Cane O La- A Juicy Endeavor

By:Atit Kapasi- 85

Manan Mehta- 102Aashka Parikh- 111

Jigar Shah- 124

About Cane-O-La:

Our business proposition is based on a Bangalore based existing company called “Can-O-La” which serves fresh, hygienic sugarcane extract. It serves in various flavors suiting the taste buds of the current generation. It is moderately priced between Rs 10-15 as per the flavor.

CANE-O-LA Sugar cane juice is produced with the best quality sugarcane that is organically grown especially. CANE-O-LA use scientifically designed equipment at a central warehouse cum pre-preparation kitchen to select clean and peel the sugarcane before transporting it in refrigerated containers to their destination. CANE-O-LA Sugar cane Juice is extracted only when required by a single pass of the pre-chilled sugarcane thought a crusher. Utmost care has been taken at all stages to ensure that every glass of our sugarcane juice maintains its nutrient value, purity and freshness.

The business model is volume driven as it is about offering a moderately priced mass product- hygienic sugarcane juice.

Clean, Fresh, Healthy & affordable Juice:

COST EFFECTIVENESS  

Considering the efficacies of CANE-O-LA Sugarcane juice and its usage, the cost is quoted at the reasonable price which is affordable by all consumers.   Not Considering the Cost of flavors etc.  

USE / ADMINISTRATION  

CANE-O-LA Sugarcane juice is directly consumed after juice is extracted only when required by a single pass of the pre-chilled sugarcane through a crusher. Utmost care has been taken at all stages to ensure that every glass of sugarcane juice maintains its nutrient value, purity and freshness.  

Production of CANE-O-LA Sugarcane juice  

Strict quality control in ensured through every phase of the crop selection of Sugarcane to the end produce. Every sugar cane crop which goes into the making of juice is collected by individual collectors. Samples of each crop thus procured are subject to rigorous laboratory tests to ensure high quality. Following which crop is stored, peeled and stored in the most hygienic environment. Thus at every level, the production is documented and is verifiable at every stage of the process.

Fulfillment   The Technical and Service Team Acts responsibly by providing healthy, natural and hygienic DESI refreshment to the customers. The technical and service team offer care and disseminates information to all customers regarding CANE-O-LA Sugarcane juice and it contents etc. Customer satisfaction is fulfilled.

Healthy Juice:

COMPOSITION:

Values per 100 gms edible portion

 

PARAMETER VALUE

Water 70 to 75%

Sucrose 11 to 16%

  (avg.=13.0%)

Reducing Sugars

0.4 to 2%

Organic Non-sugars

0.5 to 1%

FOOD VALUE

Moisture 90.20%

Protein 0.10%

Fat 0.20%

Minerals 0.40%

Carbohydrates 9.10% - 100%

MINERALS & VITAMINS

Calcium 10.0mg

Phosphorus 10.0mg

Iron 1.1mg

   

Calorific Value 39

CANE-O-LA Sugar cane juice is produced with the best quality sugarcane that is organically grown especially.

CANE-O-LA use scientifically designed equipment at a central warehouse cum pre-preparation kitchen to select clean and peel the sugarcane before transporting it in refrigerated containers to their destination.  

CANE-O-LA Sugar cane Juice is extracted only when required by a single pass of the pre-chilled sugarcane thought a crusher. Utmost care has been taken at all stages to ensure that every glass of our sugarcane juice maintains its nutrient value, purity and freshness.  

CANE-O-LA Sugarcane juice is a high-energy drink that is natural, sweet and is a healthy alternative to refined sugar added drinks. It quickly replaces lost energy in the most arduous of circumstances.  

CANE-O-LA Sugarcane juice has many medicinal properties. It strengthens the stomach, kidneys, heart, eyes, brain and sex organs, many people are recognizing the benefit of sugarcane juice in providing positive well being with health benefits. Sugarcane juice is used as a commonplace remedy for fevers, genitor-urinary disorders, jaundice and thinness.  

CANE-O-LA Sugarcane juice is popular with sportsmen and women who are looking to top up their levels of muscle glycogen. Sugarcane juice is a more effective way of replacing this carbohydrate energy than refined sugar based soft drinks, particularly for endurance training / events.  

CANE-O-LA Sugarcane juice has great reasons to switch to nature's recipe for good health. Which is a totally natural, Healthy and hygienic DESI refreshment produced for the first time as part of the sugarcane movement.

Cane-O-La- An effective Business Proposition:

USP of a business makes the business an excellent potential in terms of acceptability to masses as well as commercial viability.

Clearly, the USP of the product is hygienic sugarcane juice.Absence of a player in this segment will make it rock.

Cane O La believes new customers and retaining existing ones is an art of living. Customer service is more than just keeping customers happy. It's about revenue, because a lost customer means lost revenue and an unhappy customer can damage its reputation and brand image.

Some aspects of effective customer service are: knowing our customers' needs identifying our key service activities delivering superior service Follow-up

In a competitive marketplace it makes sense to aim to provide superior service. Customers base their purchasing decisions on the service they receive, not just price, quality and availability Cane-o-la's research studies indicate that the level and quality of customer support was the top-ranked factor driving repeat purchases by customers. Enterprises using online solutions for their Customer Service Surveys are able to employ event driven surveys, increasing the frequency and consistency in which highly valued criteria, such as quality and speed of service, are measured. Cane-o-la has continuous up-to-date customer feedback to obtain in-depth information about the customer service operations. By using Customer Service Survey solutions, relevant customer information can be incorporated into automated online surveys enabling more personalized questionnaires and more in-depth analysis. Cane-o-la has pioneered in

Helping customers in location of business point. Development in Business point. Standard operation procedure. Stock management. Staff Training/management. Business strategy. Post-Sale Customer Follow-Up. Service Parts.

It is this integrated customer centric approach that makes Cane-O-La an effective business set-up.

Sugarcane Juice- A Business Opportunity:

Absence of a player involved in offering a healthy sugarcane juice is the greatest incentive to start up this setup.

Catering is a business. And, just like many other businesses there are always new and exciting growth opportunities. It could be something like expanding our market area or increasing the services we offer”   Food, Juice etc., is definitely the star in the catering world, but it's only one part of the equation. As most of the catering companies have moved toward the full-service, event-planning model, the focus has morphed. It's not that juice & food is no longer a focal point, but rather that it is part of a broader mission.   We firmly believe that catering is about satisfying all the senses:

Sight Hearing Touch Smell Taste

With the right atmosphere, we can appeal to all of these senses in a way that makes an event special and memorable. Of course, beautifully prepared sugarcane juice can appeal to sense of taste, smell and sight - perhaps even touch but it shouldn't outshine the rest of the event. We want every piece of the puzzle, from the decor to the glassware, to have that same kind of impact.   From flatware to flowers, lighting to linens and tables to tunes, everything should complement our sugarcane juice to create a unified overall experience. According to us, continuity is the key. Every customer wants every aspect to be in sync with each other. For example:

Does the venue fit the occasion, climate and group size? No matter how lovely the surrounding gardens, we probably wouldn't want to have formally attired guests dining outside in 98-degree weather.

Does the menu fit the occasion and tastes of the group?

Geographic Spread:

We have conducted market research to understand the potential of a health juice like sugarcane juice. We discovered that the demand for it is best and commercially viable at areas pre-dominant with commercial and academic institutions.

Geographically, the business can extend to a city like Mumbai. This is a city where shanties and sky-scrapers co-exist. People of every segment live in Mumbai. This, in it self makes Mumbai a unique market for a popular mass product like sugarcane juice.

The targeted areas include commercial and educational pockets of the city. The product is an impulsive purchase product which will attract office executives and students.

Targeted areas hence include:

Commercial:Nariman PointFountainCuff ParadeChurchgateBKCAndheri (E)

PowaiMaladLower ParelWorli/Prabhadevi

Educational:Matunga- Welingkar, Podar, Ruia, Khalsa, VJTI, UDCT, Don Bosco, SIWS etcVile Parle (W)- NM College, Mithibai, NMIMS, D.J.Sanghvi, Bhagubhai etcKandivali (E)- ThakurAndheri (W)- Ritumbhra, Bhavans, S.P.Jain etcBandra (W)- National, MMK, Thadumal etc

Key Parameters:

Hygiene-The Peeler Machine is the most advanced and the only one of its kind in the entire country. The Sugarcane Extracting Machine is manufactured with 316 L grade, acid proof stainless steel, and is the first of its kind in India. The machine has been imported from USA and facilitates smooth operations with the production of fresh sugarcane juice in a single pass.   For patrons who would like to use ice, our facility provides food grade ice produced with water purified by reverse osmosis, manufactured in the world's leading ice maker. The employees will be thoroughly trained in quality control, hygiene and customer service as well as equipment maintenance.

Different, innovative flavors-We will serve fresh cane juice in many flavors including classic plain, mint, ginger, lemonade, pepper, sweet & salt.

Low cost of sourcing-Sourcing directly from the wholesalers keeping the cost of sourcing low

Medium margin, yet keeping the volumes high The structure of the set-up to make it look hygienic Smart looking, young executives

Investments:

It is a low investment business.

Capital Exp  License 50000Machine (2) 120000Fridge (3) 45000Initial Set-Up Costs 200000Total Investment 415000

No cost of land acquisition as it is on rental basis.

Operational Team- Face of Cane-o-la:

A team of 9 people is required- 4 executives, 4 workers and a manager.The executives will be involved in customer interaction either at the payment counter or serving counter. The workers will be involved in the core extraction process which is visible to the customer through the glass but it lacks any customer interaction. The manager will be responsible for the daily routine of the business.

Manager (Requirements & Roles): Will be responsible for all Sales & Marketing activities across India. Position to be based in Bangalore. Preferred candidate should be a MBA. Experience: minimum of 3-4 years in FMCG. To plan and procure catering orders from Public sectors, group gathering,

malls, institutions, I.T sectors etc.,

To fix targets and execute on every fort night. To co – ordinate with other department. To plan and execute all catering event.

Executive:

To submit stock and sale statement on 1st of every month. To attend all minor and major break down at all franchisee outlets,

warehouse etc., To give maintenance service on regular basis. To co-ordinate with other departments. To Issue and collect materials on request and demand.

Workers:

To receive catering order, plan and execute. To do spot inspection before catering. To collect payment after catering. To organize, train and execute all catering staff members. To submit fort night report.

Financial Projections

We have assumed two scenarios for each year- A Base Case and Best Case.

The Best Case assumes a higher volume of glasses sold.

A local sugarcane juice player is selling around 300-500 glasses a day, depending on the area.

Financial Projections & AnalysisSales Projections: Year 1 Year 2 Year 3 Year 4 Year 5Volume/Day 250 300 300 350 350 400 400 450 450 500

SP 12 12 12 12 13 13 13 13 14 14

Total Sales daily 3000 3600 3600 4200 4550 5200 5200 5850 6300 7000

Annual Sales 1095000 1314000 1314000 1533000 1660750 1898000 1898000 2135250 2299500 2555000

             

Costs (Annual):-            

Variable Costs:            

RM 152083 182500 200750 234208 255500 292000 316333 355875 383250 425833

Electricity 136875 164250 164250 191625 191625 219000 219000 246375 246375 273750

Fixed Costs:            

Rent 388500 388500 388500 388500 388500 388500 388500 388500 388500 388500

Salary 456000 456000 501600 501600 551760 551760 606936 606936 667630 667630Marketing & Promotion 30000 30000 20000 20000 20000 20000 20000 20000 20000 20000

Others 20000 20000 20000 20000 20000 20000 30000 30000 30000 30000

Total Costs 1183458 1241250 1295100 1355933 1427385 1491260 1580769 1647686 1735755 1805713

Taxes 0 0 0 0 81678 142359 111031 170647 197311 262250

             

Net Profits -88458 72750 18900 177067 151687 264381 206200 316917 366435 487037

Assumptions:

Raw Materials:

RM Costs: Yr 1 Yr 2 Yr 3 Yr 4 Yr 5No of glasses per sugarcane 6 6 6 6 6Rate per sugarcane 10 11 12 13 14

After consulting 6-7 local sugarcane players, we concluded that each sugarcane stick can give 7-8 glasses of sugarcane juice. On a conservative estimate we have kept this at 6. The retail rate of a sugarcane stick is Rs 22 and the wholesale rate is Rs 10. We have assumed an increment of this cost at Re 12 each year.

Space:

Rent:  Sq ft Area 175Rent per sq ft 185Monthly Rent 32375Annual Rent 388500

Requirement is 175/sq ft. The Average rent per sq ft is Rs 185. This is arrived at after talking to various existing players in the respective areas. We did not speak to real estate brokers as they have been giving inflated rates which are misguiding. The contract is a long term agreement of Five years so the cost remains the same throughout the five year period mentioned above.

HR Costs:

Employees (10% increase yoy):  Executives 4 4250Workers 4 3000Manager 1 9000Annual Salary costs    456000

A 15% increment in HR costs is assumed:

Yr 1 Yr 2 Yr 3 Yr 4 Yr 5456000 501600 551760 606936 667630

Electricity Costs:

Electricity Cost  No of glasses sold 200Rate per unit 1.5Total electricity cost 109500

On an average, cost of one glass is Rs 1.5. Hence, assuming the set-up runs throughout the year, selling 200 glasses each day will result in total electricity cost of Rs 109500. As the volumes increase, the costs increase proportionately.

Financial Analysis:

Ratios                    ROI -21% 18% 5% 43% 37% 64% 50% 76% 88% 117%NPM -8% 6% 1% 12% 9% 14% 11% 15% 16% 19%FC per glass 9.8 8.2 8.5 7.3 7.7 6.7 7.2 6.4 6.7 6.1VC per glass 3.17 3.17 3.33 3.33 3.50 3.50 3.67 3.67 3.83 3.83Total Cost per glass 12.97 11.34 11.83 10.61 11.17 10.21 10.83 10.03 10.57 9.89BE Pt (No of glasses) 277.4 277.4 294.0 294.0 282.7 282.7 306.9 306.9 298.1 298.1

Base case for Turnover

Best Case for Turnover:

Base case for Net profits:

Best Case for Net profits:

Cost composition (Base Case):

Cost composition (Best Case):

Future Growth:

We believe that Franchisee model is the most optimum model for accelerated growth for our company.

The Franchisee models are to be replicated all over the country covering major cities, towns etc. The Model of franchisee appointment is envisaged to be achieved primarily through the appointment of Master franchisee in Each Region or State and out sourcing the Franchisee appointment work including regulation, training etc of the Franchisee and the monitoring of the Services offered by Franchisee to the customers through these master Franchisees.

The structure of the Franchisee agreement: Franchisee shall carry out the business in the area selected and approved by

CANE-O-LA or Master Franchisee. Franchisee shall procure from CANE-O-LA or Master Franchisee and hold

the stock of all promotional and raw materials such as posters, banners, icons etc., under their respective area.

Franchisee should hold necessary trade license and other proceeding as per the trade rules and regulation in their respective area.

Franchisee should follow the style of operation, design of interiors, machineries, equipments, crockery etc, as per guidelines given by CANE-O-LA or Master Franchisee.

Franchisee should procure machineries and others as per guides given by CANE-O-LA or Master Franchisee.

Franchisee should ensure proper training of all staff members under them well trained by CANE-O-LA or Master Franchisee.

Franchisee should follow the instruction manual or operation manual issued by CANE-O-LA or Master Franchisee.

Franchisee should ensure that a detailed history and data of all queries and other information is maintained and the same to CANE-O-LA & Master Franchisee on day to day basis.

Franchisee should strictly follow the guidelines given by CANE-O-LA & Master Franchisee and customer complaints should be attended in time. The customer satisfaction level is to be intimated to the company. The software provided by the company shall be maintained up to date.

Franchisee shall have manager to monitor day to day sales, service and maintenance etc.

Franchisee shall inform any requirement of their outlet well in advance to the Master Franchisee or company and ensure proper stock at all times. They shall ensure the target fixed by the Master Franchisee and company. They should also carryout the promotional activities of the product, in line with the company policy. All the infrastructural requirements should be provided by them.

Franchisee should meet the customer's demand, their satisfaction, catering service etc., from time to time.

Inferences & Findings of Market Research

Group Members- Contribution

Manan Mehta: Market research (Mumbai- Fort, Andheri E, Malad, Powai, Worli) Tabulation & Analysis of Market research Financials (modeling) Assembling the PPT

Aashka Parikh: Market research- Vendors (Mumbai- Bandra, Peddar Road, Nariman Point &

Gujarat) Tabulation & Analysis of Market research Financials (modeling) Formation of Report

Atit Kapasi: Market Research (Mumbai- Vile Parle, Malad, BKC & Bangalore) Financials (modeling) Formation of Report

Jigar Shah: Market research (Mumbai- Matunga, Sion, Andheri W, Kandivali) Technical (Internet related & preparation of graphs) Assembling of PPT

Appendix

Questionnaire

1.) When you feel thirsty what do you normally consume, if not water?A.) Cold DrinksB.) Fruit JuicesC.) Sugarcane JuiceD.) Health Juices

2.) What purpose according to you does sugarcane juice serve?A.) Quenches ThirstB.) RefreshingC.) Time PassD.) No purpose

3.) How often do you consume sugarcane juice?A.) Once a FortnightB.) Once a MonthC.) Frequently/RandomlyD.) HardlyE.) Never

4.) Do you feel secure consuming sugarcane juice from the roadside vendors?

Yes No

5.) Are you willing to pay extra for sugarcane juice produced in a hygienic, healthy and clean environment?

Yes No

6.) What could be the price of this hygienic sugarcane juice?A.) Rs. 10B.) Rs. 12C.) Rs. 14D.) Rs. 16

7.) Do you like the idea of eating snacks along with sugarcane juice?

Yes No