Pasta Tree: Fresh Pasta Producer For Retail Essay.

Question:

Discuss about the Business Plan Evaluation Pasta Tree.

Some of the essential facets associated with Pasta Tree refer to its reputation as a fresh pasta producer for retail purposes. The quality of the pasta products facilitated by the company is accountable for improving the prospects for increasing investment from external sources in the company and ensuring feasible expansion. According to Ács, Autio & Szerb, the notable characteristics of the company reflect on the explicit production facility size as well as the storefront in Sydney which is utilized for providing fresh pasta products to customers. Pasta Tree reviewed the implications of its production capacity and appreciation of quality by customers in order to establish formidable objectives for its business plan (Ács, Autio & Szerb, 2014).

An organization’s goals are determined for obtaining reasonable inferences pertaining to alignment with the organization’s purpose. The notable goals that could be profoundly observed in the business plan of Pasta Tree refer to the institution of appropriate frameworks to improve sales in the noted supermarket chains within Sydney, expansion of the existing production facility alongside ensuring that product quality, operations and costs are not compromised. Pasta Tree relies on three profound pillars for ensuring sustainable competitive advantage for the business which include value, quality and integrity (Bae, et al., 2014). As per Baum, Frese & Baron, Quality aspect of the products facilitated by Pasta Tree reflects on freshness of pasta products while value of the products is derived from provision of nutritional benefits and assortment of flavours.

Pasta Tree also emphasizes on integrity by sustaining commitment to the provision of quality and value in its products which lead to the foundation of the trust placed by customers in the organization (Baum, Frese & Baron, 2014). The increasing concerns for nutritious and healthy exotic food act as promoters of viable opportunities for the food industry in Australia. Therefore Pasta Tree could find substantial foothold in the Australian market through expansion initiatives which can be validated on the grounds of product demand and the value proposition associated with the products.

The organization’s history is a credible validation for its capabilities to provide quality, value and integrity alongside facilitating potential opportunities for the expansion of the organization’s production facility and improve Pasta Tree’s competence to provide products in supermarket chains in Australia. Bruni, Gherardi & Poggio  said that some of the essential highlights that could be presented as critical insights in context of this proposal are directed towards the sustainability of Pasta Tree’s products’ performance in supermarket chains (Bruni, Gherardi & Poggio, 2014). It also presents substantial challenges for the brand identity of Pasta Tree as supermarket sales would be indicative of the assumption of a common national brand identity for the organization.

This would be detrimental for the long term prospects of the organization to realize competitive advantage. The promising operations of Pasta Tree in Sydney could be profoundly observed from the explicit performance of the organization over the course of three years since its establishment (Burrows, 2015).

The substantial diversification observed in the organizational structure of Pasta Tree that was initiated with the involvement of two people, its founders, and went on to include four personnel supervising the production, distribution and sales operations. The observation of past performance of Pasta Tree over the course of three years from 2000 to 2002 was indicative of the substantial improvement in gross and sales metrics impinging the existence of potential opportunities that could promote the organization’s sales capabilities (Carland, Carland & Stewart, 2015).

It is imperative to evaluate the prominent areas in which Pasta Tree could accomplish reasonable business performance objectives that can be integrated in the business plan of an enterprise. The necessity of research in terms of preparation of a business plan could not be undermined under any circumstances.

The research for determining the feasibility of a business in a specific location has been characterised by estimation of customer preferences and opinions pertaining to the specific business (Carland & Carland, 2015). The research outcomes could be leveraged for the preparation of a viable business strategy that is significantly applicable in the organization’s initiatives to cater the selected market segments. The primary market segments that have been emphasized by Pasta Tree refer to the professional people who do not have the opportunity to prepare food at home and therefore could acquire potential implications for higher demand for nutritious food (Carland Jr, Carland & Carland III, 2015).

Therefore, Pasta Tree has to diversify the distribution network of the organization by including supermarkets, delis and small grocery stores in the locality in order to reach the customers effectively. The pressing objective for business expansion posed for Pasta Tree is the expansion of the production facility which could serve plausible opportunities to realize the outcomes that are expected for targeting the highlighted market segments.

Therefore a conclusive interpretation of the industry environment could provide substantial indications towards the feasibility of the business plan as well as underlying elements such as financial analysis, external and internal environment analysis alongside plausible critical reflections on the same.

As per Carraher & Paridon, 201, the Australian food industry could be characteristically analysed through the implementation of models such as the SWOT analysis which provide a conclusive impression of the strengths, weaknesses, opportunities and threats that can be apprehended in case of Pasta Tree (Carraher & Paridon, 2015).

The outcomes of the SWOT analysis would be reflective of potentially favourable factors that can be implemented for accomplishing the required competitive advantage in the concerned market environment.

The Australian food market has been associated with consistent progress and the expansion of prominent global brands in the market has increased the appeal of the market in terms of financial outcomes. Furthermore, the establishment of entrepreneurial establishments in the market allows prolific indications for Pasta Tree to move forward with its plans to expand production capacity. Food preparation and delivery have been subject to radical innovative approaches by entrepreneurs in order to attain credible insights for improving business performance (Drucker, 2014).

The commitment of the employees at the Pasta Tree can also be considered as one of the profound favourable aspects in the competences of the organization alongside providing reasonable inputs for completion of work according to deadlines. Another noticeable strength that has been implemented by peers in the Australian food market which could be capitalized on by Pasta Tree refers to the provision of customized food items that provide viable opportunities for attracting the customer attention and accomplish higher revenues flexibly (Glaeser, Kerr & Kerr, 2015).

The organization’s profound weaknesses are observed in the limited human resources capabilities of the organization alongside a comparatively new product offering. The availability of opportunities to ensure flexible and functional implementation of the organization’s business strategies is limited by the organization’s new establishment and lack of maturity in the market (Hatten, 2015).

Pasta Tree has realized promising aspects for profitability in the third year of operations which would not be sufficient for realization of desired outcomes as observed in the organization’s strategic business plan. The lack of a profound market presence accounts for limited accessibility of Pasta Tree’s products by customers alongside the notable concerns pertaining to marketing activities of the organization (Kirzner, 2015).

Pasta Tree can acquire loans from interested contributors that could improvise the availability of resources especially for accomplishing objectives of product and market diversification. Pasta Tree relies on reasonable pricing which can be accounted as one of the prominent opportunities that can facilitate competitive advantage to the organization. Increasing concerns for the health problems such as cardiac and gastro enteric issues can be viably considered as the rationale for the development of healthier eating preferences among people in Australia (Kuratko, 2016).

Apart from the professional segment targeted by Pasta Tree, the general supermarket visitors could also account as a profitable market segment for the organization owing to the variable range of pasta product offerings of Pasta Tree. The availability of different products such as spaghettini, linguini and fettuccine is also assumed as a promising opportunity for the organization to establish a formidable market presence in Australia. The customer segment preferences that indicate the potential of the company to engage in service of women specifically can be viable opportunity for Pasta Tree to realize the business plan objectives (Morris, 2015).

One of the prominent threats that could be observed in the case of the Pasta Tree is noticed in the market presence of prominent fast food chains such as McDonald’s and KFC alongside the increasing popularity of restaurants and drive-by eateries. The food products provided by the peers of the organization are instantly acceptable to the palette of customers thereby limiting their choices for nutritious food. Another prominent threat is observed in the psyche of customers in Australia related to the increasing health clubs and gyms that signifies that the customers can prefer consumption of unhealthy food while reducing the negative effects by working out in the gym (Schaper, et al., 2014).

The changes in fiscal conditions could lead to obstructions for financing the expansion initiatives of Pasta Tree that has to be addressed through preparation of contingency measures. Even if the products offered by Pasta Tree provide a unique eating experience to customers, the behavioural preferences of customers are subject to concerns of product diversification and customization. Changes in customer preferences could lead to an increment in the operational costs that could jeopardize the strategies outlined in the business plan for Pasta Tree (Schaper, 2016).

Feasibility of Business Objectives

The identification of a promising marketing mix could account for increasing the capabilities of Pasta Tree to improvise its customer service as well as revenues acquired from retail sales, supermarket sales and local grocery stores sales. The marketing mix that could be presented for Pasta Tree would comprise of four basic elements referring to product, price, place and promotion (Shepherd, 2015).

Pasta Tree provides a varied assortment of pasta products with its highly selling products including Fettuccine, Linguini and Spaghettini. Other notable pasta products facilitated by the organization refer to fusilli and Cayenne tagliolini alongside the notable variants of its highest sellers such as Black Linguini, Tomato Fettuccine and Basil Spaghettini.

The critical perspective on this aspect of the marketing mix indicates towards the feasibility of the existing product offerings in the Australian market. The intentions of Pasta Tree to expand its production facility should be accountable for improvising the diversity of product offerings.

The pricing of the products facilitated by Pasta Tree is flexible since it offers the prepared pasta products at an affordable pricing of $3 for two servings. This pricing is definitively attractive for supermarket customers reflecting on its superiority as compared to dry pasta products.

Pasta Tree has to select appropriate places for distribution of the pasta products thereby implying that supermarkets and smaller local grocery stores could facilitate substantial opportunities to accomplish business feasibility effectively. One of the critical assumptions that could be observed in case of the aspect of place in the marketing mix of Pasta Tree is the gradual improvement in transition of customers from supermarkets to local community stores (Singer, Amoros & Arreola, 2015).

The supermarkets have been depicting considerable reduction in market share while smaller stores in specific communities are improving their market share alongside facilitating the services of speciality stores such as fish markets and wine shops which could attract a diverse range of customers.

The promotion of Pasta Tree’s products has to be directed towards the display of the products in-store alongside a similar packaging to the dry pasta products. Provision of discounts and participation in socially responsible activities could be accounted as promising influences on the promotional aspect of Pasta Tree’s marketing mix. The in-store displays are profoundly characterized by coupons that could improve the opportunities for Pasta Tree’s promotion strategy.

The Pasta Tree was founded by John Wingate and Jill Foreman with the latter assuming charge of production and distribution while John is responsible for sales management. The experience of the founders in the domain of production and sales in the food industry is a notable competence available for the management (Storey, 2016).

From a critical perspective, it can be evaluated that the aspects of delivery, store maintenance and production staff management could be subject to insufficiencies associated with distribution and sales while exploring novel prospects for market expansion. Therefore the personnel requirement as highlighted in the personnel plan for the Pasta Tree should be modified in accordance to the revised demands of delivery and store maintenance according to the new business plan.

Pasta Tree could be able to acquire reasonable investments for its operations through initiatives such as acquiring loans, access to long term liabilities, sale of current and long-term assets as well as the dividends and the retained earnings of the organization. The requirement of investments is a profound aspect in the operational framework of the organization leading to concerns for short, medium and long term finances. Sources of financing for an entrepreneurial venture would be imperatively associated with certain advantages as well as disadvantages (Kuratko, 2016).

The positive implications of the financing sources could be observed in the stability, security and potential competence to address the mandatory requirements of interest rates and finance. On the other hand the negative implications of financing sources are directed towards the profound variations noticed in the interest rates.

The observation of the financial plan for Pasta Tree’s expansion initiatives could be related comprehensively to the need for payroll of new personnel to be included in the organization. Furthermore, the investments in the expansion of the existing production facility of Pasta Tree present with the storefront in Sydney are also accounted as costs for the organization (Hatten, 2015).

The breakeven analysis reflects in the requirement of a monthly fixed cost of $22,490 allowing the derivation of monthly revenue breakeven estimated at $24,989. This could be realized through a prominent reflection on the increase of average variable percent cost of 10%.

Conclusion

The foremost milestone assumed by Pasta Tree is directed towards the development of the socially responsible initiatives. Other milestones observed in the case of Pasta Tree are inclusive of production facility expansion, institution of production equipment and in-store displays. From a critical perspective, the milestones for Pasta Tree’s business plan are associated with specific start and dates which are accountable for precision in accomplishing the objective milestones.

These milestones could be followed by the formulation of novel strategic business plans indicating examples of milestones such as increment in the payroll of newly recruited personnel such as production and delivery staff, sales management and production management.  

References

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