Ellise Grocery Supplier’s Investor Attraction

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Table of Contents

Economic Analysis
Startup Capital Requirements – Repeating Monthly Expenses
Business Cycle
Building a Product Line
The Future

The perception that the business of supplying groceries to urban centers and direct consumers is a preserve of the village folks and uneducated people is wrong. Every person eats vegetables, and this means that there is always a ready market for groceries. Ellise Grocery Supplier targets supermarkets, government offices and people living in urban areas. The urban population rarely gets fresh vegetables and fruits. They buy groceries from supermarkets and other stores at expensive prices. This business targets to break this cycle of suffering and bring fresh groceries close to consumers. The business plans to buy groceries from the countryside and sell them to customers in urban centers.

Economic Analysis

Ellise Grocery Supplier plans to partner and sign contracts with agricultural farms located in the countryside for a steady supply of groceries. It requires three vehicles, 12 employees, an office and store (14, 400m²). Some money will be set aside for business registration and other miscellaneous expenses. The business requires about $100,000 to finance all its start-up and monthly operations as shown in the business model canvas document below.

Startup Expenses	Amount ($)	Description
Advertising	1,000	Promotion for opening the business
Starting inventory	2,500	Amount of inventory required to open
Cash	3000	Amount needed for the cash register
Decorating	1,000	Estimate based on bid if appropriate
Deposits	1000	Check with utility companies
Fixtures and equipment	2100	Use actual bids
Insurance	1,000	Bid from insurance agent
Lease payments	1,500	Fee to be paid before opening
Licenses and permits	1,200	Check with city or state offices
Miscellaneous	3,000	All other
Remodeling	1,000	Use contractor bids
Rent	2,500	Fee to be paid before opening
Services	1,000	Cleaning, accounting, etc.
Supplies	8,000	Office, cleaning, etc. supplies
Unanticipated expenses	5,000
Supply Van	17,000
Total Startup Costs	88,800	Amount of costs before opening

Startup Capital Requirements – Repeating Monthly Expenses

Expenses	Amount ($)	Description
Advertising	30
Bank service fees	300
Credit card charges	200
Delivery fees	3,000
Dues and subscriptions	1,000
Health insurance	150
Insurance	120
Interest	12
Inventory	130
Loan payments	850	Principal and interest payments
Office expenses	300
Payroll other than owner	1000
Payroll taxes	100
Rent	1000	Exclude amount on preceding page
Repairs and maintenance	1000
Sales tax	35
Supplies	1000
Telephone	80
Utilities	100
Your salary	0	Not applicable for first six-nine months
Total Repeating Costs	10, 407
Total Startup Costs	88,800
Total Cash Needed	99,207

Business Cycle

Food is a basic need that all people require to live healthy and comfortable lives. Ellise Grocery Supplier will operate throughout the year. The business will sign long-term contracts with farmers to ensure there is an endless supply of fresh fruits and vegetables. Most farmers use modern technology that enables them to cultivate crops without relying on rainfall water.

Building a Product Line

Groceries are in high demand in all regions, especially urban areas. Most people do not get fresh fruits and vegetables because they live far from farms. This company will build its product line by making same day deliveries of groceries so that consumers get them as fresh as they are in the farms. Most suppliers sell products that were harvested several days and kept fresh by cooling systems. However, Ellise Grocery Supplier will work hard to deliver fruits and vegetables the same day they are harvested. The prices of goods will be lower than those of the prevailing market by $0.15 per kilogram.

The Future

The business is expected to break-even after six to nine months from its inception. Estimates may change depending on the prevailing market conditions. First, there are numerous policies that control land use and agricultural practice. Issues like global warming may impact negatively on the future of the business. High costs of farming may influence farmers to increase the prices of their products. The unscrupulous use of genetically modified products may force the business to establish marketing strategies to dispel negative perceptions. The business will be forced to sell its products cheaply and may fail to achieve the targeted profits.

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Ellise Grocery Supplier’s Investor Attraction

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