SIMPLY TODDY

1
SIMPLY TODDY
April 23rd, 2008

• Daniel Belleau
• Alessandra Dyer
• Chase Durrett
• Bethenie Hope

2
POINTS OF SIGNIFICANCE
3
MARKET OPPORTUNITIES

• Ready-to-Drink Packaged Coffee Beverage Market
• 413.9 Million
• 9 Market Share
• 17.5 Compound annual growth rate

• Customer Surveys
• 90 drink coffee 3-4 times/week
• 95 liked/loved Simply Toddy
• What is cold-brewing?

4
PRODUCT STRATEGY

• Offering
• Initially
• Sweetened and unsweetened
• Mexican Zaragoza Select (Allegro)
• Future
• Flavors
• Special Proprietary blend
• Pricing Strategy
• Each 12 oz bottle 2.99

5
PRODUCT STRATEGY

• Benefits of Features
• Unique Packaging
• Trendy look increases the cool factor of the
  consumer
• Niche Product
• Unique flavor provides an exciting alternative to
  the typical cup of coffee
• Caffeine
• Energy to get through the day without the sugar
  crash
• High in antioxidants/low in acidity
• Mood lifting, protects against various diseases

6
SUSTAINABLE COMPETITIVE ADVANTAGES
Packaging Design -creative and simple -Recognizable and convenient -Committed to sustainable products
Continuous Innovation -Various Blends -New and exciting flavors -Always high quality and organic ingredients
Legal agreements and contracts -Contract brew master -Supplier and distributor non-compete agreements
Management -Women-owned business -Hire CEO -Experienced and passionate company members
7
TARGET MARKET STRATEGY

• Consumer Market
• LOHAS individuals
• Young urban professionals
• Ages 20-35
• Average income 40,000

8
CHANNEL STRATEGY

• Year 1
• Local Coffee Shops, Mom Pops
• Boulder Whole Foods
• Direct Store Distribution
• Year 2
• Expand to other natural food grocers coffee
  shops
• Expand to Whole Foods Markets across Colorado
• Year 3
• Expand regionally, and to conventional grocery
  chains

9
COMMUNICATION

• Unique Packaging
• Trendy, eye catching
• Point of Purchase
• Positive, informative, exciting
• Intensive webpage
• Consumer resource
• Local events
• Name recognition

10
POSITIONING
Taste/ Health benefits
Convenience
11
MANAGEMENT

• Board of Advisors
• Wes Brasher, founder VP of operations of MIX1
  Life
• Ed Nichols, Co-founder and President of Sambazon
  Inc.
• Ed Iacino, president of Seattle Fish Co
• - Boland T. Jones, Founder, Chairman, CEO of
  Premiere Global

Position Role Desired Background
CEO Lead and guide Simply Toddy Experience in organic food/beverage industry
Co-Packer Brew package our products Educated and passionate individuals
CFO Master of finances Strong financial skills
Other Production crew, Brew master, distributer, lawyer, organic local food broker, design company knowledge in specific field
12
RISKS MITIGATION

• 1) People dont like it!
• 2)Simply Toddy does not get into Whole Foods
  Markets
• 3) Simply Toddy cannot get traction in the market
• 4) A competitor copies our product

13
REVENUE

• Portrays unit price evaluated with number of
  units sold each year
• Year 1 Local Boulder market penetration
• Year 2 All Whole Foods CO locations
• Year 3 All regional Whole Foods locations
• Year 4 Western regional Whole Foods locations
• Year 5 Coast to coast

14
INCOME

• Driving factors

• Economies of scale
• Outsource production years 3-5
• Initial start-up capital costs and transition
  costs will be highest in years 1 3

15
CASH FLOW
16
FUNDING
Funding Round Type Amount Offering Uses
Startup Investment (Prior to Year 1) Founder Bootstrapping, Friends and Family 150,000 20 Employee Salaries
Startup Investment (Prior to Year 1) Founder Bootstrapping, Friends and Family 150,000 20 CAPEX - Equipment
Startup Investment (Prior to Year 1) Founder Bootstrapping, Friends and Family 150,000 20 Inventories
Startup Investment (Prior to Year 1) Founder Bootstrapping, Friends and Family 150,000 20 Launch Marketing Campaign
Production Support (Early Year 3) Other companies funding, Angel investors 200,000 10 Additional Employee Salaries
Production Support (Early Year 3) Other companies funding, Angel investors 200,000 10 CAPEX - Kitchen Master Brewer
Production Support (Early Year 3) Other companies funding, Angel investors 200,000 10 Inventories
Production Support (Early Year 3) Other companies funding, Angel investors 200,000 10 Marketing - Sponsor Events
17
CONCLUSIONS
Market Opportunity Niche Product Sustainable Competitive Advantage
18
QUESTIONS?
19
OPERATIONS PLAN

• Market Testing

• Customer Service

• Allegro Coffee Beans
• Production in Boulder
• Brewing
• labeling
• Bottling
• Retailer
• DSD
• Whole Foods Market
• Coffee Shops
• Expansion

20
DEVELOPMENT PLAN
21
CUSTOMER RESEARCH

• Surveys
• 80 handed out
• What is Toddy Coffee exactly?
• Sampling
• 50 Distributed on-campus
• Cold-brewing system is NOT well-known
• 95 loved the drink because
• Taste
• Smooth
• Refreshing
• Less bitter

22
FINANCIAL ASSUMPTIONS

• Revenue numbers and quantities are based of Mix1
  business model
• Each bottle of Simply Toddy will be filled with
  12oz of toddy and 80 cans will be produced per
  case.
• Salary for employees will make up on average
  71.8 of our revenue
• A water permit must be obtained for 2000 due to
  the Boulder Country water allotment restrictions
• The cost of sampling for 1 year is 275 and
  500 budgeted in the financial plan

23
REVENUE MODEL
Simply Toddy Notes
Revenue Projections
Years 1 to 5
()
Year 1 Year 2 Year 3 Year 4 Year 5
Simply Toddy
Number of units 256 356 391 430 473
Cases Per Year 512 2,764 10,332 27,400 42,034
Price per unit 239.2 239.2 239.2 239.2 239.2 price customer pays
Total 61,235 661,149 2,471,414 6,554,080 10,054,533
Net Revenue 61,235 661,149 2,471,414 6,554,080 10,054,533


Revenues by Months Quarters
()
Months Year 1 Year 2 Year 3 Year 4 Year 5
Month 1 0 14,035      
Month 2 0 14,035      
Month 3 0 19,649      
Total 1st Quarter 0 47,720 143,442 546,057 860,950
Month 4 1,062 16,842      
Month 5 1,700 19,649      
Month 6 2,125 19,649      
Total 2nd Quarter 4,887 56,141 168,756 642,420 1,012,882
Month 7 2,125 22,456      
Month 8 2,550 28,071      
Month 9 3,187 28,071      
Total 3rd Quarter 7,862 78,598 236,258 899,388 1,418,035
Month 10 2,550 30,878      
Month 11 2,762 33,685      
Month 12 3,187 33,685      
Total 4th Quarter 8,499 98,247 295,322 1,124,235 1,772,544
Total for year 21,248 280,706 843,778 3,212,100 5,064,411

Average Revenue
by Month 5,103 55,096 205,951 546,173 837,878
by Quarter 15,309 165,287 617,854 1,638,520 2,513,633
24
COMPETITION
Company Product Quality Features Location Strengths Weaknesses
             
Starbucks 4 RTD coffee beverages (Frappucciono, Doubleshot Light, and Iced Coffee) Low quality, low cost product. Recent efforts to support growing community Consistency of product with recognizable brand World-wide, headquartered in Seattle, WA Consistently maintains over 90 of RTD coffee industry Lack credibility in socially and economically sustainable and organic community
Caribou Recent Partnership with Coca-Cola including plans to expand to RTD industry Low quality, low cost product. Recent efforts to support growing community Consistency of product with recognizable brand Nationwide, headquartered in Minnesota Partnership with Coca-Cola with immediate plans to sell nationwide Lack credibility in socially and economically sustainable and organic community
Bolthouse 3 protein infused RTD coffee beverages Single origin coffee from several regions. No known organic or fair-trade agreements Protein and vitamin infused health features Sold nationwide as well as online, headquartered in California Differentiation with protein and vitamin health benefits Lack any differentiation from Starbucks with inability to overcome market share
Cool Brew Cold brewed coffee concentrate served in large servings. Requires mixing Low quality, low cost product Low in acid and bitterness of flavor New Orleans based, online sales First mover in cold brew coffee beverages Poor marketing resulting in market unawareness as well as lacking convenience of RTD
Adina 4 RTD coffee beverages high in sugar and additives 100 organic, fair-trade, and single origin coffee Single origin with consistency of bean and flavor Sold nationwide as well as online, headquartered in California Socially sustainable company with products and production capability to penetrate market Lack any differentiation from Starbucks with inability to overcome market share
Veloce Whole bean and ground coffee ready for to brew 100 organic and fair-trade coffee importer 100 organic and fair-trade coffee Boulder based, sold on west coast as well as online Established Boulder based organization with necessary resources Well known in whole bean coffee with inexperience or production capacity to enter RTD coffee