University Business Proposal Report: Charger Energy Drink Startup

This report presents a detailed business proposal for Charger Energy Drink, a new venture targeting the Australian market. The proposal includes a thorough market analysis, identifying the growing demand for energy drinks and the competitive landscape. The report outlines a comprehensive marketing strategy, covering product offerings (including primary ingredients and flavors), pricing, distribution, and promotional activities. A one-year financial plan is developed, projecting the company's ability to reach the no-profit-no-loss stage within the year. The report also identifies critical operational risks, primarily the intense competition within the energy drink market, and emphasizes the importance of the product's uniqueness. The proposed business model focuses on targeting the middle-class customer segment with a competitively priced product, differentiating itself through unique ingredients and flavors. The distribution strategy aims for broad availability, and the promotional activities emphasize social media marketing and event sponsorships to generate brand awareness and customer engagement. This assignment showcases the student's understanding of business plan development, market analysis, and strategic planning within the context of a competitive consumer goods market.

Running head: REPORT
Business Proposal
Name of the Student
Name of the University
Author’s Note

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Executive Summary
This report presents a business proposal of energy drinks in Australian market. The proposal is
give for starting new venture in the proposed market. Market analysis, market targeting and
various marketing strategies have been discussed. The promotion distribution and pricing is
thoroughly discussed and strategies are offered accordingly. One year business plan is prepared
for the proposed business which calculates that the company will likely achieve the no profit no
loss stage of the business within the end of the year with their unique product line. The critical
risk in operation is also discussed that identifies that pressure of the competition is high.
Moreover, uniqueness of the product is essential in the scenario for gaining public attention.

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Contents
Executive Summary.........................................................................................................................1
Introduction......................................................................................................................................4
Background of the Idea....................................................................................................................4
Mission and Vision..........................................................................................................................5
Mission Statement........................................................................................................................5
Vision Statement..........................................................................................................................5
Product Offerings.............................................................................................................................5
Primary Ingredients......................................................................................................................5
Flavors Offered............................................................................................................................6
Market analysis................................................................................................................................6
Primary target market......................................................................................................................7
Marketing strategy...........................................................................................................................7
Product.........................................................................................................................................7
Price.............................................................................................................................................8
Place.............................................................................................................................................8
Promotion.....................................................................................................................................9
Strategies and Tactics......................................................................................................................9
Financial Plan................................................................................................................................10

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Start Up Cost..............................................................................................................................11
Profit and Loss Statement..........................................................................................................12
Cash Flow Analysis...................................................................................................................15
Balance Sheet.............................................................................................................................17
Critical Risks.................................................................................................................................19
Conclusion.....................................................................................................................................20
References......................................................................................................................................21
Appendix........................................................................................................................................23
Table 1: Start Up Cost...................................................................................................................11
Table 2: Profit and Loss Statement................................................................................................14
Table 3: Cash Flow Analysis.........................................................................................................17
Table 4: Balance Sheet..................................................................................................................19

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Introduction
The energy drinks are popular in Australia and it has grown considerably in the last few
years. It is due to the vibrant, lively and most flavorsome way of life the Australians prefer to
live. The growth of the energy drinks market likely to grow of the future market and shows no
sign of stopping in near future. The market has a wide variety of products ranging from branded
international brands to home grown products (reize.com.au. 2017). This report is a business
proposal for a new startup in the Australian market. The following parts of the report will be
presenting detailed information of the proposed product and the background of the idea. The
mission and vision of the proposed business will be highlighted in the proposal for a clear view.
The details of the product are presented in the following part. A detailed market analysis is done
along with the market targeting. Product, pricing, distribution and promotion are discussed based
on the above analysis and a one year financial plan made. The final part of the report is
consisting of the critical risk identification.
Background of the Idea
The demand of energy drink is nothing new in the Australian market. Their energized
lifestyle demands this kind of products which is why, some of the best coffee in the world is in
Melbourne. As mentioned in the introduction part, a rapid growth in the industry is visible for
over a decade and unlikely to all in near future. There are a number of international and domestic
manufactured products available in the market. However, the demand of the products fails to fall.
Some of the big names in the energy drinks industry are Red Bull, V Energy drink, Rockstar,
Monster and many more pre-exist in Australian market. It reflects the idea that, the target

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population loves to taste the variety available in the market which is the basic background of the
idea formation.
Mission and Vision
Mission Statement
Energize the mind, spirit, body of the customer and bring optimism in their thinking.
Using this statement, the brand will be seeking to maximize the revenue generation and build
long term relationship with the consumers.
Vision Statement
 Provide the customers an unique experience
 To become a leading company is the Australian energy drink industry.
 Maintain the quality of the product through quality management
 Up hold the social responsibility and gain customer loyalty.
Product Offerings
The proposed name of the product is Charger Energy Drink. The name is not chosen
out of the blue, but has significance in both promotion of the product and the purpose that it
fulfils. The name itself represents its purpose that is to charge the people with high level of
energy and increase their enthusiasm to work, harder to gain the desirable. The proposed tag line
of the product is “Unleash Your inner BEAST” that represents the effect of the drink in the
customers’ body, mind and soul.

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Primary Ingredients
The primary ingredients of the products offered are caffeine, carnitine and vitamin B
complex. It will have dual effects in one’s body. The caffeine will energize the body and the soul
of the consumer where as the carnitine is added to burn the fat composed in the body. It is will
offer dual energy to and recharge the consumer in no time. The effect of the drink will last longer
than any other energy drinks present in the market (huffingtonpost.com.au. 2017).
Flavors Offered
The product will be available in both with sugar and diet version for accessing the
maximum number of population in the target market.
Market analysis
The energy drink market in Australia is showing positive trend in the market in the last
few years. This is due to the reason that, with the introduction of various healthy energy drinks in
the market, customers are opting for these drinks instead of conventional carbonated drinks. As
of 2010, the annual energy drink consumption in Australia stands at 36.20 million litres. The
market growth rate of energy drinks in Australia as of 2010 is 25.2 percent (Pennay et al. 2015).
Thus, the growth trend in this industry is more compared to other growing industries in
Australia. The market value of energy drink in Australia is valued at 247.3 million Australian
Dollar. However, there are few regulations that to be adhered by the organizations in this sector.
Various regulations are being initiated by the government of Australia regarding the maintenance
of the quality of the drinks (Pomeranz, Munsell and Harris 2013). Charger will adhere to all the
relevant regulations and will provide the best possible product quality for their customers.

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Major competitors in this industry are the Red bull and Monster energy and various other
domestic brands. Red bull is the current market leader in the Australian energy drink industry.
However, majority of the competitors are offering their products with premium pricing. Thus, the
market for then existing competitors in the market is limited (Upson et al. 2012). Charger will
price their products accordingly to their target market of middle class populations. It will help
them in catering to more number of customers effectively (Mobin, Dehghanimohammadabadi
and Solomon 2014). In addition, it will help them to reduce the threat of substitute products. This
is due to the reason that, the price of soft drink and the existing energy drinks in the market is
having much difference. Thus, customers willing to have energy drinks will opt for soft drinks.
On the other hand, the pricing strategy of charger will help to target the existing customers from
the soft drinks sector. Thus, the targeted audience will be more for them.
Primary target market
The primary target market will be the middle class customer segments. This is due to the
reason that middle class customers constitute of majority of the total population in Australia.
Thus, the market size and market potential will be more for Charger (Kim and Mauborgne 2014).
Moreover, the existing competitors in this market are catering to the higher end customers with
their premium pricing. Thus, the energy drink sector for the mass market is untapped, which will
be a huge opportunity for charger to operate. The sales volume will also be more due to catering
to the mass market.

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Marketing strategy
Product
The core product of charger will be the energy drink. However, the product will be
released in various variants and flavors in order to cater to diversified taste and preference
pattern of the customers. It will help them in expanding their market presence in Australia. The
product will also come in various size and quantity (Chernev 2012). It will help the customers to
buy the product according to their requirement. On the other hand, the organization will be
benefited by offering their products in various price points. Thus, more customer segments in
terms of the economical segmentation will be covered.
Price
As discussed earlier, pricing will be done according to the market status of the target
market. The pricing strategy will help them to reach out to more number of customers
effectively. The pricing will be done much lower compared to the existing competitors in the
market. Thus, it will also act as competitive advantages for them (Wagner III and Hollenbeck
2014). It is being projected that with the success of the initial introduction of the mass-market
energy drinks, premium priced products will be introduced in the later stage. Those products will
have premium pricing for the niche market. Thus, the chosen pricing strategy will help them in
catering to both the mass and niche market effectively.
Place
Place or distribution refers to the mode and extent of availability of the products in the
market. Charger being a mass market will be made available in as many more outlets as possible
in the Australian market. This will help to reach out to more number of customers. Moreover, the

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brand value and exposure will be enhanced with the availability of the products in more number
of outlets (Zauner, Koller and Fink 2012). The products will be made available in departmental
and super stores also. It will help to cater to the customers from as much sales point as possible.
The distribution network will be directly controlled by the organization. It will help them in
controlling the distribution network according to the organizational policies and objectives.
Promotion
Charger will involves extensive promotional activities due to the fact that, it belongs in
the fast moving consumer goods category. Thus, with having huge number of competition in this
market, it is necessary for them to initiate aggressive marketing activities in order to attract more
number of customers. The brand promotion will be done involving potential medium such as
print and electronic medium. Print and electronic media is having the most effective penetration
among the mass market. In addition, they will also initiate social media marketing in order to
engage with the customers effectively (Tuten and Solomon 2014). It will help them in
determining the current market trend as well as the current taste and preference pattern of the
customers. Initiation of social media marketing will help them to interact with their customers to
gain opinions about their user experience.
Sample distribution will be initiated in various sports events to enable the potential
customers in having the taste of the drink. It will help them to generate positive word of mouth
from the potential customers. Moreover, promotion in the sports events will help them to
position their products effectively. These promotional activities will be implemented in a holistic
basis to cover the all the customer segments effectively.

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Strategies and Tactics
The product will utilize the social media marketing as their primary tool for promoting
the brand as it shows potential impact in the given market (Heymann-Reder 2012). Other means
of promotion are leaflet distribution in the popular places like offices, stadiums and other
potential areas. Free sample distribution in events is another promotion that is kept under
consideration and thought to be useful.
The product line on the other hand offers two varieties of products that are diet and with
sugar that will maximize the potential demography in the target market. The diet version is
specifically made for the fitness concerned people as their number is rapidly growing in the
market.
The price range will be kept from low to medium cost to attract the maximum number of
customers in the initial stage of the business as the purchasing power of the target population is
medium as analyzed. Moreover, the target population that prefers the product ages from 25 to 38
years. However, one third of the teenage population shows potential consumption of the product.
Hence, the pricing is justified according to this analysis (Duffie 2010).
The company seeks to prepare a guided CSR policy for value creation and gain customer
loyalty. To meet the mission and vision of the company, it is important to provide quality
product with unique taste without violating the CSR protocol. Moreover, the customers’
feedback is incorporated in their business strategy to get an insight of the customers’ taste and
opinion of the product.

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Financial Plan
The budget structure is the integral part of the business plan. The sequential budget
planning determines the total estimated capital amount that is required to be invested while
establishing an entrepreneur business (Wilks et al. 2011). However, it is necessary to ensure the
liabilities and the total estimated cost at the initial stage. Charger Energy Drink has estimated
$2,00,000 budget for the entire business plan. The company has total asset of $1,00,000 and it
would borrow $1,00,000 from the outer sources. The entire plan is structured further:
Start Up Cost
Budget Actual Revenue
Business Registration Fee $200
Domain name registration $200
Insurance Premiums $350
Licences $400
Workers compensation $2,000
Setting up the premises
Lease deposit and advance rent $25,000
Fitout $1,000
Utility bonds and connection $1,000
Stationery and office supplies $5,000
Plant and equipment
Equipment $5,000
Vehicles $2,000
Telecommunications $2,000