What's For Dinner?
Market Analysis Summary
The Dallas area’s meal preparation market is untapped. As a matter of fact, there is no other business of this kind in the Dallas/Ft. Worth area. Though there are no exact replicas of our company there are some types of companies that we would have to consider to be indirect competitors. These include such companies and service professionals as caterers and those that will come to your home and prepare meals for you to freeze. What’s For Dinner?, at this time, has few direct competitors, with exception to area restaurants and your basic home cooking. At the inception of What’s For Dinner?, there will be no type of company like ours in the area, thus giving us the overwhelming competitive advantage of first entry.
The What’s For Dinner? market is primarily in the Collin County area: Plano, Frisco, Allen and McKinney. We will be focusing on households in these areas that have more than one person. Primarily, those households whose income is over $50,000, with someone under the age of 18 living there. As a secondary target market, we will market to the elderly population in the aforementioned areas. Initially, the greater portion of our customers will be busy, working class people and the growing group of single-parent families, but it will be of great benefit now and in the future to market our services to the highest growing population demographic – senior citizens.
The following statistics were taken from Table DP-1 Profile of General Demographic Characteristics: 2000 for Collin County.
4.1 Market Segmentation
What’s For Dinner? has three distinct target populations:
- Family households with children under 18 years old. This group of people is generally busier than other families with their time split between work, home and their children’s activities. This group may be single parent households, which only adds to the stress resulting from lack of time, coupled with the need for proper meals for their children. This provides them with a desire to provide their families with good meals and free time to enjoy being together.
- Family households with no children living at their home. This group has a need for our services, as hectic schedules, professional careers, and daily demands on time come up against the need for tasty, healthy meals. Depending on their work and home situations this demographic could use our service to enhance their selection of meals all the while minimizing their time in the kitchen. This group does recognize the benefits of our service and want to enjoy making meals for themselves and socializing through our business.
- Senior and Elderly Citizens. This group (65 and older) is the fastest growing portion of the population, and needs our services for several reasons:
- A good portion of this group is simply unable to cook nutritious meals and does not have the knowledge or skills to continue to effectively maneuver themselves in the kitchen.
- Many seniors do not have the time, energy, or means to make it to the grocery store.
We will market several menus designed for the diet needs of the senior populace (diabetic, low cholesterol, low sodium), with pick-up and drop-off coordinated with a local senior-transportation center. All prep and measuring will be done beforehand, so they will need only to stir and combine ingredients. In addition to meeting their practical needs, we will create the social experience that this group consistently hunts for, and help them to enhance their lifestyle through a higher quality of health.
|Year 1||Year 2||Year 3||Year 4||Year 5|
|Households with children||10%||73,864||81,250||89,375||98,312||108,144||10.00%|
|Households with no children||10%||58,404||64,244||70,668||77,735||85,509||10.00%|
4.2 Target Market Segment Strategy
These target market segments were chosen based on their greater need for our services. Families with children are very busy, and they can end up spending a great deal on fast food and junk food because they don’t have time to cook healthy meals at home. Busy working couples and individuals without children are also busy, and may not have the skills or desire to plan and cook entire meals at home just for themselves; they can spend a lot on going out to eat. Seniors have special challenges in obtaining and preparing quality ingredients to feed themselves, including the loneliness of cooking for oneself. Options like “Meals on Wheels” are generally last-resorts, and many would prefer alternate food preparation arrangements, if any were available at a reasonable price – fixed incomes can be hard on the palate.
Our marketing strategies for all groups will emphasize our relatively inexpensive, fun, and easy approach to preparing healthy meals. We will vary our serving sizes, menu options, and level of preparation for each group; the family-size entree just right for a family of four makes no sense for a single individual. Different sized families have different needs, and it will be our goal to look to accommodate most family sizes through our variations in serving size.
The main objection most potential customers will raise is cost – $144 seems like a lot of money, up front, for a new, untested service. This is why we are starting our marketing and sales campaigns with established groups (church groups, cooking clubs, local senior center restaurant clubs), at a price reduction. These consumers already have experience socializing with each other, and our service will be an exciting change of pace in their calendars. We anticipate that these initial positive experiences will generate significant word of mouth and produce referrals so we can say to potential customers, “don’t just take our word for it – go ask people who’ve tried us!”
4.3 Service Business Analysis
Our service is unique among Dallas meal preparation options. There are no direct competitors for What’s For Dinner? The closest competitors are personal chefs, who will come to your home and prepare your chosen meals for you and freeze them, at a very high price. Our target market segments cannot afford personal chefs.
Our indirect competitors are area restaurants. These include family-oriented, inexpensive diners and casual restaurants, as well as fast food and takeout. We will generally not be competing with upscale, adult-oriented restaurants, since those are “special occasion” locations, and do not fulfill local residents’ daily meal needs.
Our competitor restaurants compete on price, perceived convenience, and atmosphere. They succeed when they convince customers that going out to eat is an affordable “treat” that is easier and more pleasant than preparing meals at home. In truth, the restaurants with the lowest prices also offer poor quality food and atmosphere, and the struggle to get children ready, out the door, and have them behave in a restaurant setting can make these choices less appealing in families’ realities than in their imagination. For all customers, the time it takes to get ready, travel to a restaurant, order dinner, eat, pay, and get home make going out to a eat a full-evening’s commitment – hardly the convenience it claims.
With the introduction of What’s For Dinner? to the Dallas market, we will revolutionize the way that the community looks at cooking convenience. Our prices really are much lower than restaurant meals, with much higher quality meals. In addition, our “convenience” comes in two ways – preparing meals at a set time, outside the daily routine, so they are ready in advance, and eating and minimal clean-up right in the customer’s own home, which saves time and energy at the end of a long day.
4.3.1 Competition and Buying Patterns
Even though What’s For Dinner? has no direct competitors, we will set up our business as if we are entering an already aggressive and hostile market. This is aimed at helping us to become successful through a constant drive for increased service model efficiencies and marketing effectiveness. We will strive to excel in customer service excellence, continuing our menu varieties and achieving the highest standards for our food products. As owners, we feel that word of mouth and customer retention are significant factors in our success. Our convenient locations, sanitary facilities, competitive pricing structure and honorable reputation will all play a part in satisfying our customers and increasing our clientele at an accelerating rate. What’s For Dinner? will focus on these factors and always strive to improve our business model and service offerings. We will strive to be the very best in our industry and will not rest until we not only have the largest market share in our industry, but also have the most satisfied customers.
The buying patterns of our customer base will be affected by our initial meal prep party prices. We have concluded through our exhaustive focus market groups that we could set our prices high, since there is no direct competitor, but we feel that to attract and retain customers and be able to steadily grow our customer base, so we should price ourselves at a lower level first. By setting ourselves at the lower end of our pricing range, we will not only gain the attention of the vast majority of our target markets, but we will also be able to start our revenue streams off with an upward growth pattern. The price that we will choose will be reasonable for our customers and be adequate for the business to maintain a gross margin around 25%.