KRISTEN SVENCONIS, JULIA ANGELOS, WILLIAM GERBER, & HARRISON BAKER

5 Boroughs Bagels

Mission Statement

“To bring our customers a convenient, consistent, and quality-driven New York style bagel experience outside of the five boroughs. Offering a unique selection of delicious options

catered to a college student’s hours”

Organization Strategy

Environmental Scanning: Main Bagel/Breakfast Competitors: Bruegger’s

Bagels, The Bagel Factory, and Dunkin’ Donuts Wealthy area Lots of college students, many of whom are from NY

& NJ

Organization Strategy

Organization Strategy: Cater to students with Lunch/Dinner/Late Night

hours and food variety Cater to the tri-state area students’ expectations of

bagel quality with an authentic New York style of preparation

Core Processes: Importation of NYC tap water Overnight fermentation of dough “Poach” bagels in boiling water

Market Analysis

Location: The Corner of Summit Grove and W. Lancaster

Avenue

Nearby Colleges: Villanova University, Haverford College, Bryn

Mawr College, & Harcum College

Market Analysis

Broad Target Market: College-Aged Consumers

Support: There are 14,000 college-aged consumers in the

immediate proximity (FactFinder 2010)

A study shows college students spend 36% of their disposable income on food (E-Marketer 2013)

Market Segments: “New York Style” segment “Late Night” segment “Early Crowd” segment

Market Analysis

Competition: Direct Breakfast Competition

1) The Bagel Factory 2) Bruegger’s

Indirect Breakfast Competition 1) Starbuck’s Coffee 2) Dunkin Donuts

Market Analysis

Competition: Direct Late-Night Competition

1) Main-Line Bistro Indirect Late-Night Competition

1) Campus Corner 2) Wingers 3) Domino’s Pizza

Market Analysis

Order Winners of College-Aged Consumers: 1) Accessibility 2) Wide range of operating hours 3) Unique product offerings

5 Boroughs Bagels has aligned it’s competitive priorities with these order winners

Product & Service Offerings

Signature bagels: Asiago Cheese, Blueberry, Cinnamon Raisin, Chocolate Chip,

Everything, French Toast, Garlic, Gluten-free, Jalapeno Cheddar, Onion, Plain, Potato, Poppy Seed, Rosemary Olive Oil, Sesame, Sundried Tomato, Vegetable, and Whole Grain.

Specialty bagels: Pizza Bagels, Bagel Deli Sandwiches, Peanut Butter and Jelly

Bagel Sandwiches, Cheese-steak Bagel Sandwiches, Pretzel Bagels, and Cheese-y Bagel Knots

Cream Cheese Spreads: Plain, Light Plain, Veggie, Jalapeno, Herb Garlic, Onion and Chive,

Smoked Salmon, Strawberry, Raspberry, Blueberry, Banana, Nutella, Peanut Butter and Hazelnut.

For refreshments, various juices, sodas, and teas will be available for consumers.  In addition, fruit smoothies will be available for purchase. Freshly brewed coffee will also be sold at 5 Boroughs Bagels, both hot and iced.

Operations Strategy

External Customers: 5 Boroughs Bagels customers, end product

consumers.

Internal Customers: 5 Boroughs Bagels bakers.

Internal Suppliers: 5 Boroughs Bagels bakers, employees, and

equipment.

Operations Strategy

Process Structure: Late night/Early morning option Seating for customers, however no wait-service

Operations Strategy

Customer Involvement: Cream Cheese selection Mix and Match option

Operations Strategy

Resource Flexibility: Mixture of specialized and enlarged Bakers, cooks, cashiers

Operations Strategy

Capital Intensity High Automation

Service Customer-Contact Matrix

Topic 2 Presentation: Process Stategy VSB 3008 - Myers

17

Quality Strategy

Six Sigma

“Bench mark” measurements

Quality of service, environment, production

Training of employee

Quality management skills

Quality Strategy

Quality Management Skills: Reporting of customer dissatisfaction incidents Immediate attention to fixing issues with

equipment Elimination of less than “top notch” quality

bagels

Quality Strategy

Top Quality Management: Continuous Improvement

Efficiency Timeliness Pricing Customer Satisfaction

Flat organizational structure

Quality Strategy

Six Sigma Quality Control Bagel quality recording by bagel maker Using quality standard guidelines

http://maaw.info/SixSigmaSummary.htm

Quality Strategy

Loyalty programs

Quality Control

Imported water from New York

“Use By” date methods

Defective bagels will be analyzed

Service quality – customer surveys & feedback options

Employee training

Supply Chain Inventory Management

Low inventory levelsMonthly supplies:

to-go bags, coffee cups, juice cups, straws, lids (both coffee and juice), plastic utensils, napkins, and paper towels, cleaning supplies, bathroom supplies, light bulbs, and sweeteners

Daily/Weekly supplies: fruit for the smoothies and cream cheeses (strawberries, raisins, apples,

blueberries, bananas, kiwis, raspberries, mango, oranges), all types of milk (soy, almond, skim, 1%, 2%, whole, half and half, and buttermilk), barley malt, kosher salt, eggs, water, unbleached flour, baking soda, liquid rennet, sea salt, lox, scallions, peppers, carrots, cinnamon, marinara sauce, shredded cheese, bacon, sausage, ham, peanut butter, jelly, and butter.

Primary Suppliers: US Food, Foods Galore, Coke, Naked Juice, Metropolitan Bakery, and New

York City Water Board.

Supply Chain Inventory Management

New Company Goals: Keep inventory costs low, but stay up with

demandEOQ: Economic Order Quantity

Supply Chain Inventory Management

Lean Inventory Management System Assess Inventory Levels:

each day and on a weekly basis

Demand Management

Expect 300-400 transactions per dayForecasting:

Early reliance on Judgment methods of forecasting Existing and original market research Shift to weighted moving avg. with emphasis on

recent demand As amount of historical data grows, shift to more

complex, qualitative methods (exponential smoothing, trend regression)

Pricing Decision

Start up Budget

Total Capital Equipment: Furniture: $3,040 Equipment/Machinery: $34,158 Non-depreciable equipment: $6,655

Business License: $200

Pricing Decision

Annual Fixed Costs: Buildings/Real Estate: $2,900 per month ($34,800

annually) Legal/Accounting fees: $1,700 Worker’s Compensation Insurance: $160 per

month ($1,920 annually) General Business Insurance: $8,000 annually Interest expense: $3,600 annually

Pricing Decision

Relevant Variable Costs (monthly): Payroll: $1,531 Supplies: $244 Repairs/maintenance: $286 Advertising: $500 Car delivery/travel: $325 Utilities: $100 Taxes: $1,060

Pricing Decision

Inventory Costs Per Month: $231 (coffee/tea) $1,260 (bottled juice/soda) $348 (signature bagels) $450 (specialty bagels) $520 (breakfast sides/sandwiches) $720 (fruit smoothies) $170 (cream cheese)

Pricing Decision

Approximate Menu Costs: Breakfast sandwiches (egg on a bagel with either bacon

or sausage): $3.50 Breakfast sides (sausage, bacon, hash browns): $2.00

each Signature bagels: $0.95 each Specialty bagels: $1.10 each Cream cheese: additional $1.10 each Bottled juice/soda: $1.75 each Coffee/tea: $1.20 (small), $1.80 (medium), $2.00 (large) Iced coffee: $1.75 (medium), $2.30 (large) Fruit Smoothies (one size only): $3.75 each