The Daily Perc
Opportunity
Problem & Solution
Problem Worth Solving
There are many different kinds of coffees and caffeinated specialty drinks that go along with the snacks that we serve. Some people like dark bold coffee, some people like sweet weak coffee. Some prefer green tea. People have traveled the globe and experienced lots of different cuisine so its easy to figure out what they like and what they don’t. We offer something for everyone.
Our Solution
The Daily Perc is a specialty beverage retailer. TDP uses a system that is new to the beverage and food service industry to provide hot and cold beverages in a convenient and time-efficient way. TDP provides its customers the ability to drive up and order from a trained Barista their choice of a custom blended espresso drink, freshly brewed coffee, or other beverage. TDP is offering a high quality option to the fast-food, gas station, and institutional coffee.
Target Market
Market Size & Segments
The Daily Perc will focus on two markets:
The Daily Commuter – someone traveling to or from work, out shopping, delivering goods or services, or just out for a drive.
The Captive Consumer – someone who is in a restricted environment that does not allow convenient departure and return while searching for refreshments, or where refreshments stands are an integral part of the environment.
4.1 Market Segmentation
The Daily Perc will focus on two different market segments: Commuters and Captive Consumers. To access both of these markets, TDP has two different delivery systems. For the commuters, TDP has the Drive-thru coffee house. For the captive consumer, TDP has the Mobile Cafe.
Commuters are defined as any one or more individuals in a motorized vehicle traveling from point "A" to point "B." The Daily Perc’s greatest concentration will be on commuters heading to or from work, or those out on their lunch break.
Captive Consumers would include those who are tethered to a campus environment, or in a restricted entry environment that does not allow free movement to and from. Examples would include high school and college campuses, where there is limited time between classes and corporate campuses where the same time constraints are involved, but regarding meetings and project deadlines, and special events–such as carnivals, fairs or festivals–where there is an admission price to enter the gate, but exiting would mean another admission fee, or where refreshments are an integral part of the festivities.
The following chart and table reflect the potential numbers of venues available for the Mobile Cafes and what growth could be expected in those markets over the next five years. For a conservative estimate of the number of Captive Consumers this represents, multiply the total number of venues in the year by 1,000. As an example, in the first year, The Daily Perc is showing that there is a total of 2,582 venues at which we might position a Mobile Cafe. That would equate to a Captive Consumer potential of 2,582,000.
Similarly, there are well over 2,500,000 commuters in the metropolitan area, as well as visitors, vacationers, and others. It can also be assumed that these commuters do not make only one purchase in a day, but in many cases, two and even three beverage purchases.
The chart reflects college and high school campuses, special events, hospital campuses, and various charitable organizations. A segment that is not reflected in the chart (since it would skew the chart so greatly) is the number of corporate campuses in the metropolitan area. There are over 1,700 corporate facilities that house more than 500 employees, giving us an additional 1,700,000 prospective customers, or a total of 2,582 locations at which we could place a Mobile Cafe.
Competition
Current Alternatives
When measuring head-to-head, direct competitors, we have found that there are none in the metropolitan area. The Daily Perc will be the first double-sided, drive-thru coffee house in the metropolitan area. However, there is still significant competition from traditional coffee houses and other retailers.
National Chains:
Starbucks, the national leader, had revenues in fiscal year 2000 of $2.2 billion. That is an increase of 32% over fiscal year. Starbucks plans to increase revenues to over $6.6 billion from 10,000 retail outlets over the next 5 years
Panera had revenues of $151 million from corporate owned stores and $350 million from franchised locations last year. This fiscal year revenue was an increase in 28.9% on a per store basis.
The Daily Perc believes it has a significant competitive advantage over these chains because of the following benefits:
- Drive-thru Service
- More Substantial Customer Service
- Community Benefit
- Mobile Cafes
- Selection
- Higher Product Quality
Local Cafes:
The toughest competitor for The Daily Perc is the established locally owned cafe. TDP knows the quality and pride that the local cafe has in the product purchase by their customers. Any local cafe has a customer base that is dedicated and highly educated. The quality of beverages served at an established cafe will surpass any of the regional or national chains.
The competitive edge The Daily Perc has on the local cafes is based on the attributes of:
- Drive-thru Service
- Supply Discounts
- Mobile Cafe
- Consistent Menu
- Community Benefit
- Quality Product
Drive-thru Coffee Houses:
There is not a drive-thru specialty beverage retailer with significant market presence in the central United States. The only company with similar depth to that of The Daily Perc is Quikava, a wholly owned subsidiary of Chock Full ‘o Nuts. However, Quikava has limited its corporate footprint to the East Coast and the Great Lakes Region.
In the drive-thru specialty beverage market, The Daily Perc has a competitive edge over the smaller retailers, and even Quikava, due to:
- Mobile Cafes
- Consistent Menu
- Community Benefit
- Quality Product
- Supply Discounts
- Valued Image
- Greater Product Selection
Fast Food and Convenience Stores:
These are two industries where The Daily Perc will experience a certain level of competition. The national fast food chains and national convenience store chains already serve coffee, soda, and some breakfast foods. The national fast food chains obviously know the benefits and value to customers of drive-thru. TDP knows that within the specialty coffee and tea market, the quality of the products sold will be much greater than what can currently be purchased at fast food and convenience stores. The addition of domestic soda sales for these stores is a large part of revenue. TDP knows the quality of our products, along with the addition of domestic soda and the ease of drive-thru, gives it a competitive edge over fast food and convenience stores.
Other competition:
The Daily Perc knows that once it has entered the market and established a presence, others will try to follow. However, TDP believes that the corporate missions and even the organizational design will be imitated, but never duplicated. TDP will constantly evaluate its products, locations, service, and corporate missions to ensure that it remains a leader in the specialty beverage industry.
Our Advantages
The Daily Perc will penetrate the commuter and captive consumer markets by deploying Drive-thru facilities and Mobile Cafes in the most logical and accessible locations. The Drive-thrus are designed to handle two-sided traffic and dispense customer-designed, specially ordered cups of specialty beverages in less time than required for a visit to the locally owned cafe or one of the national chains.
The Daily Perc has identified its market as busy, mobile people, whose time is already at a premium, but desire a refreshing, high-quality beverage or baked item while commuting to or from work or school.
In addition to providing a quality product and an extensive menu of delicious items, to ensure customer awareness and loyalty, as well as positive public and media support, The Daily Perc could be donating up to 7.5% of revenue from each cup sold in individual Drive-thrus to the charities of the customers’ choice.
Keys to Success
Keys to Success
There are four keys to success in this business, three of which are virtually the same as any food service business. It is our fourth key–the Community Mission–that will give us that extra measure of respect in the public eye.
- The greatest locations – visibility, high traffic pattern, convenient access.
- The best products – freshest coffee beans, cleanest equipment, premium serving containers, consistent flavor.
- The friendliest servers – cheerful, skilled, professional, articulate.
- The finest reputation – word-of-mouth advertising, promotion of our community mission of charitable giving.
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