Vending Machine business is characterized by its simplicity in terms of organizational and operational process. The key issue arises due to the placement of the machines in the most haunted places, but not due to the operations management. So, this business project is founded by 4 people and roles and responsibilities were given accordingly:
1) The CEO, Alibek Abdygapparov, is a founder of this idea. All the necessary negotiations with suppliers and wholesalers are performed by him since he has a good experience in this field (he controls a small shop – family business). Moreover, this role was given to him due to his leadership skills.
The accountant, Aidana Baigutanova, has a major in accounting and audit, and she passed practice at KPMG, Almaty. Therefore, she is skillful in accounting and she knows how to work within this sphere.
3) The vending operator, Saida Dagubayeva and purchasing agent, Ainur Alimbetova, together perform important technical work. Due to the devaluation and financial crisis, they always are seeking for the suppliers and wholesalers who charge the lowest price for the products. Moreover, vending operator everyday has to fill up the vending and coffee machines. Usually once a week, Ainur goes to the wholesale market places to purchase necessary products and checks the situation on the market. And, one should note here that they both have cars and it is very convenient in terms of delivery and transportation. They are both good at brainstorming and marketing, and the above provided idea about “Corny and Fitness” was implemented by them.
The reason for the lack of such roles as marketing or management assistants is due to the type of the business – it does not require such experts in this field because it is very costly to do so. Therefore, the ideas for the further development are usually discussed together.
Total Development Budget
· Production costs (DM, DL, MOH)
Since the business is all about providing the services, production costs will not be incurred. However, cost of the products will be shown in the next section of the business plan.
· General & Administrative costs
The business is founded by 4 people, who will perform above mentioned activities. Therefore, there is no need to hire additional employees in the early stages, so salary expenses will not be incurred.
· Marketing (advertising) costs
As it was mentioned in previous sections, the business will not incur rental costs due to mutually beneficial agreement, however, advertising costs per month = KZT 7000will incur anyway.
In addition to this, marketing plan generated for the attraction of the potential audience will require KZT 20,000for “Corny” and “Fitness” energy bars.
· Delivery and transportation costs
Since the vending operator and purchasing agent perform their work using their own automobiles, the costs incurred for the transportation of the products, and for everyday filling the machines are KZT 4,000 and KZT 8,000respectively.
In total, transportation costs per month = KZT 12,000.
· Capital equipment
Both VM and Coffee Machine are to be purchased here in Almaty from Kazakh Vending Company (KVC). By contract, the KVC Company provides 1 year guarantee on both machines and they made first installation and delivery for free.
Ø Price of Vending Machine = KZT 720,000
Ø Price of Coffee Machine = KZT 345,000
Overall, the Total Cost of the project with initial purchase of the machines and initial marketing costs (in KZT) are computed in the following way:
The main risk is that VMs will not be popular among the football players because firstly they can bring some food with themselves, and secondly that after exhausting training they might want to eat proper hot food and go to competitors, like cheap cafes/canteens (Doner, Kaganat etc). In case if it happens, possible alternative customers are football fans, who are not involved in physical activities and are most likely to buy snacks.