenous industry

Thank You!

Questions?

Agenda1. Necessary Funding

2. Macro Environmental Trends

3. Description of the Product

a. Competitors/Why we are better

4. Marketing

a. Segmentation

b. IMC

c. Creative Strategy

d. Pricing

e. Distribution

5. Operations

6. Materials/suppliers (supply chain)

i. Location of Factory

a. Quality Control

b. Costs/Margins

7. Finance

a. Financial Results

b. Comparables

c. Sensitivity Analysis

8. Risks (QM)

a. what they are

b. how to mitigate them

9. Why Invest

Back-Up Slides

Income Statement

Statement of Cash Flows

Balance Sheet

Foreign Supply Chain

Domestic Supply Chain

Year 1 IMC Schedule

Year 5 IMC Schedule

Switchover Point

Demand Curve – Seg. 1

Demand Curve – Seg. 2

Base Case – Seg. 1

Base Case – Seg. 2