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BLUE CHAIR COFFEE Business Plan

Review the expansion plans for Blue Chair Coffee, an exciting

and growing company headquartered in Denver, Colorado.

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Executive Summary
Blue Chair Coffee is a coffeehouse located in downtown Denver, Colorado. The
caf features European-style coffees, teas from around the world, light
sandwiches and salads, a bakery and dessert bar, and a space for live
performers.
The downtown location has become a popular gathering place for visitors and
locals, especially those who work downtown. The business has grown quickly in
the last two years and is near capacity. Lucy Tennyson and Roberta Jackson are
the owners of the coffeehouse (50% ownership each). They want to expand to
two other locations on the east and west sides of town and are seeking investors
to fund that growth.1

Background Highlights
Opened in the fall of 2014

Earnings increased 30% after the first year

Serve an average of 165 people per day

Average sale per person is $14.65

Owners are experienced coffeehouse managers

Net profit this year is 12% and is projected to increase to 15% next year

Organization Structure
Blue Chair Coffee is a privately held, limited liability corporation (LLC) owned by
Lucy Tennyson (50%) and Roberta Jackson (50%). Both operate as general
managers and managing partners. Marketing and accounting services are
handled by independent consultants. The coffeehouse also employs 10 part-
time servers, baristas, and dishwashers.

1The east side location is in the Galleria Center and the west side location is in the Rocky Ridge
enterprise zone.

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Keys to Success
The keys to success for Blue Chair Coffee (or any food service business) are
summarized below.

Product quality
Coffee, tea, and food are of high
quality and value.

Service
Serve patrons with courtesy,
efficiency, and attention.

Management
Manage inventory, train
employees, and control quality.

Market Analysis
The target market audience is a mix of residents, visitors, and workers who seek a
sophisticated yet casual coffeehouse experience. Members of this audience
dine out three or more times per week and prefer pedestrian-friendly, social
environments. The following chart shows the potential growth in this market.

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Sales Forecast
The sales forecast assumes no change in the price of goods sold at the three
Blue Chair Coffee locations.
The owners expect to increase sales from $1.5 million at the end of 2016 to $2.3
million by the end of 2018. This growth is average for coffeehouses and
restaurants in Denver and takes into account the projected increase in
population in the Denver area.
The following table summarizes projected sales in the three Blue Chair Coffee
locations from 2016 to 2018.
Year 2016 2017 2018
Downtown $727,600 $910,000 $1,150,000
East Side $360,000 $525,000 $550,000
West Side $367,000 $584,000 $600,000
Total Sales $1,454,600 $2,019,000 $2,300,000

Management Team
General Manager Roberta Jackson
Assistant Managers Bruce Glaze and Lucy Tennyson
Executive Chef Zachary Mallon
Pastry Chef Leslie Garcia

This file created specifically for Sung Woon Chang