Market Assessment

Target Market

Coffee Rush aims to cater to three primary consumer segments:

1. On-the-Go Achievers: Young professionals and students aged

18–35 seeking quick, energizing coffee options without
sacrificing taste or quality.
2. Coffee Aficionados: Individuals who appreciate the nuanced
flavors of premium coffee, now made accessible in convenient
bottled and canned formats.
3. Health-Conscious Consumers: Those preferring natural
ingredients and functional coffee blends tailored for wellness.

Industry and Market Trends

 Rising Demand for Convenience: Ready-to-drink (RTD) coffee

continues to expand rapidly as busy lifestyles drive demand for
portable, on-the-go beverages.
 Sustainability Focus: Consumers are increasingly choosing
brands that promote eco-friendly and ethical practices.
 Innovative Offerings: Functional beverages with added health
benefits (e.g., vitamins, antioxidants, and adaptogens) are
gaining traction.

Competitive Landscape

 Key Players: Starbucks RTD, Dunkin’, and artisanal competitors

dominate the market.
 Competitive Advantage for Coffee Rush: Opportunity to
stand out with premium, sustainably packaged products and
unique flavor options not typically found in mass-market brands.

Growth Potential

 Targeting secondary cities and rural markets with limited

premium RTD coffee options.
 Leveraging e-commerce and digital marketing channels for
nationwide reach.

Marketing Strategies

Brand Positioning
Coffee Rush’s identity centers on energizing busy individuals with high-
quality, sustainably produced coffee. Our tag line, “Sip the Rush, Seize
the Day,” reflects the essence of our brand: delivering energy,
excellence, and eco-consciousness.

Product Differentiation

Flavor Innovations:

o Signature blends like Caramel Cold Brew Bliss and Vanilla

Honey Frost.
o Regionally inspired seasonal flavors such as Philippine
Barako Brew.
o Functional options with mood-boosting or stress-relieving
properties.

Packaging:

o Eco-friendly, recyclable materials with sleek, minimalist

designs.
o QR codes on packaging linking to exclusive content about
the coffee’s origin and sustainability efforts.

Sales Channels

1. Retail Partnerships: Distribution through convenience stores,

premium supermarkets, and gas stations for accessibility.
2. Exclusive Partnerships: Collaborate with boutique cafes to
position the brand as a premium choice.
3. E-commerce Expansion: Build a strong presence on platforms
like Lazada, Shopee, and Amazon, leveraging bundle promotions
and subscription offers.

Promotion and Advertising

1. Social Media Campaigns:

o Dynamic content on TikTok, Instagram, and Facebook

featuring customer stories and the day-to-day life
enhanced by Coffee Rush.

2. Influencer Partnerships: Collaborate with lifestyle and travel

influencers to promote products authentically.
 3. Tasting Campaigns: Launch pop-up tasting booths in gyms,
campuses, and co-working spaces to gain exposure.
4. Seasonal Promotions: Highlight limited-edition flavors to drive
urgency and repeat purchases.

Customer Engagement

1. Loyalty Program: Launch Rush Rewards, offering points for

every purchase, redeemable for discounts, free products, or
exclusive merchandise.
2. Interactive Platforms: Use social media polls to engage
customers in decisions like upcoming flavors or seasonal
campaigns.

Sustainability Initiatives

1. Recyclable Packaging: Highlight eco-friendly packaging as a

core brand value.
2. Community Impact Programs: Partner with environmental
organizations through initiatives like “Coffee for Trees,” planting
trees for every sale made.

A. Capital Structure

Assumptions:

 The business is in the early or growth stages, so we'll assume

you're looking for a healthy mix of equity and debt to fuel
expansion, working capital needs, and fixed asset investments.
  Estimated Total Capital Requirements: ₱50,000,000 (for
example, based on initial operations and growth needs)

 Capital Structure Breakdown:

1. Equity (Ownership Capital)

Equity is the portion of your capital structure raised from the

owners, investors, or retained earnings. It comes with no repayment
obligation but carries the expectation of returns. For your business,
let's assume you raise 60% of the total capital from equity sources.

A. Founder’s Equity (Owner's initial investment):

 Amount: ₱10,000,000 (20% of the capital)

 Purpose: This could be the initial investment the owners make
to kick-start the operations of the business.

B. Venture Capital or Private Equity (external investors):

 Amount: ₱20,000,000 (40% of the capital)

 Purpose: You may seek venture capital or private equity funding
to grow your business. Investors provide funding in exchange for
equity ownership, which will be a source of capital to scale up
production.

C. Retained Earnings (Profits reinvested in the business):

 Amount: ₱5,000,000 (10% of the capital)

 Purpose: Over time, as the business generates profits, a portion
is reinvested back into the company for expansion, new product
lines, or upgrading machinery.

Total Equity: ₱35,000,000 (70% of the total capital)

2. Debt Financing (Borrowed Capital)

Debt financing involves borrowing money that must be repaid, typically

at an interest rate. Debt is often used to finance equipment purchases,
working capital, and capital expenditures for growth. Let’s assume
debt will make up 30% of your total capital.

A. Long-Term Bank Loan / Term Loan:

  Amount: ₱10,000,000 (20% of the capital)
 Purpose: This could be used to purchase manufacturing
equipment (e.g., coffee canning lines), production facilities, and
other long-term assets.

B. Short-Term Working Capital Loan / Revolving Credit Line:

 Amount: ₱2,500,000 (5% of the capital)

 Purpose: A short-term loan or line of credit is useful for covering
day-to-day operating expenses, managing inventory levels, and
handling seasonal fluctuations in cash flow.

C. Bonds or Convertible Debt (if applicable):

 Amount: ₱2,500,000 (5% of the capital)

 Purpose: You could issue convertible bonds that could later
convert into equity, if you are looking to give investors the
potential to convert their debt into shares at a later stage.

Total Debt: ₱15,000,000 (30% of the total capital)

3. Hybrid Instruments (Convertible Debt or Preferred Equity)

In case you need flexible capital that can convert to equity under
certain conditions, you can use hybrid instruments. Let’s assume that
hybrid instruments make up 10% of the total capital.

A. Convertible Debt / Preferred Equity:

 Amount: ₱5,000,000 (10% of the capital)

 Purpose: Convertible debt can be a good solution if you want to
raise funds with the possibility of converting them into equity at
a later stage, allowing you to minimize interest payments in the
short term.

Total Hybrid Instruments: ₱5,000,000 (10% of the total capital)

Final Capital Structure Summary:

Amount Percentag
Capital Type
(PHP) e
Founder’s Equity ₱10,000,000 20%
Venture Capital / Private Equity ₱20,000,000 40%
Retained Earnings ₱5,000,000 10%
Total Equity ₱35,000,000 70%
 Amount Percentag
Capital Type
(PHP) e
Long-Term Bank Loan ₱10,000,000 20%
Short-Term Working Capital Loan ₱2,500,000 5%
Convertible Debt / Bonds ₱2,500,000 5%
Total Debt ₱15,000,000 30%
Hybrid Instruments (Convertible Debt /
₱5,000,000 10%
Preferred Equity)
Total Capital Structure ₱50,000,000 100%

This capital structure ensures that Coffee Rush has sufficient

financial resources to scale operations, manage risks, and optimize
production while maintaining a manageable debt load. You can adjust
the amounts depending on actual funding requirements, business
strategy, and investor preferences.

Capital Structure Summary (With Assets)

Capital Amount Assets

Notes
Source (PHP) Acquired
Includes machinery,
Equity ₱35,000,00 Property, Plant,
marketing, working capital,
Financing 0 and Equipment
etc.
Debt used for long-term
Debt ₱15,000,00 Property, Plant,
capital investment in
Financing 0 and Equipment
machinery.
Total Property, machinery,
₱50,000,00
Capital Total Assets inventory, working capital,
0
Raised IP.

B. Sales Forecast

 Premium Positioning: As a ready-to-drink coffee in a can or

bottle, we will assume a premium pricing strategy due to the
product’s high quality, branding, and packaging.
 Market Price Range: In the Philippines, premium ready-to-drink
coffees (like those from international brands or local premium
brands) are typically priced between ₱60 to ₱120 per unit,
depending on factors such as size (250ml, 300ml, etc.), flavor, and
packaging.
 Competitive Landscape: You’ll want to price competitively within
the premium segment while differentiating from mass-market
coffees. The price should reflect the added value from your
product’s premium quality, taste, and packaging.

Adjusted Price per Unit:

For a premium ready-to-drink coffee in a can/bottle, let’s

assume the following:

 Price per Unit (250ml or 300ml can/bottle): ₱85

 This is higher than typical mass-market RTD coffees (which can be
around ₱50-₱60), reflecting the premium quality of Coffee Rush
(specialty beans, health benefits, unique flavors, etc.).

(EXPLANATION FOR THE PRODUCTION BUDGET)

The monthly units sold were distributed based on the total

sales for the year (200,000 units), which was derived from the
₱17,000,000 in total sales. The monthly breakdown was then done by
estimating a logical growth in demand for each month, taking into
account factors such as brand awareness, potential seasonal demand,
and the strategy for distribution.

Here's a detailed explanation of how I computed the units sold

per month:
 Total Units Sold in Year 1:

From the given ₱17,000,000 in sales and the ₱85 per unit
price:

1. Units Sold in Year 1 = 17,000,000/85 = 200,000 units}

2. Sales Distribution Strategy:
Since the sales are expected to gradually increase due to factors such
as marketing campaigns, brand awareness, and consumer demand
growing over time, I used an incremental approach to allocate the
200,000 units over the 12 months of the year. I divided the units in a
way that reflects a growth curve throughout the year.
3. Monthly Sales Allocation:
Here's the reasoning behind the monthly breakdown:

 Q1 (January - March) typically sees lower sales as the brand is just

starting to gain traction. So, sales start slow but gradually build up
in March.

1. January: 10,000 units

2. February: 15,000 units
3. March: 20,000 units

 Q2 (April - June) sees an increase in sales, as marketing efforts,

distribution channels, and customer awareness should be growing
by this time.

1. April: 25,000 units

2. May: 30,000 units
3. June: 25,000 units

 Q3 (July - September) continues to grow, with potential sales

peaking in this quarter as demand reaches its highest due to brand
recognition.

1. July: 25,000 units

2. August: 20,000 units
3. September: 20,000 units

 Q4 (October - December) sees a slight drop compared to Q3 but

maintains a steady level of sales as demand stabilizes.

1. October: 15,000 units

 2. November: 15,000 units
3. December: 15,000 units

 Total Units Sold per Month:

The goal is to ensure that the total units sold adds up to

200,000 units for the year, which is the target.

10,000+15,000+20,000+25,000+30,000+25,000+25,000+20,000+20
,000+15,000+15,000+15,000=200,000 units10,000 + 15,000 +
20,000 + 25,000 + 30,000 + 25,000 + 25,000 + 20,000 + 20,000 +
15,000 + 15,000 + 15,000 = 200,000 units

So, this breakdown gives us a total of 200,000 units sold over

the course of the year.

This distribution assumes steady growth in sales, particularly

in the middle quarters, which reflects the impact of marketing efforts,
increased brand recognition, and distribution expansion.

(EXPLANATION FOR THE DIRECT LABOR BUDGET)

For Coffee Rush, considering that it is a ready-to-drink coffee

business, and assuming the production line is semi-automated with
efficient processes, an optimal number of 500 to 1,000 units per
worker per day could be reasonable. Here’s the breakdown:

500 Units per Worker per Day:

 1. This is a conservative and realistic estimate for a semi-
automated system where workers handle certain tasks
(e.g., quality checks, packaging) alongside machines.
2. It's a good starting point if the business is in the early
stages and is focused on increasing production efficiency
over time.

For Coffee Rush, assuming a balance between automation and

manual labor, 500 units per worker per day is a realistic starting point.
As the business grows and production scales, it could potentially
increase to 700-1,000 units per day with more automation, improved
processes, and workforce training.

If you’re looking to maintain scalability and efficiency, 500 units

per worker per day seems to be a strong, sustainable figure for the
early stages, and you can scale up as production demands increase.