A Healthy Idea

1. A Healthy Idea Rimma Barran Joe Ceglia Adrienne Deeney Jaime Martin Bob Mason Cathy Hong Sun by

2. Agenda • Problem Statement • External Analysis • Business Idea • Hypotheses • Survey • Results • Lessons Learned • Conclusion

3. What’s the Problem • Currently, there is a un-served market in the Greater Delaware Valley for a fast food healthy alternative.

4. External Analysis • Economic Factors • Socio/Cultural Factors • Leading Competitors

5. Economic Factors • Economic Factors • Wealthier Americans are switching to healthier eating habits faster then those earning lesser incomes

6. Socio/Cultural Factors • Philadelphia fattest city in US • Gym membership • Today’s trends • Men eat away from home more then women

7. Leading Competitors • Saladworks • “Build your own” • Subway • 7 under 6 program • McDonalds • McGrilled Chicken • KFC • Rotisseri Chicken

8. MSA Demographic Report • Demographics for the Philadelphia Metropolitan Area • Data used to determine if this area is conducive to “putting a chain in the area” - not “where to put it” • Finding exact locations would involve more data mining relative to buying habits for health conscious consumers (ex: presence of health food stores, readership statistics by area for publications such as “Prevention” magazine) • Reviewed age categories, presence of children (traditionally a key driver in Fast Food categories), male/female, income, restaurant spending potential, and overall population

9. Population Statistics - Philadelphia MSA • Population 4,954,868 • Growth Rate < 1% • M/F Ratio 92.5 • Households 1,841,628 • Average Size 2.63 • Families 1,251,078

10. Age / Race Distribution Philadelphia MSA • 1998 Median Age 36 • 1998 Age Distribution • Under 18 22.3% • 18-24 11.4% • 25-35 21.3% • 35-64 31.2% • 65+ 13.8% • 1998 Race Distribution • % White 74.6% • % Black 19.6% • % Asian/Pacific Island 3.1% • % Hispanic 4.6%

11. Age Distribution Philadelphia MSA

12. IncomePhiladelphia MSA • Per Capita Income $22,890 • Median Household Income $56,285 • 1998 Household Income • $0-50k 52.3% • $50-100k 33.5% • >$100k 14.2% • 1998 Average Disposable Income $43,766 • Householder < 35 $38,930 • Householder 35-44 $47,623 • Householder 45-54 $55,135 • Householder 55-64 $49,353

14. Spending Potential IndexPhiladelphia MSA

15. Business Idea “ Providing a healthy, convenient alternative to fast food in the Delaware Valley at a price that is affordable, attractive, and profitable at the same time.” For example: Offer a Combo Meal of… cup of soup flatbread sandwich bottled water

16. Hypotheses 1. Women are more likely to frequent these establishments 2. Consumers will sacrifice taste for health content 3. Those people that exercise regularly are more likely to eat healthy 4. Those people that currently eat healthy are more likely to sit and eat within the establishment 5. Consumers under the age of 35 years are more likely to attempt to eat healthy 6. Those people with high household income are more likely to pay more for healthy food.

17. Survey • What • 27 Questions in Total. 10 were used to prove the Hypotheses, while the remaining were used to gain further insight of the potential market. • Why • To collect primary data • Who • 41 males • 61 females • Coworkers, classmates, family and friends • Where • Delaware Valley Area • When • April to May 2002

18. Survey Questions • Are you _ male or _ female? • Nominal, To Test H1 • What is your age? _under 18 _36-45 _18-25 _46 and over _26-35 • Ratio, To Test H5

19. Survey Question • Do you currently eat fast food? _yes _no • Nominal, To Gain Insight into the Market

20. Survey Question • Which fast food restaurant do you currently go to? _Mc Donalds _Subway _Boston Market _Burger King _SaladWorks _Wendys _KFC _Taco Bell _Chick-Fil-A _Arby’s _Other • Nominal, To Gain Insight into the Market

21. Survey Question • About how often do you eat fast food? _Once a week or more often _About twice a month _About once a month _About once 2-3 months _About twice a year _About once a year _Less than once a year _Don’t know • Nominal, To Gain Insight into the Market

22. Survey Question • Rank the following fast food attributes by personal importance. 6 being the most important, 1 being the least important. _Taste _Cost _Health content _Convenience _Promptness of service _Selection • Ordinal, To Test H2

23. Survey Question • How often do you eat food that are low in calories, non-fat, or vitamin enriched? _Once a week or more _Once every two weeks _Once a month _Almost never • Nominal, To Test H4 & H5

24. Survey Question • Eating healthy foods is important to you. • Interval – Likert, To Test H3

25. Survey Question • How likely would you be to frequent a fast food restaurant that sells a variety of healthy foods? _Very likely _Somewhat likely _Not very likely _Undecided • Nominal, To Test H5

26. Survey Question • What is your current household income? _Less than $25,000 _$25,000 - $50,000 _$50,000 - $75,000 _Over $100,000 _N/A • Ratio, To Test H6

27. Survey Question • What is the highest $ amount you would be willing to pay for a healthy combo meal? _$2 - 3 _$5 - 6 _$3 - 4 _$6 - 7 _$4 - 5 _$7 or over • Ratio, To Test H6

28. Survey Question • How likely would you be to eat within the healthy fast food establishment rather than buying to go? _Very likely _Somewhat likely _Not very likely • Nominal, To Test H4

29. Survey Question • How often do you exercise? _Almost never _Once a month _Once every two weeks _Once a week or more • Nominal, To Test H3

30. Hypothesis One • Women are more likely to frequent this healthy food establishment. • Tested using survey questions #2 and #13.

32. Hypothesis Two • Consumers will sacrifice taste for health content • Tested using Question 9

34. Hypothesis Three • Those people that exercise regularly are more likely to eat healthy • Tested by questions #12 and #27

35. Chi Square Analysis for Exercise 22 of Respondents Exercise less frequently 80 of Respondents Exercise More Frequently

36. Importance of Healthy Eating 8 Believe that Eating Healthy is Not Important 90 Believe that Eating Healthy is Important

37. SPSS Result for Hypothesis 3 Since our result of Significance is 0, which is less than 0.05, We could conclude that our Hypothesis “that those people that exercise regularly are more likely to eat healthy” can not be rejected.

38. Hypothesis Four • Those people that currently eat healthy are more likely to sit and eat within the establishment. • Tested by questions #11 and #24 Since the Significance is 0, which is smaller than 0.05, We conclude our Hypothesis cannot be rejected.

39. Hypothesis Five • Consumers under the age of 35 are more likely to attempt to eat healthy • Tested using questions #3 and #11

41. Hypothesis 5 Chi-Square Since the Significance is 0, which is smaller than 0.05, We conclude our Hypothesis cannot be rejected.

42. Hypothesis Six • Those people with high household income are more likely to pay more on healthy food • Tested by questions #21 and #22

44. Hypothesis 6 Chi-Square Since the Significance is 0, which is smaller than 0.05, We conclude our Hypothesis cannot be rejected.

45. Lessons Learned • Pretest • Changes made • Font was too small • Question 4 should not skip to question 6 • Question 5 should not use the phrase fast food • Question 6 should have a skip if not applicable • All of our questions should have the same scale

46. Lessons Learned • Learned to use SPSS • Useful in the workplace • Learned to collect primary data • Deal with the public

47. Conclusion • Food Services Industry • External Focus • Research and Data Analysis • Promising Outlook