Table of Contents

Section I - Statement of Purpose......2

Section II - Executive Summary....2
Section III - Mission, Goals and Objectives....2
Mission Statement ...2
Goals and Objectives...3
Section IV - General Description of Business.....3
Legal Description..4
Keys to Success...5
Staff Description5
Section V - Marketing Analysis..6
Industry Analysis...6
Marketing Plan..8
Marketing Mix .12
SWOT Analysis...13
Section VI - Operating Procedures.14
Operating Location.....14
Operating Process..15
Section VII - Financial Plan.....17
Business Projections.....17
Budget Sheet..18
Break Even Analysis .19
Financial Explanation....20
Appendix.24

Section I: Statement of Purpose

Penn State Dietetic Interns Class of 2015-2016, is proud to present our Business
Plan to Donegal School Districts Superintendent. Donegal High School is a pristine
institution of higher learning. Your students deserve to be properly nourished each and
every morning before the homeroom bell sounds. Although your cafeteria serves daily
morning breakfast, both social and financial stigmas may be negatively affecting student
breakfast participation. Proper utilization of your schools highly traveled Commons Area
could make for a riveting and profitable business venture. Many students can be found
congregating in The Commons with peers from 7:00 am - 7:30 am. With the appropriate
funding, a mobile breakfast kiosk, would allow you to provide your students with the
wholesome nutrition they desperately need to ensure academic success!
Section II: Executive Summary
The Beanery is a specialty breakfast food and beverage retail kiosk. The
Beanery uses a system that is revolutionary to the School Food Service Industry by
providing hot and cold beverages and breakfast item(s) in a convenient and timeefficient manner. The Beanery provides its customers the ability to walk up and order
(from a trained food service Barista) their choice of a delectable breakfast item(s),
custom beverages, freshly brewed hot or cold coffee, and other brand reputable items.
The Beanery is offering a high-quality alternative for time restricted students who fall
victim to routinely morning visits to McDonalds, Sheetz, and/or other subpar school
breakfast cafeterias of the world.
Section III: Mission, Goals, and Objectives
Mission Statement
The Beanery Mission is tri-fold, with each aspect being as integral to our success as the
next.
1.) Product Mission - Provide customers with the finest quality breakfast food and
beverage in the most time efficient manner.
2.) Wellness Mission - Provide customers with nutritious breakfast options that meet
the Smart Snacks guidelines for schools, and also meal options that meet the
standards for federal and state reimbursement.
3.) Economic Mission - Operate and grow at a profitable rate through sound
economic decisions, and provide high value reimbursable meal options to the 40
percent of students who are eligible for free and reduced meal prices.
2

Goals and Objectives

The Beanery has established three firm objectives it wishes to achieve in the next three
years.
1.) Double the average daily sale of reimbursable meals from 60 to 120 per day by
2018.
2.) Increase a la carte sales by 10% by 2018.
3.) Provide at least three different reimbursable meal options daily by 2017.

Section IV: General Description of Business

Industry Segment(s)
Food Service - Quick Service, Convenience
The Beanery provides customers with the ability to purchase daily in-house
prepared breakfast items that meet the National School Lunch Programs qualifications
for reimbursable meals, custom coffee beverages, and additional health-conscious
everyday offerings of food and beverages. Each Barista will be trained in the fine art of
quality customer service and exceptional attention to detail. Acquisition and payment for
products and services will be accomplished through an electronic Point of Sales (POS)
system (ie: Etrition Touch Screen Devices).

Legal Description
The Beanery was a manifestation of the Penn State Dietetic Internship Programs
Business Plan Rotation. The dire need for a mobile breakfast kiosk for Donegal High
School was brought to current owners attention by Food Service Director, Jeanne
Kandra, M.S., R.D. The Beanery was founded on March 1, 2016 by Hannah Cornman,
Caitlin Kumher, and John Falconio. Those of whom share equal management
responsibilities, liability, profit, and loss.
Legal: The business extension will handle all legal issues.
Insurance: Insurance will be handled by the business extension.
3

Tax and Bookkeeping System: The business extension will handle taxes and
bookkeeping.
Regulation/Licensing: There is no licensing required for our kiosk.

Location: Donegal High School (1025 Koser Road Mount Joy, PA 17552)
- Schools Common Area
Structure: General Partnership
Effective Date: Start of the 2016 School Year

Organizational Chart

Future Goals:
1. Increase reimbursable meal sales by double in the next two years.
2. Increase a la carte sales by 10% in the next two years.
3. Provide a variety of daily reimbursable meal options including freshly prepared
products and brand recognizable products.
4. Continue to improve products and services to meet the needs of the customers
and school.

Keys to Success
There are four keys to success in this business, three of which are virtually identical to
every food service business. It is the fourth key - the finest reputation - that will give The
Beanery the competitive edge and the respect of the student eye.
1.) Great Location The Beanerys location in the school commons area allows
easy visibility, convenience, and is a high traffic area in the morning when
students arrive to school.
2.) Superior Products- The Beanery provides both quality and high value freshly
made products as well as brand recognizable products that the customers have
asked for.
3.) Outstanding Customer Service- The Beanery will offer customers a more
luxurious and adult like experience which is different from a traditional school
cafeteria. Customers will be given many options to choose from daily, and food
and beverages will be delivered quickly to allow students time to enjoy their
purchases before the school day starts.
4.) Strong Reputation - Strategic marketing will be used to continually promote our
brand, and quality improvement will always be at the forefront of this business.

Description of Staffing
Job Title - Cafeteria Assistant
Summary/Objective - The Cafeteria Assistant prepares and serves breakfast food and
beverages, and maintains the cafeteria and mobile breakfast kiosk area in sanitary
conditions.
Personal Competencies:
1.)
2.)
3.)
4.)

Customer Focus
Learning Orientation
Teamwork Orientation
Time Management

Physical Demands: The physical demands listed below are representative of those that
must be met by an employee to successfully perform the essential functions of this job.

The employee:
1.) Must be able to sit; climb or balance; and stoop, kneel, crouch or crawl.
2.) Must frequently lift or move objects up to 10 pounds and occasionally lift or move
objects up to 25 pounds.
3.) Must have no vision ailments and have the ability to adjust focus.
Preferred Education and Experience:
1.) Ability to read, write, and speak English
2.) Prior Cafeteria or food service industry experience
Position Type/Expected Hours of Work - This is a part-time position, working 3-4 hours
between the hours of 6 am - 9:30 am. This position does not require weekend work.

Section V: Marketing Analysis

Industry Analysis
Just like Donegal School District, many schools across the nation are striving to
increase school breakfast participation. This has lead to many creative advances in the
methods of food delivery, so that students and school staff can be better
accommodated making breakfast more appealing to students. Schools have
implemented various changes such as, breakfast on the bus programs, second chance
breakfast, and grab and go breakfast methods. In addition, schools are also changing
many traditional school food practices in an effort to revamp school feeding programs.
Many schools are changing the design of cafeterias, so that they are more modern and
appealing. Schools have even started opening coffee shops in libraries and common
areas to help provide food and beverage options to students throughout the school day.
In an attempt to research national and local school breakfast program trends a
Director of Dining Services from a local school district in Pennsylvania was interviewed
to find out about how she has improved her program to increase participation. Michelle
Morgan from Big Spring School District in central Pennsylvania had a vision to create a
more luxurious school food program that mirrored what many universities are creating.
She wanted to provide students with more choices, and to create a more adult like
atmosphere in the school. Like many schools, Big Spring High School currently has a
small coffee shop in the library open from 7am to 2:15pm daily. The coffee shop, called
The Growler sells hot and iced coffee beverages, brewed iced tea, fruit smoothies,
6

baked goods, packaged snack foods, breakfast sandwiches, and cold bagged lunches
for students who chose to eat lunch in the library. All items sold meet the Smart Snacks
guidelines for schools, and the bagged lunches count as reimbursable meals. On
average The Growler profits about $450 a day, and about 25 reimbursable lunches are
sold. The school also serves breakfast and lunch in the cafeteria during the hours that
The Growler is open. Michelle explained that opening the coffee shop was a definite
business risk that involved $70,000 in renovations and equipment as well as hiring one
new staff member to run the coffee shop daily. In her opinion The Growler has been a
success and helped to increase reimbursable meals and a la carte sales in her school.
She also reported that the students and staff love the new addition to the school, and it
has expanded educational opportunities for the some of the business courses offered at
the school.
Two other local school districts have taken on similar business ventures in an
attempt to increase meal participation and sales. Dallastown Area School District
recently opened the Wildcat Cafe which is very similar to The Growler at Big Spring
High School. Lower Dauphin School District also opened a coffee shop using the high
school's ticket booth located in the school commons area.
Our company vision aligns well with the visions of the Food Service Directors at
Big Spring, Dallastown, and Lower Dauphin School Districts. We are all looking to
provide customers with a great food experience similar to what they would receive at a
successful cafe located outside of a school. We want the students to feel like they have
choices, and that they can enjoy the nutritious food that they purchase. Our vision
differs slightly with The Beanery, as our main goal is to increase breakfast participation,
but we still want breakfast to be a more luxurious experience for students. We feel that
the best way to increase breakfast participation is to bring the food and beverages to
the students to increase convenience, but also provide them with quality choices that
they have asked for.
After searching the internet to find out more about food kiosks being used in
schools, it is apparent that there are many different ways that schools around the nation
are utilizing kiosks to increase meal participation and sales. Some schools use
breakfast kiosks in high traffic areas to sell to students both before school starts and in
between morning classes. Schools have also chose to provide many options or just
one meal option already in a bag that can be easily grabbed and paid for. No matter
what method is used, it is obvious that there are business strengths and threats. Here
are the strengths and threats of The Beanery that we have identified and will need to
address in short and long term planning:

Strengths:
The unique breakfast kiosk concept of The Beanery will help to bring the
products to the customers in a convenient, high traffic location.
The Beanery will provide expanded breakfast options to both students and staff.
The Beanery features a modern design, much like an upscale coffee kiosk that
will appeal to the target customers.
The Beanery will provide future opportunities to sell products after school and
during school events.
The Beanery offers educational opportunities to students, as many schools
feature student managed businesses. Many media and marketing experiences
could be established to help students gain valuable experience to prepare them
for collegiate and professional success.
Threats:
Outside restaurants and convenience stores pose as threats to The Beanery, as
these large establishments can provide quick and inexpensive meal options to
students before school.
Time constraints on students to eat and drink their purchased food and
beverages before going to class is a major threat.

Marketing Plan
We have outlined specific actions that we intend to carry out to market this new
business to our potential customers.
Our Brand-The Beanery brand itself will be used as our key marketing strategy. Our
vision of a modern collegiate like convenience kiosk will be upheld long-term to retain
customers. Our food packages will feature labels with our sleek logo, and the kiosk
itself will be customized with the name and logo on the front. In the future we hope to
have customized cups for the hot and cold coffee beverages we sell. In addition, our
menu items will be always changing based on food trends and popular items amongst
our customers. We will aim to please our customers by providing the high quality food
and beverages that they ask for.
Grand Opening- A grand opening celebration will be held on the opening day of
business. Coffee and food samples will be handed out to students, and those who
purchase breakfast will be entered into a drawing for prizes. Prizes include, but are not
8

limited to free coffee coupons, custom travel coffee mugs, and custom 12 ounce
tumbler cups. The travel mugs and tumbler cups can be used when buying hot or iced
coffee at The Beanery. This event will be highly advertised on social media and during
school announcements.
Long-term Marketing-In order for this business to be successful, we must be
committed to ongoing marketing for years to come. The Beanery will have at least two
different marketing campaigns each year. These campaigns will be created and
planned by the Penn State Dietetic Interns doing their management rotations at
Donegal School District.
The Media-Many forms of media will be utilized long-term as one of our main aspects of
marketing. The Beanery will have a Facebook, Instagram, and Twitter account that will
be utilized to advertise daily menus, new products, and to host various competitions and
prize opportunities. It is crucial that these three social networking sites be up and
running prior to the grand opening, so that students and school staff are aware of what
The Beanery will have to offer. It is important that these sites be updated weekly, if not
daily, which is why we propose that a Media Coordinator position be available to junior
or senior students. This position will give students volunteer experience as well as
professional experience that will greatly benefit them if they are applying to colleges or if
they are interested in marketing, communications, or media relations as a profession.
In addition, the Media Coordinator will also be responsible for managing the Texts for
Brex program, which utilizes a program called Call Fire. More details can be found
below.
Texts for Brex will send out daily mass text messages to students and staff who
subscribe to the service. Subscribing is very simple, and it is free. In order to subscribe
students must text a keyword to the Texts for Brex number. Texts for Brex will
automatically send the daily entree choices to all those who subscribe, and subscribers
will be given options to text back what they are planning on ordering.

See below for an example Texts for Brex text message.

As stated previously the Text for Brex program will be managed by the student
Media Coordinator using the Call Fire website. This website allows users to send out
custom mass text messages to subscribers. The website also allows subscribers to text
a reply message, which for our purposes will be their choice entree. This program will
be beneficial in the future for surveys and marketing competitions, as students can use
the reply feature.

10

See below for a depiction of the Call Fire website.

One of the most important features of the Texts for Brex program is the ability to
forecast how many entrees must be prepared for breakfast. The Call Fire website
converts the reply messages into a Microsoft Excel spreadsheet. Forecasting will help
cut back on food waste and labor. This feature will also make adding more menu
options in the future more feasible.

11

See the Microsoft Excel forecasting spreadsheet below.

Components of the Marketing Mix

Product-The service that we are offering is a convenient breakfast kiosk that offers a
variety of breakfast foods and beverages. Items sold are both a la carte and
reimbursable meal eligible.
Placement-The Beanery will be placed in the schools Commons Area, which is a very
high traffic area located by the main entrance of the school. Our target customers are
the high school students, which makes this a perfect placement to catch students on
their way in to school.
Price-The Beanery will sell reimbursable meals, as well as some a la carte items. Meals
prices will stay the same as they currently are.
o Full Price-$1.25
o Reduced Price-$0.30
o Free-$0.00
Promotion-The Beanery will be promoted through multi-media. Social media, mass
texting, and school announcements will be used to promote the products that The
Beanery has to offer.

12

Target Market-Our target market is the students at Donegal High School. We also hope
to target the staff at the school as well.
Market Segmentation-We are looking to target a variety of different customers within
the school population.
o Students eligible for Free/Reduced Meals
o Students not eligible for Free/Reduced Meals
o Students who do not eat breakfast
o Students who drink caffeinated beverages
o Staff who do not eat breakfast
o Staff who drink caffeinated beverages
SWOT Analysis

Internal Audit
Strengths
o Convenient, high traffic location
o Variety of a la carte food and beverages
o Free/Reduced Meals
o Texts for Brex program will send daily menu items to subscribers
o Cycle menu will give a variety of food choices
o Modern kiosk design
Weaknesses
o Limited open hours (7-7:30am)
o Students cannot eat or drink in the classrooms
External Audit
Opportunities
o Possibly expand business to after school hours, so that student could purchase
snacks
o Open for sporting events, musicals, plays, concerts, etc.
o Expanded hours during the school day if administration permits food and drinks
in the school
Threats
o Fast food restaurants and convenience stores sell similar products
o Pushback from administration or custodial staff if there are issues when students
are eating in the Commons Area
Discussion of business risks
One of the biggest business risks is the time constraint that the business has.
The Beanery will only be open 7-7:30am, which means that sales will only take place for
13

thirty minutes. We selected a kiosk design that will be efficient when serving customers.
We also chose recipes and menu items that can be easily prepared ahead of time, or be
prepared the day of. We also created a position for a Cafeteria Assistant who will just
work breakfast, so that he/she can be devoted to this business. This is not only a
constraint on the business staff, but also the students. We want to make sure that the
students know they will be served in a timely manner, and that they will have time to
enjoy their purchases. We received feedback from students that the coffee was too hot
to drink in a short period of time, so we will also be offering iced coffee beverages.
Another risk is that the passed stigma of school breakfast could still be relevant,
and students may think that it is awkward to eat breakfast at school. We are trying to
dissolve this idea by creating a modern kiosk similar to what would be found at a college
or university. We think that if we give The Beanery a more coffee shop feel that
students will like purchasing food and coffee.
Another business risk is the potential that the kiosk could get damaged during
hours that the business is closed. We chose a stationary kiosk because of the size and
quality, but there is a potential that students or people attending school events could
vandalize the kiosk. We decided that valuables must be removed from the kiosk daily
for this reason, and investing in some kind of covering may also be valuable.

Section VI: Operating Procedures

Operating Location
Currently, the students at Donegal High School are served breakfast in the food
court in the cafeteria. Unfortunately, there has been a low participation rate in the school
breakfast program. On average, only about six percent of the high school population
participates in the program. To determine if location was a factor in the low participation
at breakfast, an evaluation was completed during lunch. Students expressed that the
current breakfast location is awkward and they feel weird going into the food court to
buy breakfast. When students were asked their opinion on how they feel about having
a food cart in the commons area that serves breakfast, the responses were very
positive. The conclusion of this survey found that moving the location of the breakfast
service may increase the number of students who participate in school breakfast.
After interviewing the students, it was determined that The Beanery kiosk will be
located in the commons area of Donegal High School. There will be one kiosk and it will
be placed to the left of the concessions windows. This location has access to electrical
outlets for the kiosk to properly function. The Commons is an area in the high school
where students congregate and converse with fellow students in the morning before
14

classes begin. Some students also sit in the cafeteria prior to the start of classes.
Locating the breakfast kiosk in The Commons allows for the kiosk to be seen by many
students. The kiosk will also be close to the cafeteria. Therefore, the students will have
to option of eating their breakfast in The Commons or in the cafeteria. To make it
possible for students to eat their purchased breakfast in The Commons area, eight high
top tables will be placed around the perimeter of the space. This will allow students to
place their food items on a table as they eat if they choose to eat in The Commons
rather than in the cafeteria.
In addition to the new breakfast kiosk, the current breakfast service line in the
food court will be closed. The number of sales currently taking place in the cafeteria is
very low. Keeping this service line open with the addition of The Beanery kiosk would be
very inefficient. Closing this service line will increase efficiency and allow for more
staffing to focus on The Beanery kiosk.
The Beanerys breakfast kiosk is 96 inches in length and 42 inches in width. The
counter of the kiosk is 34 inches in height. The kiosk will feature a stainless steal
counter, hot and cold food wells, and LED lighting. Additionally, the concessions area
next to the kiosk will be used to store food during breakfast hours. A warmer can be
moved from the kitchen to the concessions room to store any extra food that does not fit
in the kiosk. The warmer will be returned to the kitchen by the cafeteria assistant with
the conclusion of breakfast.

Operating Process
One additional cafeteria staff will be hired for The Beanery kiosk. This staff
member will be required to set up the kiosk and breakfast equipment, manage the kiosk
during breakfast, tear down the equipment, and clean the breakfast area. After the area
is cleaned up, this staff member will prepare breakfast menu items for the next day.
Also, because the food court service area will be closed, the current cashier will be able
to assist at the breakfast kiosk. This means that the current breakfast cashier, who is
also the cafeteria manager, will experience a slight change in job description. The
cafeteria manager will assist in the preparation of the breakfast items for the food cart in
the morning when they arrive. At 7:00 am, when the breakfast kiosk opens, the cafeteria
manager will work at The Beanery kiosk. Their job will be to manage the cash register.
The new staff member will manage the beverage section of the kiosk. They will function
as the barista and will provide students with their coffee of choice.

15

The Beanery kiosk will require some new equipment. The kiosk station will be
purchased from MultiTeria . In addition to the kiosk, eight new high top tables will be
purchased from Walmart. One new Etrition Tablet with keypad will be purchased from
Harris School Solutions as the Point of Sales (POS) system for the breakfast kiosk. A
cash box will be purchased from Staples to keep any cash secure during breakfast
service hours.

The new staff member will fold up these tables and stored in the concessions
area near The Commons when they are not in use for breakfast. The breakfast
preparation and set up will take approximately one hour. The Beanery will be open from
7:00 to 7:30 am. After this time, the cafeteria assistant will put all food away in the
kitchen, clean up the kiosk, sweep the floors, and put the tables in the concessions
area. Any trays used during breakfast will also be taken back to the dish room by the
cafeteria assistant. This will take about one hour. For the last half hour of the cafeteria
assistants shift, the staff member will prepare items for breakfast the next day.
The cafeteria manager, who currently works the cash register, will now work the
cash register at The Beanerys breakfast kiosk. After the kiosk closes at 7:30, the
cafeteria manager will take the cash box to the managers office to be counted. All sales
will be counted the same way they currently are. This will be the managers only
responsibility during breakfast hours.
After surveying the students, it was apparent that the students desire more
choices. The Beanery is designed to give the students a feeling of freedom of choice
while keeping the choices within the restraints of reimbursable meal standards and
Smart Snacks guidelines. The Beanerys service line will feature one main entree daily,
an assortment of fruits, pre-packaged items, assorted baked goods, a variety of milk
and fruit juice, and hot and iced coffee beverages. Each of the entre option will be the
equivalent of two grains to meet the requirements of a reimbursable meal. The service
line is designed to promote the items that students must take for a reimbursable meal.
The students must take three items for a reimbursable meal including half of a cup of
fruit or fruit juice. Some entrees may count as more than one item such as, a fruit and
yogurt parfait with granola. The coffee options will be located at the end of the line
because they are not a part of the meal. The cash register will be at the end of the
service line.
After surveying students and asking their opinion, it was clear that they strongly
want a variety of coffee offered for breakfast. The Beanery will feature coffee options
because it will draw students to the kiosk and increase overall sales. With order of
16

breakfast items at The Beanery kiosk, the students will have to view all of the enticing
food items before they reach the coffee. This will encourage students to purchase a full
reimbursable meal rather than just the coffee.

Section VII: Financial Plan

Business Projections

Sales Forecast
140

120

120
100

Number of
Reimbursable 80
Meals Sold Per 60
Day

100

60

70

50

40
20

Currently
Total Meals

45

30

10

75

First Year at The

Beanery

Free/Reduced Meals

Goal for Year Two at

The Beanery
Full Pay Meals

Figure 1. Sales Forecast. This graph shows current sales compared to the projected increase
of sales for The Beanery.

17

Budget

The Beanery Budget

One-Time Start Up Costs

Cash Deposit Box

High Top Tables
POS system, Tablet and Keyboard

-$20.00
-$519.92
-$1,345.00

Total Start Up Costs -$1,884.92

Monthly Operating Budget

Fixed Expenses

Staff Wages
-$740.00
Staff Benefits
-$222.00
Equipment Maintenance
-$2.80
Depreciated Costs of Equipment (Kiosk)
-$114.20
Total Fixed Expenses -$1,079.00

Variable Expenses

Cost of Goods Sold

Coffee
Food
Coffee Creamer
Milk
Non-Food Supplies

-$115
-$1,560
-$34
-$420

Napkins
Coffee cups, Lids, Stirrers, Straws, Filters
Total Variable Expenses

-$16
-$34
-$2,179

Total Monthly Expense Budget

-$3,256

Income

Coffee Sales
Free/Reduced Meal Sales
Full Pay Meal Sales

$500
$2,464
$984

Total Monthly Income

$3,948

Table 1. Budget for The Beanery. This table outlines the operating procedures for The Beanery.
The starting costs are described along with the on-going monthly costs. The wages include a
three hour shift for the new cafeteria assistant as well as compensation for the managers time
spent helping with the kiosk.
18

Gross Profit Per Day

Coffee
Free/Reduced Meals
Full Pay Meals
Gross Profit Per Day

Daily
Amount
Sold
25
70
30

Income
Per Unit

Cost Per Unit

Profit per
Unit

$1.00
$1.76
$1.64

$0.37
$1.00
$1.00

$0.63
$0.76
$0.64

Gross
Profit
Per Day
$15.75
$53.20
$19.20
$88.15

Table 2. Gross Profit Per Day. This table shows the break down of the gross profit per day
before subtracting the fixed costs. The number of each item is estimated per day along with the
income associated from each item. The variable costs associated with each item are subtracted
and the profit for each item is added together for the total daily gross profit.
Break Even Analysis

Break Even Analysis

$2,500.00

$2,219.08

$2,000.00

$1,535.08

$1,500.00

$851.08

$1,000.00
$500.00

$167.08

$0.00

Net Prot

-$500.00

-$516.92

-$1,000.00
-$1,500.00

-$1,200.92

-$2,000.00
-$2,500.00

-$1,914.92
Day One Ader 1 Ader 2 Ader 3 Ader 4 Ader 5 Ader 6
Month Months Months Months Months Months

Figure 2. Break Even Analysis. This figure displays the profits of The Beanery and how long it
will take for The Beanerys costs to equal their profits. The break even point is at 56 days (2.76
months) of operation or $4,865.88 in sales. This assumes that 100 reimbursable meals (70
reimbursable meals and 30 full pay meals) are sold per day and 25 cups of coffee are sold per
day.
19

Daily Expense Analysis

Total Fixed
Expences

33%

Total Variable
Expences

67%

Figure 3. Daily Expense Analysis. This figure shows the daily fixed expenses compared to the
average variable costs per meal.

Daily Prot Analysis

22%

18%

Daily Coee
Income
Daily Free/
Reduced Income

60%

Daily Full Pay

Meals

Figure 4. Daily Profit Analysis. This figure shows the daily profit from coffee, free/reduced
meals, and full pay meals as a percent of gross profit.

Explanation of Financials
At Donegal High School, there are approximately 1000 students. Of these
students, 30% qualify for free meals and 10% qualify for reduced meal prices. This
accounts for approximately 400 students. Currently, the school receives $1.66 of
reimbursement for students who qualify for free breakfast, $1.36 for students who
qualify for reduced price breakfast, and $0.29 for students who pay full price. There is
also an additional $0.10 reimbursement from the state for each reimbursable breakfast
sold.

20

Donegal High School currently charges students $1.25 for a school breakfast.
Students who qualify for reduced prices pay $0.30 for a school breakfast. Therefore, for
every breakfast sold that qualifies for a reimbursable meal, the food service department
receives $1.76 for students qualifying for free or reduced meal prices and $1.64 for
students who are not on free or reduced meal prices. For Donegal High School to break
even, the total fixed and variable costs must be less than the income received for each
meal sold.
To determine the total income for The Beanery and assess the break-even point,
the amount of sales from students who qualify for free or reduced and students who pay
out of pocket must be forecasted. This is because the income for the meals purchased
by students who qualify for free or reduced meals is different than those who do not
qualify. Right now, only 6% of the student population participates in the school breakfast
program at Donegal High School. This equates to only 60 students out of the 1000
potential customers. Of these 60 students, only about ten students pay the full breakfast
price. On average, about 85 percent of sales during breakfast come from students who
qualify for free or reduced lunches.
The Beanery began to forecast future sales by evaluating current sales and
investigating what factors have limited current sales. As previously stated, the location
of the current breakfast program has hindered sales. The students do not want to go out
of their way to get food in the food court at the high school. The Beanery also believes
that there is a stigma attached with the current school breakfast program. It appears
that students believe that the school breakfast program is aimed towards students who
quality for free or reduced meals.
To overcome these obstacles and increase breakfast sales, The Beanery is
going to bring the food to the students. The location of The Beanery will attract many
more students and is very convenient. The Beanery is also designed to attract all types
of students. Its modern, attractive kiosk will defeat the stigma that school breakfast is
only for low-income students. Additionally, through surveying students, it was
determined that students greatly desire the ability to make their own choices. They want
options of what they can have for breakfast. The Beanery Breakfast kiosk offers two
different entre options along with choices of iced and hot coffee. This will increase the
appeal for high school students.
After forecasting future sales, The Beanery predicted that sales will significantly
increase when the breakfast kiosk first opens for business. This projection was
confirmed when reviewing what has happened at other schools who opened food
service kiosks. It is believed that there will be a high spike is sales initially and the sales
21

will level off after a few weeks. The goal of the financial prediction for The Beanery was
to overestimate expenses and underestimate the profits. Therefore, the initial spike in
sales was not included if the forecast of sales for financial purposes. As shown in Figure
1, The Beanery estimates that for the first year of business, the kiosk will sell an
average of 100 reimbursable meals per day. After the first year of business, The
Beanery predicts that sales will increase to an average of 120 reimbursable meals per
day. Through out the first year, The Beanery will continue to improve as problems are
addressed and corrected. Additionally, as The Beanery provides nutritious, convenient
meals in a timely manner, more students will participate.
Currently, the majority of breakfast sales are from students who receive free or
reduced meals. It is predicted that as The Beanery overcomes the stigma of the
breakfast program, the percentage of sales from students who do not qualify for free or
reduced meals will increase. Therefore, it is predicted that the percentage of sales from
students who do not qualify for free or reduced meals will increase from 15 percent to
30 percent. Therefore, it was forecasted that for the first year, 70 free or reduced
reimbursable meals will be sold per day and 30 non-free of reduced reimbursable meals
will be sold per day. This is also shown in Figure 1. These forecasted numbers are also
used in Table 2 to forecast the daily sales and gross daily profit. The forecasted number
of coffees sold was estimated after reviewing the current number sold. Currently, an
average of 14 cups of coffee are sold per day. Again, The Beanerys location, dcor and
marketing will increase the coffee sales from 14 to 25 cups of coffee per day.
To determine the average cost of goods sold, the number of each menu item
purchased was estimated. It was assumed that the amount of students who purchased
each entre option would be split evenly. Therefore, the price of each menu item was
considered and an average cost was calculated. It was determined that the average
entre costs about $0.54. The cost of fruits sold was also averaged. It was assumed
that most students will not take both fruit options. Therefore, the cost of goods sold for a
reimbursable meal that includes an entre (grain), a fruit, and a milk was calculated to
be one dollar.
Similarly, the variable expenses associated with coffee were calculated. The cost
of the Folgerss Coffee is $8.29 per pound. One pound of coffee grounds will make 36,
eight ounce cups of coffee. This comes out to $0.23 per eight ounce cup of coffee with
the addition of $0.14 for the cost of a cup, lid, straw, coffee stirrer, and coffee filters. The
cost of goods sold for the coffee; along with the meal costs are shown in Table 2.
To determine The Beanerys break even point, the forecasting in Table 1 and
Table 2 was considered. It was assumed that The Beanery will sell 100 meals per day.
22

Of these meals, 70 meals are from students who qualify for free or reduced meals and
30 are from students pay the full price. In addition it is assumed that 25 cups of coffee
will be sold per day. The start up costs and fixed costs shown in Table 1 of the budget
were also considered in the break even analysis. The variable costs are the costs that
change depending on the number of meals sold and are subtracted from the profits in
Table 2. The break even point is also determined using the assumption that The
Beanery will be open 180 school days.
The cost of the breakfast kiosk itself is $25,704. This includes shipping and
installation. The cost of the kiosk is depreciated over 25 years. This is because the
kiosk is expected to last and have value for this length of time. For example, even
though the cost of the kiosk will not be fully accounted for after year three, the kiosk can
be sold for a value and therefore does not impact the break even. The depreciation cost
of the kiosk is also shown as a fixed cost in Table 1. All other start up costs are
considered a one-time cost as shown in Table 1. It is assumed that The Beanery will not
have to borrow any money for start up costs and no additional interest costs will be
encountered. The point at which The Beanerys profits equal the expenses is
considered the break even and is shown in Figure 2. The Beanery will break even after
56 school days or after $4,865.88 in sales. After this point The Beanery is turning a
profit.
If the cost of the kiosk is viewed as a one-time start up cost, the break even point
does not occur as early. If the depreciation of the kiosk is not considered, the break
even point is 3.84 years. However, this method is not as accurate because the kiosk
retains a value over many years.
Overall, the business plan proposed by The Beanery displays a feasible business
model. This breakfast kiosk will attract Donegal High School students and increase the
number of reimbursable meals sold during breakfast. This business also allows room for
growth. To increase revenue, The Beanery could be reopened in the afternoons. This
could increase sales along with provide nutrition to students who have to go to jobs or
sports practices right after school. Implementation of The Beanery will provide nutritious
foods to students, increase participation in school breakfast, and provide profits for the
school to continue to improve the students food service experience.

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Appendix
Week One Menu Ideas
Monday

Tuesday

Wednesday

Thursday

Friday

Grain/entree Breakfast
option 1
Wrap

Breakfast
Panini

McDonegal
Bacon, Egg
& Cheese on
an English
Muffin

Breakfast
Smoothie
with
Mini Apple
Cinnamon
Muffin

Cinnamon
Danish
Twist

Grain/entree Chocolate
option 2
Chip Muffin

Bagel with
Cream
Cheese

Croissant

Bagel with
Cream
Cheese

Blueberry
Muffin

Fruit/ Fruit
juice

Apple Juice

Grape Juice

Orange Juice Fruit Punch

Petite
Banana

Pineapple
Apple Slices Cup

Fresh
Mandarin
Strawberries Oranges

Milk

Chocolate
& Plain

Chocolate &
Plain

Chocolate &
Plain

Chocolate &
Plain

Chocolate
& Plain

A la Carte
Coffee

Iced & Hot

Iced & Hot

Iced & Hot

Iced & Hot

Iced & Hot

Apple Juice

Table 3. The Beanerys Week One Menu. The Beanery will feature two weeks worth of
menu items with many new options. This table presents week one options.

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Week Two Menu Ideas

Monday

Tuesday

Wednesday Thursday

Friday

Grain/entree Fruit &

option 1
granola
parfait with
Mini Apple
Cinnamon
Muffin

Skillet
Frittata
(turkey
sausage
and cheese
on a tortilla)

Mickeys
Breakfast
Pizza

Egg &
Cheese
Quesadilla
with Hash
brown

French
Toast Sticks
with syrup

Grain/entree Chocolate
option 2
Chip Muffin

Bagel with
Cream
Cheese

Croissant

Bagel with
Cream
Cheese

Blueberry
Muffin

Fruit/Fruit
Juice

Orange
Juice
Apple
Slices

Fruit Punch

Grape Juice
Mandarin
Oranges

Apple Juice

Peach Cup

Apple Juice
Petite
Banana

Milk

Chocolate
& Plain

Chocolate &
Plain

Chocolate &
Plain

Chocolate &
Plain

Chocolate &
Plain

A la Carte
Coffee

Iced & Hot

Iced & Hot

Iced & Hot

Iced & Hot

Iced & Hot

Pineapple
cup

Table 4. The Beanerys Week Two Menu. The Beanery will feature two weeks worth of
menu items with many new options. This table presents week two options.

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Image 1. Weekly Food Component Report for Week One Menu. This image shows the
analysis of the week one menu items from PrimeroEdge.

26

Image 2. Weekly Food Component Report for Week Two Menu. This image shows the
analysis of the week two menu items from PrimeroEdge.

27

Image 3. Financial Quote for POS System. This is the quote provided by Harris School
Solutions quoting two tablets and two keypads. The total price was divided in half for
The Beanerys budget because there in only a need for one POS tablet and keypad.

28

Image 4. Kiosk Pricing Quote. This image includes the description of the kiosk and the
quoted price provided by MultiTeria.

29

Image 5. Sample Kiosk Visual. This image displays a sample visual of The Beanerys
breakfast kiosk. However, The Beanerys kiosk will include an added section for the
coffee and cashier.

30