CREATIVE CUISINE

Personal Chef Service

Market Study
Introduction
Creative Cuisine, to be located in Somerville, Massachusetts,
will provide personal chef services to busy working
professionals in the West Suburban Boston area. This service
will include personalized menu planning, grocery shopping
and preparation of dinner entrees and side dishes on a
regular basis. The service will be available as a monthly, bi-
weekly or occasional service. Price will vary according to
level of service selected. The meals will be prepared in the
client's home during a weekday while the client is at work.
All meals will be packaged, labeled and refrigerated or frozen
with complete instructions for final preparation. Creative
Cuisine will use all its own utensils and will do complete
clean-up.

Creative Cuisine's target market will be affluent working

couples with children who want to enjoy healthy dinners at
home with minimum preparation. The average clients will be
homeowners age 35 to 55, with incomes over $100,000.
Creative Cuisine's marketing focus is to provide them with a
convenient, unique and high-quality alternative to cooking,
dining out, or take-out meals.

Creative Cuisine's targeted high-end consumers continue to

demand more convenience and quality in their dinner meal.
Nearly half of America's dinner meals are currently prepared
outside the home by full-service restaurants, grocery store
prepared food sections, and take-out food retailers. Two of
Creative Cuisine's advantages over such competitors are: 1)
its ability to completely customize meals to the client's
tastes, preferences and dietary requirements; and 2) its
ability to deliver these meals directly to the client's home
refrigerator/freezer, thus saving clients valuable free time
that would otherwise be spent shopping, driving, and
cooking. The customized meals personally prepared by
Creative Cuisine will be significantly higher in quality, taste
and nutrition than the mass-produced food offered by its
competitors.

What follows is a detailed analysis of the current market for

a personal chef service.

Current Market Size

Economists at the National Restaurant Association estimated
total foodservice sales for 1996 at $313 billion, representing
a 5 percent increase over 1995. That means consumers
spent an average of $855 million per day on food away from
home.

According to the National Restaurant Association's 1996

Foodservice Industry Forecast, fast food comprised the
largest segment of this market, capturing 47.8 percent of the
dollars spent. The report attributes this success to "fast
food's ability to meet consumers' desire for value and
convenience." It was further estimated that at least 64
percent of all fast food purchases were consumed off-
premises.

According to Technomic, Inc., a food industry consulting firm

in Chicago, almost half of consumer food dollars are spent on
meals prepared away from home. In addition, food
expenditures rise significantly as income increases according
to the Bureau of Labor Statistics' Consumer Expenditure
Survey Data.

Industry Trends
This significant trend of consumers purchasing prepared
meals is so pervasive that the foodservice industry has
coined a new term to describe it: "home-meal replacement."
Many businesses are shifting their focus to meet the growing
demands of consumers:

• Most supermarkets now include a deli, bakery, and a

prepared-foods section. Also, many offer fast-food
service.
• Boston Market has continued to expand its product lines
and market share.
 • Famous chefs, such as Wolfgang Puck, are offering high-
end prepared meals in upscale supermarkets.
• Fast-food chains such as KFC, Pizza Hut and Taco Bell
have formed alliances to offer multiple product lines
under one roof.

There are also several economic and cultural trends that

have contributed to this growing demand:

• Increasing number of women in the workforce

• Increasing number of woman-owned businesses
• Growing number of higher-income households
• Americans working longer hours
• Decreasing amount of leisure time
• Premium placed on convenience
• Trend toward purchasing personal services (i.e.,
personal-trainers, house-cleaning services, home
shopping services)

According to Foodservice Solutions, a Tacoma, Washington

hospitality consulting firm:

"Home-meal replacement is not a luxury

today - it's a necessity. People don't want
to take the time to cook; they have too
many other things to do. Americans want
high- quality prepackaged foods. It's the
American way - to make life easier."

Entrepreneur Magazine's February 1997 article selected

"Personal Chef Services" as one of the top service
businesses to start today:

"Convenience-craving consumers are

always looking for a way to do things
better, faster and cheaper. Often, that
means turning to a specialty-services
 entrepreneur who knows how to get the
job done right. Those with culinary
competence can likely find a hungry
clientele among the ranks of America's
busy working families."

Growth Potential of the Market

Based on the National Restaurant Association's 1996
Foodservice Industry Forecast, the percentage of food dollars
spent away from home has grown from 25 percent in 1955 to
50 percent in 1996.

More importantly, the proportion of the food budget spent on

meals away from home increases significantly as income
increases. Households with incomes of $70,000 spent 81
percent more per capita ($1,278 per person) on food away
from home than the average income-reporting household
($705 per person) according to the Consumer Expenditure
Survey conducted by the Bureau of Labor Statistics.

Also contributing to the potential growth in the market is the

rise in affluent households documented by the Current
Population Survey from the Bureau of the Census. From 1990
to 1994 the number of households earning $50,000 to
$74,999 increased by 16.4 percent; households earning
$75,000 to $99,999 increased 36.1 percent; and households
earning $100,000 or more increased by 61.1 percent in the
same period.
 Affluent Households Gaining Ground
Change in Number of Households from
1990 to 1994

Increase Perce
(Decrease) in nt
Household Number of Chang
Income Households e
Less than
(1,638,000) -3.0%
$35,000
$35,000 to
(331,000) -2.0%
$49,999
$50,000 to +16.4
2,310,000
$74,999 %
$75,000 to +36.1
1,841,000
$99,000 %
$100,000 or +61.1
2,496,000
more %
Total 4,479,000 +5.0%

Source: Bureau of the Census

A personal chef service is uniquely positioned to take

advantage of the increasing demand for fast food, growing
health concerns, and the rise in high-income households.
Affluent working couples want "fast food," but they want it
upscale, healthy, and convenient. The founders of Truly
Unique Personal Chef Service in Newport Beach, California,
report that their business has grown 10 to 15 percent every
year since opening in 1992. Many of their clients said they
were getting bored with going out to restaurants and wanted
something different.

Customer Profile
Creative Cuisine's' target customer will be families with two
working, professional parents who are too busy to cook
every night but are fed up with takeout and restaurant food.
Their specific demographics are as follows:

Household Income: Over $100,000

Age: 35 to 55
Education: College degree and/or advanced degree
Marital Status: Married couples or high income single
Job: Professional status (one or both partners)
Children: Preferably ages 7 to 18
Homeowners: Preferably
Location: Live in neighborhoods with high concentration of
affluent families
Customer Benefits
Here are just a few of the benefits to customers if they hire
Creative Cuisine:

• 6 hours per week more free time (1 hour per day

cooking/acquiring meal plus 1 hour per week grocery
shopping)
• Very convenient
• Meals customized to personal tastes
• More variety
• Health and nutrition benefits
• Less stress
• Client feels pampered
• It makes life easier
• Don't have to cook
• Less grocery shopping
• Minimal kitchen clean-up
• Peace of mind

The Competition
There are a handful of other personal chef services in the
Boston metropolitan area; however, since this is still a new
business concept, there remains a large untapped market.
Most competition for home-meal replacement exists from
neighborhood restaurants, upscale fast-food outlets (e.g.,
Boston Market) and supermarket prepared meals. Following
is a competitive analysis of the various meal replacement
alternatives:

Creative Cuisine's competitive advantage is its ability to

deliver consistently high quality, personalized meals, custom
menu planning, grocery shopping, and preparation of meals
right in the client's home for consumption at the client's
convenience.

This is an opportune time for beginning a personal chef

service. According to Entrepreneur Magazine, some of the
fastest growing trends in service businesses today include:

• Servicing smaller, upscale markets

• Products and services for children and their parents

Creative Cuisine is better positioned to service small,

upscale markets in a personal way than are the other
competitors. Creative Cuisine's personal chef services are
specifically geared toward affluent couples with children.
Busy working parents have more quality time to spend with
their children when they aren't rushing to get dinner on the
table, and their children get a more nutritious dinner.
Creative Cuisine also has the advantage of being a home-
based business which requires lower overhead and start-up
costs than a traditional foodservice business.

Target Markets
The following cities in the West Suburban Boston area have
been targeted by Creative Cuisine. All have high average
household incomes and large populations of educated,
married couples with families who own their own homes:

Demographic Summary
West Suburban Boston Communities
 Marrie
Ave. d Colleg
Househ 1996 Owner Couple A e
Communi old House 1996 Occupi / ve. Degre
ty Income holds Pop. ed Family Age e
$137,07 10,32
Weston 3,514 87% 90% 42 68%
7 1
$116,73 27,28
Wellesley 9,070 81% 88% 38 69%
6 9
$101,17
Lincoln 2,806 7,919 54% 89% 34 60%
7
Wincheste $100,94 20,73
7,698 79% 87% 40 55%
r 6 5

$99,180 29,93
Lexington 11,145 82% 86% 42 59%
8
82,79
Newton $94,753 30,952 69% 84% 39 57%
8
24,87
Belmont $84,873 10,080 60% 84% 42 55%
1
56,03
Brookline $80,039 26,206 43% 76% 40 64%
4
44,20
Arlington $65,610 19,705 57% 81% 42 42%
0
32,17
Watertown $63,636 14,999 46% 77% 41 41%
4
93,34
Cambridge $63,489 41,264 30% 63% 36 54%
9

Source: Equifax National Decision Systems, 1996, Courtesy

of Community Newspaper Company
Market Penetration
Research indicates the most effective advertising tool for a
personal chef service is placing a small display ad in a
weekly community newspaper with a paid subscription base
of 5,000 to 40,000 readers. All of the above communities
have a weekly community newspaper, although some offer
free subscriptions and some have a paying subscriber base.

In addition, the following marketing tools will be used:

• Offering $100 discount on initial service for first-time

customers
• Developing contact list for referrals through friends,
family, co-workers and networking
• Fliers and business cards placed at strategic locations
• Occasional advertising in other publications (e.g.,
Boston Symphony program)
• Press releases to community newspapers and radio
stations
During the initial inquiry by the prospective client, an
appointment will be scheduled in the client's home to
discuss the service. At the first meeting, the Creative Cuisine
chef will present sample menus and sample meal options. A
questionnaire on food choices and preferences will be
completed. After presenting the pricing structure, a plan will
be chosen, a check will be collected, and a date will be set
for the first service. An interim phone call will be made to
present the personalized menu and obtain menu approval. A
small gift will be left at the first service appointment with a
thank you card. A follow-up call a few days after service
begins will inquire into the client's satisfaction with the
meals. If this is a trial customer, an additional call will be
made one week later to see if their is interest in becoming a
regular client; if so, a regular service date will be set. For all
future service, a check made out to Creative Cuisine will be
left at the client's home on the service date.
Creative Cuisine has the potential to create a very profitable
business by capitalizing on several major trends of the
1990s. With the increasing numbers of affluent families
comes their increasing demands. Creative Cuisine can help
solve some of their problems while meeting these demands.

Creative Cuisine
Problem
Solution
• More stress
• Less stress
• No time to cook
• Relax with family
• Too many
instead
decisions
• Fewer decisions
• Want to eat
• Eat healthier
healthier
• We'll grocery shop
• Hate to grocery
for you
shop
• Lots of variety in
• Tired of same old
food choices
food
• Personal attention
• Impersonal world