1a. Three cost benefits in Red Jet Sweets feasibility plan include the following: the cupcakes are competitively priced at $2.75 when other cupcakeries in the Fort Worth area sell their cupcakes from $2.50 to $2.95 (Katz & Green, 2014); since Red Jett Sweets is a mobile bakery this means that the company does not have to spend on costs related to renting, leasing, mortgaging or maintaining a brick-and-mortar shop; and the fact that the company does not have to spend money on owning and renting a physical shop (which can form a considerable part of small business’s income) allows them to be able to donate “10 to 15 percent” of their profits to “local charities and organizations” (Katz & Green, 2014, p. 248).
b. The three value benefits of Red Jetts Sweets include the following: Red Jett Sweets will be the “first and only mobile cupcakery” in Fort Worth when it opens (Katz & Green, 2014, p. 248); the company will be able to facilitate a special delivery service that will be convenient for the customer who does not want to enter a brick-and-mortar shop that she must travel to; and selling only cupcakes will help Red Jett Sweets easily create a “clear brand identity” (Katz & Green, 2014, p. 261).
2. I would place a café specializing in “specialty teas/Chai” on the growth stage of the “industry cycle” found on page 197 because the “specialty teas/ Chai industry” continues to be a “year of growth,” according to the Year in Review done by Peter Goggi of the Tea Association of the USA (Goggi, 2014, para. 1). In addition, the opening of “thousands of teashops” nationwide are providing “greater consumer access” to “finer-quality teas” (Goggi, 2014, para. 2). Consequently, this has caused the American consumer to become more aware and interested in the varieties of teas as they continue to make the tea their “beverage of choice” (Goggi, 2014, para. 2).
3.a The strengths of Red Jett Sweets proposed primary market, which is the 25-44 years olds, include the following: they have increasing “spending power,” “strong interest in trends,” and are “knowledgeable about current trends” found in “local and national magazines,” “television and social media outlets,” and among “their peers” and “celebrities” (Katz & Green, 2014, p. 254).
b. The weaknesses of this proposed primary market include the following: this section of the population is so easily influenced by trends that if the Red Jett Sweets is no longer trendy or attractive it can easily move to the another competitor, especially if it offers a mobile service; this proposed primary market may be difficult to please if Red Jett Sweets do not keep up with trends related to cupcake baking; and it should be noted that a significant number of persons within this demographic, such as 25 to 34 year olds, have problems paying off student loan debt, financing higher education (which is becoming increasingly expensive), and being able to find “well-paid jobs” at times difficult for them compared to other age groups, can pose a significant challenge for the business to keep these persons as customers since their disposable income can fluctuate (Tuttle, 2012, para. 4).
c. The strengths of a secondary target market, the 45 to 54 years olds (or Baby Boomer generation), of Red Jett Sweets include the following: this group has a “large size” and “large expenditures” (Katz & Green, 2014, p. 254); and this target group will be appreciative of the “special orders” aspects and the convenience of the “mobile cupcakery” (Katz & Green, 2014, p. 254).
d. The weaknesses of the Baby Boomer demographic include the following: this group will find it difficult to buy from a less established business and more willing to shop at businesses that have been in the area for “many years” (Katz & Green, 2014, p. 254); and this age group is less likely to be influenced by trends, such as the food truck trend (Katz &Green, 2014).
e. One additional target market that I recommend that the Red Jett Sweets establishment consider is the 10 to 16 year old demographic. This demographic will be attracted the concept of a mobile cupcakery and special order aspect of the business since it is convenient and would not require that they leave their homes to purchase these cupcakes. This demographic will not always have disposable income, and will most likely depend on their parents to purchase them, but they would be able to purchase on their own if they have a summer job that allows them to earn an income. Three additional competitors in this additional target market are Cupcake Cottage, J Rae’s, and Blue Bonnet Bakery.
4.a The strengths of Red Jett Sweets plans to differentiate its products and services from those of its competitors include the following: allowing their cupcakery to be a mobile service that permits it to come to its customers instead of vice versa; selling only fresh top-quality cupcakes daily and donating leftovers at the end of the day to shelters; and the use of innovative flavors in the creation of its cupcakes.
4b. The weaknesses of Red Jett Sweets plans to differentiate its products and services from its competitors include the following: Red Jett Sweets as a mobile cupcakery is unable to do its baking on-site because it does not have a brick-and-mortar location so it will have to do its baking the day before; Red Jett Sweets will also have to pay a significant amount of money for baking ingredients because it has to make a fresh batch of cupcakes daily; and Red Jett Sweets will always be challenged to change its recipes on a regular basis so as to ensure that its menu is always innovative, especially if other competitors get a chance to copy one or more of its recipes.
5. Ms. Meyer has the ability to quickly build “personal connections” and maintain “strong relationships with people” (Katz & Green, 2014, p. 250). However, Ms. Gamez is very “detailed and well organized” and has a “passion for baking,” unlike Ms. Meyer (Katz & Green, 2014, p. 250).
References
Tuttle, B. (2012, March 16). “Thanks, Recession: Now 18-to-34-Year-Olds are No Longer Coveted Customers.” Retrieved June 20, 2015, from http://business.time.com/2012/03/16/the-declining-economic-might-of-the-18-to-34- demographic/
Katz, J. and R. Green (2008). Entrepreneurial small business (4th ed.). New York: McGraw- Hill Higher Education.
Goggi, P. (2015, January 4). “State of the Industry.” Retrieved June 20, 2015, from http://www.teausa.com/14654/state-of-the-industry
