Business Idea

Business Idea

1. The idea for our new venture is to capitalize on the health conscious trend sweeping the globe. With our non-GMO and vegan alternative when it comes to frozen desserts, our international brand of flavors offer a healthy option with superior flavors when compared to a more commercial-brand of ice cream and gelato. By providing a world-class customer experience to match our unique blend of style and flavor, we can be your next top gelato destination.

2. When we analyzed our customer base in the Las Vegas area, it became prominent that our main target market were teenagers (15 to 18 y.o.) and young adults (19 to 15 y.o.). The male-to-female ratio was steady at 50% with a median age of 37 to 37.8 years with just over 310,000 for either gender. Other demographics we would be targeting included the median household income of families, whether married or unmarried. When it came to married or unmarried families, the likelihood of reaching our target market depends on marketing strategies tailored toward local consumers and unique in-house recipes.


3.1. To find customers we researched how the local market considers consumer behavior and economic trends so that our business idea survives for many years. It was crucial that our team understood what the local consumer needs and benefits were so that our unique customer experience stands among other independent gelato shops.

3.2. When considering consumer behavior in Las Vegas, we looked at both the local demographics and the tourism industry in order to better serve a diverse population. Locally, Las Vegas has seen a dramatic increase in population, household income, and employment within the past decade alone. However, globally, the demand for gelato benefit consumers who are lactose intolerant and cannot consume ice cream. Most of all, by serving toward this unique attribute of health-conscious consumers, our business idea is considered to be desirous when targeting consumers’ purchase-decision habits.

3.3. According to a market research report (2018), not only has there been a rising demand for “unique flavors” for ice cream in developing nations but it is also true that consumers in North America and Europe continue to push for healthier lifestyles. Comment by Mayah Tayah:


4.1. In a market that is saturated with franchises (e.g. Dairy Queen, etc.) and independent business owners offering unique competitive advantages, a starting gelato shop owner needs to target and attract time-valued consumers. Location is key when looking to start a gelato shop in any market, especially one with huge potential like Las Vegas. Quality is another deciding factor that plays into getting your customers to return time after time.

4.2. To find a market advantage we analyzed competitors that target the same potential consumers as our business idea in the Las Vegas area. More specifically, by focusing on the needs of our target market our ideal consumer is time-valued and appreciates frozen desserts. Thus, in identifying our competition, our team chose a product service that focuses on customer intimacy.

4.3. Evidently, in 2016 the market share for gelato has spurred up around the world with southeast Asia leading the main markets of the United States, Japan, Germany, Italy, Spain, and Argentina. This growth in the gelato market can be associated with a global trend in consumer-health for more vegetarian or vegan options. Comment by Mayah Tayah:

4.4. Gelato’s superiority as an Italian delicacy has less competitors due to a smaller market size that does not match the needs of commercialized manufacturers’. It should also be noted that gelato made in-house attracts potential customers more than purchased gelato.


5.1. The startup costs associated with fast-food businesses can include both variable and fixed costs, similar to starting a commercial ice cream shop. For example, factory cost, manufacturing cost, payroll, insurance, and any technology cost associated with high-end kitchen equipment. Comment by Mayah Tayah:

5.2. Also, the utilities costs that cover electricity, gas and water for a 1,600-square-feet gelato shop should “pay on average of 10%.” Any fees for permits at the state and local level can range from hundreds to sometimes thousands of dollars.

5.3. Any insurance costs at small commercial fast-food businesses can add up in the long-run. In the end, a small business owner can be paying up to $15,000 and $25,000 in start-up costs.

5.4. Essentially, our business plan does not cover costs associated with franchises due to its many fees and royalties. But instead, our plan is to independently own a gelato shop for its advantages (i.e. freedom to choose own products and personal tailor to local marketing strategy).


6.1. The different types of capital equipment assets are similar to commercial kitchens that include dispensing and topping units, sink units, beverage dispensing equipment, storage equipment units, sales and display equipment, and miscellaneous equipment.




8.1. Due to its unique proximity to the Las Vegas strip, the airport and plenty of residential outlets a gelato shop is ideal in highly populated areas with mild to moderate traffic.

8.2. By taking notice of peak hours, such as breakfast, lunch and dinner, is a top deciding factor when choosing a prime location. Our business will count on a heavy populated and well-traffic location to reach maximum potential of reaching customers. Office buildings, banks and upscale shopping areas can add to the overall brand and pricing strategies in the long-run.




Strategic Plan

1. Formulate Mission Statement

a. To provide an international experience of flavors; to provide a customer experience worth the status as world class in Las Vegas — one gelato at a time.

2. Complete Environmental Analysis

a. Strengths

b. Weaknesses

c. Opportunities

d. Threats

3. Perform Competitive Analysis

a. Market Research:

i. DEMAND (“Is there a desire for our product or service?”)

ii. MARKET SIZE (“How many people would be interested in our offering?”)

1. Total Population for Las Vegas, NV (2017 Census) : 621,662

a. Las Vegas Median Age: (US Census 2017 ACS 5-Year Survey)

i. Male: 37

ii. Female: 37.8

iii. Total: 37.4

b. Las Vegas Adults: (US Census 2017 ACS 5-Year Survey)

i. 471,791 adults (87,615 of which are seniors)

c. Las Vegas Sex Ratio: (US Census 2017 ACS 5-Year Survey)

i. Female: 311,123 (50.05%)

ii. Male: 310,539 (49.95%)

iii. ECONOMIC INDICATORS (“What is the income range and employment rate?”)

1. The Median Household Income for Las Vegas, NV: $53,159 ($877)

a. Las Vegas Income by Household Types: (US Census 2017 ACS 5-Year Survey)

i. Types: (Median / Mean)

ii. Households: $53,159 / $72,694

iii. Families: $62,786 / $82,972

iv. Married Families: $76,912 / $98,248

v. Non Families: $35,003 / $50,334

2. The % of Population (16 y.o+) in labor force: 63.6% (0.5%)

3. The % Employed: 57.6% (0.5%)

4. The Avg. travel time to work (mins): 25.4 (0.4)

iv. LOCATION (“Where do our customers live and where can your business reach?”)

1. Boulder City

2. Blue Diamond

3. Enterprise

4. Henderson

5. Las Vegas

6. Nellis AFB

7. North Las Vegas

8. Paradise

9. Spring Valley

10. Summerlin South

11. Sunrise Manor

12. Whitney

v. MARKET SATURATION (“How many similar options are already available to consumers?”)

1. See Appendix-A.

vi. PRICING (“What do potential customers pay for these alternatives?”)

1. $

a. Dairy Queen

b. Sprinkles (bakery)

c. Sweetspot Nitrogen Ice Cream & Boba Tea

d. Yogurtland

e. Rolled Ice Cream

f. Others: ( See Appendix-A. )

2. $$

a. Ben & Jerry’s

b. Dairy Queen

c. Baskin-Robbins

d. Others: ( See Appendix-A. )

3. $$$

a. Others: ( see Appendix-A. )

4. $$$$

a. N/A

4. Analyze Strategic Alternatives


5. Set Goals and Strategy


6. Setup Control System




A. Handel’s Ice Cream

B. Nielsen’s Frozen Custard

C. Gelato Bar

D. CJ’s Italian Ice and Custard

E. Luv-It Frozen Custard

F. Sweet Addiction, Cookies & Ice Cream (2)

G. Asia Creamery

H. Gelatology

I. U-Swirl (2)

J. Poppy’s Frozen Yogurt

K. La Flor de Michoacan Ice Cream Shop (3)

L. La Neveria fruit & juice bar

M. Cali’s Scoops

N. Creamberry

O. Ice Land

P. Art of Flavors

Q. Ghirardelli Ice Cream @ the Linq

R. Gelato Cafe

S. Tasty Crepes

T. Milk Bar

U. Tarasco Flor de Michoacan

V. Italcream Inc.

W. Cocolini Gelato @ the Venetian

X. Chill-A Yogurt bar (?)

Y. Illy Caffe

Z. Rocky Mountain Chocolate Factory

AA. Haagen-Dazs (7)

AB. SONIC Drive-In (15)

AC. Cold Stone Creamery (6)

AD. Ben & Jerry’s (5)

AE. Baskin-Robbins (8)

AF. Dairy Queen (18)




MGT302 October 7, 2019

· According to, the statistic, Household penetration rate of frozen foods in the United States in 2019, by category, shows the “household penetration of frozen foods in the U.S. in 2019”, whereby Desserts ranked 2nd as having a 90.3% household penetration after prepared foods (92.4%).

· According to, the statistic, Consumer average spend on frozen foods in the United States in 2019, by category (in U.S. dollars), shows the “consumer average spend on frozen foods in the U.S. in 2019”, whereby Desserts ranked 6th with consumers in the U.S. spending an average of 6.02 dollars.

· According to, the statistic, Per Capita consumption of frozen food products in catering services in Italy in 2017, by category (in kilograms), illustrates the “per capita consumption of frozen food products in catering services in Italy in 2017”, whereby Desserts ranked 8th with Italian consuming on average 0.05 kilograms per capita in catering services.

· According to, the statistic, Sales value of natural and organic frozen foods in the United States in 2017, by category (in million U.S. dollars)*, shows the “sales value of organic frozen foods in the U.S. in 2017”, whereby Desserts ranked 2nd in sales amounting to 1.45 billion U.S. dollars after Meat, poultry and seafood ($1.524 billion). When compared to the previous year, Desserts stayed in 2nd, however had increased from 1.028 billion U.S. dollars (2016) and Meat, poultry and seafood increased from 1.178 billion U.S. dollars.

· According to, the statistic, Percentage change in retail volume sales of frozen desserts and ice cream for the big five markets in Western Europe in 2015, shows the “percentage change in retail volume sales of frozen desserts and ice cream compared to the year before for selected countries in Western Europe in 2015”, whereby Spain held the largest growth at two percent, followed by Germany at 1.9 percent, U.K. at 1.1%, and Italy and France tied at 0.1%.

· According to, the statistic, Dollar sales growth of ice cream in the U.S. in 2017, by type*, shows the “dollar growth of ice cream in the U.S. in 2017”, whereby for the 52 weeks ended May 27, 2017, the “sale of non-dairy ice cream increased by 49% compared to the previous year, followed by Dairy Ice Cream at 4.3%; Ice Cream at 3.4%; and Sorbet at 3.2%. Frozen Custard had decreased the most when compared to the previous year by 70.4%, followed by Frozen Yogurt at 20.3%; Other Ice Cream at 7.7%; Ice Milk at 4.2%; and Sherbet at 3.4% decrease.

· According to, the statistic, Top ice cream brands of the United States in 2017, based on sales (in million U.S. dollars), shows the sales of the leading ice cream brands of the U.S. in 2017”, whereby Private label ice cream ranked first with about $1.09 billion worth of sales for the 52 weeks ended January 22, 2017, followed by Breyers at $503.9 million; Ben & Jerry’s at $477.1 million; Haagen-Dazs at $461.3 million; Blue Bell at $425.8 million; Wells Blue Bunny at $292.3 million; Turkey Hill at $253 million; Talenti at $249.7 million; Dreyer’s/Edy’s Grand at $220 million; and Dreyer’s/Edy’s Slowchurned at $215.8 million. “Total ice cream category sales amounted to about $5.47 billion. Chocolate, vanilla and cookie dough/cookies and cream were among the leading ice cream flavors in the United States in 2013.


October 15, 2019

1. Ratio Analysis

a. Calculate Liquidity:

b. Calculate Asset Utilization:

c. Calculate Leverage:

d. Calculate Profitability Ratios:

2. Discuss which of the ratios look weak and which look positive.




-Six to ten school and/or college students will be hired to work shifts during peak sales periods. Other part-time employees may be hired on an “as needed” basis

Seeking to finance this project through a local lending institution using the assistance of a Small Business Administration (SBA) guarantee, with an agreement that allows for loan repayment over 10 years.

-Must ensure that the customer continues to return to purchase the product, again and again. One way to ensure repeat business is to provide consistency in both the product and service.

-In order to earn a reasonable return on the investment, along with the ability to repay debt, strict cost-control measures will be implemented. These measures will include, among others, proper purchasing practices, maximization of product distribution ,amounts and recipes (portion control), effective utilization of personnel, and the constant search for ways to reduce the cost of sales of our products without sacrificing quality and service.

-Prices will conform to what is obtainable in the industry but will ensure that within the first 6 to 12 months our products are sold a little bit below the average prices of various ice cream and frozen yogurt brands in the United States of America.


-Put in place business strategies that will help us run on low profit margin for a period of 6 months


-This is the key areas where we will spend our start – up capital; SUBJECT TO CHANGE!

· The Total Fee for Registering the Business

· Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) –

· Marketing promotion expenses

· Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium

· Cost for payment of rent

· Cost for construction of a standard cold – room –

· Other start-up expenses including stationery ($500) and phone and utility deposits .

· Operational cost for the first 3 months (salaries of employees, payments of bills et al) –

· The cost for Start-up inventory (raw materials and packaging materials et al)

· Storage hardware (bins, rack, shelves, food case) –

· The cost for counter area equipment (counter top, sink, ice machine, etc.)

· Cost for yogurt making equipment –

· Cost for store equipment (cash register, security, ventilation, signage) –

· The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al) –

· The cost of Launching a Website – $600

· The cost for our opening party –

· Miscellaneous –

We would need an estimate of to successfully set up our ice cream production company


· Business Registration:

· Application and Obtaining Tax Payer’s ID:

· Application for business license and permit:

· Purchase of Insurance for the Business:

· Leasing of facility and construction of standard cold – room:

· Generating capital from family members:

· Applications for Loan from the bank:



-Do not pay a franchise fee or royalty. This can sometimes be a whole years profit

-All franchisors charge a non-refundable franchise fee and a startup fee. A shop or small desert restaurant fee of $25,000 is common. In some cases this is as much as the projected cost of the shop! Some charge an annual fee and/or demand a royalty, often 6% of your net profit. 6% of net profit may be as much as 20% of the gross! In addition, you have to buy their products and cannot switch around.

Being independent, you can:

-select any products you wish and switch as you please.

-personalize your service and products to meet local demands.

-Name your shop any way you wish, The product, gelato tastes and looks significantly better than mass-produced ice cream—but it is slightly more expensive. We are not as well known as the largest franchisors and therefore charge much less for startup.


COMPOSITION: The main composition difference between gelato and commercial ice cream is that it contains about 20-35% less air, 15% less sugar and 60% less butterfat than premium ice cream. They are replaced with milk solids. This makes gelato much healthier and the flavors more intense but the smaller amount of air results in more milk solids per scoop, hence higher ingredient cost.

COST: Another difference between gelato and commercial ice cream is the factory cost, which is huge. However, once the commercial factory is set up and running, manufacturing costs are very low, output is high and few workers are required to run it, whereas a gelato factory is more like a commercial kitchen and has a higher overhead

DISPLAY: Gelato is heavier than ice cream and its freezing point is a little lower than commercial ice cream. Commercial ice cream can be kept hard at -15°C but gelato requires 18°C. This may appear to be a small difference but it is important when buying a display freezer. Many ice cream freezers only freeze to -15°C. Be sure you buy one cold enough to keep your product hard!


-Gelato is a superior product that tastes better, looks better and is healthier than commercial ice cream.

-It is usually sold from highly decorated tubs, which make the product look very alluring.

-It is often sold in upscale malls or areas where people with money go and in those areas the people know they will be paying more for whatever they buy.

-Also, there is a huge amount of commercial ice cream available everywhere and selling it is very competitive. Gelato is a niche with much less competition, competing for a smaller market that is too small for most commercial manufacturers to enter.


-Is the location busy at peak hours, lunchtime, dinner and evenings? If the location is not really busy at these times, you cannot prosper.

-Car traffic is nice, but foot traffic is more important.

-If we are counting on car traffic, make sure that your location is easily visible from the street • Competition: How many dessert/ice cream shops are located nearby. But, having competition in the same area as you will dilute sales.


-Since gelato is an artisan product, made by hand, it does best in highly targeted locations where people can afford gourmet cuisine. Areas surrounded by office buildings, banks and close to upscale shopping are good.

-It is important to match your business goals to your investment capital.

MONEY SAVINGS: important to have a cash reserve of about 25% of the startup cost or enough to keep the operation going for at least 4-6 months, so that you do not run out of money before the business becomes profitable.


LOCATION: If you are located in an upscale area you should be able to charge about 12% more than elsewhere. Of course a big factor is how much ice cream is in a scoop but again, the competition will set the standard.

SCOOP SIZE: But scoop size varies tremendously. In America a 4ounce (112 gr.) scoop is normal but in Thailand a 2.5 ounce (70 gr.) scoop is typical

RENT à rent is probably the second largest expense you will have after cost of goods. Caution: businesses driven out of business because the rent was too high but this can also be because sales were too low! Furthermore, rent can be high because the landlord is gouging you or because the location is hot. A rough rule-of-thumb states that rent should be about 10-15% of projected sales. In the gelato business, we always recommend upscale locations—which have upscale rents.

SALES: So, if the sale-to-passers-bye is 3%, then if 10,000 people pass by your location during the day you will get 300 customers. If the rent is $1,840 Euros/month and you are making a gross profit of $2.80/scoop, you will need to sell 657 scoops/month to pay the rent. You are projecting selling 300 scoops per day @$2.80 each gross profit= $840 x 30=$25.200/month. 1,840/25,200=7% or selling 150 scoops/day is 14% so this rent is OK.

SPECIALTY: Since are making your own ice cream, vegetarian or vegan events are a prime source. Not many companies make a prime vegan or vegetarian ice cream! Also, offering a Light Line of sugar-free, healthy products is both unique and appealing.


What I have so far:





For a 1600 Square Foot Gelato Shop pays an average of 10% of their revenue for Utilities

-Electricity: $1000

-Gas: $50

-Water: $350

-40 Gallon Grease Trap (monthly):

Many county health departments require that grease traps be used for waste water containing dairy products. There are two issues with grease traps, first, it’s a $150 per month to have it pumped and the health department will track how often you are cleaning your trap.

-Linen Service (towels and mats) (Monthly) $80

The mats will have a grease build up and become harder and harder to clean.

100 towels and 4 mats picked up weekly.

-Phone Lines (2) (Monthly) and Internet (monthly): $180

2 phone lines are required for use credit cards and gift card processing.

-Lease expense – Common Area Maintenance: $425

The CAM expense comes with each lease and will be quoted to you above and beyond your lease square footage quote. Including CAM in utilities since it includes trash pick-up, building maintenance, landscaping, and some property companies even throw their property taxes into the CAM

-No business license shall be issued or renewed by the director and/or approved by the board unless the applicant has obtained all required public safety inspections for the business activity conducted, such as, zoning, fire, building, health, air quality, animal control or an(y) other inspection, license, certificate or permits for the profession, occupation, or business.

-Business License:

Business License for Gelato Shop:

-NAICS CODE: 722515

-License Category: Food Services – Restaurant & Other

-Fee Description:

-Cost of Nevada Business License: $200

Gen Gross

A gross fee license is a business license that has a renewal fee that is determined by the amount of gross revenue generated by the business. Per Clark County Code Section 6.04.005, Gross Revenue is defined as, “…all revenue received by the business from sales, service and other business transactions minus deductions only for returns, refunds, any tax on fuel or retail sales that is collected by the business, and discounts. The business may also allocate and apportion gross revenue pursuant to the formula set out in Clark County Code Section 6.08.100.”

-Renewal Due Date: April & October (Every Six Months)

-in addition to the license fees, all applications are assessed a $45.00 non-refundable application fee.

Average Yearly Premium For General Liability Policy: ice cream parlors in America spend between $500 – $1,200 per year

Factors will determine the price of your policy:

· Location

· Deductible

· Number of employees

· Per-occurrence limit

· General aggregate limit

Workers Compensation Insurance

· State law requires business owners to carry workers’ compensation on each of their employees. This coverage offers reimbursement for medical bills and a part of the employee’s wages while they recover from their injury or illness. If they decide to sue for additional damages, the policy would also offer legal representation and pay damages awarded to the claimant

Product Liability Insurance

· Product liability insurance is critical for every business owner that manufactures, supplies, or sells products. If a customer claims illness or injury due to a product purchased from your business, they could sue you for damages. This policy would cover awarded damages and associated legal fees.

· You can tailor product liability policies to the specific needs of the business


Commercial Property Insurance

· This type of business requires special equipment and a workspace tailored to its specific operating needs. If the building and its contents suffer damages from a covered loss, commercial property insurance would pay to repair or replace damaged items. Whether you own or rent, you can tailor this policy to meet the needs of your business. Entrepreneurs should discuss policy terms to ensure a policy covers losses at replacement cost and that there is no gap in coverage.





sales and marketing approach to sell our wide range of frozen yogurt flavors;

· Introduce our ice cream brand by sending introductory letters to residence, merchants in Las Vegas.

· Open our ice cream production company with a party so as to capture the attention of residence & college students who are our first targets

· Advertise our products in community-based newspapers

· List our business and products on yellow pages ads (local directories)

· Leverage on the internet to promote our ice cream brands

· Encourage the use of Word of mouth marketing (referrals)

· Give out loads of freebies so that new people can like our brand


Features and Amenities

· Bus Line

· Restaurant

· Dedicated Turn Lane

· Signage

· Pylon Sign

· Signalized Intersection

· Very Walkable

About the Property

The subject property is situated in the middle of the

University corridor just across from the Student Union building. The property

has been with the same owner since 1998 and has very unique and historical

Rebel architecture. Come join the many local tenants who have called this

center home for many years. Situated in the center of the University corridor,

the area continues to see new growth over the last year as new student housing

apartments are built near the Flamingo/Maryland intersection and University

Gateway mixed-use project just South of the subject site is developed. Campus Village just North of the

site was just purchased and future redevelopment may happen there as well as a

future light-rail system connecting Downtown and the University via Maryland


Total Consumer Spending:

-1 Mile: $271.15M

-3 Miles: $1.5B

-5 Miles: $4B


Have you decided to open a hand-made gelato shop or a gelato café? That means you too are passionate about gelato and moved by the desire to do something creative.

At last, everyone’s becoming aware that hand-made gelato is a healthy food in its own right, that it has great nutritional value, so much so that it’s moving away from being just a seasonal product to being something to enjoy during the winter or even as a lunchtime snack.

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