statistics project

Executive Summary

Mission Statement: To provide Denverites with fresh, authentic, and fast South American food.

Operations Plan: Del Sol Food Truck will operate 5 days a week from 11 am—1 pm for lunch, then 4-9 pm for dinner.

Industry and Target Market: We will cater to the metropolitan Denver area. Our main clients will be both young food-savvy people who are looking for new ethnic cuisine to try, as well as immigrants and families from South America who are looking for a quick and authentic South American meal.

Marketing Plan: Del Sol Food Truck will be using mostly a social media platform for marketing, as well as later placing ads in local magazines.

Financial Statement: Del Sol Food Truck will need about $62k in starting capital. We expect to be making a revenue of about $5k per week at full operation hours. The starting investment is expected to be recuperated at the 17th week since start-up.

Concept

Del Sol Food Truck is a food truck specializing in selling quick and convenient yet authentic South American food. Our target market is Non-South American people who are curious about ethnic food and want to try new tastes, as well as South American people who grew up with this food and are looking for authenticity. Our meals will sell for about $5-8 for sandwiches, and $8-10 for full meals. The recent trend of gourmet and unique food trucks sprouting up in major cities all across the country has captured a market of young people wanting to try high-quality and new foods without the formality of a brick-and-mortar restaurant and with the convenience of being able to eat at whatever park or outdoor festival they are at at the moment. This is where we come in.

Del Sol Food Truck will capture the young and hip market by offering new ethic cuisine for relatively low prices, as well as with our colorful urban-inspired décor on the truck. We will also attract older and South American clients by offering an authentic menu with as much of the same ingredients that they grew up with as we can get in the United States.

Tasks needed to start up

According to our research, to start up we will need about 39 days and $61,314. The tasks needed to start up (along with the estimated time and capital needed to complete them) is as follows:

1. Logo Design: We will hire a professional logo designer to make our logo, then trademark it. Average time: 5 days Average cost: $200

2. Obtain Truck: We will purchase a gently used food truck. Average time: 8 days Average cost: $50,000

3. Commissary Kitchen: Find and rent a commissary kitchen for food prep and storage. Average time: 2 days Average cost: $300/month

4. License and Permits: Obtain all licenses and permits needed to operate a food truck in Denver. Average time: 5 days Average cost: $350

5. Equipment: Purchase all equipment necessary to prepare our food on the truck Average time: 7 days Average cost: $6,050

6. Paint: Hire a muralist to paint our truck exterior Average time: 2 days Average cost: $1,500

7. Food: Buy all food ingredients for our menu Average time: 6 days Average cost: -2,000

8. Supplies: Buy all necessary cups, plate, utensils, etc. Average time: 5 days Average cost: $314

9. Hire: Hire 2-3 employees Average time: 5 days Average cost: $100

10. Website: Hire a website designer, pay for domain name and hosting Average time: 2 days Average cost: $200

Profit analysis

Based on other food trucks’ costs and revenues, as well as on my own simulation, Del Sol Food Truck can expect to sell about $5,000 in revenues each week. Taking the costs into account, we can start to see a profit in about 17 weeks since starting up (this is 13 weeks from the day we start selling). Profits will continue to increase and we can see a profit of $14,786 in week 20 since start-up.

Summary of Simulation

A. Flowchart of tasks

B. Equation

Total Startup Time=SUM(Logo,MAX(Truck+Kitchen),License,MAX(Equipment+Food,Paint+Supplies),Hire,Website)

C. Tasks

Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
1	Logo (Hire a designer and register it)	Min: 1 Max: 7	Alpha: 3 Beta: 2	$200	-
Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
2	Truck (Buy used food truck + any internal repair)	Min: 1 Max: 20	Alpha: 2 Beta: 4	$50,000	-

Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
3	Kitchen (Find and rent a commissary kitchen to prep and store food)	Min: 1 Max: 3	Alpha: 6 Beta: 6	$300/month	-

Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
4	License & Permits (Obtain necessary license and permits from city)	Min: 3 Max: 7	Alpha: 3 Beta: 3	$200 $150/year	-

Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
5	Equipment (Buy cooking & storing equipment for use on truck)	Min: 3 Max: 10	Alpha: 5 Beta: 2	$6,050	-
Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
6	Paint (Hire muralist to paint our name, logo, and designs on truck)	Min: 1 Max: 2	Alpha: 2 Beta: 2	$1,500	-

Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
7	Food (Buy all food ingredients for the dishes)	Min: 3 Max: 10	Alpha: 2 Beta: 1	$2,000	-

Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
8	Supplies (Buy supplies such as cups, plates, napkins, cutlery, etc.)	Min: 3 Max: 10	Alpha: 1 Beta: 4	$314	$5,000

Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
9	Hire (Hire employees, about 2-3)	Min: 3 Max: 7	Alpha: 2 Beta: 2	$100	$5,000

Task #	Task Description	Starting/ Ending points	Distribution Shape	Cost Estimate	Revenue Estimate
10	Website (Hire a website designer and pay for domain & hosting)	Min: 1 Max: 3	Alpha: 3 Beta: 3	$200	$5,000

D. Summary of Outputs

Task: Logo Average Time: 4.60 days

Task: Truck Average Time: 7.28 days

Task: Kitchen Average Time: 2 days

Task: License + Permits Average Time: 5 days

Task: Equipment Average Time: 6.5 days

Task: Paint Average Time: 1.5 days

Task: Food Average Time: 5.7 days

Task: Supplies Average Time: 4.4 days

Task: Hire Average Time: 5 days

Task: Website Average Time: 2 days

Total Average Time to Startup:

39 days (with doubling up of some tasks)

E. Decisions

Based on my output, I decided to stick with the average times that I got for all my tasks. This is because in the food truck world, a month to two months is already a fairly quick start-up time (which is around the amount of time my truck would need; even at its maximum the number of days needed is 62). I can accomplish this quick startup time by hiring only family and close friends, having a simple menu that doesn’t require hard-to-find ingredients, using personal contacts as designers for logo, website, and truck so as to quicken the process, and by only requiring essentials to get started (other luxuries and assets would come later).

F. Cost and Revenue Analysis

According to my analysis, we should expect to see a profit at the 17th week since starting up. We can start to sell and make revenues at the 5th week, which is when we have acquired the food and supplies which is enough to begin selling. From the point that we start selling, it will take us about 13 weeks to see a profit.