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Use the attached documents for instruction and guide to the paper. 

This Marketing Plan section is apart of a Business Plan, the sections is "Target Market and Segmentation"  Please see attached doc for business plan and further instruction and guide "Everything needed is in attached documents". All parts of the question MUST BE ANSWERED AND ****ORIGINAL WORK****.  This is a Business Plan on a Drone Fast Food Delivery System/Service. Must include ONLY recent (2013-2016) cited references, must be Graduate level writing and a minimum of 2-3 pages including any graphs/flow charts etc, APA format.


Running head: CHOW CHOPPER INDUSTRY ANALYSIS Chow Chopper Industry Analysis 1 Page |1 CHOW CHOPPER INDUSTRY ANALYSIS

 

TABLE OF CONTENTS

 

Introduction.........................................................................................................................Page 2

 

Industry Review..................................................................................................................Page 2

 

Regulation Review and Legal Concerns.............................................................................Page 4

 

Competitive Analysis..........................................................................................................Page 6

 

SWOT Analysis..................................................................................................................Page 8

 

Conclusion..........................................................................................................................Page 12

 

References..........................................................................................................................Page 14 Introduction

 

The Chow Chopper is a company that aims to deliver fresh food in minutes with care via state of

 

the art drone technology to the Portland, OR community. Currently, there are very few

 

companies offering food delivery via drones and both Amazon.com and Walmart are initializing

 

similar services in various cities. This company is different from competitors in that it will

 

specialize in the Portland locality and offer restaurants an option to deliver food faster than ever

 

before right to customer?s doorstep or to a location unreachable via car delivery. People want

 

their food fast and to get on with their day. The Chow Chopper is the solution. This on demand

 

delivery service provides customers fresh food in less than 30 minutes. Our drone delivery

 

service will deliver from local restaurants in an eco-friendly delivery container to your

 

1 Page |2 CHOW CHOPPER INDUSTRY ANALYSIS

 

designated delivery point within the Portland area. This gives our customer an eco-friendly

 

option to get their takeout rather than driving, saving our customers precious time, and

 

decreasing air pollution emissions. Chow Chopper is unique because it will be the first local

 

delivery service of its kind in the Portland area. Our delivery service caters to customers who are

 

environmentally conscious and want another resource for getting their breakfast, lunch or dinner

 

quick fast and in a hurry. Industry Review

 

Unmanned Aerial Vehicles, UAV?s, are about to change our lives. They are being used all

 

around the world. Some examples include, energy companies using them to inspect power lines

 

in the United Kingdom, Japanese farmers using them to spray crops, and the United Arab

 

Emirates is working on a prototype to deliver government documents [Gui15]. In the United

 

States, UAV?s are being used in a variety of industries from real estate to construction.

 

The first UAV created were mostly for the military. This industry required big budgets and

 

cutting edge specs. For instance, MQ-9 Reaper, which is a UAV used in battlefields, cost about

 

$12.5 million [Kay13]. The second UAV?s were created for children and hobbyists. This

 

industry had low budgets but enjoyed the advantages of using UAV?s [The16]. The UAV?s for

 

children and hobbyist prices ranged from $100 to $5,000 according to the level of technology

 

that the UAV was equipped. Both of these industries used some ideas in the advances of

 

technology to create both UAV?s for military and toys. The Chow Chopper is the drone we have

 

designed to deliver fresh food in minutes with care via state of the art drone technology to the

 

Portland, OR community. The cost for drone usage in delivering food is $50,000. The benefit 2 Page |3 CHOW CHOPPER INDUSTRY ANALYSIS

 

for starting the Chow Chopper Company is it has the advantage of being one of the first to enter

 

the market for this purpose. Currently we only have a dozen companies approved to operate

 

drones commercially in the United States resulting in low competition and the ability to acquire

 

more local businesses. This is a great opportunity for the Chow Chopper to set the standards for

 

food delivery via drone technology and establish a reputation in the industry that will inspire

 

others to follow. 3 Page |4 CHOW CHOPPER INDUSTRY ANALYSIS Regulation Review and Legal Concerns

 

For the business to operate the business must adhere to all the licensing policies from various

 

departments of the City of Portland and or State. The first we have to ensure that we register our

 

business with;

 

1. Office of Management & Finance Revenue Division will confirm and authorize us to

 

collect any city sales tax. So that we comply with all Portland City sales tax on food

 

and beverages we need to register our business in such. Everyone doing business in

 

Portland or Multnomah County is required to register. (Revenue Division ? Office of

 

Management & Finance ? the City of Portland)

 

Portland Bureau of Transportation (PBOT) for the following;

 

2. Parking Permits City Code 16.20.220; in order to designate specific locations around

 

the City of Portland to mark delivery locations our customers can pick up their food

 

delivery, we must adhere to PBOT Central City Plan District including any ordinance

 

restricting vending may not occur within 250 feet of any public library or park

 

grounds, any stadium or grounds. (Department of Transportation, The City of

 

Portland 2016)

 

3. Signs & Other Permits Title 32; Signs, A-Board and Banner; any signage, or

 

advertisement around the City of Portland we must file the appropriate permit request

 

through the Development Services Office and Portland Bureau of Transportation.

 

Despite the beauty associated with this modern day delivery system we intend to use, there are

 

also some challenges associated with the same. One of the limitations is with the Federal

 

Aviation Authority (FAA). The Federal Aviation Authority has made it mandatory to register

 

4 Page |5 CHOW CHOPPER INDUSTRY ANALYSIS

 

owned drones that is purchased and weighing over 55lbs. In addition, the FAA has enforced pilot

 

requirements including our pilots passing an initial aeronautical knowledge test at approved FAA

 

knowledge testing centers, they must also be verified by the Transportation Safety

 

Administration (TSA)

 

The complete list of requirements are as follows;

 

First-Time Pilot

 

To become a pilot you must: (Federal Aviation Administration ? Unmanned Aircraft Systems) Be at least 16 years old Be able to read, speak, write, and understand English (exceptions may be made if the

 

person is unable to meet one of these requirements for a medical reason, such as hearing

 

impairment) Be in a physical and mental condition to safely operate a small UAS Pass the initial aeronautical knowledge exam at an FAA-approved knowledge testing

 

center Pilot certificate Requirements Must be easily accessible by the remote pilot during all UAS operations Valid for 2 years ? certificate holders must pass a recurrent knowledge test every two

 

years Existing Pilots ? What to Expect

 

Eligibility: Must hold a pilot certificate issued under 14 CFR part 61 Must have completed a flight review within the previous 24 months Remote Pilot Certificate Requirements Must be easily accessible by the remote pilot during all UAS operations

 

5 Page |6 CHOW CHOPPER INDUSTRY ANALYSIS Valid for 2 years ? certificate holders must pass either a recurrent online training course

 

OR recurrent knowledge test every two years Other issues we may incur are our drones could be at risk in the hands of untrustworthy

 

customers who may damage them or hack their systems and use them to their advantage leading

 

to losses for the company. The introduction of drones in the market for food delivery will make it

 

possible for food to be delivered even to places where some road condition gets worse, and they

 

become impassable in inclement weather. They will also make it possible for food to be

 

delivered in much less time and help to avoid the compensation costs experienced earlier when

 

foods used to get cold on delivery by use of road transport. In conclusion, the use of drones to do

 

business will be the most efficient and reliable means for food delivery. Competitive Analysis

 

Direct Competitors

 

A complete competitive analysis shows that there are no direct competitors at this time.

 

Currently, in the Portland area there are no restaurants or fast food chains that provide drone

 

delivery as an option nor are there drone delivery businesses in this area. All the restaurants in

 

this area offer the standard dine in, carry-out and car delivery options which makes The Chow

 

Chopper a unique business opportunity. The world of unmanned aerial vehicles is improving

 

daily with drones that now come equipped with cameras and the ability to carry cargo (AlleyYoung, 2015). The companies currently testing and using drone delivery are limited to online

 

retail stores such as Amazon, Walmart and Google however that does not pertain to hot food

 

delivery (French, 2015). The UAV delivery services being offered by companies such as 6 Page |7 CHOW CHOPPER INDUSTRY ANALYSIS

 

Amazon are for items typically purchased on their website such as clothes or household goods

 

but not specifically for food. While Amazon is said to be ?experimenting with a restaurant

 

delivery service in Seattle? there is no evidence showing that they will use unmanned aerial

 

vehicles to do so (Demmitt, 2015). The restaurant industry has yet to fully embrace the concept

 

of drone food delivery which is why taking full advantage of UAV technology and cornering this

 

market in a small localized area such as Portland can be the start of a ground-breaking change for

 

the restaurant industry. Possibilities are endless and The Chow Chopper intends on tapping into

 

these prospects.

 

Indirect Competitors

 

Although there are currently no direct competitors in the food delivery market in terms of the use

 

of unmanned aerial vehicles, there are many driving delivery services that pose potential threats.

 

Companies such as Grubhub and UberEats provide delivery options to restaurants that do not

 

typically offer the option to deliver food orders. Customers can get their favorite foods from any

 

restaurant with the help of these delivery service companies. Though a relatively new concept,

 

companies like Grubhub are established and have been in use for a few years now. Currently,

 

Grubhub is the nation?s leader in online and mobile food ordering. They provide customers with

 

the ability to ?order directly from more than 44,000 takeout restaurants in over 1,000 U.S. cities?

 

which is why it is just as important to consider our indirect competitors as it is to consider our

 

direct competitors (grubhub.com, 2015). The Chow Chopper must differentiate itself amongst all

 

competitors alike and the best method to establish itself is by appealing to the customers? needs

 

and wants in regards to food delivery. One of the most difficult aspects with our new idea will be

 

transitioning customers, who are comfortable using Grubhub, UberEats or traditional driving

 

delivery services to using an unfamiliar option like drone delivery. People are hesitant when

 

7 Page |8 CHOW CHOPPER INDUSTRY ANALYSIS

 

trying new things therefore The Chow Chopper must demonstrate exactly how it will supersede

 

all other delivery options. Customers want quick service, low cost and good food with no hassle;

 

The Chow Chopper can provide all of this and more by removing delivery drivers and using

 

drones to get food to their customers quicker than ever. To win over customers The Chow

 

Chopper must outperform the current competition and prove that it is a reliable and efficient

 

delivery service. SWOT Analysis

 

STRENGTHS

 

Chow Chopper is uniquely suited to offer restaurants an option for food delivery that is unlike

 

any other currently offered. According to the NPD Group, the average customer purchases 127

 

meals annually at restaurants for consumption elsewhere, compared to 81 meals annually at a

 

restaurant[Nat15]. The percentage of adults who are likely to use delivery from a full service

 

restaurant ranges from 52-68% depending on how frequent they are restaurant patrons, and over

 

half of all consumers purchase takeout once a week or more, utilizing home delivery 45% of the

 

time [Nat15]. What this data tells us is that the market for restaurant delivery is strong and an

 

entrenched part of the way Americans consume restaurant food. Given that takeout and delivery

 

split the market relatively evenly, we want to capitalize on saving restaurants and customers time

 

between food preparation and consumption by using drones to take food immediately when

 

prepared to the customers? location. This reduces time from production to delivery by allowing

 

the company to send the food out immediately when the order is complete without hiring internal 8 Page |9 CHOW CHOPPER INDUSTRY ANALYSIS

 

delivery personnel. For end user customers, they get their food faster than if they went and

 

picked it up themselves.

 

Chow Chopper is a strong concept due to its revolutionary use of brand new drone technology to

 

reduce delivery time for restaurants and deliver food to a precise location marked by customers.

 

It specializes in restaurant delivery, thus focusing on providing the best service to local

 

restaurants in the Portland area, providing true local service, and adjusting to customer needs

 

quickly since we are designed specifically for this purpose. Our delivery isn?t a part of some

 

giant corporation, but a commitment to improving restaurant customer service.

 

WEAKNESSES

 

There are weaknesses to conducting restaurant delivery via drones. Chow Chopper is a small

 

business serving the Portland area. Should growth opportunities arise quickly or large

 

companies take over market share, Chow Chopper may not have the capital to outpace that

 

growth. Additionally, delivery time is paramount to competing in this sector. If the company is

 

unable to provide delivery service faster than car delivery and/or cheaper, it will be difficult to

 

gain market share. A potential weakness is the pending and continual development of drone

 

regulations in localities and by the FAA for nationwide drone use. Any change in these results

 

unfavorable to this type of business and could be potentially disastrous. Another challenge is the

 

effect of weather on drone delivery systems and their navigational components, which is an area

 

that is still under development. Restaurants would have to adapt from having a person pick up

 

the order from the restaurant to an employee placing the order in a designated drone delivery

 

container. This requires training and even simple actions can present a barrier to hiring Chow

 

Chopper for their food delivery needs.

 

9 P a g e | 10 CHOW CHOPPER INDUSTRY ANALYSIS

 

OPPORTUNITIES

 

Chow Chopper is uniquely suited to take advantage of brand new drone technology and the

 

unveiling of new FAA regulations that allow for business use of drones. The restaurant delivery

 

business is a growing sector, and according to the National Restaurant Association (NRA) 2015

 

Restaurant Industry Forecast, America?s 365,000 independent restaurants sell about $70 billion

 

in takeout food a year, and the percentage of online orders continues to increase. Also, 3 in 5

 

consumers order delivery or takeout once a week [Nat15]. The food delivery service market is a

 

growing sector enabled by application technology that allows users to order food with their

 

cellphone for quick delivery. The biggest opportunity for a drone-based food delivery company

 

is the ability to deliver to remote locations and get food to the customer faster than a car could

 

while avoiding any effect of traffic on the time to deliver.

 

THREATS

 

There are a number of competitors and large companies testing drone delivery systems, such as

 

UberEATS, Grubhub, and EAT24 to name a few [Don151]. Grubhub uses mobile application

 

technology to connect customers with a restaurant?s online ordering mechanism and contracts out

 

delivery to drivers. UberEATS uses its driver network that has been delivering people for years,

 

to swing by and pick up your takeout for you. As this sector develops and the legalities are

 

sorted out around drone technology, these companies will have the capital to invest in a drone

 

option and will likely seek to either contract drone delivery, which would benefit Chow Chopper

 

or directly compete in the drone takeout delivery business. Another potential threat is the

 

expansion of large companies planning to leverage drone delivery for their own products, such as

 

Amazon.com, moving that ability into the restaurant delivery sector.

 

10 P a g e | 11 CHOW CHOPPER INDUSTRY ANALYSIS

 

OTHER Drone delivery via the Chow Chopper would revolutionize restaurant food delivery by

 

offering takeout delivery faster than current methods to any location that can be set with a GPS-enabled device.

 

Obstacles to overcome to successfully operate include navigating FAA regulations,

 

finding an appropriate delivery vehicle, training restaurant staff to properly use the

 

delivery system, and the small scale of Chow Chopper restricts its operations to the Portland area.

 

Opportunities abound in the growing food delivery sector as more and more Americans eat restaurant food and are constantly seeking ways to save time.

 

Threats to the Chow Chopper can come from numerous large companies and the alreadyoperating car delivery services that provide online ordering and relatively fast delivery

 

via ground vehicle. RISK MANAGEMENT PLAN

 

Risk is inherent in any new endeavor and drone delivery is no exception. In fact, there are

 

numerous aspects of this business that must be taken into consideration. First, one must consider

 

the risk of success. What are the specific factors that must be planned for and maximize to

 

ensure Chow Chopper succeeds in this competitive market?

 

The possibility that drone food delivery will dramatically reduce delivery times for restaurant

 

food to customers is high. Given that, there are programs and processes that Chow Chopper can

 

put in place to increase the risk that their delivery is faster. These include an integrated

 

application that provides ordering and location services so that all orders arrive exactly where a

 

customer selects and a drone is dispatched immediately to the delivering facility.

 

11 P a g e | 12 CHOW CHOPPER INDUSTRY ANALYSIS

 

Other risks exist that would negatively affect Chow Chopper, and they must be planned for and

 

mitigated. This could include FAA regulations that negatively impact our ability to do business.

 

Mitigation efforts will be undertaken to lobby the FAA for favorable laws, ensure a presence in

 

local government to provide drone operators perspective to any local ordinances, and to submit

 

waivers for any ruling that would curtail our operations. Additionally, employees must operate

 

drones within current guidelines, and because of this there is always a risk of FAA violations.

 

Chow Chopper will mitigate this through the use of a comprehensive training program and

 

annual reviews to test employees? knowledge of regulations.

 

Delivery errors could also negatively affect consumer satisfaction and must be reduced to the

 

maximum extent practical. The delivery application must be simple to operate and be

 

continually adapted to better suit the needs of customers.

 

Risk is inherent in any new venture, but with integrated planning solutions, and the ability to

 

adapt and overcome any obstacle, Chow Chopper can lead the charge in delivery efficiency. Conclusion

 

Chow Chopper is a revolutionary new concept, and one that brings with it the possibility for fast

 

delivery of restaurant food to the customer, no matter where they may be. With any new

 

technology, growing pains and challenges can be anticipated, planned for and risks of all types

 

mitigated through detailed analysis and execution. The restaurant delivery sector has undergone

 

rapid transformation since the advent of application-based order and delivery systems. Chow

 

Chopper is another step in that evolution, taking existing ordering technology and adding the

 

efficiency of drone delivery, effectively reducing delivery times and increasing the flexibility of 12 P a g e | 13 CHOW CHOPPER INDUSTRY ANALYSIS

 

current delivery systems. Of course, this company does not exist in a bubble and many

 

companies compete in this sector and will attempt to maximize their own market share. Anytime

 

a new idea is introduced, running with it is a risk. With Chow Chopper, success would

 

revolutionize food delivery and create a new standard for convenience and speed of delivery. References

 

13 P a g e | 14 CHOW CHOPPER INDUSTRY ANALYSIS

 

Guillot, C. (2015). Drone's Eye View. Planning, 30-33.

 

Kay, R. (2013, December 4). Drawbacks of Delivery Drones May Outweight the Benefits.

 

Retrieved from Forbes: http://www.forbes.com/sites/rogerkay/2013/12/04/the-drawbacksof-delivery-drones-may-outweigh-the-benefits/#4770a0b16737

 

The Drone Revolution is Coming. (2016). Trends Magazine, 17-23. Portland Bureau of Transportation, City of Portland ? Parking Permits ? City Code 16.20.220

 

(https://www.portlandoregon.gov/transportation/article/64547)

 

Revenue Division, Office of Management & Finance ? The City of Portland ? New Business

 

Registration (https://www.portlandoregon.gov/revenue/59484)

 

Unmanned Aircraft Systems ? Become a Pilot

 

(https://www.faa.gov/uas/getting_started/fly_for_work_business/becoming_a_pilot/

 

Alley-Young, G. P. (2015). Drone (Unmanned aerial vehicle). Salem Press Encyclopedia,

 

French, S. (2015, December 15). Drone delivery is already here - and it works. Retrieved July

 

20, 2016, from http://www.marketwatch.com/story/drone-delivery-is-already-here-and-itworks-2015-11-30

 

Demmitt, J. (2015, August 26). Amazon expands Prime Now into Portland, will deliver food

 

from local groceries. Retrieved July 20, 2016, from

 

http://www.geekwire.com/2015/amazon-expands-prime-now-into-portland-will-deliverfood-from-local-groceries/ 14 P a g e | 15 CHOW CHOPPER INDUSTRY ANALYSIS

 

Overview. (2015). Retrieved July 20, 2016, from http://about.grubhub.com/aboutus/overview/default.aspx

 

Barnburry, D. (2015). Drones: Designed for Product Delivery. DMI .

 

Elzweig, B. (2015). Civilian Commercial Drones Are Coming; Are We Ready? Southern Law

 

Journal, 161-177.

 

Fenn, D. (2015, August 31). The (Almost) Complete Guide to Food Delivery Services.

 

Fortune.com.

 

Guth, D. J. (2016). Restaurants Take a Chance on Tech-Based Food Delivery. Crain's Cleveland

 

Business Vol. 37 Issue 10.

 

Logic Manager, Inc. (2016, July 17). Risk Assessment Template. Retrieved from Assessment Best

 

Practices and Free Download: http://www.logicmanager.com/erm-software/knowledgecenter/best-practice-articles/risk-assessment-templates/

 

National Restaurant Association. (2014/2015). Takeout and Delivery. Restaurant, Food &

 

Beverage Market Research Handbook.

 

Wehrspann, J. (2015, April 21). What You Didn't Know About Drones. Farm Industry News

 

Exlusive Insight. 15 P a g e | 16 CHOW CHOPPER INDUSTRY ANALYSIS 16

 


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