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U Foods
Business Plan







Parker Alleman
MGMT 3210

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Table of Contents

Part I: Executive Summary3

Part II: Operations5
a) The Founding Team
b) Management of Assets
c) Locations and Services

Part III: Organization and Culture7
a) Legal Organization
b) Management and Personnel
c) Partnerships

Part IV: Marketing9
a) Market Analysis Research
b) The Plan for the Masses

Part V: Financials12
a) Cash Flow Statements
b) Profit-Loss Statements
c) The Balances
d) Golden Ratios

Part VI: Growth Plan.13
a) Where are We Going?

Part VII: Contingencies17
Appendices20
Executive Summary

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U Foods is a food courier business for SUU campus with the possibilities of
franchising for other college and university campuses across North America. In college
towns, the majority of the food establishments that get business are those closest in
proximity to the campus. Some large food service businesses have franchised their way
into student centers, but variety is seriously lacking. Most revenue comes to these
companies because students are on a limited budget for time and money, not allowing
them to seek out more preferred food options. We all love a good snack from a
convenience store now and then, but no one wants to live on frozen burritos and Mountain
Dew. What U Foods does is bring the more preferred off-campus options right to the
students and faculty. Whether a quick sandwich from Subway or some chow mien from
Panda Express, U Foods will bring the food directly to campus with minimal money
adages.
Catered events for faculty, parties for classes and school organizations or a much
needed pick-me-up energy drink from Maverick are all possible with this company. We
are living in an increasingly fast-paced world and we are filling our lives with more and
more to do, leaving less and less time to replenish needed energy and food. U foods is all
about keeping up with the high energy demand of a campus lifestyle.
We all have been in class or a meeting and thought to ourselves, Man, I am really
hungry, I could go for a _____________. U Foods makes that wish a reality with
just a simple text message of a name, location and food item request. Additional info such
as a time for delivery can be added, as well as anonymous deliveries for loved ones,
friends, etc. U Foods, being a campus specific delivery service, differs from all other
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delivery companies in that the requested items can be delivered not to one arbitrary pick
up point, but to a specific building or even classroom.
Students and faculty are busy throughout the day and dont always have time to
leave for an hour to get lunch, and we never have meetings that run late or get stuck with
another last-minute homework assignment due the next morning that we totally spaced
right? Life happens, and the unexpected events are always inconvenient, but that doesnt
mean we should have to go unnecessarily hungry. This is a very unique market niche that
hasnt been tapped into yet. There is huge growth potential in a business like this because
total costs are minimal, the operation it completely scalable, and franchising to other
campuses is easy for any entrepreneur familiar with local favorites.


Operations
Location, Location, Location
U Foods will hold office space in downtown Cedar City where day to day
operations take place, including paperwork filing, customer service, equipment storage
(including bicycles), payroll services, etc. Office space in the SUU Business Resource
Center will serve as the base of our operations. The majority of information transfer and
storage will be through text, e-mail or calls onto data bases that will cyclically transfer
data every 30 days to a SkyDrive. Part of the operations office is having a receptionist
take the incoming orders and relay that info both to the restaurant to be prepared and the
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courier to be delivered. This location is prime because the maximum amount paid for this
space is $50 per month. After sufficient growth U Foods will be contracting with SUU
and/or the school to decide a more permanent office space.
Basic Operations for Orders
Customers will be able to text, e-mail or call in orders to be delivered at a specific
time and a specific location on SUU campus. The only information needed is a name,
order (including the food store), place and time for delivery. The courier will deliver the
requested food items via company bicycles/mopeds. Once the order is received and
processed, a confirmation text or e-mail will be sent to the purchaser as a receipt. We will
start with 5 couriers on a rotating basis, to fit class schedules, and 1 receptionist and
expand when necessary. U Foods will seek out sponsors to advertise for, with the
companys names, logos, etc. on the bicycles that will be delivering to food.
U Foods business model is fully scalable and has the potential to franchise out to
other campuses only after the potential owner/operator passes U Foods business school
and produces necessary research on the requested university and city within its
operations. One of the revolutionary ideas behind U Foods is the method of payment. U
Foods will operate a joined running tab in conjunction with the university and partner
restaurants. More on this will be included in the organizational structure and marketing
portions of this plan.

Organization and Culture
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Legal Structure
U Foods will operate as a limited liability company for initial launch and will
grow into an S-Corporation after specific requirements are met; the company will need to
generate more than $75,000 in profit annually and have more than 5 franchises in
various communities each with an annual profit margin of $65,000. This isnt anticipated
until after the 6
th
year of operation.
Goals and Philosophy
U Foods will partner with local food stores and restaurants to subsidize food costs
and supply food items with minimal mark-up for profit margins. U Foods is all about
partnering with and giving back to the community; the company wishes to be involved in
furthering community integration with SUU and sponsoring and promoting SUU events.
U Foods wont be a branch of the school but wishes to be able to serve as an internship or
work study program opportunity for business students.

Payment Operations
At U Foods, we understand that poor college student mindsets abound, so we do
not accept payment of CODs or checks. Cash and receipts will be a payment option,
charging a debit or credit card will be accepted, but the company will also partner with
SUUs financial department so allow students to use their SUU credited accounts for
campus food to be used as payment for delivered goods through U Foods. We understand
that part of the revenue generated from students to SUU is money paid for but not
consumed by students. SUU and universities across the nation plan on making a small
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profit from this discrepancy. U Foods and SUU will partner to allow up to 12% of the
revenue generated from food plans to be charged through U Foods purchases. The
company will allow students to generate a running tab to be cleared monthly, at the latest,
or to have the balance drafted from their SUU account directly.
Management/Employee Sources
Employees and management will come first from SUU students. We feel it
important to use current students so those delivering have a better idea of where specific
buildings on campus are and they will serve at additional bridges of information about
school events and activities. Any additional fill-ins for couriers will come from the
community, preferable SUU alumni. The management will operate on a rotating basis
based on employee output and contracts acquired. U Foods wishes to have 80-90% of food
service companies in Cedar City area as partners, but we understand that will be a
growing process. Employees will have the opportunity and be encouraged to contract with
other local companies and as contracts are made, raises and promotions will become
available to employees, though it wont be a requirement. This program is designed to give
incentives and to help employees generate leadership skills.

This Little Piggy Went to Market
Market and Industry Analysis
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Market research shows that individuals are more likely to buy if the customer isnt
trading physical money for goods and services and are even more likely to purchase if the
balance due for the goods and services is small (less than $10) and that can be reconciled
at a later date, this is why credit cards have gotten so popular. Now, given the average cost
of a meal for one is $5.52, the amounts of money paid to U Foods is small and justifiable
in the minds of most people. For these reasons, U Foods is not concerned with whether
students will buy, as long as they know it exists. Market research shows that other than
taxis, there are no general delivery service providers and Jimmy Johns is the only food
company that delivers besides pizza restaurants. There is very little competition here is
Cedar City. Market research must be done by any person wishing to branch the U Foods
name to other communities.
Advertising Plan
U Foods marketing strategy to generate this awareness will be 3-fold; advertising
through social media, though physical banners/signs on the U Foods transport bikes and
through SUU campus recruiting. First, U foods understands that in this digital age, there
are huge growth opportunities through social media such as Twitter, Facebook, YouTube,
Pinterest, etc. Social media is a two-edged sword, but with our money-back guarantee and
determination for excellence, we feel these avenues will be a great advantage, more so
than a detriment.
We will work closely with restaurant suppliers to run various specials a head of
public awareness and publish these multiple times daily on our website and through these
social media avenues. A huge majority of college students have their phone and mobile
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devices in their hands at all times, so our ordering and advertising avenues are prime. We
will also offer for students to register with our texting list to receive notices and deals
when they come available. After the company grows into the S-Corp phase, a software
engineer will be hired to develop an app to help facilitate the ordering process as well.
Secondly, getting public awareness is key in early promoting, so we will offer
discounted advertising to be places on our bikes and scooters/mopeds. Signs and
interchangeable decals, after a predetermined amount of time, will be charged as a small
fee instead of the discounted rate and will not only serve as advertising but also a way to
raise funds for startup costs. U Foods will have a standard fee for those wishing to
advertise on a contractual and rotating basis, so all companies wishing to participate can
with our limited number of bicycles and scooters.
Lastly, we will be going through the SUU career resource center to offer jobs for
those students wishing to earn a little money on the side and will offer internships
through the business school and entrepreneurship classes. We wish to give students
internships so those interested in starting a business can see the operations and day to day
managerial responsibilities required to run a business. Many duties performed by the
interns will be of practical and financial in nature so as to see hands on the principles
taught in their various SUU classes. All of the publicity in and around the university
from this type of involvement will be very helpful in promoting U Foods.
Financials
Profit Margins
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Breakdown of total cost to customers

Growth during Initial Phase

A full financial breakdown will be included in Appendix A.
Growth
Initial entry into the market will be marked with 3-7 employees and a local office
in the SUU Small Business Resource Centers business incubator. This location will be
utilized for the first phase of operation. Weve decided to utilize this space to keep initial
65%
5%
10%
20%
Where The Money Is
Food Costs (From Restaurant)
Wages (To Courier)
Wages (To Reception)
Markup
12,050
10,642
15,785
13,940
22,300
19,625
TOTAL SALES GROSS MARGIN
Year 1 Year 2 Year 3
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upfront costs low. The number of employees hired will depend on total profit generated
after launch; a potential of one new employee per additional $1,500 per month in profit.
U Foods philosophy is to provide the fastest and most reliable service specifically
for university students. With this in mind, the majority of growth will come from
franchising to other university campuses and bridging gaps with more and more local
businesses. U Foods has a vision of growing into a network of locations serving dozens, if
not hundreds, of campuses catering to thousands of students. Growth in individual cities
will be limited, which is why growth beyond the two-year mark will be heavily
concentrated on franchise marketing.
Franchising
Those wishing to take this business model with its unique financial strategy, will
have to pass our specialized U School of Foods course. This is a 40-hour course over a
one month period designed to help the investor/franchisee to understand the basic
principles that this business runs on, including, but not limited to: accounting, human
networking and resources, building assets, acquiring clients/restaurants, etc. At U Foods,
we reserve the right to not sell any rights to individuals that we feel wouldnt be a good fit
on a personality basis; at any point in the training program, if we feel prospective owners
arent up to our integrity and personality preferences, we will not proceed with that
individual.
One of the most important factors in finding those individuals desiring to use the
U Foods name is the individuals knowledge of the requested campus and city where the
university resides. We desire people with a local knowledge of foods, restaurants and
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events. Because one of the companys goals is to blend seamlessly into the surroundings of
its environment, office decorating, modes of transportation and advertising can have a
range of avenues and mediums. U Foods wants to encourage local owners to tie in colors,
environments and general atmosphere of their respective communities into the business.
Any and all major deviations from pre-approved general designs will be welcomed,
reviewed and approved before company rights are distributed.
The SUU branch of U Foods is only the start of the U Foods name. The company
will gain momentum and popularity as time moves on and more and more braches of U
Foods become established. This company will never be publicly traded on any market and
the SUU branch will eventually be given to the university. U Foods wants to give back to
the university and this is one way that the company can help perpetuate business learning
by giving students an actual business to own and operate. The U Foods company will give
SUU all assets and rights to the local branch while retaining 50% of all profits generated
by the business.


Timeline to Launch

Contract
with
restaurants
Acquire
founding
office
space
Hire U
Foods
team
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- Visit local restaurants and contract for deliveries. Agreements between U Foods
and any given business will be drafted by U Foods and entered into by local
representatives from the indicated businesses.
- U Foods will arrange for operations based out of the SUU Small Business
Resource Center.
- Meet with students to find potential employees. U Foods first source of staff will
be from the universitys population.
- Partner with SUU and their financial department and arrange for EFTs from
SUU student accounts to U Foods accounts.
- Implement the U Foods advertising campaign. Launch Facebook page, Twitter
account, SUU business center announcements, SUU career center support, etc.
- First customer!

Contingencies
Partner
with SUU
financial
dept.
Implement
Marketing
campaign
First
customer!
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There are 3 major contingencies that U Foods operates on are: 1) cooperation with
SUU or any given university, including financial subsidies, 2) contracts with local
companies and 3) finding just the right management/franchise owners. Operating space,
types of target restaurants, methods of delivery, etc. are all parts of localizing the U Foods
brand and blending into the respective community. These three aspects are major points
of training at the U School of Foods seminars.
University cooperation is crucial in the financial and operations well-being of U
Foods. The business model U Foods operates in depends, in part, on credit lines through
a community standard institution, the local university. Without the partnership of U
Foods and the local university, marketing strategies, financial support and hiring, any
progress will be drastically halted. If university cooperation is never generated, the office
will never be established. If the university decides to cancel their partnership with U
Foods before the contract is up, legal action will be taken to recoup any losses sustained
by the dissolution of the partnership. In the contractual partnership with any given
university, a minimum contract length of 5 years is required, and a minimum of 1 year
notice must be given before the end of any contract so proper adjustments can be made to
minimize losses in the transition.
Contracts with local restaurants guarantees lower food costs for the business and
thereby creating a large portion of U Foods profit margin. Contracts with the restaurants
helps create steady flows of product and money for both parties. U Foods contracts with
local businesses will be more flexible than with universities because there simply are
more opportunities to choose from. If any one restaurant ends its contract as a supplier,
another restaurant will take its place. Restaurants will want to partner with U Foods
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because food costs drop as food is purchased in greater quantities. U Foods will take 50%
of that increased profit from lower food costs so both the restaurant and U Foods is
profitable.
Arguably, one of the most important factors in running this type of business is the
franchise owner and founding team. Having an owner with leadership qualities, a
personal connection within the operating community and a sound knowledge of general
business practices are vital to success. These characteristics will be screened for during the
U School of Foods training course before the go-ahead is given to the franchise owner
hopeful. If extenuating circumstances create an environment for the owner that isnt
compatible with running the business, a member of the training program will fill in until
a replacement can be found.