Case Study For Lils Cafe

Submitted By jfitzgerald81
Words: 3086
Pages: 13

Marketing Plan for Lil’s Café
Market Situation
-Industry Analysis:
The coffee industry and the coffee shop business both have boomed in recent years, especially with regards to specialty coffees. The market for specialty coffees has grown as consumers become more educated about espresso-based drinks and how they are made. According to a National Coffee Association Annual Drinking Trends Survey, specialty coffee consumption has risen from 9 percent in 2000 to 16 percent in 2004. Every day, more than half of the adult population drinks coffee, 108.9 million people. The United States accounts for 52 million of those coffee drinkers.
There are tea stats out there too I may be able to get you some.
While fast food chains are growing at a rate of 2 percent each year, coffee shop chains grow more than 10 percent annually. Even though 75 percent of the cups of coffee brewed daily are consumed at home, 66 percent of Americans buy their coffee outside of their homes. Strong competition within the industry for new customers, premium locations, etc. but overall the industry is saturated, settled and stable which allows almost all of the competitors to yield very good margins
- Competitors: * Beach Pea – Main competitor * Portsmouth Book & Bar – unique paring similar to Lil’s and River Run * Lunch competitors: Beach Pea, Carl’s, Loco Coco’s, AJ’s, Town Pizza, and BBQ place will all be competitors for lunch business. * Chain coffee competitors: In the Kittery malls and in Portsmouth are Starbucks. Dunkin Donuts on Route 1, Route 236 and in Portsmouth. * Independent coffee competitors: In Kittery: Beach Pea. In Portsmouth, there are several cafes that offer a similar experience: Kaffee VonSolln, Café Kilim, Breaking New Grounds, Popovers, Ceres Bakery, Café Espresso, Port City Coffee, Me and Ollie’s, St Joe’s in York. * Breakfast competitors: Beach Pea, Bagel Caboose, Dunkin Donuts. * White Heron is opening up a café on Islinton St will be serving their own tea and coffee etc. (Jay is involved)
* Strengths – Large and varied target market. Located just outside Shipyard entrance (lunch). Coming in with proven operational strategies. Superior product quality. Unique brand and model. Foot traffic from neighboring stores. Financial support from the commissary kitchen. * Weaknesses – New brand with relatively low brand awareness in market. Lack of expertise in coffee shop management. New business means limited funds. Located outside of Portsmouth. Shipyard gate proximity location could be a liability in the AM. Target market could be too broad. * Opportunities – To be the only locally owned coffee shop in Kittery. To be the ‘go to’ coffee, tea, pastry, sandwich place in the greater Portsmouth area. * Threats- Competition, specifically from the Beach Pea, but also from area coffee shops. Sluggish economy could drive people away from higher end coffee. Construction could cause more delays to opening.
-Competitive Advantages: * Tandem Coffee will be a competitive advantage of Lil’s Café. Tandem may be the best coffee North of Boston and South of Portland. * Serving loose leaf tea/being a tea room * CSR – This is a main point of difference between Lil’s and most other restaurants in the area. * River Run Books and Maine Squeeze Juicery – These unique parings will increase foot traffic and create another point of different for Lil’s * Backing of Bob’s/Robert’s – Having the operational experience and financial backing of two successful restaurants will give Lil’s support they will need as a new venture. * Location – Being located so close to the shipyard entrance may make Lil’s and attractive choice for lunch for the shipyard folks. Also the proximity to the hospital may prove to be advantageous as well.

Target Market
Seventy-Seven Percent Of U.S. Adults Drink Coffee Daily
The challenge is how to identify a relatively broad target market