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Food & Housing Nonprofit icon Catering Business Plan

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Bright Future Youth and Family Services

Executive Summary

Opportunity

Problem

Society lacks resources for the less privileged or homeless youth population. Eugene, like all the other cities, has a migration of homeless teenagers who have run away from home. They are here for a few months of the year and then they hitch down to California during the winter for warmer weather. These are young adults who have no idea how to be part of society. They can’t provide for themselves and eventually they have children and the cycle continues.

Solution

We provide at-risk youth alternative education and career assistance in Lane County. We want to make this experience valuable for our clients. We do this through a series of curricula funded by the Lane Workforce Partnership, Oregon Youth Conservation Corps, Oregon Department of Human Resources, and the local school districts.

Our most recent program is a culinary arts program in which students learn about food preparation and safe handling and then put this knowledge to use by preparing lunches for their peers at the Chambers School. After completing the 9-week curriculum, students are placed with a local food service business for a 60-hour practical training where they can continue to develop their skills. Currently, the culinary arts program is available to five students per 9-week school term, or approximately 25 students per year. Students enrolled in the program are selected because of their sincere interest in the culinary field and their excellent attendance.

Market

According to the Eugene Area Chamber of Commerce, “[a]t the heart of the Eugene economy are the homegrown small and medium-sized businesses. Most of Eugene’s businesses employ fewer than 20 workers. From specialty retail shops to financial service firms, from management consultancies to ethnic groceries, Eugene’s small business community is diverse, active, thriving and well-supported. Including sole proprietorships and limited partnerships, there are more than 10,000 businesses in and around Eugene.” Eugene/Springfield’s population has grown 3.95% on average since 1998 and this new growth has meant new businesses and expanding opportunities for catering companies who can serve these businesses’ needs.

Catering For Kids anticipates that Eugene/Springfield businesses have unmet demand for catered lunch meetings and other events. And unlike other restaurant and food-related businesses, business to business catering is not as cyclical as business to consumer catering. Businesses continue to have lunch meetings and employees who wish to purchase their lunches year round. In order to gain some insight into the market size and demand, we undertook some limited market research. An email survey was sent to 144 Lane County nonprofit organizations that requested their current or future demand for catering services and their interest in patronizing a nonprofit catering business. We received many responses like the ones that follow.

“I think that this is a great idea and could be a good resource for the community. Springfield/Eugene Habitat for Humanity does not host many lunchtime meetings, however there is a group of about 13 or 14 Executive Directors of Habitat affiliates that meet here about every three months that might use your service.” – Susan Brown, Volunteer Coordinator, Eugene/Springfield Habitat for Humanity

“…if we do have an event that we need catering we will call your program first. We have a policy of using nonprofit organizations for services first.” – Bob Smith, Exec Dir, Pacific Youth Corps of Oregon

“Our needs for catering are not very large, maybe a few times a year. However, you may contact me to discuss the program. My son attends Chambers School and I would welcome hearing more details.” – Mark West, Lane County Agricultural Museum

“We do have General Membership Meetings where we require a venue for 50 to 100 people. I’m not involved with arranging the meetings but do know that our organization is in need of a place to meet where food and beer can be served. Perhaps you will hear from Dave – I think the first meeting is usually in October.” – Emily, Graduate Teaching Federation Office

Competition

A number of other caterers offer boxed lunches for business clients. However, none of these businesses specialize in serving the nonprofit sector, nor are they themselves a nonprofit that benefits the local community. Catering For Kids will specialize in developing excellent relationships with its nonprofit clientele. We believe that this unique position, combined with competitively priced, fresh, high-quality meals will set Catering For Kids apart as the premier caterer for the Lane County nonprofit sector.

Why Us?

Catering For Kids is dedicated to providing at-risk youth with an opportunity to gain work experience and transferable skills by providing our customers with  healthy, homemade foods and excellent service at reasonable prices. Employees of Catering For Kids will be students who are enrolled in the culinary arts program at the Chambers School and Career Center and are interested in gaining work experience in the restaurant and food services industry. The experiences the students have while participating in this program will assist them in making the transition from school to work and will allow them to develop entrepreneurial skills that will be transferable to any job in the future.

Expectations

Forecast

The following benchmark chart indicates our key financial indicators for the first three years. We foresee slow but steady growth in demand for our services and consequent increase in operating expenses. During year one, Catering For Kids will serve its internal market only, as we ramp up to serving the external market in year two.

 

Financial Highlights by Year

Chart visualizing the data for Financial Highlights by Year

Financing Needed

One of our revenue lines is grant funding, $15,000 annually. And we need and anticipate donations of $2,000 per month, plus some revenue from fees for lunches and event catering.

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Opportunity

Problem & Solution

Problem Worth Solving

Society has a problem, they do not have enough resources for the less privileged or homeless youth population. Eugene, like all the other cities, has a migration of homeless teenagers that have run away from home. They are here for a few months of the year and then they hitch down to California during the winter for warmer weather. These are young adults who have no idea how to be part of society. They can’t provide for themselves and eventually, they have children and the cycle continues. 

Our Solution

The Chambers School and Career Center is one of ten tax-exempt nonprofit programs of Bright Future Youth and Family Services. Our mission is to assist at-risk youth in the Eugene/Springfield area in becoming productive citizens by providing a learning and work environment where they feel challenged, respected, and accountable as they strive to meet the demands of adulthood.  We have a staff of approximately 250 employees and also utilize several volunteers each year who play a vital role in the organization. Bright Future prides itself on its diversity of funding sources that make for a fiscally strong organization. Agency revenues come from governmental contracts, charitable gifts, United Way funding, and fees for service

Target Market

Market Size & Segments

Market Segmentation

Catering For Kids will serve three primary groups of customers. As our business grows, we will begin serving these groups in the order listed below as each new customer group represents a larger step into the community and therefore requires Catering For Kids to differentiate itself further from local for-profit caterers. All of our target customers may be defined as corporate clients who are continually looking for new, refreshing meals to eat at recurring lunchtime meetings.

1. Internal Bright Future Customers:

  • Board of Directors meetings, serving 35-45 meals per month in either a buffet or lunch box format.
  • Board Sub-committee meetings, serving 40-50 meals per month in either a buffet or lunch box format.
  • Bright Future Counseling Center meetings, serving approximately 25 meals each week in either a buffet or lunch box format.
  • Miscellaneous meetings throughout the Bright Future organization, which has over 250 employees on staff.
  • Rolling cart lunch service at various Bright Future locations in Eugene/Springfield, serving boxed lunches and beverages only.

2. Nonprofit External Customers:

  • Catered meetings held by other nonprofit clients.

3. For-profit External Customers:

  • Rolling cart boxed lunch and College City coffee service in local government or private sector offices that are underserved by local restaurants and coffee shops.

Target Market Segment Strategy

Catering For Kids’ target market segment is nonprofit customers (including internal customers). We plan to target this group for several important reasons. First, we are a nonprofit organization and believe that we are better positioned to serve the needs of other nonprofits. Secondly, we believe that nonprofit organizations are more likely to try and continue to use a fellow nonprofit for catering services. And thirdly, we do not intend to jump into the commercial catering market in direct competition with for-profit caterers. Instead, this is a long-term growth opportunity that Catering For Kids may explore in the future. By postponing this direct competition, we believe our organization will be better able to remain focused on our primary objective: serving at-risk youth in Lane County.

Competition

Current Alternatives

There are several caterers in town that will compete directly with Catering For Kids for business, once we grow beyond serving our internal organization customers only. The key alternative caterers are:

  • Of Grape & Grain, which specializes in deli style boxed lunches and cafe-style dining. This is the caterer currently used by Bright Future.
  • Cravings Fine Foods, which specializes in event planning and cafe-style dining but which also offers deli style corporate boxed lunches.
  • Ariana’s Deli (owned by Alpine Catering), which features online ordering of deli style boxed lunches for delivery.
  • Fetuccini and Co. , which also features online ordering of deli style boxed lunches for delivery.
  • The Garden Deli, which also features online ordering of deli style boxed lunches for delivery.
  • Napoli Restaurant, which features Italian style boxed lunches with a limited menu and no delivery.
  • Brindiamo Catering, which features high-end boxed lunches with delivery, table decor and waitstaff.
  • Wild Duck Brewery, which features hot and cold boxed lunches as well as boxed salads and offers delivery for a small fee.
  • Oregon Electric Station, which specializes in high-end events such as weddings and corporate parties.
  • Alpine Catering, a full service caterer.
  • Oakway Caterers

Several of the above caterers, such as Napoli Restaurant, have a primary focus of operating their restaurant and may not put as much emphasis on catering details. Others, like Wild Duck Brewery, are focused primarily on large events and require a 15 person minimum for service. Still others, like Brindiamo Catering, are focused on very high-end customers and are out of the price range of many nonprofit organizations at over $12 per person. Therefore, Catering For Kids’s primary competitors are the smaller, deli-style caterers, such as Of Grape & Grain and Ariana’s Deli, whose prices are around $5-7 per person and who can be flexible with catering to small, less formal meetings.

There are also a number of low-end caterers that will compete with Catering For Kids even before we grow beyond our internal clients, as these caterers are currently used by some Bright Future programs now. These include:

  • Local and national grocery stores chains such as Albertson’s that will make made-to-order deli submarine sandwiches, chips and sides.
  • Local and national sandwich fast-food chains such as Togo’s and Quizno’s. Like grocery stores, these stores will also make made-to-order sandwich based meals that include chips and a beverage.

Although these providers offer low-cost fare, they are unable to offer much in the way of custom menu planning and do not differentiate between retail consumers and business or nonprofit customers. Thus, their services are one size fits all – they have a fixed and limited menu and their delivery hours are restricted to their normal hours of operation. Patronizing this type of business also does not benefit the community directly as does the Catering For Kids.

Our Advantages

Catering For Kids has the ability to provide internal and external customers with high-quality catered business lunches year round at competitive pricing while providing a valuable service to the community. We are able to provide this value because we have a pre-trained workforce – students of the Bright Future Chambers School and Safe & Sound Youth Project. These students are enrolled in the culinary arts program and have training in commercial food preparation and have food handler’s cards. This work experience will provide students with transferable skills that help facilitate their transition from school to work and provide an excellent public relations position for Catering For Kids. The instructor of the culinary arts program is an experienced restaurateur who will bring practical business management know-how to the business and serves as a role model to the students in the program.

As our organization is a school, which experiences a constant flow of students through its classes, the workforce of Catering For Kids will be constantly changing as well. This presents a challenge to the permanent staff to maintain the same high levels of customer service and quality that our customers demand, despite having an entirely new staff every nine weeks. However, we are confident that our teachers and staff members are committed to the success of this project. In addition, each class of students is quite small, which allows adequate supervision and quality control over the products created.

Keys to Success

Keys to Success

Our Keys to Success: 

  • Cultivate an identity (brand) for the Catering For Kids business in the Eugene/Springfield community.
  • Expand our customer base into new areas within Eugene/Springfield.
  • Hire a year-round business manager for the catering business, thereby providing student employment twelve months of the year.
  • Expand the donor/corporate partner base and corporate contributions that add to the financial resources of Chambers School’s programs.
  • Provide students with entrepreneurial job skills that can open doors to future employment opportunities.
  • Acquire additional equipment to support future growth and offer greater flexibility, leading to expanded services offered by Catering For Kids that will further the goal of providing valuable work opportunities for homeless and at-risk youth.

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Execution

Marketing & Sales

Marketing Plan

Catering For Kids strives to be the premier provider of healthy, homemade catered corporate lunches for nonprofit organizations.

The marketing strategy attempts to successfully communicate the unique value the program offers to customers. This strategy builds on the focus of high-quality lunches for catered meetings to the benefits that at-risk youth student workers gain from involvement in the program. The marketing strategy will continue to identify the needs of the corporate market and to communicate with this audience in the most effective and positive manner possible.

Ongoing efforts continually attempt to understand how Catering For Kids can maintain the quality and integrity of the program within the finite financial resources of customers and the costs of supplies and labor. This challenge is increasing. As costs continue to increase in a number of areas, the demands and expectations of the customers do as well. Catering For Kids will constantly work to better our service through improvement and changes in its structure and implementation. Quality and efficiency are just two goals of these changes. The business manager, culinary arts instructor and Chambers School director play key roles in ensuring that the Catering For Kids continues to grow and succeed.

The growth strategy is based on continued attention to the quality of the customer’s experience in conjunction with identifying opportunities to expand the student participation in the program. Future changes in key areas, such as the facilities used for food preparation as our customer base grows will present considerable challenges for all aspects of the program.

Sales Plan

Catering For Kids is committed to balancing its operating budget and operating on a solid financial foundation. These efforts are based on a mixture of revenues from catering events, fundraising, partnerships with local businesses and charitable gifting. Just as revenues are tracked, internal expenses will be closely monitored.

Catering For Kids is intentionally emphasizing the need to reduce reliance on donation-based revenues and looks toward revenues from catering customers to support the program. Indeed, our goal is to become self-sustaining, involving our students in the process of maintaining a profitable and competitive entrepreneurial venture that benefits our community. This is a considerable challenge, due to the number of local catering competitors, the small size of the program and the unpredictable costs in areas such as food.

 Fundraising Programs

  1. First year revenues assume that internal Bright Future customers will begin using Catering For Kids in October for all catered board, committee and counseling meetings. A sales increase is anticipated in December when Catering For Kids may be used to cater company Christmas parties.
  2. Per person pricing of $6.50 is assumed and is an average number. This number may be revised up or down to reflect costs of goods and competitor’s prices.
  3. Anticipated donations are based on past donations received from grant-making foundations for similar Bright Future school-to-work programs. However, as it is a goal of this program to become self-sustaining, these funds taper off over the first year as Catering For Kids becomes more financially stable.

 

Operations

Locations & Facilities

Catering For Kids will be located inside the Chambers School and Career Center at 1390 Keasey Boulevard in Eugene, Oregon. The school facility includes a commercial kitchen that is licensed by the Oregon Department of Human Services to serve the public. Currently, the kitchen is used by the culinary arts program to prepare and serve breakfast and lunch for students during each school year.

 

Technology

So far, only three Eugene caterers offer online ordering, which means that the primary methods of ordering catered lunches in Eugene/Springfield is still by phone or fax. Catering For Kids will offer fax/phone ordering with either trained students or staff taking orders with a minimum two days in advance of delivery. During this first year, Catering For Kids will primarily serve Bright Future internal customers only and online ordering will be unnecessary. However, in the long term as more customers become used to ordering lunch online, Catering For Kids may update its website to receive online orders.

During year two, Catering For Kids will have a website that includes its complete menu and contact information. We will include this website address on as many printed materials as possible. For example, our thank-you notes, which will be included in every boxed lunch, will have our website address printed on them. The administrative offices of Bright Future currently updates and maintains the organization’s websites and we anticipate that this department will also handle the design and creation of the Catering For Kids website.

Milestones & Metrics

Milestones Table

Milestone Due Date
Business Plan
July 05, 2016
Commercial Kitchen Certification
Aug 08, 2016
Overhaul Culinary arts Schedule
Aug 24, 2016
Hire part-time business manager
Sept 12, 2016
Buy Food Supplies
Sept 26, 2016
Buy Equipment
Oct 06, 2016
Create entrepreneurial curriculum
Nov 07, 2016

Key Metrics

Our key metrics are: 

  • Linked in business to business lead generation 
  • # of facebook page views 
  • # of twitter tweets and retweets 
  • Blog – share and get consultants to write expert artices 
  • Fundraising events – a little old school but donors expect this 
  • Facebook videos 
  • Videos and articles that take advantage of crowdfunding 

 

 

 

 


     

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Company

Overview

Ownership & Structure

Our organization is led by the director with the instructor(s) reporting directly to this director. A volunteer advisory board offers a broad range of social services expertise and years of business experience to the team.

Team

Management Team

Christy Smith, the director of the Chambers School and Career Center, holds an MS in counseling from the University of Ohio and has been employed with Bright Future for the past 24 years.  She has over 30 years experience in working with at-risk youth and 16 years in program management including: personnel, grant writing, fiscal management, contract compliance, public relations, and daily operations.

Monica Kraft, the head of the culinary arts program at the Chambers School and Career Center has over 23 years of restaurant business ownership experience. While she currently owns La Pequena Taqueria, a successful  food booth that has been serving the Eugene Saturday Market for 23 years, she has also owned a catering business and cafe and was a founding member of the Keystone Restaurant, a fixture in Eugene since 1981. She received her teaching credentials at Kansas State University  and has been teaching the curriculum she developed for the Chambers School

The Volunteer Steering Committee consists of seven talented members of the Eugene/Springfield business and education communities. Combined, they bring years over 55 years of business experience, including two MBAs, to the table. These volunteers are dedicated to the success of the Catering For Kids and to ensuring that our area youth get the opportunities they deserve.

Personnel Table

2017 2018 2019
Manager $24,000 $24,000 $24,000
Student assistants $12,000 $12,000 $12,000
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Financial Plan

Forecast

Key Assumptions

The financial plan depends on important assumptions, most of which are shown in the following table. The key underlying assumptions are:

  • We assume direct food costs will be equal to or less than 30% of total direct costs.
  • We assume a slow-growth economy, without major recession or crisis in food contamination.
  • We assume that there are no unforeseen changes in government grant funding availability.
  • We assume a continued interest in restaurant and hospitality services by students of the Chambers School. It has proved to be a highly popular program in the past and we have no reason to believe this situation will change.
  • We assume a continued interest in using catering services by organizations and businesses in the Eugene/Springfield area.

Revenue by Month

Chart visualizing the data for Revenue by Month

Expenses by Month

Chart visualizing the data for Expenses by Month

Net Profit (or Loss) by Year

Chart visualizing the data for Net Profit (or Loss) by Year

Financing

Use of Funds

Start-up Expenses

Dept. of Health Fees $100

Lease (Commercial kitchen) $8,000

Expensed Equipment $1,500

Software $500

TOTAL START-UP EXPENSES $10,000

 

We will also have $30,000 in mostly culinary equipment as long-term assets when we start. 

Sources of Funds

We will get our $40,000 from initial fundraising to a specific grantor that will front us the money, plus an annual $15,000 grant from the Eugene Downtown Commission. Our plan assumes $2K per month in donations. 

Statements

Projected Profit & Loss

2017 2018 2019
Gross Margin $49,718 $50,000 $50,248
Operating Expenses
Salaries & Wages $36,000 $36,000 $36,000
Employee Related Expenses $7,200 $7,200 $7,200
Marketing $2,500 $500 $500
Admin etc $3,600 $3,600 $3,600
Interest Incurred
Depreciation and Amortization $6,000 $6,000 $6,000
Gain or Loss from Sale of Assets
Income Taxes $0 $0 $0
Total Expenses $68,654 $67,781 $68,772
Net Profit ($5,582) ($3,299) ($3,052)

Projected Balance Sheet

Starting Balances 2017 2018 2019
Cash $10,000 $418 $3,119 $6,067
Accounts Receivable $0 $0 $0
Inventory
Other Current Assets
Total Current Assets $10,000 $418 $3,119 $6,067
Long-Term Assets $30,000 $30,000 $30,000 $30,000
Accumulated Depreciation ($6,000) ($12,000) ($18,000)
Total Long-Term Assets $30,000 $24,000 $18,000 $12,000
Accounts Payable $10,000 $0 $0 $0
Income Taxes Payable $0 $0 $0
Sales Taxes Payable $0 $0 $0
Short-Term Debt
Prepaid Revenue
Total Current Liabilities $10,000 $0 $0 $0
Long-Term Debt
Long-Term Liabilities
Paid-In Capital $40,000 $40,000 $40,000 $40,000
Retained Earnings ($10,000) ($10,000) ($15,582) ($18,881)
Earnings ($5,582) ($3,300) ($3,052)

Projected Cash Flow Statement

2017 2018 2019
Net Cash Flow from Operations
Net Profit ($5,582) ($3,299) ($3,052)
Depreciation & Amortization $6,000 $6,000 $6,000
Change in Accounts Receivable $0 $0 $0
Change in Inventory
Change in Accounts Payable ($10,000) $0 $0
Change in Income Tax Payable $0 $0 $0
Change in Sales Tax Payable $0 $0 $0
Change in Prepaid Revenue
Investing & Financing
Assets Purchased or Sold
Investments Received
Dividends & Distributions
Change in Short-Term Debt
Change in Long-Term Debt
Cash at Beginning of Period $10,000 $418 $3,119
Net Change in Cash ($9,582) $2,700 $2,948
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