Booster Juice Expansion into the UK: A Marketing Strategy

EXPANSION INTO THE UNITED KINGDOM

BUSI 4205 A Comprehensive Project

Dr. Alia El Banna March 28, 2016

Reagan Bradley 100936062 Emily Bolton 100897332

Olivia Carapella 100939644 Reid Gardner 100936766

Jie Huang 100906996 Mikayla Mlynarczyk 100900256

Kate Taylor 100924611

Next Destination Mergers 2

Table of Contents Executive Summary ............................................................................................................ 4

Introduction ....................................................................................................................... 5 Product Description .................................................................................................................... 5 Company Background ................................................................................................................. 6 Problem Statement ..................................................................................................................... 8

Country Analysis ................................................................................................................ 8 Rationale for Expansion .............................................................................................................. 8 Socio-‐Cultural Environment ........................................................................................................ 9 Technological Environment ....................................................................................................... 11 Environment ............................................................................................................................. 12 Economic Environment ............................................................................................................. 13 Political Environment ................................................................................................................ 15 Legal Environment .................................................................................................................... 16

Business Analysis ............................................................................................................. 18 Mode of Entry ........................................................................................................................... 18 Advantages & Disadvantages of Each Mode of Entry ................................................................. 19

Exporting ...................................................................................................................................... 19 Turnkey Projects ........................................................................................................................... 20 Contractual Agreements .............................................................................................................. 21 Licensing ....................................................................................................................................... 22 Franchising ................................................................................................................................... 22 International Joint Venture .......................................................................................................... 24 Wholly Owned Subsidiaries .......................................................................................................... 25 Greenfield Investment .................................................................................................................. 25 Mergers and Acquisitions ............................................................................................................. 26

Selection of Mode of Entry ........................................................................................................ 27 Strategic Orientation ................................................................................................................. 31 Key Objectives & Limitations of Expansion into England ............................................................ 35 Market Segmentation ............................................................................................................... 37

Demographic ................................................................................................................................ 37 Geographic ................................................................................................................................... 38 Psychographic .............................................................................................................................. 39 Behavioral .................................................................................................................................... 40

The Target Audience ................................................................................................................. 41

Marketing Mix ................................................................................................................. 43 Product ..................................................................................................................................... 43

Core Product Offerings and Brand Name ..................................................................................... 45 Trademarks, Labeling and Packaging .......................................................................................... 47 Service, Warranties and Usage Instructions ................................................................................ 48


Price ......................................................................................................................................... 48 Objective setting .......................................................................................................................... 48 Psychographic, Technological, Sociocultural, Demographic and Economic conditions with respect to International Pricing ................................................................................................................ 49 Demands and Cost Considerations ............................................................................................... 51 Pricing Strategies ......................................................................................................................... 52 Discounts and Allowances ............................................................................................................ 54

Place ......................................................................................................................................... 54 Promotion ................................................................................................................................. 56

Advertising/Copy/Artwork ........................................................................................................... 57 Media Channels & Technology ..................................................................................................... 58

Action Plan ....................................................................................................................... 61 Overview .................................................................................................................................. 61 Timeline for Launch of Franchise ............................................................................................... 63 Timeline and Budget for Promotional Programs ........................................................................ 65 Long Term Action Plan .............................................................................................................. 66 Additional Budgetary Considerations ........................................................................................ 67 Total Expected Budget .............................................................................................................. 68

Conclusion ........................................................................................................................ 68

References ....................................................................................................................... 69

Appendices ...................................................................................................................... 73


Executive Summary

Since it’s humble beginnings in Alberta, Canada, Booster Juice has grown and

expanded across North America. Now it is time for Booster Juice to expand even further, all

the way across the Atlantic to the United Kingdom. The UK is a strategic choice based on its

strong cultural and political similarities and an encouraging country analysis. As the UK is

currently experiencing a growing health trend, as seen by an increase in importance that the

public places on a healthy diet, coupled with a grab and go culture, Booster Juice can easily

capitalize on their North American successes within the UK.

To implement this expansion, Booster Juice will use a waterfall strategy to open three

test-‐market kiosks. These locations will be franchised with support and training offered by

the Canadian headquarters and a home-‐country expatriate for the preliminary stages. These

kiosks will be opened in London Heathrow International Airport, the Brent Cross Shopping

Centre, and in downtown London on Oxford Street. All three locations are situated in

London as it has the largest population base as well as a large number of international

visitors, who will likely recognize the Booster Juice brand. Many aspects of these kiosks will

be standardized from the North American stores, the colours and logo for example will be

kept as to increase and maintain brand familiarity. Other aspects will be localized and

adapted, such as the material of the cups, the location layout and promotional strategies, as

to meet UK norms and expectations.

To make this expansion a success, Booster Juice will separate itself from its two main

competitors, Boost Juice and Fuel Juice Bars, by carving out a new market niche, leveraging a


highly favorable home country image, entering at a low-‐price strategy, as well as unveiling a

strong marketing campaign to gain awareness. After the initial test period, if objectives are

met and Booster Juice is found to be profitable in the UK, a full roll out will be lead over the

entire region.

This recommendation will lead Booster Juice to meet its goals to go global and lead

to increased recognition worldwide, increased profits, and an even more successful

company and brand.

Introduction

Product Description

Booster Juice has searched the world for innovative and healthy products while also

pioneering the “superfood” movement as it has committed itself to being part of the

solution to the growing obesity problem in Canada and throughout the world (“Our History”,

2016). Booster Juice is working to combat obesity by offering a variety of healthy product

options that range from smoothies and fresh-‐squeezed juices to organic, ready-‐made hot

food offerings such as panini’s, quesadillas, and wraps -‐ a true departure from the

conventional fast-‐food world (“Philosophy-‐Product”, 2016). While Booster Juice does

provide hot eats, its main focus is on its superior smoothies and juice line, which has a

variety of offerings in it’s own right.

Specifically in regards to the smoothies, customers can choose between high protein

superfood smoothies, hardcore smoothies, spirit smoothies, superfood smoothies, and a


wide variety of “classic” smoothies. The company’s “one-‐of-‐a-‐kind smoothies are made from

ripe berries, delicious fruits, wholesome veggies and fresh active live culture yogurt, with

50% less ice than leading competitors” (“Philosophy-‐Product”, 2016). Booster Juice only uses

all natural flavours, with zero artificial sweeteners, colouring or alternatives, ensuring the

product’s dedication to premium organic ingredients (2016). Additionally, customers have

the option of adding a “booster” to their smoothies, such as whey protein powder or hemp

hearts, to give it that extra healthy boost the company’s active target market seeks to have

in their post or pre workout snack or as a meal replacement. Booster Juice also offers a

variety of delicious freshly squeezed juices such as Cool-‐Cumber, Maui Juice, Tahiti Squeeze,

and many more. Other various merchandise such as frisbees, hacky sacks, water bottles, and

wheatgrass juicers can also be purchased depending on individual preferences. As the

company’s menu reflects, Booster Juice is committed to serving delectable, premium

products that emphasize sustainable and organic food sources.

Company Background

Current President and CEO of Booster Juice, Dale Wishewan, has always had a

passion for health and fitness. In 1999, while travelling across the United States and

searching for a new business opportunity, he noticed the growing popularity of smoothie

bars (“Our History”, 2016). This observation hit home for Wishewan as he realized that

smoothie bars were the perfect solution to fill the hole that was in the Canadian fast-‐food

market for active individuals seeking a healthy alternative, therefore he decided to capitalize


on the opportunity (2016). As the next few months passed by, Wishewan created one

smoothie recipe after another, using friends and relatives as taste testing guinea pigs. It was

in this process that the modest origin of one of Canada’s largest and most successful

franchises can be realized.

Once the decision to establish the company was in place, a common vision was

created; “The Booster Juice approach is truly a unique food service concept that combines

great tasting products with unparalleled convenience while promoting a ‘health, freshness,

wellness’ message in a fun, vibrant, colourful & magnetic store environment” (“Philosophy-‐

Business”, 2016). The first Booster Juice shop to open was in Sherwood Park, Alberta in

November of 1999. The newly established company utilized its dedication to health,

freshness and wellness to make the most delectable yet healthful smoothies that enticed

customers, even in the midst of -‐25 degree Celsius Albertan winters (“Our History”, 2016).

Clearly, Booster Juice understood exactly how to satisfy its health-‐craving consumers

and was witnessing strong customer loyalty from the start. Due to steady initial success,

Wishewan was able to open 15 Booster Juice locations across Canada within the first year of

opening. Now, with over 300 locations in Canada, United States, and Mexico there is a new

franchise opening faster than 3 per month since the end of 2013 (“Philosophy-‐Business”,

2016). Achieving such strong brand recognition and customer loyalty throughout North

America and Mexico indicates that Booster Juice is more than ready and capable to offer

their fresh and delicious juices and smoothies to the UK market.


Problem Statement

Booster Juice is an industry leader in Canada and has experienced immense success

across the North American market. A company goal mentions that they aspire to one day

bring their delectable smoothies and juices across the world but have currently not done so.

Next Destination Mergers believes that in order for Booster Juice to continue their successful

growth, the next logical step is to expand the company outside of North America. The United

Kingdom is regarded as the most strategic start to this expansion as its culture strongly

reflects the culture of North America, making the new business development an easier

transition. An in depth analysis of the country, business, and marketing mix will be

conducted to further support this suggested expansion.

Country Analysis

Rationale for Expansion

Throughout the past few decades, consumer demand regarding food has changed

dramatically in the United Kingdom and the rest of the world. Consumers are now starting to

understand the impact that food has on their health and they are becoming increasingly

health-‐conscious. People are realizing that food not only serves the purpose of satisfying

hunger and providing nutrients, but it can also prevent nutrition-‐related diseases and

improve physical and mental well-‐being (Siro et al., 2008). Booster Juice offers smoothies

and juices in order to provide a healthy alternative to its customers. With the increasing

global trend of healthy eating, Next Destination Mergers believes the United Kingdom would


be both a favorable and lucrative market for Booster Juice to consider expanding its

operations.

Socio-‐Cultural Environment

Opportunities

The current population of the United Kingdom is 64.5 million, with the largest age

cohort ranging from ages 25 -‐ 40 years (World Bank & World Factbook, 2016).

Approximately 82.6% of the population lives in urban areas, most of which is concentrated in

London, with a population of 10.3 million. As most of the UK’s population is densely

populated in the major cities, it creates an opportunity for Booster Juice when determining

where to set-‐up shop. In 2008, a survey conducted by the Food Standards Agency (FSA)

revealed that 86% of British adults consider healthy eating to be of high importance, which

suggests that the majority of the British population believes that food, diet and healthy

eating are considered important (National Obesity Observatory, 2011). Additionally, findings

show that presenting healthy foods as an enjoyable option, opposed to as specifically a

health product, increases the chances of them being selected (2011). To Booster Juice’s

advantage, well-‐established fast-‐food companies that have strong brand awareness in the

UK are being faced with competition from growing health trends (Consumer Foodservice,

2015). Booster Juice is a product that is both healthy and tasty and because their brand

image represents this fact, it is likely that young adults who are concerned with their health


will be attracted to this product. In fact, teenagers are becoming more willing to pay for

higher-‐quality food than their adult counterparts (2015).

Recently, leading food chains have focused on offering more convenient methods of

ordering food to keep up with the growing demand from 100% home delivery (2015). Fast

casual dining represents a growing segment in the fast food sector, driven by the segment’s

healthy perception among British consumers (A Diverse Foodservice Sector, 2011, p. 10).

This presents an opportunity for Booster Juice to leverage the grab-‐and-‐go culture, offering

healthy products that customers can take-‐away from the point of purchase.

Threats

There has been a rise of budget gym facilities in London, England. Most recently

reported, budget gyms account for 21% of all fitness-‐club memberships and are growing at a

rate of 200% in the United Kingdom (The Economist, 2014). This socio-‐cultural trend

demonstrates that Britons are becoming increasingly interested in cheap alternatives to

achieve a healthy lifestyle. This is a limiting factor to Booster Juice’s potential success in the

UK as those looking to stay fit on a small-‐dime will not be likely to purchase an expensive

beverage to supplement their post-‐workout nutrition. In fact, a survey conducted in 2007 by

the Health Survey for England revealed that 20% of British respondents claimed that cost

prevented them from adopting healthier eating patterns (National Obesity Observatory,

2011).


Technological Environment

Opportunities

Globally, the fast food industry is rapidly adopting new technologies and it is

transforming the way companies identify growth opportunities. With 57.3 million Internet

users, 89.9% of the UK population is online and as of May 2015, 76% of Britons had

smartphones (The World Fact Book, 2014 & Mobile Consumers, 2015). Collectively, UK

consumers look at their smartphones over a billion times a day (Mobile Consumers, 2015).

Booster Juice can capitalize on this opportunity by integrating their marketing strategies with

Internet technology to better reach, connect and engage with their target audience through

their smartphones. Additionally, data and analytics from digital marketing efforts will

provide Booster Juice customer insight, which will help when making brand and product

management and pricing.

Contactless payment methods are a recent and growing trend in the UK market.

According to The UK Cards Association, contactless payments increased 215.4% from 2014

to 2015 (Contactless Statistics, 2015). As more UK consumers adopt these payment

methods, it would be opportunistic for Booster Juice to adopt NFC (contactless) card readers

so that all in-‐store payment methods are available at the customer's convenience.

Threats

A growing technological adoption trend in the fast-‐food retail industry is digital menu

boards. Digital menu boards offer full-‐colouring LED display images that allows restaurants


to promote menu times in real time and up-‐sell, giving those who have them a competitive

advantage over businesses that are still using back-‐lit or paper solutions. As more

restaurants follow this trend, Booster Juice will be forced to implement this technology to

compete with competitors. This will be a high added-‐cost for the business and thus a threat

for the company.

Environment

Opportunities

The UK Department for Environment Food and Rural Affairs defines waste as “any

substance or object in which the holder discards or intends or is required to discard” (DEFRA,

2012). Booster Juice smoothie products are given to the customers in a styrofoam container,

which becomes waste after the customer consumes the beverage. The UK is expected to

meet the EU target of recycling 50% of waste by 2017 and expect the government, local

authorities and businesses to work together to achieve this target (EEA, 2013). In the city of

London, expanded polystyrene, more commonly known as styrofoam, is considered waste

and it is required to be put in the waste bin when being disposed (City of London, 2016).

Booster Juice can become more socially responsible in the UK market by switching their juice

primary packing from styrofoam to PETE plastic, a recyclable product (2016). This

modification from styrofoam to plastic is an opportunity for Booster Juice because,

according to the Nielsen Global Survey of Consumer Shopping Behavior, one in four UK


consumers are choosing more environmentally-‐friendly products despite their higher price

(“Retail Gazette”, 2013).

Threats

It is predicted that the population of the UK will grow to be between 72-‐77 million by

2039 as a result of net migration (Cangiano, 2016). This growth in population places stress

on UK food production and prices for consumers within the region as they become more

reliant on imported foods. Currently, the UK has a self-‐sufficiency ratio for fresh fruit and

vegetables of just 12% and 58% respectively, demonstrating that they are reliant on

international food imports to sustain population demand in this food group (Wright, 2014).

Climate change is affecting global food production as rising temperatures have a direct effect

on crops yield, reducing the food availability in the UK, which in effect is contributing to food

inflation (UK Food Security). As Booster Juice’s product is reliant on fresh fruits and

vegetables, climate change and food scarcity will increase their direct material costs. Climate

change also has potential to affect the fresh fruit beverage industry in the long-‐term.

Economic Environment

Opportunities

Located in Western Europe, the high income, developed economy of the United

Kingdom is an open market where the price of goods and services are determined by a free

price system, helping attract potential organizations. The UK has a population of 64.5

million, making it the 22nd most populated country in the world (EIU, 2016). The


unemployment rate is 5.4%, which is quite impressive when compared to Canada’s

unemployment rate of 6.9% (EIU, 2016). The UK has a rather large economy that has the

capacity to support many major businesses. In 2015, the economy experienced a 2.2%

growth that is expected to level out and remain steady through 2016 and 2017 (EIU, 2016).

GDP per capita of the United Kingdom is $41,259, making it among the top thirty countries in

the world (EIU, 2016).

Since Booster Juice is a more expensive and healthy alternative, it is important that

the citizens of the country are able to afford it. Considering the fact that the UK is a well

developed and relatively wealthy country, people generally have higher disposable incomes

that they are willing to spend on healthier options such as fruit smoothies or fresh juice.

The UK is also united through a political union, the European Union, and is a member

of the World Trade Organization. Their top three trading partners are the United States,

Germany, and Switzerland. It is extremely important for a country to maintain positive trade

relations throughout the world because trade has become an integral part of being

successful in today’s world economy.

Threats

Since 1998, the United Kingdom has been running consistent trade deficits that are

mainly due to the increase in demand of consumer goods, decline in manufacturing,

depreciation of the British Pound and deterioration in oil and gas production (Trading

Economics, 2016). In October 2015, people worried that the dismal trade figures provided


further signs that the economy recovery has remained significantly unbalanced in the fourth

quarter (BBC, 2015). There are many negative implications of a prolonged trade deficit that

could eventually affect the UK. For example, over time, investors may notice a decline in

spending on domestically produced goods, which will hurt domestic producers and their

stock prices. Many are worried that if they do not begin spending less than they borrow, the

country may never be able to reverse the damages done.

Political Environment

Opportunities

The United Kingdom, like Canada, operates under a parliamentary democracy and

constitutional monarchy system (UK Government, 2016). A parliamentary democracy means

that the government is voted into power by the people, to act in the interests of the people.

A constitutional monarchy means that there is an established monarch, currently Queen

Elizabeth II, who remains politically impartial and has limited powers. The Prime Minister is

the head of the UK government and is responsible for all policy and decisions, which includes

overseeing the operation of the Civil Service and government agencies and appointing

members of government. The current Prime Minister is David Cameron and he is the

principal government figure in the House of Commons. Since the government structures in

both Canada and the United Kingdom are so similar, Booster Juice would be very familiar

with the political environment and would not have to learn how to adjust to a different


system. This political know-‐how will most definitely work in favor of the company as it

enters this new market.

Threats

There have been major discussions recently regarding the United Kingdom leaving

the European Union altogether. This exit could cause a number of negative implications for

the country. People believe that this exit could potentially tarnish the UK’s reputation of

being a major financial centre. It also may cause them to lose negotiating power, weaken

their overall military and could cause other countries to view them as a weaker ally than

before. The United Kingdom’s relationship with the rest of Europe remains a hot topic and

the referendum on June 23, 2016 will be a very important day for all.

Legal Environment

Opportunities

Since the 1960s, when the very first franchises were launched in the United Kingdom,

this entry strategy has continued to flourish and become an extremely effective technique

for expanding business (Drakes, n.d.). As of 2013, there were over 900 franchises operating

in the UK across a variety of sectors, boasting an annual turnover of 13.7 billion GBP

(Franchise Know How, 2016).

International businesses are attracted to the UK for a number of different reasons,

including their reputation for being a lightly regulated place to do business and the

perceived efficiency and fairness of the English court system in resolving international


commercial disputes. The Code of Ethics of the British Franchise Association provide a

benchmark for good industry practice in relation to issues such as advertising, recruitment,

fairness in the franchise relationship, and dispute resolution. Overall, if Booster Juice wants

to expand their operations, the laws in the United Kingdom allow franchising to be an

extremely realistic and viable entry mode.

Threats

Through conducting research, it was discovered that there were no major legal

threats present in the United Kingdom that could hinder the success of Booster Juice.

However, with any franchise, which according to the company’s website is Booster Juice’s

preferred mode of entry when entering new markets, there are some possible complications

to consider. For one, since the franchisor sells intangible property to the franchisee, they

may lose power on some quality control issues (Cateora et al, 2011, p. 334). The franchisor

must trust that the franchisee will abide by a variety of rules on how to do business, and if

the franchisee does not follow through, a messy lawsuit could ensue. Furthermore, the large

geographical distance between Canada and the UK could make it difficult for the franchisor

to detect poor quality (p. 334). Since they are not physically close together, it is hard to

supervise the operation and make sure everything is running as smoothly as it would back in

the home country.


Business Analysis

Mode of Entry

The United Kingdom is an appealing market for Booster Juice to expand into for a few

key reasons including free trade, a rich and tech savvy economy and the nation has a huge

potential customer base due to its vast population, as stated earlier in the socio-‐cultural

environment of the country analysis. However, it is important to note that while the focus of

the country analysis is on the entire United Kingdom, it is believed that it will be more

strategic for Booster Juice to initially open up shop solely in England as this nation has the

highest population density (53 million) when compared to Scotland, Wales and Ireland, that

have a combined population of 10 million (“United Kingdom: Countries and major cities,

n.d.). Furthermore, approximately 82.6% of the United Kingdom’s population resides in

urban areas, most of which is concentrated in and around the downtown core of London

(World Bank & World Factbook, 2016), a statistic that supports the expansion decision.

Therefore, if Booster Juice experiences success within the English market, the plan is to

expand operations into the rest of the United Kingdom.

It is imperative for Booster Juice to closely examine all possible modes of entry

because the company needs to ensure it utilizes the appropriate method for their product

and brand. There are five possible modes of entry that Booster Juice could use when

expanding into England. These include exporting, turnkey projects, contractual agreements,

joint ventures and wholly owned subsidiaries. Each of these expansion options will be


examined in regards to their advantages and disadvantages in order to select a mode that is

believed to be the most successful and lucrative for the company.

Advantages & Disadvantages of Each Mode of Entry

Exporting

Prior to choosing which type of exporting method would be a favorable mode of

entry for Booster Juice, the product in which they wish to export must first be explored.

Booster Juice’s main products are fresh smoothies and juices. However, when considering

exporting smoothies internationally to England, the fresh aspect of their product is no longer

achievable. Booster Juice makes all their product fresh in-‐shop and currently, the company

does not have the business capacity or facilities to mass produce and pre-‐package their fresh

products to be exported internationally. For that reason, it would be ideal for Booster Juice

to consider exporting their Whey Protein Powder because it is a prepackaged product, has a

long shelf-‐life nor is it marketed as a fresh food product.

There are two different methods Booster Juice can consider when exporting their

products. The first method is to directly export their product to another international

company or customer (Cateora et al, 2011, p. 315). The second method is through indirect

exporting, which would require Booster Juice to sell their product to a buyer who in turn will

export the product (p. 315). Indirect exporting is the safer method between the two, as it

minimizes the risks and financial losses for companies just beginning to export their product

internationally (p. 315). When comparing the two methods, it would be ideal for Booster


Juice to indirectly export their product to England through a Canadian wholesaler that

distributes health supplements. This method would be the best option for Booster Juice as it

would confirm that their product reaches supplement retail-‐companies in England free of

charge. Selling their product to Canadian wholesalers would provide additional guaranteed

profit as well and save Booster Juice capital they would have otherwise had to spend

negotiating export logistics for a product the company already puts so little emphasis on. If

Booster Juice is successful in exporting their product this way, they should then consider

diversifying their health supplements, then directly market these products to retailers and

wholesalers in England.

Turnkey Projects

A Turnkey Project is essentially, a ready-‐to-‐use project that has been constructed and

sold to a buyer (El Banna, 2016). Generally, the contractor will construct the plant and train

personnel until the terms of the contract have been completed and then the client will be

given full control of the operation. Turnkey projects are typically implemented when dealing

with production technologies, which can be complex and expensive such as chemical,

pharmaceutical, and refining industries. Some advantages to this method include earning

large economic returns from the knowledge and expertise given from the turnkey project

process, and limits political or economic risk (2016). Turnkey project owners are also

relieved of any additional costs of potential defects; the contractors cover these costs. These

projects usually begin before finalization of plans resulting in a shorter timeline (Shapiro,


n.d.). One major disadvantage, from the perspective of the contractor; is that it could create

competitors by selling competitive advantages and/or technology (El Banna, 2016).

Additionally, there would be loss of control over the project in terms of design and

execution, leaving little to no room for changes to meet needs. Also, the contractor is in

charge before purchase, which can lead to the elimination of a third-‐party “quality control”,

resulting in a quick, cheap, and project of poor quality (Shapiro, n.d.). Given this

information, Booster Juice might not benefit from a turnkey project as it would not leave

much room for alterations or creativity, therefore the products from the original project and

Booster Juice would have to be the same or similar for success.

Contractual Agreements

Contractual agreements are a long-‐term non-‐equity association with a company that,

in the case of this report, is already well established in England (Cateora et al, 2011, p. 318).

It is a mode of entry that Booster Juice commonly implements and, because they have

successfully opened multiple locations in both the United States and Mexico using this

method, it suggests that this is a great starting point when merging into a new market that

already has a large health-‐conscious consumer base (National Obesity Observatory, 2011).

There are two main types of contractual agreements that Booster Juice could implement

when entering the English market. These two types are licensing and franchising.


Licensing

Essentially, a licensing agreement is an arrangement whereby a licensor grants a

license for a specified period of time to a licensee in exchange for a royalty fee (Cateora et

al, 2011, p. 318). The license would give the licensee access to intangible property such as

copyrighted materials, patents, inventions, designs and trademarks when processing or

selling Booster Juice products in England (p. 318). Typically, this mode of entry is viewed as a

supplement to exporting and is a major advantage if capital for the company is insufficient as

licensing is a means of establishing space in foreign markets without significant capital

investment (p. 318). Another advantage that comes with this mode of entry is that both the

licensor and licensee do not have to cover the high development costs and risks associated

with entering a foreign market. However, there are also disadvantages and risks associated

with this method of expansion. For example, licensing means potential loss of control over

manufacturing, marketing and strategy. As a result, precautions would have to be taken to

ensure that the actual smoothies and health food products and their marketing are

maintaining high quality. Another disadvantage that is a potential turn off to this method of

entry is that it is often the least profitable way of entering a market (p. 319).

Franchising

Franchising is a form of licensing in which the franchisor in the home country supplies

a standardized package of products, systems and management services to the franchisee in a


foreign market, which in return provides market knowledge, capital and personal

involvement in management (Cateora et al, 2011, p. 319). Typically, the franchisor drafts an

agreement with the franchisee that include details about how the franchise should look and

operate (Canada Business Network, 2015). It is for the above reasons that franchising is a

very popular method of expansion for foreign market entry.

Booster Juice provides many opportunities for individuals who want to purchase its

franchise. For one, Booster Juice provides single/multi-‐unit franchisee opportunity for

individuals who have drive and motivation to enjoy life and spread their passion to their staff

and customers (“Booster Juice Franchise Business Opportunity”, 2015). As well, Booster

Juice provides master developer opportunity for people residing outside of Canada who

have a successful business history, strong financial backing and the desire to develop and

support a regional territory (2015).

A crucial advantage that comes with owning a franchise is that one can directly

obtain the turnkey store development, design, permit, management of contractors, and

store setup (Cateora et al, 2011, p. 320). In addition, the franchisee will be given top of the

line equipment that focus on labor efficiency, customer experience, speed of service and low

on-‐going maintenance (p. 320). The franchisee can also receive support with site selection,

high quality ingredients at a low cost, specific training and a complete operations manual.

Nevertheless, there are still some disadvantages of owning a franchise, such as losing

flexibility to run the business and ongoing costs such as royalties and advertising. Moreover,


due to the geographic distance of the firm between Canada and England, franchising can

make poor quality difficult for Booster Juice to detect. However, despite these few

difficulties, Next Destination Mergers believes franchising would be an excellent entry mode

to expand business to England.

International Joint Venture

An international joint venture occurs when two or more companies mutually own a

new separate and independent firm, leading to a share in management and equity (Cateora

et al, 2011, p. 321). When moving into the English market, an international joint venture

may be able to provide assistance to Booster Juice. This is because by offering knowledge on

the host country’s competitive conditions, culture, language, and its political and business

systems, a local partner could ease the transition into the new market. This mode of entry

also leads to less risk for the firm entering the foreign market as the costs and risks are

shared with the local partner (p. 322). International joint ventures do, however, come with

disadvantages. Booster Juice risks giving control of its business and technological know how

to its partner firm in England, not allowing for complete jurisdiction over business decisions.

This mode of entry can also lead to conflicts over time if goals and objectives begin to

deviate between firms. It is for these reasons that it is suggested that Booster Juice does not

pursue an international joint venture. The lack of control over the company and sharing

technological insights is not ideal, and because England is similar to Canada in many


respects, Booster Juice, with the proper research, could make a strong entrance into the

English market (and eventually the entire United Kingdom) without a local partner.

Wholly Owned Subsidiaries

Overall, a wholly owned subsidiary is when a firm owns 100 percent of the stock and

is seen as the ‘parent company’ of another (El Banna, 2016). Establishing a wholly owned

subsidiary in a foreign market can be done in two ways. The first would be to set up a new

operation in that country, this is known as Greenfield investment. The second would be to

acquire an established firm and use that firm to promote its products in the country’s

market, known as acquisition. The two strategies will be explained in further detail below.

Greenfield Investment

One consideration under wholly owned subsidiaries is a Greenfield investment.

Although Booster Juice’s current mode of entry for their locations within Canada, the United

States and Mexico are done through franchising, Greenfield investment is still an option they

could switch to when entering England’s market. Greenfield investment is when a company

starts a new venture in a foreign country by constructing operational facilities from the

ground up. Some advantages of this approach is that it reduces the risk of the firm losing

control over their compliance, however, it is also one of the most costly methods when

entering into a foreign market. Although this option would allow full company control in

terms of quality, entry and marketing, it lacks the local cultural knowledge that Booster


Juice’s current mode entry, franchise and turnkey, offers for the company and it is the

expansion method that is the most expensive.

From a marketing perspective, much market research would have to be conducted in

order to fully understand this market before entering as a Greenfield investment.

Nevertheless, even extensive marketing research is sometimes not enough to fully

understand the market and local expertise works best to assist the ease of entry, which is

something Greenfield investment lacks.

Mergers and Acquisitions

Mergers and acquisitions is an overall term used to describe the consolidation of

companies, but it is important to note that these two activities are somewhat separate. A

merger would require the two companies (Booster Juice) and another local English company

to ‘merge’ together to form a new company. On the other hand, an acquisition is the

purchase of one company by another (Booster Juice purchasing a local business) to sell their

products.

A merger would allow Booster Juice to combine their own expertise with a local

business that already understands the culture and demographic of the English market.

Although this would reduce entry risks, this option would also take away from the Booster

Juice brand itself. In terms of an acquisition, this would require Booster Juice to actually

purchase an already established local business within England’s market. The advantage of

this option is that it takes away some entry risks, as the local business is already adapted to


the local markets. This mode of entry is definitely a safe and quick way to acquire a business,

with a greater likelihood of initial financial gain as products are sold through an already

established local business. This means the marketing and branding expenses will not be as

substantial compared to other modes of entry. Although this would allow initial success, it

would still be up to Booster Juice to fully understand the market in England when taking over

the new acquired business for continued adaptation to the local market. One risk of this

option, as stated above, is that it takes away from Booster Juice being able to fully establish

their ‘Booster Juice’ brand, as they would be established under a different name. It is noted

that Booster Juice does not currently use mergers and acquisitions as a mode of entry

method.

Selection of Mode of Entry

Based on the above analysis of the advantages and disadvantages of the eight main

methods of expansion into foreign markets, Next Destination Mergers believes the best way

to enter London, and later expand fully into the entire United Kingdom, is by utilizing

franchising as the selected mode of entry. The city of London is understood as the most

strategic initial place of entry into the English market because, as stated in the socio-‐cultural

environment in the country analysis, it has the largest population and metropolitan area

within the entire United Kingdom, therefore Booster Juice stores have a better chance of

creating brand recognition and attracting active customers in this location.


To begin, it should be noted that one of the most important factors when it comes to

international franchising is to ensure the franchisees have enough information about their

foreign markets economic and regulation power because, without this vital understanding,

the franchise is bound to fail due to violation of the law or misunderstanding the economic

situation. Another important factor is to establish a good relationship between the

franchisor and franchisee, as this is crucial for a seamless expansion.

In order to open up a Booster Juice franchise in the city of London, the first step is to

choose a developer who has a successful business history, strong financial backing and is

familiar with the regional territory (“Booster Juice Franchise Offering Circular”, 2006, p. 2).

Booster Juice currently offers an opportunity for international developers called Master

Developer. For the Master Developer, Booster Juice has already determined the franchising

price. It requires that the developer have minimum financial net worth of $350,000 and

liquid assets of $100,000 while the initial franchise fee is $20,000 (“Franchise Info-‐Costs &

Qualifications”, 2016). Upon satisfying these mandatory requirements and complying with

the franchise agreement, the developer can purchase a Booster Juice franchise and start the

business in the agreed upon location and establish a store space. Based on research, it is

recommended to open a smoothie-‐bar kiosk in the Heathrow International Airport. This is

recommended because Next Destination Mergers came across a news article on the

company website about how in 2014, Booster Juice was listed as one of the top six airport

franchisors in North America (“Booster Juice: The Only Canadian Franchisor to Make the


List”, 2014). It is also important to note that Booster Juice was the only Canadian franchisor

to appear on this prestigious list, indicating that the Canadian company is quite competitive.

As well, it is recommended that a kiosk is located in an international airport because

customers travelling from North America will most likely recognize the Booster Juice brand.

This could work in the company’s favor because these consumer’s brand recognition can

provide the company word-‐of-‐mouth advertising because Canadian tourists may talk about

Booster Juice smoothies and recommend the brand to British and other international

tourists. Because Booster Juice has already experienced success in the airport space in North

America and because the country analysis found that fast casual dining represents a growing

segment in England, it would be wise to bring this grab and go kiosk to the English market.

Additionally, another recommended franchise location is within a major shopping centre,

such as Brent Cross Shopping Centre. This specific shopping centre is recommended because

there is a high amount of customer traffic that falls within the Booster Juice target market of

active, urban-‐chic, individuals between the ages of 25 and 40 that will be shopping for

workout clothes or health food items. Booster Juice also plans to open one more location

within the downtown core of London on Oxford Street, please refer to place in the

marketing mix section for more on this.

When it comes to the dimensions of the actual space, the first few smoothie-‐bar

kiosks that open will be between 120 and 400 square feet because these measurements will

be cost efficient as it minimizes rental fees that are associated with opening a franchise. As


these kiosks will be the first locations in England and Europe as a whole, the company will

provide a comprehensive franchising guide for the international developer to ensure their

operation is following the company’s requirements.

The next step in the franchising agreement is to provide two weeks of training to the

developer. The purpose of this training is to guide the developer and help them gain a deep

understanding of the company’s corporate culture and operational procedures. It is useful

for the developer to have a clear understanding and consideration about how they can

combine North American values with British values. During preparation and the first month

of business, the company will dispatch a home-‐country expatriate (HCE) to provide

management support and help with any problems that may emerge at the preliminary stage.

Home-‐country expatriates (HCE) are simply people who are not nationals of the country in

which they work (Cateora et al, 2011, p. 511). In the case of Booster Juice, there will be a

Canadian relocating to England to help and support initial franchising operations.

If this initial franchise expansion proves to be successful, then Booster Juice can

attract more international developers to open up shop in the rest of the United Kingdom.

Additionally, given initial success, the English franchises can increase the size of their kiosks

to further develop the operation and attract more customers. With time, these franchises

will better understand how Booster Juice can fully integrate and adapt to the British lifestyle,

which will inform the expansion strategy into the rest of the United Kingdom.


Finally, the marketing strategy Booster Juice will focus on is tailoring their

promotions and customizing the products based on British taste and values. More details

about the levels of standardization and adaptation will be provided in the strategic

orientation section and more on promotions can be found within the marketing mix section.

When it comes time to plan further operations into the United Kingdom, the

company will conduct market research profiling British consumer attitudes in regards to

Booster Juice expansion into the UK to gain a deeper understanding of local consumers

wants and needs in regards to the expansion as well as to acquire insight into where Booster

Juice should develop its operations.

Strategic Orientation

Once the best mode of entry has been chosen, the next thing to tackle is strategic

orientation. Specifically, the desired scope of Booster Juice’s international operations. Next

Destination Mergers has decided the waterfall strategy will be the best overall strategy for

Booster Juice’s expansion. The waterfall strategy occurs when the firm puts all of its

available resources into one or a select few markets (Cateora et al, 2011, p. 311). This is

believed to be the company’s best option, when compared to the sprinkler strategy, because

it gives Booster Juice time to truly understand the English market, thus it is more likely to

make appropriate adjustments to the marketing mix to satisfy local needs and wants before

full expansion into the UK (p. 312).


Moreover, when entering London and eventually the rest of the United Kingdom, it is

important for Booster Juice to determine the right balance between standardization and

adaptation of its offerings. In regards to the EPRG framework, the company will achieve this

balance through a regional/global market orientation. This simply means that there are

aspects of the marketing planning and marketing mix that are standardized however, where

cultural uniqueness dictates the need for adaptation of the product, promotions, image,

etcetera, it is accommodated (p. 25).

After consulting the country analysis and conducting further research, it was decided

that it will be both cost and culturally effective for Booster Juice to standardize the

company’s logo, smoothie and juice products, cup design (including the bright colours and

font), reusable Booster Juice branded mug from the merchandise store, and the convenient,

grab and go nature of the Booster Juice experience across the entire United Kingdom. The

company logo and cup design should be standardized across markets because Booster Juice

wants Canadian tourists to recognize its brand and products within the UK market while,

eventually, getting British (Scottish and Irish) tourists to recognize the brand when visiting

Canada (See Appendix 1, Standardized Booster Juice Logo). The smoothie and juice products

will be standardized because it is both a cost effective strategy and some fruit that may

seem standard in North America is considered to be unique in the UK, such as cantaloupe.

The reusable Booster Juice mug is the only merchandise, besides the smoothies and juices,

initially coming over to the English market because it signifies to consumers that the

company promotes social responsibility. Moreover, as stated under environment in the


country analysis, one in four UK consumers are choosing more environmentally friendly

products despite their higher price; therefore keeping the reusable mug is a strategic

inclusion. As well, Next Destination Mergers wants Booster Juice to standardize the

company’s convenient nature because this strategy is very successful in the North American

market and research indicates the same for the United Kingdom. For example, a survey

conducted in 2013 on British fast-‐food consumption found that, on average, Britons spend

£110 on fast-‐food every month (McCann, 2013). The study indicates that because the British

spend a fair amount on ready-‐made meals, that this grab and go culture almost dominates

their eating patterns outside of the home (2013). Moreover, according to the 2008 British

Social Attitudes Survey (BSAS), Britons are increasingly concerned with living a healthy

lifestyle and consuming healthier foods (BSAS). With this information in mind, Booster Juice

believes that customers of England, and later the entire United Kingdom, will see Booster

Juice as a healthy alternative within the booming fast-‐food market because the company’s

focus on providing healthy smoothies that are plentiful with vitamins, probiotics and protein

is consistent with the British lifestyle, according to the information given in the BSAS survey.

However, because the UK market does differ from the Canadian market in some

respects, it is important to adapt and tailor particular aspects of the franchise to fit the UK

market. Therefore, Next Destination Mergers believes it would be cost and culturally

effective to adapt the material of the cups from styrofoam to PETE plastic, the kiosks will

have the same bright yellow/pink/purple colours but the rest will be a darkly stained wood


bar (very modern and sleek) with phone charging stations, remove all food items from the

menu and other associated merchandise (hats, frisbees, etcetera.), offer only one size as

opposed to a regular and snack, and tailor the promotional strategy to the UK market.

Although the company will use the same design of cups, the material will be modified

from styrofoam to PETE plastic because it is recyclable. This adaptation is beneficial for both

the company and local consumers because more and more UK consumers prefer eco-‐

friendly products (“Retail Gazette”, 2013) and, because plastic cups keep consumers happy,

it pushes them through the Booster Juice door, which generates revenue for the company.

Next Destination Mergers wants to adapt the kiosk to be more sleek and modern (decorated

with a dark wood counter and a few wooden stools), when compared to the kiosks in North

America, because Booster Juice is targeting active, hipster-‐esque, urban-‐chic consumers with

its products in the UK. The phone charging station is added because, as stated under the

technological environment in the country analysis, 76% of Britons have smartphones and

having this will attract more consumers to the business and will also keep customers happy.

As well, all food items and additional merchandise, except the reusable mugs, will be initially

removed from the Booster Juice franchises across the UK because it will be cost effective for

the company to stop their production. Furthermore, because Booster Juice is not yet well

recognized within the UK, Next Destination Mergers wants all focus on the delicious

smoothies and fresh-‐squeezed juices because it will appeal to health-‐conscious consumers.

The company is also removing the choice between regular and snack size and offering only


one size because it will help the company to save for fruit import and storage costs. Finally,

it is crucial for all promotions to be fairly adaptive when moving into the UK because, for

example, there are a few strong competitors (as opposed to only one competitor existing in

Canada) in this market, so promotions will have to be altered to stand out and grab the

attention of consumers.

Key Objectives & Limitations of Expansion into England

There are many variables to consider when entering an international market. For

example, it is challenging for a niche business to compete in a foreign environment that has

already been influenced by other competitors, such as Boost Juice and Fuel Juice Bars.

Nevertheless, Booster Juice does have key objectives that it plans to achieve upon

penetration of the UK market. Because Booster Juice places high value on their fresh,

organic juice and smoothies and lives by its slogan “squeeze more out of life,” its first main

objective is to make healthy eating fun and enjoyable for people all over the world. The

company can achieve this objective because they are setting up a juice bar in a market

where 86% of British adults consider healthy eating to be of high importance.

The second objective is to gain brand awareness for Booster Juice in the new market

for the first year, before expanding to the rest of the UK. As a Canadian specialty juice brand

entering an urban and trendy market, it is necessary to emphasize the juice and smoothies

as a high quality, reasonably priced, “Made in Canada” brand. Focusing on the “Made in

Canada” aspect will be useful for Booster Juice because it will work to attract customers due


to Canada having a highly favorable country image within the UK. In addition, seeking 75%

customer satisfaction within the first year of expansion is a realistic goal for the firm and this

will be determined through online and in-‐person customer surveys.

By the end of 2016, the third objective is for Booster Juice to analyze their success

with the London kiosks and decide from there if the company wishes to expand further into

the United Kingdom in the long term. If both of the above objectives are met and Booster

Juice is making a moderate to good profit margin, then the plan is to open more franchises in

the largest cities across the UK.

Nevertheless, there are still some limitations that must be considered as they have

the potential to disrupt Booster Juice’s expansion into the United Kingdom. The first

limitation is that there is absolutely no guarantee that people will accept the new Booster

Juice brand, as there are already two established smoothie bars, Boost Juice and Fuel Juice

Bars, penetrating the UK market. For example, Boost Juice has over 30 locations within the

United Kingdom currently (“Boost Australia”, 2016). Therefore, will be challenging for

Booster Juice to assert dominance as Boost Juice already has established infrastructure and

customer loyalty. Due to strong competition, it is imperative for Booster Juice to develop a

great marketing campaign that will prove to the Brits that they are a juice and smoothie

brand they can trust. Moreover, it is vital for Booster Juice to differentiate themselves in this

niche market.


Cost is another major limitation for the company’s expansion. Firstly, not everyone is

willing to pay premium price for smoothies and fruit juice. Secondly, the fruits used in

Booster Juice smoothies and juice must be imported from other countries, which is very

costly for the company, especially during the off-‐season. Thirdly, the current low value of the

Canadian dollar when compared to the British pound is another obvious problem. To

counter these limitations, Booster Juice is working to be cost effective wherever possible, as

mentioned in the strategic orientation section.

Market Segmentation

Booster Juice is a strong Canadian company providing on-‐the-‐go service with a focus

on health. The company has correctly identified and targeted their own market leading to its

current popularity. Booster Juice has successfully employed demographic, geographic,

psychographic, and behavioral segmentation to divide their market in Canada and will now

have to do it again as they enter the London and eventually the entire UK market. Although

the UK is very similar to Canada in many respects, the markets and consumer base do differ.

Therefore, it requires a comprehensive segmentation in order to make Booster Juice’s

entrance into the UK market a success.

Demographic

The United Kingdom’s demographics, particularly those involving age and income, set

the scene for a healthy environment for Booster Juice’s entry.


The United Kingdom’s current population, as mentioned in the socio-‐cultural

environment in the country analysis, sits at 64.5 million, with the majority of the populace

between 25-‐40 years of age (World Bank & World Factbook, 2016). This is an ideal age

range for smoothies and Booster Juice as these consumers are most likely post-‐secondary

graduates, with full-‐time jobs, who are busy and constantly on-‐the-‐go but who still desire

healthy options. Interestingly enough, as found when analyzing the UK’s socio-‐cultural

setting, those willing to purchase and pay for high quality food is quickly being filled by the

teenage market, more so than the adult cohort, making this age demographic another target

market in the fresh juice and smoothie industry (Consumer Foodservice, 2015). A low

unemployment rate of 5.4 % also means consumers in the UK have the disposable income

necessary for made-‐to-‐order smoothies (EIU, 2016). Since the UK is a wealthy country with a

strong GDP, the demographics of the area reflect an educated and high-‐income population.

Geographic

In order to attract customers in a market already familiar with fresh smoothie and

juice vendors, Booster Juice should look to gain presence in high traffic areas. Since such a

large amount of the population lives in urban areas, mostly concentrated in the downtown

core of London, starting with three test-‐market locations, Heathrow International Airport,

Oxford Street, and the Brent Cross Shopping Centre, means Booster Juice can get a sense of

how the UK business atmosphere operates and begin to build a positive image and

relationship with consumers. These locations target the on-‐the-‐go attitude Booster Juice


looks to convey while, in the case of the Shopping Centre and Oxford Street, reach

customers as they buy products related to Booster Juices values of healthy living. By

connecting with the culture, community, and feel of each test-‐store location, Booster Juice

can bond with customers to build a strong brand image leading to success. The customers

that visit these shopping areas are young, active, and seek a healthy lifestyle, just like the

customer base Booster Juice is targeting. It is also a large tourist destination and, like the

Heathrow location, can give those visiting London from North America the chance to enjoy

the same great smoothies and juices abroad as they do at home.

Psychographic Using psychographics as a segmentation tool will concentrate on targeting health-‐

conscious consumers. The market is beginning to appreciate the effect of diet on their

health and realizing that food not only satisfies hunger and provides nutrients, but also

prevents disease and improves their overall quality of life (Siro et al., 2008). As discussed in

the socio-‐cultural environment of the country analysis, 86% of British adults rate healthy

eating as being of high importance (National Obesity Observatory, 2011). This is significant

for Booster Juice as it shows there is a strong customer base for healthy drinks among adults

residing in Britain. Because these individuals believe healthy eating is vital, they will likely

turn to Booster Juices for their smoothies and freshly squeezed juice products. Overall, the

British population values living a healthy lifestyle, as noted in the 2008 British Social

Attitudes Survey, and sees drinking juice as a clear choice in maintaining a healthy diet. This


shows that many consumers across the UK believe in the power of the products Booster

Juice sells and the company can segment the market on consumer beliefs toward healthy

living.

Behavioral Behavioral segmentation will look at the lifestyles of those in the UK in regards to their

on-‐the-‐go, health conscious actions and decisions. The socio-‐cultural environment in the

country analysis noted that the UK market is seeing growth within the fast food sector,

particularly for fast, casual dining. This is fueled by the healthy perception this style of eating

has received from consumers (A Diverse Foodservice Sector, 2011, p. 10). Booster Juice will

fall perfectly into this market, offering a sit-‐down option at the smoothie bar, or allowing for

customers to purchase their drink and go on with their day. All of Booster Juice’s products

are healthy and made for the active consumer, allowing for customers to have their

smoothie as a quick snack or meal replacement, or even a post-‐workout option, without any

of the calorie guilt.

On average Britons spend £110 on ready-‐made foods and meals a month. This is a

high amount per person, allowing for purchases on Booster Juice products to be made

without customers feeling an effect on their wallets. This grab and go behavior makes up a

large amount of Britons eating habits, giving Booster Juice yet another opportunity to reach

the market (Mccann, 2013).


Booster Juice will also segment its market on not only how health conscious

consumers are in their buying behavior, but also their personal action when it comes to

fitness. Those who demonstrate an ongoing commitment to the gym and leading a physically

active life are of great interest to Booster Juice when entering the UK market.

The Target Audience

With so many ways to segment a market, Booster Juice is left with multiple targeting

options. To narrow down this choice, the consumer base’s age, income, and level of health

focus will be concentrated on. While it is important to consider all potential markets,

Booster Juice will best perform with identified primary, secondary and tertiary markets (See

Appendix 2, Segmentation Grid).

The most profitable of these options, the primary target market, will be the active

25-‐40 year olds living in an urban environment with a hipster-‐esque way of life. They live a

healthy lifestyle, balancing work with their social lives and making conscious choices to

maintain a model diet combined with exercise. They have middle to high incomes as to be

able to afford made-‐to-‐order fresh smoothies and juices. They desire a “cool” atmosphere to

enjoy high quality, fresh drinks, while still having a grab and go option. They are attracted to

modern designs, using natural elements and clean lines and the feeling of belonging to

something unique and somewhat upscale without paying above average prices. This target

market can be reached through advertising focusing on the chic, trendy, hipster, atmosphere


Booster Juice will deliver. Fresh ingredients will be another large focus in attracting this

market segment, emphasizing the healthy attributes and effects of the offered products.

Youth, aged 10-‐24, with high incomes and a high level of health focus make up the

secondary market for Booster Juice in the urban UK. This age cohort is smaller than those

aged 25-‐40 and these potential customers have less disposable income. Consumers in this

stage of life are most likely to still be in school at some level, or have recently graduated and

are just starting their professional lives. This means they have limited income and may

decide to make their own smoothies at home as a way to save costs. A high health focus is

what makes this group likely to visit Booster Juice as well as a sense of being “accepted” by

visiting the same establishment as the successful 25-‐40 year old market. This demographic is

also less likely to live in the city core and would require forms of promotions, such as an app,

that Booster Juice would not be ready to launch without more market experience. These

consumers could potentially be reached through special events, much like Starbucks

“Frappuccino Happy Hour”.

Booster Juice’s tertiary market is focused on those who are slightly older than the

target. These consumers, aged 40+, are also of a high to middle income and are very

concerned with their health. This age cohort is harder to reach than their younger

counterparts and are very much set in their ways. They have gone through much of their

lives without the Booster Juice brand and may not see the purpose of changing their out-‐of-‐

home food purchasing habits. This group also separates itself from its fellow segments by


caring less about image and trendy ambiance of their on-‐the-‐go eating establishments,

something the other market segments value. They could be reached through purpose and

fact based advertising, illustrating the positive effect drinking at Booster Juice can have on

one’s health.

Within the fast food and casual dining environment in the UK, particularly Britain,

Booster Juice finds itself facing two main competitors, Boost Juice and Fuel Juice Bar (See

Appendix 3, Perceptual Map). Both of these businesses are well established in the

marketplace, putting Booster Juice at a disadvantage. However, by using information listed

on the companies’ websites and perceptions based off of their online presence, on a

perceptual map Booster Juice rates higher in choice variety while also being placed lower on

price. This places the company in an optimal location when being introduced into the new

market and shows unique strengths over its competitors. By leveraging Booster Juice’s

Canadian background with a focus on quick, healthy drink options, served from small kiosks

with a bar to lower costs compared to competitors with larger stores, Booster Juice can

distance itself from other smoothie and juice vendors and carve out its own niche, urban-‐

chic, corner of the market.

Marketing Mix

Product

A brand's product can be positioned in many different ways—what is seen as

valuable in terms of product attributes in one country, may not be as attractive in another


(Cateora et al, 2011, p. 438). There are typically four different cases to segment a brand’s

product in a country: Case 1: A product currently branded as ‘A’ in one market and ‘B’ in

another. This case typically occurs when two countries are very different in terms of market

needs, thus, needing to create two different marketing strategies to successfully target these

markets (p. 439). Case 2 results in a product currently branded and marketed

homogeneously amongst all regional markets—this approach utilizes economies of scale in

the sense that it standardizes products across all markets, with little to none package

changing, labeling and other marketing initiatives, treating all regions or countries the same

(p. 439). Case 3 results in a product following a customization strategy, but for corporate

reasons, needs to be standardized in terms of selecting an existing brand name and message

strategy, then switch all other factors to this selection (p. 439). Case 4 is when a product is

currently being branded and marketed differently across markets, but with the market

wanting to achieve as much standardization as possible, without sacrificing local

responsiveness. In this strategy, a solution is for the brand name to be standardized across

all markets, with a two-‐tier system in place in order to standardize what is needed, while

capturing local responsiveness at the same time (p. 439).

It is advised for Booster Juice not to implement Case 1, as careful and in-‐depth

external research (as seen in the country external analysis) indicated that there are no

drastic differences between the UK and Canada where re-‐branding would be seen as

necessary. Furthermore, this strategy would be extremely costly to implement, which will be


elaborated further within the pricing strategy. Case 2 was not seen as an appropriate

method for Booster Juice to use because although Canada and the UK are relatively similar in

terms of language, social cultural factors, etcetera, they do differ enough where some local

responsiveness would benefit Booster Juice’s transition into the market. Additionally,

although case 2 is cheaper to implement since it uses the benefits of economies of scale, it

can be seen as a risky method, as no local responsiveness can diminish any value added for

the customer, as well as customer enthusiasm towards the product (p. 439). Case 3 was not

chosen as there are no corporate reasons specifying that the product absolutely needs to be

standardized under certain conditions.

After examining external factors of the UK market, it is suggested that if Booster Juice

is to successfully position their product in this region, they should implement case 4. This

case allows Booster Juice to standardize where there is overlay between Canada and the UK,

while customizing certain aspects needed in order to ease the transition into the UK market

and respond to their local needs. This would allow Booster Juice to keep their current

branded name, logo and standard fruit offerings through continuing to import, while

customizing certain aspects of each stage of the marketing mix.

Core Product Offerings and Brand Name

Booster Juice is a company that is well known for its extensive selection of freshly

squeezed juices and smoothies, offering multiple categories of each that range from high

protein to superfood. Therefore, when one thinks of the Booster Juice brand, their


superfood protein infused smoothies typically comes to mind. The company originally

started as ‘Dale's Kitchen’, where the co-‐founder of Booster Juice, Dale Wishewan, noticed

that there was a hole in the Canadian fast-‐food market, with active lifestyles looking for a

healthier alternative. The company started producing smoothies in ‘Dale’s Kitchen

Restaurant’, later expanding fully into Booster Juice (“Our History”, 2016). Booster Juice’s

current locations in Canada, the US and Mexico all offer smoothies, along with healthy food

items like fresh grilled paninis, sandwiches, salads, etcetera. Additionally, the company

offers merchandise for purchase, such as Booster Juice Frisbees, water bottles, hacky sacks,

lunch kits and much more (“Merchandise”, 2016). However, when entering the UK,

specifically starting in London, it is suggested for the company to only focus on offering

smoothies and freshly squeezed juices. It is also suggested that Booster Juice removes all

food items that are not smoothies and juices from the menu, as well as removing all

merchandise except for their eco-‐friendly reusable mugs. A streamlined product offering and

focused strategy is usually suggested when entering into new markets, as this method eases

the customer’s product adoption (Ivey Business Journal, 2015). More specifically, it is

suggested for Booster Juice to strictly focus on their core-‐competency; producing superfood

protein infused healthy smoothies, rather than veering off into a confusing, less focused

offering of merchandise. In terms of smoothie ingredients, currently, Booster Juice imports

all of their fruit in North America. Importing fruit will continue in the UK as not only is this

method cost effective, but also will continue to represent the Booster Juice brand of offering


unique, exotic fruits that locally grown farmers are not able to grow themselves. Booster

Juice’s product offering will continue to be emphasized as a ‘grab and go’ convenient

product for health-‐conscious individuals. This grab-‐and go mentality that consumers in the

UK embody conveniently also reflects the same mentality of the North American culture, as

well as Booster Juices current strategy (“Grab N' Go”, 2016). Thus, the grab-‐and go nature of

the business will be standardized, with no customization needed.

Trademarks, Labeling and Packaging

All labeling will remain the same because, fortunately, there are no language barriers

between Canada and the UK. With zero language barriers in place, the expense of

translating, as well as the risks of improper translation of labels on packaging, is reduced.

Nevertheless, while labeling is going to remain the same, packaging will be modified. As

stated under environment in the country analysis, the municipal government of the City of

London, England considers polystyrene (Styrofoam) waste (DEFRA, 2012). Additionally, the

UK is working towards the enforcement of 50% of all waste being recyclable by 2017 (EEA,

2013). Thus, to accommodate the UK’s environmental standards, PETE plastic cups will

become the replacement, as these cups are recyclable. It is also important to note that

despite the fact that the cups will be changed from polystyrene (Styrofoam) to plastic, the

logo and colours (bright yellow/pink/purple) will remain the same (see Appendix 4, Booster

Juice Styrofoam to PETE Plastic Cups). As stated above, the only merchandise Booster Juice


will have available for purchase within the UK market is their eco-‐friendly reusable mugs.

These mugs align with the UK’s noted growth towards becoming eco-‐friendly and will be a

key promotional item within the promotion strategy, which will be explained further under

the pricing and promotion section. Additionally, these mugs align very well with both

Booster Juice and the UK’s grab and go strategy, where these eco-‐friendly mugs can be

carried on a run or during workout, for example.

Service, Warranties and Usage Instructions

Fortunately, for Booster Juice, because they are classified as a smoothie and healthy

fast-‐food company, they do not operate with any warranties and usage instructions that a

technology company, for instance, would provide.

In summary, using product strategy Case 4, Booster Juice will standardize their

labeling, grab-‐and-‐go mentality and fruits in smoothies through importation. In terms of

customizing certain aspects to meet local needs of the UK market, their current packaging

(polystyrene, Styrofoam) will be changed to PETE plastic, as well as removing all food items

and merchandise, excluding their eco-‐friendly reusable mugs.

Price

Objective setting

Price is a very important aspect of the marketing mix that must be addressed and

analyzed carefully. There are usually two views to pricing decisions: 1) Pricing as an active


instrument of accomplishing marketing objectives, or 2) pricing as a static element in a

business decision (Cateora et al, 2011, p. 402). This first view means that the company can

either use price to achieve a specific objective like targeting a particular return on profit,

target market share, or some kind of specific goal (p. 402). The second option entails exports

as excess inventory, places a low priority on foreign business and views their export sales

more passively (p. 402). When assessing a proper pricing strategy for the UK, factors such as

the country’s values (psychographics), disposable income and demographics must be taken

into consideration.

Psychographic, Technological, Sociocultural, Demographic and Economic conditions with respect to International Pricing

In terms of a country's values (psychographics), it is important to keep in mind that

consumers from one country may place a higher value on a product than consumers from

another—meaning, one country that places a high value on eating healthy may also value

spending more on healthy products than another country. The UK is a prime market for

Booster Juice to enter as the UK’s core values have demonstrated positivity towards living a

healthier lifestyle. As stated in the socio-‐cultural environment of the country analysis, adults

in the UK place a high importance on healthy eating, with studies supporting the fact that

healthy foods presented as an enjoyable option increases the chance of them being selected

(National Obesity Observatory, 2011). Because Booster Juice has established its brand as a

fun but healthy way to consume food in their delicious smoothie format, they are already

well positioned to penetrate the UK market.


Currently, in the North American market, Booster Juice appears to be a quality

healthy food product, offering competitive-‐high prices amongst competitors. However,

when moving into the UK market, they would still be positioned as a quality healthy food

product, but actually at a low cost strategy in comparison to competitors, even with the

price conversions from Canadian to Euro (See Appendix 3, Perceptual Map). As mentioned in

the socio-‐cultural environment of the country analysis, although UK consumers place high

importance on living healthier lifestyles, they seek cheaper alternatives in doing so, such as

discount gyms. Thus, UK consumers are actively seeking a healthy lifestyle, but on a small-‐

dime. This actually puts Booster Juice in a perfect position when entering the UK market, as

again, they would be entering at a low-‐cost strategy in comparison to competitors, with a

higher likelihood of being selected after evaluating this sociocultural/physiographic data (see

Appendix 5, Competitor Pricing for further explanation).

The UK economy almost outperforms that of North America in the sense that they

have a lower unemployment rate and a high/steady growth of disposable income, as noted

in the economic environment of the country analysis. Thus, higher disposable income allows

more wiggle room for the purchase of products like Booster Juice. However, as noted,

despite the low unemployment rate and relatively steady/high disposable income, UK

citizens still have preference to cheaper healthy alternatives. Luckily for Booster Juice, when

entering the UK in comparison to pre-‐existing competitors, they position themselves as just

that (see Appendix 3, Perceptual Map).


Demands and Cost Considerations Demand and cost considerations are important to analyze when attempting to

determine a pricing strategy when entering a foreign market (El Banna, 2016).

Understanding the demand in foreign markets for the particular products a company desires

to sell reduces chances of overstocking or under-‐stocking products (El Banna, 2016).

Overstocking products can lead to waste and under-‐stocking products can lead to a loss in

sales. Both of these factors can be very detrimental to a company and therefore, it is crucial

for Booster Juice to understand the demand for their products in order to prevent

overstocking or under-‐stocking within their new market environment. Based on research,

Booster Juice seems like it would be a hit in the UK market—they are a ‘healthy and fun

alternative’ and are cheaper amongst their competitors, which perfectly outlines the

average profile of the UK ‘wanna be healthy’ individual, as analyzed in the country analysis

and explained above. Thus, based on consumer profiles, demand seems to be apparent.

Luckily for Booster Juice, most of their ingredients, such as fruit, can be frozen.

Additionally, once fully implemented in the UK, they will be importing their fruit, meaning

they can reduce the excessive orders by properly keeping track of demand through the use

of a POS system. Product packaging like cups, lids, straws and their eco-‐friendly mugs do not

have an expiration date, so the worry of product waste is omitted. As well, a proper POS

system in place will help track orders and help predict demand and inventory to reduce

excess stock of these packaging items.


There are many costs that are involved with a company establishing into a foreign

market. Booster Juice must make sure they comprehend the amount of money needed to be

successful in their expansion into the UK. This type of comprehension requires a financial

breakdown of expenses, along with a timeline (see Appendix 17, Estimated Total Overall

Budget for First Year of Operation). Additionally, it is important to note that Booster Juice

already has an understanding of some of the costs and procedures involved in entering a

foreign market, as they have already expanded from Canada into the United States and

Mexico, which again increases their chances of adapting to and being successful in the UK

market.

Pricing Strategies There are many different factors required for consideration when a company is

determining what price they should sell their products at, especially when entering foreign

markets. These pricing considerations refer to international pricing strategies, such as

parallel imports and grey marketing, variable cost pricing, full-‐cost pricing, dumping,

skimming pricing, penetration pricing and geographic pricing (Cateora et al, 2011, p. 420).

For Booster Juice’s business, penetration pricing seems most reasonable to use, as naturally,

when converting over from the Canadian dollar into Euros, their product prices fall at a

lower price strategy than competitors. Penetration pricing refers to entering at a low-‐cost

strategy in order to capture and stimulate overall market growth. Although Booster Juice

must still be aware that this price may slightly increase due to taxing and importation/supply


chain costs that the international developer may bare, even with this, Booster Juice will still

ensure they are priced competitively, but slightly below competitors. This strategy will help

them capture market share in a market where competitor’s product offering is almost

identical to theirs (See Appendix 5, Competitor Pricing).

In terms of quoting prices, as noted from lectures, the price quotation settled on

should specify the quantity and quality, which is responsible for transportation and who will

pay for it, the currency to be used and credit terms, etcetera. As Booster Juice will be

franchising their business into the UK market using an International Developer, it is noted on

their site that an International Developer is responsible for developing their own supply

chain. Therefore, price quotations will vary, however, Booster Juice as a company can give

their International Developer a pricing guideline during their training session to ensure the

International Developer still follows the ‘low cost pricing strategy’ that Booster Juice will

implement when positioning itself in the UK Market.

Additionally, factors needed for consideration also include the need to cover fixed

and variable costs, as well as competitor pricing and economic goals. A company must make

sure that they are covering the fixed and variable costs that are attached with a product.

When Booster Juice expands into the UK, these costs may increase or decrease, which is

something that the company must be aware of. The cost of the products must be at least as

high as the cost to produce them.


Discounts and Allowances

As stated above, Booster Juice will be focusing on a low-‐cost pricing strategy in order

to differentiate themselves from their competitors, as well as penetrate market share within

the UK. Entering at a low cost strategy positions themselves well with UK consumers, where

healthy products are valued, but with low costs associated to them. Staying loyal to the eco-‐

friendly vibes that are part of the UK culture, a discount that Booster Juice will implement is

10% off every purchase for customers who use an eco-‐friendly reusable Booster Juice mug,

as opposed to the plastic cups the company normally offers.

Place

It has been decided to first introduce Booster Juice in England, and following its

success, continue expansion to the rest of the United Kingdom. Since London is the most

populous city in the UK region, with 8.6 million people in total, this city would be a great

market to introduce Booster Juice’s deliciously healthy products (BBC News, 2015). If

Booster Juice focuses on the downtown London core only, this will saturate a large

percentage of the market and allow a huge number of locals and tourists to be exposed to

the company’s product. The UK, especially the city of London, is an extremely popular tourist

destination for travelers all around the world. In 2013, there were 32.7 million visits to the

UK, which was a 5.2% increase since 2012 (The National Archives, 2014). It is assumed that

this will continue to increase in the coming years. The enormous population of London,


coupled with the large amount of tourists, will provide a sufficient target market for Booster

Juice. The company plans to begin with a small Booster Juice kiosk present in Heathrow

International Airport, which is the busiest airport in the United Kingdom, the busiest airport

in Europe by passenger traffic, and sixth busiest airport in the world by total passenger

traffic (Heathrow Airport, 2015). This will be a great location to catch visiting tourists,

commuters, or locals returning home who are looking for a quick and healthy snack on the

go. It is also strategic to open a small kiosk on Oxford street, which is an extremely busy

street located in London that has over 1 and ½ miles of stores. By putting a location on this

street, Booster Juice can attract shoppers who may also be looking for a quick and easy

snack to satisfy their hunger while shopping around. Putting a kiosk in Brent Cross Shopping

Centre should also be considered, as it is another very large and popular shopping mall in

London. This shopping centre location also allows Booster Juice access to people who are

looking for workout clothes or health food items and may be easy to attract.

Since Booster Juice believes in the freshest ingredients, they will be getting all of

their fruits and berries through importation from different areas in the world. This will

ensure quality and freshness for every customer. For the time being, Booster Juice’s market

reach is very concentrated in busy areas of London including Heathrow Airport, Oxford

Street, and Brent Cross Shopping Centre. This will allow them to reach a wide variety of the

target market that includes locals and tourists. Booster Juice will need a special freezer

vehicle and freezer warehouse to store the fresh fruits before they are ready for


consumption. The only inventory they will have is the ingredients for the smoothies, which

includes plastic cups, straws, blenders, fruit, and small freezers for the kiosks.

Promotion

Sales promotions refer to short-‐term efforts directed to the consumer or retailer to

achieve specific objectives, such as consumer-‐product trial, immediate purchase or

introduction to the store (El Banna, 2016). They are designed to supplement advertising and

personal selling in the promotional mix. Booster Juice’s stores run on a customer service

basis, rather than on a sales personnel basis due to the setup of their stores and kiosks.

Therefore, currently, the store set-‐up does not allow for any personal selling.

However, to promote the enthusiasm towards the Booster Juice brand when

entering the UK market, a ‘street team’ of brand ambassadors will be hired. These street

team ambassadors will have profiles similar to the target audience—mid 20-‐30’s who live an

active, urban and healthy lifestyle. These individuals will be responsible for handing out

samples of juices and smoothies occasionally in the Heathrow Airport, Brent Cross Shopping

Centre and Oxford Street, again, where there is high traffic and where the target audience is.

These brand ambassadors will also be walking through gyms with samples, with the hopes of

gaining a partnership with these facilities in the future. These ambassadors will emphasize

the promotion of the eco-‐friendly travel mugs, as they will allow a consumer to save 10% off

every purchase when they present their mug. Also, the mugs will be emphasized in TV


commercials/YouTube commercials, emphasizing the grab and go culture and the ability to

carry these mugs anywhere (on a plane, to the gym, on the bus to work, etcetera).

Advertising/Copy/Artwork

Currently, Booster Juice has a website available that displays their menu, showing a

list of all the products offered and nutrition details that go with it. Their website also

promotes the “grab and go” philosophy of their business, their store locations as well as

hours based on store selection.

Booster Juice does offer items such as gift cards and certificates, as well as

promotional cards; however, these items are not available at any of their international

locations or special domestic locations, like Universities, due to logistical or contractual

restrictions (“Participating Stores”, 2016). To stay consistent with the international location

restrictions Booster Juice follows, there will be no gift cards or promotional cards

implemented into the promotional mix for the UK. However, the eco friendly mugs will

provide a promotional purchase incentive with receiving 10% off each purchase. It is noted

that this type of promotional offer does not act like a gift card or promotional card (like

purchase 10 Booster Juice products and get one free) therefore, it is permissible.

Additionally, as Booster Juice already offers a free drink on a customer’s birthday in the

North American market, this same promotional offer will be implemented in the UK as well.

This offer will require a consumer to sign up on their website and give their email and

birthday date in order to be eligible. As Booster Juice will need to first test their success in


the UK, keeping the promotional offers to a minimum will help simplify their promotional

strategy and ease into the UK market for initial success. Additionally, as they are entering at

a low cost strategy, having only one discount option, such as their environmental mugs is

necessary—anymore, and the value of their product will start to depreciate. Future

promotional strategies are discussed in the media channel and technology section of this

analysis.

With the growing popularity of the Internet, the use of social media has become

increasingly popular. Social media marketing includes online company blogging, tweeting,

video sharing—any type of consumer generated content (El Banna, 2016). Some problems

with using certain types of mediums are availability—for example, certain advertising media

may be forbidden or subject to heavy censorship in some countries. Nevertheless, the

Booster Juice brand and promotions are already widely available on social media,

maintaining their presence on Instagram, Twitter, Facebook, Google+, YouTube and

LinkedIn. Media channels will be further discussed below.

Media Channels & Technology

Currently, Booster Juice does use TV advertising, however, these video ads are also

implemented on their website, YouTube channels, as well as Twitter. It is recommended that

Booster Juice continues to launch their commercials in the UK using these same platforms,

especially since they will be setting up one of their first few shops in Heathrow International

Airport, where many TV’s are in sight. In terms of launching commercials, they will not have


to worry about translation barriers; however, there are a few changes they will need to

make. Some of their current commercials emphasize baseball and their after school kids

program, activities that are not as popular or would attract consumers in the same way in

the UK. One of their current commercials ‘#whateverthereason’ could potentially work as it

emphasizes the grab and go culture of Booster Juice, showing someone purchasing a

smoothie then going to the library, going to work, going to a soccer game, going to a yoga

class and going for a run all in the same frame. A video like this would successfully capture

audiences within the UK market due to their attraction to the grab and go culture, fitness

and busy lifestyle, as this focus on health and being busy appeals to Booster Juice’s primary

target market profile, as stated within the segmentation section of this report. The Booster

Juice commercials also use the hashtag ‘#whateverthereason’. To penetrate the UK market,

hashtags will be implemented across all social media accounts such as: #whateverthereason

and #BoostNGo. These hashtags not only relate to the culture of the UK, but also uphold

Booster Juice’s original philosophy of the grab and go culture. As one of Booster Juice’s

initial test locations will be in the Heathrow International Airport, having a universal hashtag

that ties both the North American and UK market is an added bonus for the company, along

with their same brand name, colours and setup. It is believed that this familiarity will bring

attention to North American tourists entering the UK who are looking for a quick snack while

they are on the go.


As mentioned earlier how Booster Juice currently uses Facebook, Instagram, Twitter,

Google+, YouTube and LinkedIn, these same media channels will be used as well in the UK.

Facebook will be the social media platform that the company focuses most of its

promotional efforts through targeted advertising as 43% of the UK population use this

platform daily (Rose, 2016) (see Appendix 6, UK Social Media Statistics for 2015). Alongside

targeted advertising, Facebook will be used to emphasize the grab and go culture with

photos of consumers and brand ambassadors enjoying their fresh juices and smoothies in

their reusable mugs. Facebook will also be utilized to promote any Booster Juice local

events. The UK Instagram account will also have pictures of brand ambassadors and

customers on the go with their eco-‐friendly mugs, individuals going for a workout, hike, or

run with Booster Juice by their side, really emphasizing and capturing the Booster Juice

active culture that promotes grab and go via photographs (see Appendix 7, Example of UK

Twitter Account). Twitter will be used to further implement the grab and go culture using

the hashtags discussed above, as well as responding to any customer concerns through

monitoring the Twitter feed (see Appendix 8, Example of UK Instagram Account). Google +

and LinkedIn will be used for more professional and hiring purposes.

Additionally, as mentioned in the technological environment of the country analysis,

as UK smartphone users look at their phones over a billion times a day, it is key for Booster

Juice to continue with a social media campaign and fully utilize their social media accounts.

As technology is on the rise, into the future and if successful, Booster Juice will generate an


app with features such as NFC readers for mobile payment methods. The Booster Juice app

will include their menu, prices, locations, hours of operation, promotions as well as

integrating a contactless payment method, again, using NFC readers. As consumers pay

using the app, their purchase habits will be tracked and month-‐by-‐month they will receive

‘suggested smoothie of the week’ based on their purchasing tastes and preferences.

Action Plan

Overview

Months 1-‐6 Months 6-‐11 Months 11-‐16 Months 16+

Franchise Meet with Booster Juice officials

Sign agreements; non-‐disclosure, franchise agreements, etc.

Discuss locations

Location approval Constructing franchises

Store development; lease agreements, training, etc.

Stores are ready for opening

Look to expand to other locations

Logistics/

Production

n/a Develop supply chain: warehouse, transportation, etc.

With expansion, look for another warehouse location

Develop more flavours and


products

Political/Legal n/a Finalize location documentation

Ensure Booster Juice practices meet all standards/laws

Oversee aspects of all departments

Oversee plans to expand

HR n/a Hire local personnel for airport and mall locations

Hire personnel pertaining to supply chain operations

Begin training all personnel

Implement HR practices to maintain high morale

Hire more personnel with expansion to new locations

Marketing n/a Develop street team

Develop plans for an app

Continue use of Booster Juice social media accounts for promotion

Create re-‐usable cup incentive program

Deploy street team to select locations

Develop partnership with gym facility

Begin construction of app

Create more street teams for each district


Timeline for Launch of Franchise

The timeline and implementation of the franchise project can be broken down into

two phases, the qualification process phase and the development process phase, in total

estimated to take 10-‐16 months, beginning in April 2016 to be completed by the

spring/summer of 2017.

The first process phase, the qualification process, requires several steps to

implement, typically completed in 4-‐6 months. The first step would be to file an application

to become a franchisee. The potential franchisee must meet all requirements and make

contact with the head office in Edmonton. A meeting will be scheduled after receiving a

franchise package containing a disclosure agreement and full application (“Franchisee Info –

Qualification Process”, 2016). The second step involves a meeting with the franchisee and

Booster Juice. During the meeting, the company will review the application, discuss business

plans, answer any questions, and sign the disclosure agreements (2016). During this step,

the company will deliver an outline of the expected costs and expenses to operate a

franchise store (“The Free Franchise Document Resource Centre”, 2006). The third step in

the process can be optional. Potential franchisees are invited to participate in “Discovery

Day” at the headquarters in Edmonton (“Franchisee Info – Qualification Process”, 2016).

Lastly, the franchisee will complete the qualification process by signing an agreement. The

franchisee must complete a background and reference check. They will also begin to discuss

locations, which leads into the development process (2016).


The development process, also known as phase 2, can take a total of 6-‐10 months, as

it sets in motion the construction of the franchise. Firstly, picking a location can be done one

of two ways, requesting a list of pre-‐approved locations or submitting a location for

approval. With England being a new location for Booster Juice, it would have to be approved

(“Real Estate-‐ Development Process”, 2016).

Once decided, the store development would begin, taking around 4-‐5 months. It

would take approximately 4 weeks for the lease agreements to be approved for the airport,

shopping mall and Oxford street locations and another 4 weeks for architectural drawings

and design approval. The permits would take about 6-‐8 weeks, and construction 5-‐7 weeks.

During this time, 2 weeks of training would be administered 6-‐12 weeks before the

anticipated store opening (“Real Estate-‐ Development Process”, 2016). The store is then

ready for opening.

Budget for Franchise

Booster Juice has not previously entered into England, or anywhere within the United

Kingdom for that matter, therefore, the franchisee is responsible for several things. The

franchisee must develop a supply chain, learn construction standards and the local real

estate market, learn and operate firsthand, and meet cost and qualifications requirements of

the Booster Juice International Developer Agreement (“International”, 2016).


The franchisee qualifications ensure a good candidate for franchising. A potential

franchisee must have a minimum net worth of $350,000 dollars and liquid assets of

$100,000 dollars, as stated earlier in the selection of mode of entry. It is preferred that the

franchisee has a customer service background and agrees to a 10 years franchise agreement,

2 weeks of training, and complies with proper unit size (see Appendix 9, Franchisee

Qualifications) (“Franchisee Info-‐ Costs and Qualifications”, 2016).

It is important to note that the franchisee costs can be significant. The franchise fee

is about $20,000 dollars and turnkey fee ranges from $214,500 to $244,500 dollars (2016).

The regional development agreement cost ranges from about $110,000 to $600,000 dollars

(2016). Overall, the estimated total initial investment is roughly in between $344,500 and

$864,500 dollars, subject to some clauses. There is also a royalty fee, renewal fee, national

advertising/marketing fund fee, and local advertising allocation fee, all derived from a

percentage of gross sales (see Appendix 10, Expected Franchise Costs and Considerations)

(2016).

Timeline and Budget for Promotional Programs

Following the estimated spring/summer 2017 London opening, a number of

programs are anticipated. A ‘street team’ program of brand ambassadors would allow

Booster Juice to partner with local brand ambassador companies to create several brand

activations in the summer months to promote the product. In accordance, a street team

comprised of 30 individuals would cost about £156,780 (see Appendix 11, Estimated Street


Team Salaries/Wages). A street team would deliver smoothie and juice samples to local

gyms at peak hours. This would ideally lead to a partnership with a well-‐recognized gym

facility in the future, allowing for promotional booths within gyms, and agreements to

display promotional material at each partner's’ business. These ambassadors would also be

delivering smoothie and juice samples to individuals within Heathrow, Brent Cross Shopping

Centre and Oxford Street. Booster Juice would also implement a reusable cup incentive

program, where customers would receive a discount on any order with the use of a reusable

mug from Booster Juice.

Furthermore, due to living in an increasingly technological world, Next Destination

Mergers is considering a future implementation of a Booster Juice app that would fit with

the quick and convenient ideals of the company. It would take roughly 4-‐6 months to fully

implement (Yarmosh, 2015). This process, budgeted as seen in Appendix 12, includes

planning, design, adding features, setting up infrastructure, app administration, testing and

deployment. The estimated total cost for median to high hours is at $125 dollars an hour,

therefore amounting to approximately $135,435 dollars for the entire process (Clutch,

2016).

Long Term Action Plan

In the future, Booster Juice will be looking to expand further into England and

throughout the entire United Kingdom. Within the next six years, Booster Juice plans to


open five new locations, given the success of the two locations in London. Future locations

can be football (soccer) stadiums, due to the popularity and correspondence with our target

market, and shopping malls to start. With respect to promotions, Booster Juice expects to

create street teams for each district of operation, and begin implementation of an app. In

the near future, after increased brand recognition and sales, Booster Juice should plan to

develop new products and flavours for existing products, such as protein bars and smoothie

mixes for example.

Additional Budgetary Considerations

In addition to start-‐up costs of the franchise, there are also numerous operating costs

to consider. Consideration for utilities, repairs and maintenance, raw materials,

transportation costs, warehousing, manufacturing/purchasing, and inventory storage, and

more will be necessary to allocate resources (see Appendix 13, Estimated Operating Costs).

In terms of raw materials, the fruit would be imported and brought to the new warehouse

for freezing, sorting, packaging, and distribution. Juice and protein powders will be sourced

from wholesalers, and then brought to the warehouse for sorting and distribution. Property

fees such as warehouse mortgage payments and lease payments for all locations add to

budgetary considerations (see Appendix 14, Estimated Property Fees). In addition, salaries

and wages of the airport, shopping mall, and Oxford street personnel, warehouse

employees, part-‐time and full-‐time management, account for a significant portion of the

budget (see Appendix 15, Estimated Salaries/Wages). Lastly, general and administrative


costs will provide insight into a well-‐rounded expected budget for the first year of operation

(see Appendix 16, Estimated General and Administrative Costs).

Total Expected Budget

With all of the above considered, the budget requires resource allocation to the main

areas: franchisee cost, operating cost, property fees, salaries/wages, general and

administrative costs, street team salaries/wages, and expected app costs resulting in a grand

total budget of $2,419,898 Canadian dollars or £4,486,434 Pounds. This expected cost for

the first year of business does not include the franchise cost due to the large range of

estimated initial investment (see Appendix 17, Estimated Total Overall Budget for First Year

of Operation).

Conclusion

In it’s goals to continue to grow and expand worldwide, Booster Juice can confidently

move into the UK market with this strategy and recommendation and expect to see positive

results. By creating a strong brand image and differentiation from competitors, Booster Juice

will continue to provide fresh and healthy juices and smoothies to customers within the UK

market by adapting when necessary, but still upholding their highly regarded grab and go

culture.


References

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Appendices

Appendix 1: Standardized Booster Juice Logo

(Booster Juice, 2016)

Appendix 2: Segmentation Grid

Age Income Level of Health Focus Primary/Secondary

Market

10-‐24 High High S

Low

Middle High

Low


25-‐40 High High P

Low

Middle High P

Low

40+ High High T

Low

Middle High T

Low

Appendix 3: Perceptual Map


Appendix 4: Booster Juice Styrofoam to PETE Plastic Cups

(Lacchar, 2013)

Appendix 5: Competitor Pricing

Highest Price Lowest Price Canadian Dollar direct conversion

Fuel Juice Bar £3.95 £3.65 $ 6.86-‐ $7.43

Boost Juice $6.70Aus $6.30 Aus $ 6.25-‐ $6.64

Booster Juice $6.25 CDN $3.75 CDN $ 3.75-‐ $6.25

(Booster Juice, Toronto Pearson (n.d.).

(Weight Management & Nutrition Guidance (n.d.).


Appendix 6: UK Social Media Statistics for 2015

(Rose, 2016)


Appendix 7: Example of their UK Twitter Account

Source: https://twitter.com/BoosterJuiceWpg


Appendix 8: Example of UK Instagram Account

(“Booster Juice • Instagram photos and videos”, 2016)


Appendix 9: Franchisee Qualifications

Minimum financial requirements ·∙ Net Worth: $ 350,000 ·∙ Liquid Assets: $ 100,000

Experience Customer service background preferred

Unit size ·∙ 950 – 1200 sq. ft. (Traditional) ·∙ 550 – 950 sq. ft. (Small Format Traditional) ·∙ 120 – 400 sq. ft. (Kiosk)

Term of franchise agreement 10 years

Franchise training 2 weeks

Appendix 10: Expected Franchise Costs and Considerations

Franchise fee* $20,000

Turnkey cost* $214,500 to $244,500**

Royalty fee 6% of gross sales

National advertising/marketing fund 2% of gross sales

Regional development agreement* $110,000 to $600,000***

Renewal fee $5,000

Local advertising allocation 1.5% of gross monthly sales

Total estimated initial investment* $344,500 to 864,500****

*Per restaurant developed ** Includes equipment, leasehold improvements & complete store build-‐out ***If you are a Regional Developer and perform all of your obligations, you will receive 50% of the initial franchise fees and 50% of the royalties actually paid by Franchisees you recruit and service in the Development Area. ****Locations requiring additional signage will be priced accordingly


Appendix 11: Estimated Street Team Salaries/Wages (per year)

CND GBP

30 employees (15 hours/per person/per week)-‐minimum wage $263,250 £156,780

Total cost $263,250 £156,780

Appendix 12: Estimated App Costs (median high hours x $125/hour)

CND GBP

Planning $3,415 £6,420

Design $21,437 £40,300

Features $26,687 £50,171

Infrastructure $47,500 £89,300

App administration $15,020 £28,240

Testing $20,000 £37,600

Deployment $1,375 £2,585

Total cost $135,435 £254,616

Appendix 13: Estimated Operating Costs (per year for all 3 locations)

CND GBP

Utilities ·∙ Heating /Lighting/Power ·∙ Gas ·∙ Hydro

$30,576 $39,282 $27,900

£57,480 £73,860 £52,350

Repairs and maintenance $16,500 £31,020

Raw materials (includes delivery fees) ·∙ Fruit ·∙ Ice ·∙ Proteins ·∙ Juice

$300,000 $225,000 $132,000 $174,000

£564,000 £423,000 £248,160 £327,120


Decorating (plants, holiday decor, etc.) $1,050 £1980

Incidental costs ·∙ Replacing uniforms ·∙ Linens

$1500 $1,140

£2,820 £2,145

Miscellaneous $1,350 £2,550

Automobile ·∙ Car payments ·∙ Insurance ·∙ Repairs and maintenance ·∙ Gas and oil

$14,000 $28,000 $5,700 $8,000

£26,320 £52,640 £10,720 £15,040

Warehousing ·∙ Heating /Lighting/ Power ·∙ Gas ·∙ Hydro

$25,600 $28,900 $17,450

£48,130 £54,300 £29,800

Manufacturing/purchasing ·∙ Straws ·∙ Cups ·∙ Napkins

$47,000 $60,500 $44,500

£88,360 £113,740 £83,660

Inventory ·∙ Blenders ·∙ Freezers ·∙ Cups ·∙ Straws

$9,500 $18,000 $5,900 $3,890

£17,860 £33,840 £11,100 £7,315

Total combined operating expenses $1,267,238 £2,379,310


Appendix 14: Estimated Property fees

CND GBP

Heathrow Airport $35,600 £66,930

Brent Cross Shopping Centre $24,750 £46,530

Oxford Street $40,000 £75,200

Warehouse $28,500 £53,580

Total costs $128,850 £242,240

Appendix 15: Estimated Salaries/Wages (per year)

CND GBP

Heathrow airport ·∙ 2 employees per shift (airport hours/per day/per year) ·∙ Management

$14, 600 $128,000

£27,448 £240,640

Brent Cross Shopping Centre ·∙ 2 employees per shift (mall hours/per day/per year) ·∙ Management

$8,000 $128,000

£15,040 £240,640

Oxford 3 employees per shift (12 hours/per day/per year) Management

$16,000 $128,000

£30,080 £240,640

Warehouse/transportation 10 employees per shift (8 hours/per day/per year) Management

$29,200 $148,000

£54,900 £278,240

Total salaries/wages $451,800 £1,127,628

Appendix 16: Estimated General and Administrative Costs (per year)

CND GBP

Office Supplies (papers, scissors, etc.) $2,000 £3,760

Photocopying and data processing $1,300 £2,450


Liability insurance $12,000 £22,560

Professional fees (bookkeepers, accountant, lawyer, etc.) $100,000 £188,000

Security system $56,000 £105,280

Telephone $2,025 £3,810

Total Cost $173,325 £325,860

Appendix 17: Estimated Total Overall Budget for First Year of Operation

Total operating costs $1,267,238 £2,379,310

Total property costs $128,850 £242,240

Total salaries/wages $451,800 £1,127,628

Total general and administrative costs $173,325 £325,860

Street team salaries/wages $263,250 £156,780

Total expected app costs $135,435 £254,616

Expected total overall cost (excluding franchise cost) $2,419,898 £4,486,434