Do you want to start an energy drink company? If YES, here is a detailed sample energy drink production business plan template & FREE feasibility report. Okay, so we have considered all the requirements for starting an energy drink production business.
Starting an energy drink production business is not as easy as it might look, especially as it requires that you fulfill certain modalities before the business can kick off. In the united states for instance, the food and beverage industry is a highly regulated one.
Asides from the stiff regulations from government agencies, you will also need to contend with competition for a space on the shelf and for customers as well. It is however not all doom and gloom as there are several successful energy drink start-up companies. The key is in planning right from the beginning.
There are several things you would need to kick start your business, chief of which is getting a consultant that will help you carry out a thorough research from developing the beverage to getting consumers. These consultants who thoroughly understand the market will guide you through the process of starting your own energy drink business, and help you avoid unnecessary obstacles that you would have otherwise encountered during the course of starting the business.
Another important aspect that cannot be neglected is an energy drink business plan. A business plan is very important as it shows the seriousness with which you are taking your energy drink business. This is why a sample energy drink has been prepared below;
A Sample Energy Drink Production Business Plan Template
1. Industry Overview
The energy drink production industry is an $8 billion industry that has an annual growth of 14.3% and has employed about 6,500 people in the United States. The energy drink industry has achieved a double digit growth from 2010 to 2015.
The energy drink production industry according to indices has outperformed the most of other packaged beverage production industries. This is because the positive economy has ensured the increase of disposable income which has seen energy drink producers benefitting massively.
As at 2011, customers bought less energy drinks especially because of the recession, and this affected the energy drink industry as consumers stocked up on other alternatives that were cheaper. There has also been an increase in the consumption of energy drinks especially amongst young adults and teenagers, which has allowed the industry to boom and for operators to recoup their investment.
However, despite the positive growth in the industry, it is expected that growth will slow down in the next five years, from 2016 to 2022, especially as it seems the market will become saturated with new products and brands from new start-ups as well as from established brands.
According to Investopedia, the energy drink industry is saturated, which makes it hard for small as well as new companies to compete. The long established brands – Redbull, Monster or Rockstar – have no serious threats from newly established companies or other smaller companies.
However, brands that differentiate themselves in terms of products, services, marketing and publicity have a chance to make it in the industry. However, there is still competition for shelf space as well as distribution challenges.
The bottom line is that the energy drink production industry is still growing profitably as demand for other beverages have declined, despite all the strict regulatory policies posed to the industry and the resulting health challenges.
2. Executive Summary
Zuzu Lite Energy Drinks LLC is a leading energy drink production company that is based in Pittsburgh – California, USA with the intention of producing energy drinks for sales by distributors and retailers. We intend to cover a large variety of customers which is why we have produced different flavors of our energy drinks.
We are in the business not only to make profit but to also compete favorably with other brands – established and upcoming in the energy drinks industry. We have perfected our corporate goals as well as business structure to ensure that we become the best in the industry.
We have also acquired the best equipment that will be needed to mix our energy drinks. Also, our cans and bottles were designed with our customers in mind; it was to attract the customers and also achieve high ergonometric use for the user, providing a fine grip.
The energy drinks industry is a high regulated one, and so our drinks are packaged in a highly controlled environment that is not only hygienic but also conducive for storage as well. We hold our production standards high and will therefore not compromise on ensuring that we produce only the best always for our customers.
Because we intend to go far in this business, we have hired the best hands that will ensure that we not only achieve our visions but that we grow to be the leaders that we intend to become and expand to other states in the United States of America. Our employees were sourced using the best employment strategies.
Our employees will be highly trained and will undergo continuous training to ensure that their skills remain relevant both in the company and in the industry. We also know that having these skills would enhance their productivity in the workplace.
Because we hold our customers in the highest esteem, we are committed to ensuring that we not only meet their expectations but surpass it as well. This will ensure that our customers remain loyal to us and also help refer others to us as well, thereby increasing our customer base and revenue base as well.
Zuzu Lite Energy Drinks LLC is owned and operated by two indigenous businessmen, Mr. Chu Zing and Mr. Taylor Wang both Harvard Graduates and business partners in several businesses. Both men will bring the necessary business experience that the business needs.
3. Our Products and Services
Zuzu Lite Energy Drinks LLC intends to deal in various flavors and types of energy drinks that will be sold in different locations in Pittsburgh – California and in the whole of the United States of America.
However, we do not intend to solely make money from just the sale of energy drinks as we intend to make money from multiple sources by selling other products as well as services. However, all our sales will be guided under the legal laws of the United States of America.
Listed below are some of the products and services we intend to offer at Zuzu Lite Energy Drinks LLC;
- Different flavor and brand of energy drinks
- Other beverage drinks
- Consultancy Services
- Business Partnerships
4. Our Mission and Vision Statement
- Our vision is to bring a new set of purpose to the energy drink production industry by producing drinks that will make us leaders in the industry.
- To achieve our vision, we intend to hit the ground running by drafting and implementing strategies that will make us become industry leaders and also compete favorably with our competitors. We intend to be amongst the top 3 energy drink production companies in Pittsburg – California and top 7 in the whole of the United States of America.
Our Business Structure
The importance of a business structure cannot be over-emphasized in any business because getting the business structure right will enable the business not only start off on the right foot but also have less start-up mistakes than it ordinarily should. This is the reason why we are taking our business structure very seriously.
We know how important getting the right hands are, and so we intend to source for employees that are not only competent and professional but those that understand the vision and goals of our companies and are willing to see that they work to see it come into fruition. Because getting the right hands are very important to us, we intend to pay them well.
Asides making sure that our employees work in a conducive environment and are being paid well, we intend to ensure they have a solid welfare package that is of a high standard across the industry. Also, we intend to ensure that our employees undergo constant training that will not only enhance their skills but also improve their productivity as well to the benefit of the company.
Below is the business structure that will be built at Zuzu Lite Energy Drinks LLC;
- Chief Executive Officer
- General Manager
- Quality Assurance Manager
- Human Resources and Admin Manager
- Purchasing Manager
- Store Manager
- Customer Service Executives
- Delivery Driver
- Security Guard
5. Job Roles and Responsibilities
Chief Executive Officer
- Meets and negotiates with high end clients on behalf of the company
- Develops a budget with the general manager and accountant
- Develops strategic vision on behalf of the company
- Oversees and coordinates the whole departments
- Takes decisions together with the chief executive officer
- Oversees the day-to-day running of the business
Quality Assurance Manager
- Ensures that the products are checked so that defective products are not sold to customers
- Reviews the process of checking products
Human Resources and Admin Manager
- Responsible for ensuring that the administration runs smoothly in the organization
- Recruits new employees and carries out orientation for the new employees so that they can best settle into the company
- Represents the interest of the employees at all times and ensures that they are adequately paid and have welfare packages
- In charge of carrying out performance appraisals and conducting training and promotions.
- Responsible for sourcing for raw materials and reliable vendors and distributors on behalf of Zuzu Lite Energy Drinks LLC
- Prepares and reviews contracts with distributors and vendors
- Drafts a budget for the purchasing department in alignment with the overall company budget
- Responsible for ensuring that the store is conducive and secured always
- Checks stock and ensures that depleted stocks are re-stocked.
- Ensures that the store remains clean at all times
Customer Service Executives
- Attends to customers and takes their orders, answers their inquiries and attend to any complaints that they might have
- Creates and keeps an accurate customer database on behalf of the company
- Ensures that they remain updated as regards the information in the energy drink and beverage industry
- Responsible for preparing all the financial statements – income statement, balance sheet – for Zuzu Lite Energy Drinks LLC
- Prepares the necessary tax information on behalf of Zuzu Lite Energy Drinks LLC to be submitted to the tax authorities
- Drafts and prepares the budget in collaboration with the owners of Zuzu Lite Energy Drinks LLC
- Ensures that the energy drinks are safely delivered to distributors and retailers
- Supervises the uploading and offloading of products in and out of the delivery van or truck
- Carry out light maintenance on the delivery van and report any major breakdown to the admin manager
- Responsible for securing the environment during and after work hours
- Constantly reviews security measures and ensures that they are updated
- Monitors the surveillance cameras to check incoming and outgoing customers and employees
- Ensures that the premises is kept clean at all times
- Responsible for stocking cleaning supplies
- Reports any major defect on the company’s structure to the admin manager
6. SWOT Analysis
Because we believe in starting on the right foundation, we hired a business consultant in California that took several critical looks at our business concept so as to be able to give us a factual evaluation on whether we were likely to survive in the energy drink and beverage industry.
The critical evaluation was the SWOT (Strength, Weakness, Opportunities, and Threats) analysis that was to help know if we had the strength to be able to withstand the weaknesses and especially the threats that were likely to crop up during our course of running the business in Pittsburgh – California and in the whole of the United States of America.
Below is the of the analysis that was conducted on behalf of Zuzu Lite Energy Drinks LLC;
Our strength lies in the fact that we are producing something new and unique in the market, our energy drinks come in flavors that are not easily found in the market. Also, we are positioned in a strategic location in Pittsburgh – California that allowed customers and distributors to easily access us.
We also know the importance of technology, which is why we are prominently on the internet to ensure that we cater to a variety of customers that prefer to shop online. Also, we hired the best employees by ensuring that we got only those that are competent, thoroughly understand their jobs and are attuned to our vision of becoming the top five brands in the whole of the United States of America.
The energy drink and beverage industry is largely saturated with top brands and upcoming start-ups in Pittsburgh – California, as well as in the United States of America as a whole, and so we would be fighting hard to ensure that we are recognized and noticed. We have the strategies in place that would help us achieve this.
Energy drinks are still in much demand and so there are loads of opportunities available to us in this industry. We have seen the opportunities in offering training and franchises to start-ups by setting up a training center that has been approved for that purpose.
Every business is faced with threats no matter how fantastic the business might be. Therefore we are likely to face threats from the economy, governmental policies, a shift in demand and also entrants of similar competitors in the same location where our energy drink is situated.
7. MARKET ANALYSIS
- Market Trends
The energy drink market is not growing at the same rate it was 3 years ago, this is not to however mean that demand is stagnant or negative, it is still positive but not with the same surge of previous years. This is because more entrepreneurs are going into the business, as there are more available start-up funds available; which have led the industry to become stifled with too much competition, especially at the sales level.
Also, energy drinks have to compete with other beverage drinks in the market especially big brand names. To remain on top, it would mean coming out with a unique tasting drink.
With more and more people getting into the business, production costs have gone up. Research and then planning is key in this business. As at last year, more than 300 energy businesses were launched in the United States of America. To make sales, a sales force and deals are usually needed. The sale force does the task of sourcing for deals and ensuring that the energy drinks gets into as many distributorship outlets and retail stores as possible.
Asides, ensuring that the drinks are sold after being produced, marketing is a key aspect that helps the company, and with the evolving technology, energy drink companies are realizing that most of their customers can be found via the internet and that marketing through the internet can allow a deeper penetration into the target market than it would ordinarily have done via the conventional marketing method.
8. Our Target Market
Every business has a target market that they are sure of; however any serious business that intends to make serious profit and last for a long time will need to conduct a market survey. The advantage with conducting a market survey is that the company knows who the target market is and where they are and is then able to draft strategies that will enable them capture the target market.
This is why we have conducted a market survey with the help of a consultant to help us determine where we would likely make more money from and where we would need to advertise more to get customers for our products at Zuzu Lite Energy Drink LLC.
From the market survey conducted, most of Zuzu Lite Energy Drinks will be sold in wholesale and retail to the following groups of people;
- Sports Personalities
- Corporate Executives
- Business People
- Retail Stores
- Military men and women
- Chain stores
- Drug stores
Our Competitive Advantage
Every business that is being established knows its main intention is to make profit as well as compete favorably with competitors in same industry, to however achieve this, there are certain competitive advantage that the business must have that will stand it out from similar businesses.
At Zuzu Lite Energy Drinks LLC, we know that to attain our vision of being the top three in Pittsburgh – California and the top five in the whole of the United States of America will require us to have to have several competitive advantage strategies at hand.
Our first competitive strategy is in ensuring that we give our product – energy drinks – a name that is easily recognizable. Also, we are located in a strategic area that makes it easy for our customers and distributors to easily access.
We also intend to employ a variety of professional and competent employees who understand the energy drink and beverage industry thoroughly and who are also attuned to our vision of becoming amongst the top five brands in the whole country, to help achieve our visions and goals.
We know how important it is to keep our employees happy, and so we intend to ensure that our employees work in an environment that is easily accessible and conducive. We also intend to ensure that our employees are adequately paid and have the best welfare packages that can be attained in the industry. Asides, from giving our employees continuous trainings, we intend to ensure that we promote hard working employees by carrying out a performance appraisal.
We also intend to have excellent customer service so that our customers can come back to us time and time again. We know that the key to retaining customers is to ensure that their expectations are not only met but exceeded. Our customer care executives are the best in the industry and continuously undergo training that will ensure that they serve our customers better than other energy drink companies would.
9. SALES AND MARKETING STRATEGY
- Sources of Income
Zuzu Lite Energy Drinks LLC is a company that has been established with the means of making profit in the beverage industry. However, we are not only established to make profit but to also increase our revenue base as well by engaging in other revenue making services or products legally in the United States of America.
Zuzu Lite Energy Drinks LLC therefore intends to generate incomes by selling the below listed products and services;
- Different flavor and brand of energy drinks
- Other beverage drinks
- Consultancy Services
- Business Partnerships
10. Sales Forecast
The energy drink industry might not have as much demand as it did three years ago but it is still an industry that hasn’t reached the point of saturation yet as demand for energy drinks are relatively stable.
Due to our strategic positioning in Pittsburgh – California, we are optimistic of achieving our set revenue generating target in at least a year of operations that will sustain and help grow our business.
Our optimism were not based on fiction but on facts that were generated from critical analysis and evaluation conducted by our proficient and reputable business consultant, who analyzed the beverage and energy drinks industry in and around our location in California as well as the whole of the United States of America.
The sales projections for Zuzu Lite Energy Drinks were however made on the assumptions that several factors for our company would remain the same for the period of analysis.
- First Fiscal Year-: $550,000
- Second Fiscal Year-: $1,200,000
- Third Fiscal Year-: $2,400,000
N.B: It should be noted that the above sales projection were based on the fact that there won’t be an economic crises or melt down; we won’t have a competitor in same location and that our location and other strategies in revenue generation would remain the same. Should there be any change positively or negatively in the above factors, it might affect our sales projection, making it lower or higher.
- Marketing Strategy and Sales Strategy
The energy drink and beverage industry is such a highly competitive place that it is not so easy for new drinks to find a space on the shelf or easily displace other old and established brands, which is why to get the recognition and survive in this industry, we conducted a thorough market survey that was to allow us penetrate the available target market and also ensure that we were adequately positioned to attract the customers we needed in Pittsburgh – California and in the whole of the United States of America.
Knowing the role of technology in this day and age, we have decided to massively tap into this aspect as our research showed that more customers prefer to shop online than visit physical stores. This is why we have created a unique website that is not only interactive but user friendly as well.
This is so that the majority of our customers who go on our websites can easily find the products they want as well as well contact us for whatever inquiries, suggestions and complaints they might have. Also, we are not limited to marketing or selling via our website, as all our social media platforms such as Facebook, Instagram and Twitter are active to also cater largely to our teeming customers.
The marketing consultants we hired have together with our marketing team have drafted the strategies that would enable us penetrate the target market and generate revenue while also communicating our brand to our customers. Our hired marketing consultants have a high understanding of the energy drink industry market, and with their track record, we are sure of gaining a large percentage of the target market throughout the United States of America.
Asides, from drafting marketing strategies that would help generate revenue for the company; we have also ensured that they team up with the sales team to help them deploy these strategies. We have also empowered them to so that they can deliver our corporate goals without any hitches.
In essence, the marketing and sales strategies that we hope to deploy at Zuzu Lite Energy Drinks LLC are;
- Ensure that our energy drink company is introduced to retail stores and distributors and other stakeholders in the energy drink and beverage industry.
- Launch our energy drink company with a bang by throwing a grand party that will be in the news for many days thereby increasing customer awareness for our company.
- Advertise our products and services in local and national newspapers, magazines, radio and television stations
- Ensure that our business is listed on yellow pages and appear tops in online directories
- Engage in direct marketing and sales
- Use the internet to massively promote our energy drinks
11. Publicity and Advertising Strategy
Due to the fact that this is an intense and competitive field, having a publicity and advertising strategy is highly necessary especially if one expects to be in business for a very long time and also compete favorably with competitors in the same industry – both established and new. At Zuzu Lite Energy Drinks LLC, we intend to explore all means of publicity and advertising strategies in order to promote our product.
We aim to promote Zuzu Lite Energy Drinks LLC through a variety of functions and we will strive to have fun whilst doing so. We want to be firmly known and established in Pittsburgh – California before venturing out to other states in the United States of America.
Our publicity and advertising strategies will not only aim to communicate our brands to our customers but also ensure that our revenue base is increased as well. Some of the publicity and advertising strategies we intend to carry out at Zuzu Lite Energy Drinks LLC include;
- Sponsoring parties, events, clubs, and games in the local community
- Advertise our energy drinks in newspapers, magazines, radio and television stations
- Give sampling to our distributors and retailers when they buy into our drinks
- Make use of the social media platform – such as Facebook, Twitter, Instagram and LinkedIn – to promote our energy drink production business
- Distribute our unique handbills and fliers in target locations
- Ensure that our delivery truck is emblazoned with our design and unique logo
- Install bill boards in strategic areas in Pittsburgh – California
12. Our Pricing Strategy
The pricing of a product depends on so many factors, and is not much different from an energy drink. In setting a price for your energy drinks, you will need to consider your running and overhead costs and how much your competitors are selling theirs. The industry is an intensely competitive one and not setting the right price for your product can lead your business to fail even before it starts off.
Even though our energy drinks will be different from what is offered in the market, we know that it will be hard to gain much awareness in the marketplace if we do not lower our prices in the first few months of operations. The strategy of lowering our prices a bit below what is averagely sold in the market for at least 6 to 12 months is so as to be able to attract more customers into buying our unique energy drinks and referring us to others as well.
- Payment Options
Zuzu Lite Energy Drinks LLC always has the needs and convenience of our customers in mind, and this extends to the payment options we offer to our various customers, as we are aware that having different payment options will increase our customer base, and invariably, our revenue base.
Therefore, the payment options that will be made available for every Zuzu Lite Energy Drinks customers are;
- Cash payment
- Payment via check
- Payment via Point of Sale (POS) Machine
- Online bank transfer
- Credit card payment
Because we know how important it is that our customers have a hitch free transaction with us, these payment platforms were carefully chosen with a reputable bank whom we trust.
13. Startup Expenditure (Budget)
Starting the energy drink business is not as easy as it might look, because we will need to develop a unique flavor, try out a small batch before producing a mass batch for sale. Most times the capital generated is usually put into overheads and major operating expenses such as can or bottle design and production, utility bill payment, employees’ salaries, equipment and truck delivery.
The major areas we would need to focus our start-up capital on are;
- The total fee for business incorporation – $800
- Obtaining of licenses, permits, software and other legalities – $2,000
- Cost of hiring business researchers and consultants – $20,000
- Insurance coverage (general liability, property insurance and workers’ compensation) – $5,000
- Operational cost for the first 6 months (bills payments, employees salaries) – $150,000
- Cost of start-up inventory (raw materials and packaging materials) – $20,000
- Drink formula development and testing – $15,000
- Marketing expenses (promotion of grand opening night and general marketing) – $10,000
- Other start-up expenses such as phone, computer, furniture, printer and stationery – $5,000
- Cost of energy drink making equipment and installation – $150,000
- Cost of store equipment (racks, bin, shelves, store register) – $5,000
- Cost of purchasing an energy drink delivery van – $40,000
- Cost of launching a website – $1,000
- Cost of the opening party – $5,000
- Miscellaneous – $10,000
From the above listed items, we would need an estimate of $440,000 in order to successfully set up our energy drinks production company in Pittsburgh – California. The capital looks huge because we would be paying our employees for 6 months and utilities as well.
Generating Funding / Startup Capital for Zuzu Lite Energy Drink Production Business
Zuzu Lite Energy Drinks LLC is a business that was founded and is operated by two business partners Mr. Chu Zing and Mr. Taylor Wang. These two partners intend to run the business without much interference from investors and so have decided to limit the sourcing off their start-up capital to these sources.
The sources where we intend to get our start-up capital from are;
- Sale of personal properties by the two owners to generate part capital
- Applying for loan from the bank
- Approaching wealthy friends for loans
N.B: We were able to generate the sum of $100,000 from the sale of our personal properties. We also got the sum of $50,000 from our wealthy friends. We sought for a loan of $290,000 for the bank, and after submitting several documents, we have just been informed by our banker that our loan has been approved and that our account would be credited as soon as all the modalities have been handled from their end.
14. Sustainability and Expansion Strategy
Sustainability and expansion measures are part of a business’s long term goals after a company might have been established and is making profit. There are three factors – products, employees, customers – that ensure that companies are not only sustained to last for a long period of time but they can also expand as well at their own pace.
One of our major sustainability goals are our products and services. Without having any product to sell or services to offer, we would not be in business at all; and so we must ensure that our products and the other services are not only unique and stand us out from the rest but that we remain a degree of consistency in our products and services.
Also, without having the right hands a business is likely to crumble in a short period of time. We intend to source for and recruit only professional and experienced hands to help ensure that our goals and objectives are being achieved as they should.
Our workers have one of the best pay rates in the industry with an enviable welfare package. Also, our employees constantly undergo training so that they would remain relevant and so as to also ensure that the company’s productivity rates are increased.
Finally, customers are the reason why any business remains in existence. Our customers are important to us and we intend to let them know this by listening and acting promptly to their complaints, answering inquiries and getting and appreciating feedbacks. Also, we intend to always ensure that we not only meet the expectations of our customers but that we exceed them as well.
Check List / Milestone
- Business Name Availability Check: Completed
- Business Registration: Completed
- Opening of Corporate Bank Accounts: Completed
- Securing Point of Sales (POS) Machines: Completed
- Opening Mobile Money Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Conducting feasibility studies: Completed
- Generating capital from family members: Completed
- Applications for Loan from the bank: In Progress
- writing of business plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents and other relevant Legal Documents: In Progress
- Design of The Company’s Logo: Completed
- Graphic Designs and Printing of Packaging Marketing / Promotional Materials: In Progress
- Recruitment of employees: In Progress
- Creating Official Website for the Company: In Progress
- Creating Awareness for the business both online and around the community: In Progress
- Health and Safety and Fire Safety Arrangement (License): Secured
- Opening party / launching party planning: In Progress
- Establishing business relationship with vendors – wholesale suppliers / merchants: In Progress
- Purchase of delivery trucks: Completed