‘ Current operations:
Divine cakes & Dessert is proudly Canterbury owned and operated. They making cakes & desserts for special occasions. They use the finest of ingredients to make a range of ready to go cakes, mousse cakes, cheesecakes, tarts and gateaux for their customers. Divine Cakes & Desserts bakes and creates its cakes and desserts with real ingredients. Their banana cake has real bananas, carrot cake has real carrot and decorations are made by hand in the bakery. Original philosophy from the beginning was to use REAL eggs, REAL butter, FRESH cream, that is something that will never change.
‘ Product description:
Divine Cakes & Dessert have a large product range for birthdays & novelties( boys, girls and adults) and for special occasion like mother’s days, anniversary, father’s day, valentine days, ester and Christmas:
‘ Mousse cakes
‘ Savoury quiches
‘ Overview of its marketing (4p’s):
They provide a variety of products ranging from egg & gelatine to eggless & without gelatine foods. All main cakes and Dessert serve in different favours. They divide their products into different categories like special function for boys, girls and adults.
‘ PRICE :
The prices of all of the items offered by Divine Cakes & Dessert is very reasonable and in compliance with the target market. Reasonable Price is ‘Strength’ for cakes and dessert. Price list is available online.
Divine Cakes & Dessert is situated in different parts of New Zealand. Divine Cakes & Dessert has 11 outlets in New Zealand. The place of outlets is all over in Christchurch and also in Auckland like Westfield, Blenheim, Northland and the Palms.
‘ PROMOTION :
There are no advertisements on television, in the form of print ads or on radio as it is too expensive. They mostly use internet media for advertisement. They believe in providing best services to the customer which helps them indirectly in promotion.
‘ Overview of enterprise:
The location of Divine Cake & Desserts in all over the Christchurch and also in Auckland (Westfield, Blenheim, Northland and the Palms). They believe to provide the excellent customer service. They provide reservation as well as voucher system. Home delivery is not available, take away food is available. Payments options are MasterCard, VISA, Cash and EFTPOS.
‘ Appropriate picture of the product:
(B) REASON FOR REPORT
If I talk about small business enterprise nowadays the business development and growth is so high. The Divine Cake & Desserts first they have only in Christchurch but nowadays they are in Auckland because of their business development. They currently have a good image in market and they would like to know if they could expand their business further and where.
SECTION: 1 PESTLE analysis
‘ Tax concession policies:
Tax concession is also plays a vital role in growth of business. Tax deduction will be given once the business is on the growth stage which is in a form of subsidy. It reduces the overall tax of the business.
‘ Impact upon the business:
It will help Divine cakes & dessert to get tax concession and save more capital which creates a positive effect and they can concentrate on other ways to carry out work.
‘ Infrastructure policies:
Infrastructure support is momentous support by government. Government improves the rail and road links to encourage the growth of the business. Government also provides many facilities like water, transport and electricity.
‘ Impact upon the business:
It will help the customer to get the products availability at their convenience. A good infrastructure attracts the customers to buy more and visit again.
‘ Varieties product policies:
Divine cakes & desserts make product according to gender like girls, boys and adults according to there occasion and demand and also make some discount for daily customer.
‘ Impact upon the business:
Divine cakes & desserts can offer cheaper products but it might have to sacrifice the quality. This is the main socio-cultural challenge that the start-up faces. It will expand consumer base to include the buyers from the lower and the middle-income tiers.
‘ Online & wifi policies:
Divine cakes & desserts is doing online order. If they use online order facility than they will give discount coupon. Divine cakes & desserts introduced Wi-Fi capabilities in its outlets already.
‘ Impact upon the business:
Divine cakes & desserts make online order than we have enough time so we make order at pre time and delivery make easy and at time. Internet is important to the consumers. They can now surf the web and do work while they are in store.
‘ Legal holidays for employees policies:
Divine cakes & desserts will have a policy to pay minimum pay to its employees time to time including holiday pay and sick leave.
‘ Impact upon the business:
Divine cakes & desserts pay regular holidays and sick leave without any question and medical certificate. That is effect positively because that policies is very easy and without stressful for the employees.
‘ Holidays policies:
Our business environment will be affected when the bill to ‘amend the Holidays Act 2003’ to provide for the transfer of the public holidays for Waitangi Day (6th February) and ANZAC Day (21st April) if they fall on the weekend (clause 5, holidays act, 2003). This means if Waitangi Day and ANZAC Day fall on Saturday than the previous day
‘ Impact upon the business:
staff working on public holiday gets extra pay and gets day off which is an advantage of them. Part time and casual employee get 1.5 times pay and one day off while the salaried employee get only one day off which is advantageous for company point of view. Business gets more trading hours and also makes more profits.
SECTION: 2 ECONOMIC, CULUTRE AND INDUSTRIAL ANALYSIS
(A) NATIONAL ECONOMIC INDICATOR
‘ Inflation :
The rate of inflation tends to increase when the overall demand for goods and services of Divine Cakes & Desserts exceeds the economy’s capacity to sustainably supply goods and services.
Implication: Inflation has the positive effect on food business as it contains 18% of weights of CPI. Divine Cakes & Desserts gets the low profitability and low business when inflation is greater than demand because most of the raw materials are imported by them.
‘ Unemployment :
Unemployment is defined as being without paid work, where a person was available for work and actively seeking work. Unemployment and economy of country is related inversely proportional.
Figure shows the unemployment by sex from 1986 to 2013. It seems highest in 1991 and 1992 approx. 11%.
Implication: Divine cakes & desserts help the New Zealand economy by providing jobs to the people and decrease the unemployment. New Zealand falls on 22 positions with around 6.5% unemployment rate.
‘ Share market fluctuations :
Divine Cakes & Desserts share market aggregates the measurement of price to the overall moment of common shares of.
Implication: Falling share its effect shares price of Divine cakes & desserts and we need to increase public profile given that share to customers and suppliers.
‘ Investment spending:
Investment spending is a booster into the circular flow of income. Investment may be required to change worn out, or dying machinery, equipment, or buildings.
Implication: Divine cakes & desserts can invest their money for purchasing new machinery, for good infrastructure, interior and technological tools which help to lead the business in to marginally profit side.
‘ Money supply:
The entire stock of currency and other liquid instruments in a country’s economy as of a particular time. The money supply can include cash, coins and balances held in checking and savings accounts.
Implication: Money can be rotate with the help of using proper strategy for selling cakes & dessert by divine cakes & dessert. More liquid assets are useful to them to increase the business as well as fame.
‘ Business confidence:
Business Confidence measures how businesses feel about their financial state.If finance stuck because of recession or any other reason business confidence going down and that’s not good for owner and investors.
Implication: Divine cakes & desserts needs to keep long term relationship with their customers not like other companies which produce products. Industry provides front line service to the customer it is essential to provide best services to customer which helps in expansion of business.
‘ Gross domestic product:
The gross domestic product (GDP) is one the primary indicators used to measure the health of a country’s economy. It represents the total dollar value of all goods and services produced over a specific time period.
Implication: Divine cakes & desserts can help to grow the value of New Zealand dollar indirectly by increase in the economic condition by providing employment.
(B) INTERNATIONAL ECONOMIC INDICATORS FOR BUSINESS DEVLOPMENT
‘ International trade :
New Zealand’s international trade in services activity has grown significantly in the last 10 years and has been characterised by an increasing range and diversity of service types. In the June 1999 year New Zealand exported $7,608 million of services and imported services worth $8,561 million.
Implication: If Divine cakes & desserts has to import more raw material from outside than the cost of products served by them will increase. So it’s advisable to use local raw material and avoid importing it.
‘ Balance of payment :
Balance of payments (Bop) statistics provide a comprehensive record of New Zealand’s economic relationship with the rest of the world. They cover International trade in goods and services, Investment income and transfers with other countries, Financial transactions with the rest of the world.
It is essential tool for the country to get balance payment statement. By proving the balance payment Divine cakes & desserts help the government of New Zealand to maintain the relationship of economic with rest of the world.
‘ Currency fluctuations:
The value of dollar depicts the foreign exchange rate of New Zealand dollar in relation to other nation’s currencies. If dollar rise in value will help to decrease the cost of import as compare to export. While dollar falls than export become less expensive as compare to import.
If the value of dollars increase than Divine cakes & desserts earn maximum profits. On other hand the if dollar decrease than the raw material which is exported by Divine cakes & desserts will expensive.
( C) REVELENT INDUSTRY or SECTOR INDICATOR
‘ Population trends:
Population estimates show the New Zealand population of New Zealand was 4.471 million in 2013. The chance of New Zealand reaching 7 million people by 2061 is estimated at 1 in 25. Population growth rate was recorded 0.8% in 2013 in New Zealand.
Implication: All business is depends on the population and its growth. Basically Divine cakes & desserts will get more target customers if the population growth is more than 0.8%.
‘ Buildings permits:
Building Permits in New Zealand decreased to 644.70 NZD Million in January of 2015 from 833.10 NZD Million in December of 2014. Building Permits in New Zealand is reported by the Statistics New Zealand.
Implication: To build any building permission from the council should be required. Divine cakes & desserts have to fulfil many requirements to construct the infrastructure. Divine cakes & desserts have to invest wisely for building permits.
‘ Business surveys :
Business surveys illustrate the details about growth, opportunity and feasibility of business. There are different medium for doing surveys.
Implication: It is very essential to know the position of Divine cakes & desserts in customer’s mind. Requirement of new products, new outlet requirement and any customer requirement can be known by surveys.
‘ Specialist trade, industry or service surveys :
Retail trade statistics measure the sales turnover and stock levels of a wide range of businesses that provide household and personal goods. Statistics show quarterly sales of goods by industry and region.
Implication: Divine cakes & desserts can be managing inventory by using forecasting methods. Customer satisfaction survey will give the result about the service provided by Divine cakes & desserts.
(D) CULTURAL ENVIRONMENT INDICATOR:
There are many languages used in New Zealand as it is known as multicultural country but among all English is officially announced for communication.
Implication: Divine cakes & desserts has the basic requirement for hiring the people to speak and understand English. Language has the most important indicator for front line service provider at Divine cakes & desserts.
‘ Migration trends:
There are basically two categories of migration trends. One is international migration and the rest is internal migration which is measure within the country.
Implication: Migration trend has the visible effect on food industry. Divine cakes & desserts has to concentrate on this indicator to make reliable and long lasting business.
‘ International students:
Worldwide understudies are the individuals who go from diverse nation with the end goal of study. Presently a day’s numerous understudies are impending New Zealand to accomplish worldwide study.
Implication: international students are very eager to buy readymade foods and delicious foods. So Divine cakes & desserts has to target this group and attract them by providing cheaper Desserts, best facilities and good taste.
(A) TWO COMPETITORS MARKETS:
(i) Competing product
Cup cakes (Gateua) Cheese cake(The cheese cake shop)
Strength ‘ Available in small size
‘ Different type of flavor
‘ Variety of cakes decoration ‘ Full of chess
‘ Chess with different flavor
Weakness ‘ Only egg cakes available
‘ Only in Auckland
‘ Limited by price ‘ Ready for order only
‘ Price high
Target market Only in Auckland Auckland, Hamilton and Tauranga.
Growth rate Note available Note available
(ii) Opportunities for development.
I have banana cakes and 3D cakes for both product I have different opportunities for this product.
For banana cake my business opportunities is school kids as a individual pack of banana cakes. And also sell in the yoga centre because it full of banana and healthy for health conscious person.
For 3D cakes my business opportunities is the ceremony of the weeding person and also business opening ceremony because it is unique and expensive for special person, occasion, time and etc.
(B) Two product in existing market.
Banana cakes 3D cakes
Potential contribution to sales volume We are selling 1 school of Auckland city Auckland grammar school of 2500 range of student. Each banana slice cake is $2. Per days selling is 50 slices and earn $5000 week. We are selling 3D cakes in 3 weeding of Auckland. Each 3D cost is $1200. For 400 people of each weeding.
Market growth Market growth is 2500 boys. Market growth is 1200 guest.
Market share Market share is 50/100 it means 5% market share. Market share is 3%.
Profitability Our expenses is 2500$ and earning is 2500$ so profit is 50%. Our expense is $700 and earning is $500 so profit is 40%.
( c) Two competitor market for similar product.
The cheesecake factory Baker delight
STRENGTH ‘ Attractive d??cor, low employees turn over, suitable price and quantitative worth price.
‘ Targets exceptionally youthful youngsters through offering candles, decorative things. ‘ Replicates a bakery environment including a sales staff visual, Expertise and authenticity of its bakers and baking methods.
‘ Situated obviously among other cakes and baking product.
WEAKNESS ‘ Dairy dependant purchasing.
‘ weather is our weakness. (Ex: ice cream cake in winter) ‘ Reduces margins and market share.
‘ low brand awareness.
Target market is Auckland. Target market is Auckland, Christchurch but now they have Tauranga.
GROWTH RATE The growth rate is increase from last year. But proper amount is not available The growth rate is increase of the year.
(D) Enter existing or new product.
Banana cakes product School Yoga
Potential contribute to sales volume We are selling nana cakes in school because the student like to cakes. And also they have no option to buy any new product as a lunch. We are selling banana cake in yoga classes it will directly effect on sales because yoga people are very aware about their health and they habited to eat natural product.
Market growth Market growth is based on population of boys. Market growth increase according to yoga customer.
Market share Market share is increase according to student purchasing banana cakes. Market share increase according to customer test and purchasing product.
Profitability Profit increase according to sales ratio. Profitability increase.
(a) Market research for two potential new market.
Target market For banana cake Our target market is children of the school. Our target market for 3d weeding cake is guest how attending weeding ceremony.
Consumer behavior Consumer behavior for banana cake is good because of best quality of cakes and also easy to consume. Consumer behavior for 3d cakes is unique cake with good handmade decoration.
Promotional activity Good services in small piece so they can try it first than buy it. Before 3d cake we give small sample free as a tester.
Pricing strategy If student buy 3 pieces of cake at one time we offer $5. We gave free candles with them according to customer requirement.
(B) Two opportunities for new market.
Potential contribute to sales volume For the student they can get new lunch food at low price with good quality. Now a day adults are more conscious about their health. This banana cake is very healthy for health for them.
Market growth Market growth increase according to student range. Market growth is increase on base of adults awareness
Market share Market share increase if student demand is high. Market share is increase.
Profitability Profitability is increase. Profitability increase because adult buy banana cake for them and also for their family.
( C) product range of Divine cakes & desserts
Cakes & desserts
Birthdays & novelties Boys
Novelty cakes & hire Hire 3d car
Hire 3d train
Hire buzz light year
Hire car tin
Hire crouching spiderman
Hire dump truck
Hire elephant cake tin
Hire enhanted castle
Hire fire truck
Hire mickey mouse
Hire pirate ship
Hire round, squire and heart
Candles Master party pack
Missy party pack
Standard 6cm candles
Standard 7cm candles
Special occasion Mother’s day
Savoury quiches Quiches Lorraine
Spinach & feta quiches
(D) opportunities for further development and discontinue for potential business development.
Further development Discontinue
Opportunity Divine Cakes & desserts Employee should be proper trained so that they will decrease the waiting time of customer for serving the foods. Divine Cakes & desserts giving free candles to the customer. But some time customer requirement is high and we give in small among so it create problem in business.
Potential contribution to business development Save time of customer.
Increase sales Decrease responsibility of the employees.
(E) Two opportunities for two new product.
Product / service Opportunity 1 Opportunity 2 Contribute to potential development
Online order and card with point system By online order Divine cakes & desserts can increase the sales volume and attract the group which believes in time savings. Card system with point attracts the customer to visit again and again to earn more point. Divine cakes & dessert will create good image in customer’s mind by providing such kind of schemes.
Increase the product length and width More product basket will gives more choice to the customer to choose the cakes & desserts. Many customers like to eat delicious cakes & dessert so they will be the best option for them as Divine cakes & desserts providing large variety at cheaper cost. Mostly the international students get more attracted by this offer. By providing this facility they can get the unique identity in food industry.
From the PESTEL analysis (section: 1) of I gather information regarding policies of PESTEL like tax policies, infrastructure policies, variety of product policies, online & wifi policies, holidays & wages policies and holidays policies this all policies I identifies reason for directly effect to the Divine Cakes & Desserts.
From economic, culture and industrial analysis (section:2) I evaluate economic indicator of inflation, unemployment, market share fluctuation and more. And international economic indicator according to New Zealand. Industrial indicator of New Zealand business is also effect to the business development. I gave strong inside and how to develop the business. I give reason for future development.
Through competitive environment (section:3) of Divine Cakes & Dessert I identified banana cake for as competing product in new market and opportunity is the key to growth of business.
And through competitive advantage ( section:4) is identified new market and opportunity are how long beneficial to the Divine Cakes & Dessert. If product successful than add some new product range varieties but it is not beneficial than removing that product.