Market segmentation - Essay Example

Freshly Brewed is a Limited Liability Corporation. All membership shares are currently owned by Eric, with the intent of using a portion of the shares to raise capital. The plan calls for the sale of 100 membership units in the company to family members and friends. Each membership unit in the company is priced at RM 5000, with a minimum of five units per membership certificate, or a minimum investment of RM 25,000 per investor.

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If all funds are raised, based on the pricing established in the financial section of this plan, Eric will maintain ownership of no less than 51% of the company. Eric realized the potential the drive thru company and wants to seize the opportunity. Eric’s log term goal for the company is to see it boom into a in-house franchise all over Malaysia. As a sole individual, he does not have the means to finance the entire business by himself. He requested his family members and friends to invest in the Freshly Brewed drive thru business with a share of profit percentage.

The coffee industry evolved from the traditional plain normal coffee to espressos and lattes in Malaysia over the past ten years. Starbucks for instance first started in Malaysia in 1998 when they opened their first cafi?? in KL Plaza, Bukit Bintang. Now it has 39 cafes in Kuala Lumpur alone. Coffee Bean has 20 outlets in Kuala Lumpur. Starbucks and Coffee Bean are only two of the many coffee chill-out places in Kuala Lumpur and many more are coming up. This shows Malaysia is definitely a coffee drinking country and the coffee industry is reaping the rewards.

The coffee industry in Malaysia is still growing and there is still room for more. But for how long? The trend of sitting down in a cafi?? while sipping a cup of espresso and enjoying the environment was brought to Malaysia by franchises like Starbucks and Coffee Bean ten years ago. Those same customers who helped push Starbucks to $2. 2 billion in global sales are now rushing kids to extra classes, basketball games, running to the grocery and trying to get to work on time and back home in time for dinner.

In today’s fast paced environment, people do not have the luxury of time to sit and sip a cup of coffee but they still have the desire for that refreshing, specially blended coffee each morning. Coffee drinker are ready for the introduction of a company that offers a variety of freshly brewed coffee in a convenient, drive-thru environment at a price that is competitive to the coffee chains and cafes in town. Freshly Brewed intends to do just that. There is only one direct competitor in Freshly Brewed’s drive-thru market which is McDonald, the fast food chain franchise in Malaysia.

McDonald pioneered the drive-thru service in Malaysia and it has provided MCD a strong competitive advantage over other fast food companies in Malaysia. Why is a fast company the direct competitor for Freshly Brewed? The reason is McDonald added coffee on their menu about a year back and have since been selling freshly brewed coffee to its customers through its drive-thrus. Freshly Brewed indirect competitors are Kuala Lumpur’s specialty beverage chains, such as Starbucks, Coffee Bean, San Francisco Coffee, Dome Cafi??

, Old White Town Coffee and all other coffee houses or cafes. However, the indirect competitors will not affect Freshly Brewed business unless these competitors start their own drive-thru services. Basically the target group of Freshly Brewed does not match with the indirect competitors. Customers to a Starbucks, or to one of the local cafes, go there for the environment, the ability to “design” their coffee, smell the fresh pastry, listen to the soothing music, and read the local paper or visit a friend.

It is a relaxing, slow paced environment. On the contrary, Freshly Brewed Customers are those working individuals who are always in a rush. These people have no time for idle chatter and are willing to over-pay for a cup of coffee on the way to the office, as long as it’s quick. Freshly Brewed believes it can gain a significant competitive advantage over its indirect competitors through its drive-thru services, warm and friendly customer service and making available a variety in coffee selection.

Freshly Brewed target market are the working individual who have more money than time, and excellent taste in a choice of beverage, but no time to linger in a cafe. By locating the drive-thrus in high traffic/high visibility areas, this unique–and abundant–consumer will seek Freshly Brewed out and become a regular guest. Freshly Brewed will place its kiosk in the Kuala Lumpur golden triangle which is surrounded by business centres to attract customers heading to or from work, or those out on their lunch break.