An Analysis of Honestly Juices Business

The beverages industry is highly dynamic. Some of the prevalent transformations that have been witnessed in the industry over the years include an increasing likability for healthy-benefiting drinks. As very few businesses are able to offer a world-class variety of fresh juices, the Honestly Juices business idea to provide the market with a wide array of freshly blended non-GMO fruit juices befits the needs and expectations of the health-conscious consumers from Charlotte and other target market populations. The product specifications are unique compared to what competitors offer. Despite the fact that competitors such as Minute Maid and Simply Oranges provide intense rivalry to Honestly Juices, strategic differentiation is expected to put the business in a competitively top-selling position to guarantee market relevance owing to corporate goal attainment.

The Background

The Chief Executive and President of the company, Dr. Francis Johnston, developed the novelty Honestly Juices business from the existing market gap whereby the health-conscious consumers are in dire need of a reliable supplier of fresh juice products that befit their taste and preference. The production of pure non-GMO concurs with the consumer trends to prefer health-benefitting beverages that give the customers an experience of a healthy eating culture in a bid to prevent dietary diseases in public society. The healthy products also address the health-boosting needs for infants, the aged, and those who are diagnosed with a wide spectrum of diseases.

The Company

Honestly Juices is envisioned to become an eco-friendly business that is dedicated to meeting the healthy eating needs of the target consumers. It was started in November 2018 and seeks to secure a significant size of the beverage market share by the end of the first fiscal year. With continuous market outreach and product development, Honestly Juices aims to expand its operations to serve at least 40% of the Charlotte market and about 15% of the global beverage consumption market within three fiscal years. Health awareness creation is expected to prolifically contribute to Honesty market growth and expansion over operational years. Notably, Honesty Juices is a legitimate business, which is registered in accordance with North Carolina’s state law on the business establishment. The official patent certificate is registered under Dr. Francis on the ground of ownership of the novel business idea.

The Market

The company targets to serve a wide range of fresh juice consumers from Charlotte City in North Carolina. Honestly Juices customer-base is comprised of the children, the youth, young families, and adults. These targeted customers fall into the age bracket of 10-55 years. Other critical customers include those who are diagnosed with dietary and other related diseases that can be better managed by eating healthily. The capacity Honestly Juices has toward luring these potential buyers depends entirely on the effectiveness of health awareness campaigns. This is built on the premise that health-conscious customers are easy to convince when it comes to making purchase decisions.

Competitive Position

Amid the prevalent industrial dynamics, Honestly Juices is faced with the mandate to distinguish its business by focusing on the production of purely non-GMO fresh fruit juices. These products are associated with health benefits owing to the expertise dietician guidelines on how to sustain the quality of recommended healthy beverages that could boost the health standards of the consumer population at large. Further, continuous learning and research will be extensively employed at Honestly Juices to inform feasible decisions to guide operations at the organizational level. Routine marketing research will be intensively used by Honestly Juices to redefine operational decisions such as product designing and marketing according to the needs and expectations of targeted consumers.

Management Team

In terms of management, Honestly Juices employs an organic structure whereby sectoral managers are entitled to making decisions based on situational considerations. This managerial approach is designed to reduce unnecessary bureaucracies, which are likely to jeopardize goal attainment, especially when it comes to addressing emergent issues that require timely mitigation measures. However, Dr. Francis, the CEO remains the top decision maker. As a holder of a Doctor of Philosophy degree in business administration and entrepreneurial management, Dr. Francis has gained an indisputable hands-on experience in strategic management and oversight. With the help of other qualified managers such as the Chief Finance Officer (CFO), Melinda Gates and the Chief sales representative Mrs. Jane Alfred Jaden, the CEO is capable of spearheading successful management.

The Future

According to growth projections, Honestly Juices is anticipated to register a steady growth rate of about 13% per annum. The Honestly Juices business is faced with several growth and expansion opportunities, which will be exploited through sound strategic plans and implementation measures. Technology advancement is expected to open up more trading opportunities for Honestly Juices owing to improved health awareness.

Financials

According to projections, Honestly Juices is set for a rapid growth in terms of profitability and market share, which is measurable from returns on sales. As a result, Honestly Juices is destined for about $ 24,148,604 returns on sales for the first year, $ 33,834,857 for the second year of operation, and an approximate of $ 45,988,599 for the third fiscal year. The business advocates for witty reinvestment rather than the distribution of the profits among core stakeholders as dividends. This is to enable growth and expansion into other market regions.

Funds Sought

The Honestly Juices business expects a single financing round unless if there arises a need for franchising at a later date. Funds will be sought from family loans, investments, and loans from credit enterprises such as banks. Family loans add up to $ 20,000, $ 6,000 from creditors and banks as well as a summation of $ 2,617 from North Carolina State business loans. Each investor will contribute about $ 156 toward the Honestly Juices business. These financial resources will be wisely used to carry out the production of fresh non-GMO fruit juices, marketing, and sales promotions.

Financial Summary of the Honestly Juices Business Plan

Sources and Use of Funds

Funds on Hand

Equity capital investments

Melinda Gates - Inheritance $40,000

Metal caps $ 300

Cardboard cartons $ 500

Labels $ 840

Glass bottles $ 3,000

NAB ingredients $ 600

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Total $45,240

Total Dollar Amount Being Sought

Loans

Friends and Family Short-Term Loan $20,000

(Expected early pay off within one fiscal year @ 5% interest)

Convertible Debt $5,000

(Loan may be converted into stock or paid off @ 2.10 % interest within 24 months)

Bank Loan $1,000 (payable within 12 months @ 4% interest

Small Businesses startup loans $160 (Payable in 12 months @ 3.4 % interest)

Business Development loans $1,897 (Payable in 12 months @ 7% interest)

Domestic Entrepreneurships loan $560 (Paid off within 36 months at 14% interest.

How the Funds are used

Monetary Expenses

Cost of furnishing material and equipment $101,593

Working Capital

Inventory cost $1,070,805

Additional Marketing Activities $236,200

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Total Use of Funds $1,408,598

Plan Assumptions

Assumption 1: There a market need for Honestly Juices’ Products

• The nutritional fresh juice drinks market is on the upward trajectory. The market is valued at $995,237,500.00 by 2017 and is expected to keep rising.

• About 55% of the current consumers entail patients and health-conscious families. Therefore, there are plenty of healthy people who are not yet consuming Honestly Juices fresh juice products.

• Stocking in larger stores such as hypermarkets to reach and penetrate a larger market.

• Pioneering approaches to health care improvement and advancement at the societal level creates a reliable business opportunity or Honestly Juices.

Assumption 2: Presence of Significant Customer Base for Honestly Juices

The target customers include individuals at every stage of life, precisely health-conscious consumers who are aged between 10 and 50 years. These customers live in Charlotte City in North Carolina and have an average income of $26,000. According to WMake County.gov (2014), the median family income for those living in Charlotte zip code 27610, was $ 22, 145, the median age was 45, and a rapidly growing population of more than 89,000. About 56% of the target Charlotte residents aged 25 and above hold a Bachelor’s degree and are eligible for formal employment opportunities. (https://goo.gl/BZFr9G ).

Assumption 3: Honestly Juices can turn a Profit

Because there is a dire need for the supply of fresh quality fruit juices that match the needs and expectations of consumers. Honestly is confident that the business will be profitable.

Assumption 3: Personnel

The business requires a relatively medium size of workforce to effectively run operations as stipulated. Dr. Francis Johnston, Honestly Juices’ CEO/President is a holder of doctorate degree in business management and is close friend of the CFO, Melinda Gates, Business creator and master mixer who owns the patent or the Honestly Juice’s fresh juice idea, and the corporate Sales Representative, Mrs. Jane Alfred Jaden. This workplace rapport is expected to contagiously spread to all Honestly Juices’ operational levels so as to build competencies toward goal attainment.

Assumption 4: Expansion

Honestly Juices expects no business expansions in the preliminary years of operation (2018-2019 and 2019-2020).

Assumption 5: Financing

Hitherto, Honestly Juices is financed by $20,000 loan from friends and family, which is due within 12 months @ 5% interest, a $5,000 convertible debt from creditors, which may be converted into stock or paid off @ 2.1% interest within 24 months, a $ 1,000 bank loan that is payable at 4% interest rate within 12 months, and business startup loans amounting to $ 2617.

Analysis of the Break-even

Average Monthly Total Fixed Expenses (FE): $117,383. 17

Gross Profit Margin, expressed as a % (GPM): $453,689 @ 72%

Value of sales required to Break-Even: $ 23,156 for the first fiscal annum.