1 Rationale of selecting the business

1.1 Business idea

In the current market different flavours of ice-cream can be found. But when it comes to fruit
ice-creams, there are only a limited number of flavours. The existing flavours that can be found
are, strawberry, mango etc. Those flavours do not cover many flavours of fruits that are
available in Sri Lanka. Therefore, our idea is to introduce a range of ice-creams of different
fruit flavours that are not existing in the market.

The concern on healthy eating has been rapidly increasing over the society. Through this
context, we have gone through several product offerings which do contain artificial food
flavours. Here, we are considering on the ice cream manufacturing and its flavours. Basically,
most of the ice cream brands available in Sri Lankan market have been added artificial food
flavours rather than natural food flavours.

Therefore, our ideas have been brought forward to come up with ice cream, which contains
only real fruit flavours. So that, it is supposed to add nutritional value towards the core product
of ice cream rather than which have manufactured using artificial flavours. Moreover, we are
supposed to introduce the flavours which are not widely available in Sri Lanka, and very
essentially all of the flavours made out of real fruits. According to o ur market survey, there
will be demand for the identified flavoured namely Bael fruit (Bali), Banana, Pineapple and
Avocado. It is expected to record best demand for Avocado flavoured ice cream.

We differentiate our product with the existing ice cream by highlighting the nature of flavours
as to the real fruit (natural) flavours. Therefore, in a broader context, the potential market for
our product can be identified as the all who are health conscious. Even though, at the initial
stage, the target market for our product will be the university students who consume ice-cream.
Our ultimate business idea is to introduce an ice cream range, which contains real fruit flavours.

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1.2 Feasibility study
1.2.1 Market feasibility
Current Market Analysis
Ice-cream industry is a very popular and a profit making industry all over the world. At
present, we have some leading ice-cream producers in Sri Lanka. But they have focused
only on some flavours of ice-cream. The prevailing flavours such as mango, strawberry
and fruit and nut only covers a certain range of fruits that can be found in Sri Lanka.
Therefore, we are planning to introduce the other flavours of fruits that are not already
existing.

Anticipated Future Market Potential

Consumers are always interested in trying out new and different products. People like
to taste different flavours from time to time. From a survey conducted by us, we found
out that out of 70 respondents 69 respondents were willing to try out the new flavours.
Therefore, we can anticipate that there will be a high demand for our product as people
are interested in trying out new flavours and also as our product contains real fruits with
a nutritious value as well.

Potential Buyers
Our target market would be people who like to have ice-cream as a dessert or at any
other event. At the first stages our target market will be the u niversity students who
consume ice-cream. We will be supplying the ice-creams to the university canteens and
cater to the crowd at universities. Therefore, at the initial stage we would focus on
catering to the demand arising from the university and gradually expand our focus on
wider markets by distributing them to super markets.

1.2.2 Operational feasibility

Sri Lanka is a country blessed with cultivable land and has an abundance of fruits throughout
the year. This ensures easy access to all the fruits we are planning to use in our product. Except
avocado all the other fruits can be found all throughout the year. And the team members are
able to do the manufacturing at this level so that can be done without the need of any paid
labour. As the product is a food product a food certification can be obtained to assure the quality
of the product.

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1.2.3 Financial feasibility

This ice-cream is made out taking real fruits as a base. Therefore, to assure the quality and the
fact that real fruits are included, the cost of the product will be on par or a little higher than the
existing ice-cream products. And we would be pricing the product accordingly to make profits
out of the product. A collection is made with the contributions of the team members to
manufacture the product at the initial stage. As the demand for the product increases with time
we will be able to increase the supply at a larger scale.

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2 Company overview
2.1 Introduction

"Fruitco" is a real fruit ice-cream that introduce an ice-cream range to the market in the flavours
of beli, avocado, banana, anoda and pineapple. The existing ice-cream brands are full of
artificial flavours and we are providing a solution for that through the introduction of our
product range "Fruitco" to the market. It is completely produced of real fruits and no sugars
which makes Fruitco a healthier option for the customers.

2.2 Legality of the company

Our company is a partnership of eleven members. The law governing partnerships in Sri Lanka
is the Partnership Act of 1890. The Sri Lankan Companies Act No.7 of 2007 limits the
maximum number of partners as twenty in a partnership. This company is consisted with eleven
members which is conforming with the act which means it is not necessary to register under
the Company Registrar.

Each partner invests in the company with an initial investment of Rs.5000. Therefore, it is
written as a document and signed by the members for future reference according to the section
18 of the Prevention of Frauds Ordinance No. 7 of 1840.

2.3 Vision

To be known as the only natural ice-cream brand in Sri Lanka while serving the customer with
the ultimate ice-cream experience.

2.4 Mission

To provide a range of quality products that exceed the desires of the customers by ensuring that
all the fruits are natural and healthy for the customer.

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2.5 Business model

In order to understand the business model, we have used the business model canvas. This maps
out our business idea, allowing it to be understood, tested and improved.

Key partners Key activities Value propositions Customer relationship Customer segments

-Team members -Manufacturing -Healthy -Maintaining long term University of

(in production relationships with the Colombo
-Packaging -Real fruits
and raw material customer
supply) -Labeling -Low prices -Undergraduates
-Understanding the desires
-Distribution -High quality -MBA students
-Raw material and needs of the customer
suppliers (once Key resources -Meeting the Channels -Academic staff
the demand customer needs
-Non-academic staff
increases)

-Team members Direct marketing

-Location of -Word of mouth

production-
-Whatsapp status
Diulapitiya
-Group chats
-Equipment such as
-FB and messenger stories
beater and
refrigerator
Cost structure Revenue streams

-Equipment Selling price per cup-Rs. 50

-Wages

-Raw materials

-Fruits

-Plastic cups

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2.6 Value proposition

"A healthy real fruit ice-cream experience at a considerable price."

We provide a range of real fruit ice-creams at almost the same price as of our customers. But
how we stand out from them is by including real fruits in our product without simply opting
for artificial fruit flavours.

2.7 Team competences

The opportunity identified was put into execution with considering the competences of the
team members.

Name of the student Competency Role

Wijerathne M. M. K. S. Leadership skills, presentation Leader

skills, Ability to coordinate
people
Rathnayaka R. M. C. L. P Ability to coordinate with Secretary
people, sound knowledge in
project management
Pathirana B. A. P. D. S Financial management skills, Treasurer
Follows Business Level at the
ICASL
Anuradhika K. A. C Designing skills,Creativity, has Production planning
good knowledge and
experience of making the
product previously
Chanaka D. S. H Technical skills, creativity, Technology
designing skills
Dimanthika S. P. I Coordinate well with people, Customer relations
commu nication skills,
interpersonal skills

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Ediriweera T. T Ability to work with and Human resources
coordinate with people,
interpersonal skills
Madhavi W. M. R Pays attention to little details, Quality assurance
has a sound knowledge about
SLS and quality requirements
of products
Pathirana K. P. D. D. M Ability to influence people, Marketing and
Good commu nicating skills, promotion
innovative

Tharuka S. H. D. J Financial management skills, Budgeting

experience in an audit firm,
follows business level at
ICASL
Wijerathna S. S. K Good networking with people, Supplier connections
supplier connections

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3 Product and Service plan
3.1 Description about the product selected

Fruitco real fruit flavors ice cream is new product for Sri Lankan market. Our product is special
among the current flavored ice cream. Because we produce ice cream using real fruits. Current
ice cream flavors do not cover many flavors of fruits that are available in Sri Lanka. Therefor
we introduce a range of ice creams of different fruit flavors that are not existing in the market.
Fruico ice cream, which contains only real fruit flavors. So that, it is supposed to add nutrition
value toward the core product of ice cream rather than which have manufactured using artificial
flavors. We planned to introduce the flavors which are not available in Sri Lanka. We
producing ice cream using real fruits natural flavors namely Bael fruit (Beli), Pineapple,
Avocado, Banana and Anoda. We are supposed to differentiate our ice cream with the existing
ice cream by highlighting the nature of flavors as to the real fruit flavors.

Current context many people consider healthy eating products. Therefore we thinking our ice
cream product is great support to people for healthy eating. Because many existing ice creams
in Sri Lanka manufactured using artificial flavors.

3.2 Features of the product

Suppliers: At the initial stage we plan to take fruits from our group member's houses.
Furthermore increasing our business we suppose to purchase fruits from Colombo Manin
Market. Also milkmaid and wiping cream we plan to purchase from super markets.

Product: Fruitco ice cream is targeted all of people they interest in changes of ice cream flavors.
Current market have limited flavored ice cream and artificial flavored. Therefore our product
is introduce Sri Lankan natural fruit flavors of ice cream.

Retail ventures: Initially we sell our product at university premises. We hope to sell our product
all faculty canteens. Next we hope to distribute our product through juice bars, restaurant in
Colombo region.

Internet ventures: We hope to advertise our product details through Whatsapp status and
Whatsapp massages among the university students.

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3.3 Product strategy

Fruito ice cream which made using natural fruits. We will be provide healthy food product.
Current context all of ice cream products are manufactured by using artificial flavors. Also
these products have few flavors. We are produce range of ice cream which have different
flavors. That flavors are not existing in the Sri Lankan ice cream industry.

Our product is healthy product and it is create a new change for customer taste. We use our full
knowledge and experience to attract customers and distribute our ice cream among the people.
Also we use our adequate knowledge and experience to manage the cost and to improve the
product and manage future risk that may arise in the market.

3.4 Benefits of the product

Good for healthy life

Our ice cream is healthy product, because we produce ice cream using real fruits. Artificial
flavors are very harmful to human body. Therefore, our product is support to healthy body.
Real fruits add nutritional value to the ice cream.

Customer can consume fresh products

We don't use preservatives to produce Fruitco ice cream. Therefore, customer can eat fresh
products.

Range of ice cream

We produce range of ice cream which have different flavors. Existing market have few flavors
of ice cream such as Vanilla, Chocolate, Strawberry, Mango and Fruit and nut. But we produce
different fruit flavors existing Sri Lanka. Also we produce ice cream using fresh fruits.

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4 Environment and industry analysis
4.1 Industry Analysis

An industry analysis is a tool which conducted reviewing the market factors in which the
product will be developed. The Porter's five forces model is used to understand the competition
and potential profitability of relevant industry. It helps to identify threats and opportunities and
problems facing their business. Major factors that are analyzed through the model are suppliers
and bu yers, the condition of competitors and the possibility of new market entrants.

Our business idea is related to produce ice cream in different fruits flavour. Porter's five forces
model is used to determine position of our company relative to other substitutes companies.

Competitive rivalry

Within the ice cream industry there are many substitutes available for our product. Also there
are large number of ice cream shops existing in the current market place. Beside there are well
established loyal brands in the market. Such as Elephant House, Cargills Magic, Highland,
Palwatte and etc. Therefore, can be identified there is high level of competition for our product.

Supplier power

Supplier bargaining power usually comes through competitive force. The power of the
suppliers in this industry is very feeble. An ice cream is produced with milk and fruits. There
are huge suppliers for milk and fruits. Therefore, it will be easy to choose a supplier and it is
also facilitates to mover from a new supplier due to the large number of it. Therefor we can
recognize suppliers do not have power for the bargaining over the companies.

Bargaining power of buyers

The power of the bu yers can either increase or decrease a firm's profit. According to the
product we offer, the bu yers are often a demanding a lot. They want to bu y the best offerings
available by paying the minimum prices as possible. This puts a pressure on our product
profitability in the long run. In this industry there are lot of alternative product. Therefore,
consumer have more power to switch to that product. Because of that can be identified power
of bu yers is high within this industry.

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 Threat of Substitutes

Here, the threats from substitutes are comparably high because ice cream which is easily
available anywhere in the market. and can have a threat by its substitutes. There are lot of
substitutes for ice cream as a dessert. Such as Yogurt, Fruits, Sweets (chocolate, caramel,),
Pudding, and etc. moreover Milk, Fresh drinks are also considered standard substitutes for our
product.

Threats of new entrants

Entry into the market by small firms can be high and quick. But when a company wants to
established itself in this industry, there are lot of things to consider before doing so. In this
industry well established brand names for ice cream. As results there are many threats arise to
new comers. Therefore, they have hard time to get the customers. We are going to introduce
range of fruit flavor ice cream. Their ingredients easy to find and we use easy technology.
Therefore, new comers easy to enter into the market. We can identify threats of new entrants
is high for our product but also if we consider the giants of the industry we can also say that
smaller companies wouldn't want to enter and face the competition.

4.2 Environment analysis

4.2.1 SWOT Analysis
Strengths

• There are different members in our groups with different backgrounds and various types
of abilities. So we can easily face the challenges by overcoming the barriers.
• According to the team members' skills and ideas we can improve the product quality
and efficiency.
• Our product ranges have different flavours of the Ice cream.
• Availability of fruits at a low cost most of the time of the year.
• This fruits have various nutrients.
• The members have various connections and strengths that make the team resourceful.

Weaknesses

• We have fear of failure of innovation in the market.

• Team members have lack of experience on that project.
• We have to concern about more things since we prepare a food product.

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Opportunities

• Ingredients of the product can be supplied easily.

• We can offer quality product to the customer with concessionary price to increase their
satisfaction.
• High customer base available in the market.
• People prefer to consume various flavours of Ice cream.
• People tend to consume more nutrients products.
• These flavours oflce cream don't exist in the market.

Threats

• Products can be easily imitated by rivals.

• Stronger brand names of potential competitors.
• Lack of the advance technology.
• There are high legal impacts to Ice cream because it's directly affecting to consumer
health.
• It takes more time to change the consumer behaviour because they are already familiar
with the existing brands.

4.3 External environment analysis

Political Environment

We plan to introduce new flavored of the ice cream it is not existing Sri Lanka.
Government is mostly concerned about the consumers' protection. Therefore they
introduce many policies such as food certificates. Government always try to encourage
new entrepreneurs. Therefore they have a positive manipulation from the political
environment.

Economic environment

We introduce new product to the economy. It will generate new jobs. If we start this
business in a large scale it may help in reducing unemployment level in Sri Lanka.
Before introducing a product we should consider about the ingredients prices of ice
cream, equipment prices, wages rates, substitute and complementary products in the
market.

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According to the analysis of this product, ice creams that are flavored in these fruits not
available in Sri Lanka. It will be a good opportunity for us. We should be more
considerate about our ingredient quality and suppliers.

Social Environment

This product provides a new taste to the society. Therefore, we study about the current
market situation before lau nching our product. Current market has few flavors of the
ice cream. We producing various fruit flavors provide a new tasty and new experience
to the consumers.

Technological Environment

We need some technological support to our product. Technology helps to produce

quality product to the consumers.

Environmental environment

This product producing process may less harmful activities to the environment.
Container of the ice cream is a plastic container. It is one and only harmful thing to the
environment. But that container can be reused for domestic work.

Legal environment

In the current situation we mostly think about the environmental protection and
consumer protection. Therefore, we have to adhere to some legal rules and regulations.
There are many rules and regulations in the Sri Lanka for food products Such as SLS,
ISO 22000, HACCP and etc.

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5 Marketing plan
5.1 Customer Research
5.1.1 Customer Survey

Consumers are always interested in trying out new and different products. People like to taste
different flavours from time to time. From a survey conducted by us, we found out that out of
70 respondents 69 respondents were willing to try out the new flavours. Therefore, we can
anticipate that there will be a high demand for our product as people are interested in trying out
new flavours and also as our product contains real fruits with a nutritious value as well.

The results of the customer survey are drafted bellow on the customer preference for different
flavours;

50.00%

40.00%

30.00%

20.00%

10.00%

0.00%
Avacado Beal Fruit Pineapple Banana Anoda

5.1.2 Feedback from the potential customers

We were able to obtain feedback form few selected potential customers on "Fruitco", real fruit
ice-cream. Their preferences on the different flours were in line with the results, which obtain
from the customer survey. Meantime, a suggestion has given for the new product as to come
up with a green package.

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5.1.3 Mock demonstration of the concept

5.2 Target Customer Strategy

The customers for the "Fruitco", real fruit ice-cream will be the ice-cream consumers, who are
expecting nutritional value rather than the core product. Customers are not thinking of
nutritional value of ice cream. But our efforts will able to highlight the importance of the
intended product. Merely, an ice cream is only satisfying the tasty requirements. The product
is go beyond the core usefulness of the product. Therefore, the customers will able to enjoy
the taste, while taking something nutritious.

Simply, the target customer strategy of Fruitco, real fruit ice-cream is to focus on the ability of
the Fruitco to add nutritional value towards the ice cream.

Our target market would be people who like to have ice-cream as a dessert or at any other
event. At the first stages our target market will be the university students who consume ice
cream. We will be supplying the ice-creams to the university canteens and cater to the crowd
at universities.

Therefore, at the initial stage we would focus on catering to the demand arising from the
university and gradually expand our focus on wider markets by distributing them to super
markets. According to the survey conducted and the feedback form the potential customers, it
is expected for a positive a trend in bu ying decision of the Fruitco ice cream.

15
Meantime, the customer understanding on our product concept is at a considerably high level.
Since, 99% of the ice cream consumers are willing to purchase Fruitco ice cream and they
understood the importance of the product concept. The customer value addition from the real
fruit ice cream is greater than the floured fruit ice creams, which are available in the existing
market.

5.3 Channel Strategy

The following planned marketing channel strategies are supposed used for enhance the
awareness of the product and enhance the bu ying decision.

Social media marketing

Internal groups of Facebook, Instagram, WhatsApp and all other chat groups that are consisting
of university students can be used to promote the Fruitco ice cream. It is expected to display
WhatsApp flyers to make aware the availably of the product.

Direct marketing

Direct marketing can be one in conducting awareness stalls to make aware of the product, just
before make available the products the canteens.

Banner advertisements within u niversity premises

It is expected to display banners of the Fruitco ice cream for the purpose of enhancing
awareness among the university students.

Promotional campaigns

For accelerate the sale, we can introduced promotional campaigns such as free issue for bulk
purchase. For an example bu y 4 ad get 1 free.

5.4 Positioning

The Fruitco ice cream is able to position at the market, where healthy eating is targeting. The
concern on healthy eating has been rapidly increasing over the society. Therefore, the growing
demand for foods, which are adding nutritious value and eliminating or minimizing the
artificial ingredients usages is observed. Accordingly, Fruitco ice cream will lead for a unique
positioning in the competitive market for ice cream in near future, by highlighting the use of
real fruit flours.
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5.5 Branding Strategy

None of ice cream brand in the market says as to nutritious, since those ice creams are
consisting of artificial flours. However, Fruitco ice cream is going to be a product which fully
manufactured using real fruits. The brand name, Fruitco itself send notification on the term
fruits. Moreover, the slogan of real frusut ice cream is used to create a unique brand image
towards Fruitco. Accordingly, the Fruitco brand leads a unique brand recognition among rest
of the ice cream brands.

The branding strategy of Fruitco ice cream is supposed to focuses on passion-based insights to
creative solutions. Further, growing concern on healthy eating can be addressed using the
branding strategy. Therefore, branding strategy of Fruitco ice cream can be considered as a
brand which creates a memorable brand experience.

The planned brand strategy is focusing on developing a brand personality for Fruitco. The
customer perception for Fruitco is expected developed with the attribute of healthy foods.

5.6 Pricing Strategy

According to the cost analysis, the selling price is set at 50 rupees for an 80ml ice cream cup.
The minimum price of the competitive brands for the same product (80ml ice cream cup) is 50
rupees. According to the customer survey, customer are willing to pay 50 rupees for an 80ml
ice cream cup. Since, the value addition of the product is greater than the product, which
manufactures with artificial flours.

Whipping cream 4L of ice-cream

1OOOml
4L of ice-cream
Milkmaid 800ml
Size of the cup - 80ml

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 Flavour Whipping Milkmaid Fruit (Rs.) Cup with Cost per Cost per
cream (Rs.) label cup without cup when
(Rs.) (Rs.) purchasing purchasing
fruits from fruits from
outside outside

Bael Fruit 19.50 9.00 10 4.50 33 43

(Beli)
Avacado 19.50 9.00 13 4.50 33 46
Pineapple 19.50 9.00 4 4.50 37 37
Banana 19.50 9.00 5 4.50 33 38
Anoda 19.50 9.00 7.50 4.50 33 40.50

The pricing strategy should have to be covered the total cost of production, while maintaining
a decent profit margin.

5.7 Internet Strategy

As the internet strategies, our initially focus is only on social media campaigns such as groups
of Facebook, Instagram, WhatsApp and all other chat groups that are consisting of u niversit y
students. Because, at the first stages our target market will be the university students who
consume ice-cream and we are supposed to supply the ice-creams to the university canteens.
Therefore, social media is using as the internet strategies to promote Fruitco.

It is expected to develop a website with the enlargement of the business. So that, it can be used
to facilitate e-commerce using the web site.

5.8 Communication Strategy

The following communication strategy are supposed used for enhance the awareness of the
product and enhance the buying decision of potential customers. At the initial stage, our target
market will be the university students who consume ice-cream and we are supposed to supply
the ice-creams to the university canteens. Therefore, our communication strategy is focus only
on university students, and mostly limited within the u niversity premises.

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Social media marketing

Internal groups of Facebook, Instagram, WhatsApp and all other chat groups that are consisting
of university students can be used to promote the Fruitco ice cream. It is expected to display
WhatsApp flyers to make aware the availably of the product.

Banner advertisements within u niversity premises

It is expected to display banners of the Fruitco ice cream for the purpose of enhancing
awareness among the university students.

5.9 Sales Strategy

The concern on healthy eating has been rapidly increasing over the society. Therefore, the
growing demand for foods, which are adding nutritious value and eliminating or minimizing
the artificial ingredients usages is observed. Accordingly, Fruitco ice cream will lead for a
unique sales strategy in the competitive market for ice cream in near future, by highlighting the
use of real fruit flours. Meanwhile, the target customers are university students, who have a
right understanding on the product concern. Therefore, the sales strategy is supposed to
successful in the market.

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6 Operations plan
6.1 Production process

Initially we had to do the production at Dinesh's home it is located in the diwulapitiya. We

selected his house because they have retail and wholesale shop. They have a freezer also. The
ice-cream will be made based on three main ingredients. They are heav y whipping cream, fresh
fruits and sweet condensed milk. The speciality of the ingredients of our product when
compared with other leading brands is that we are not adding any sugars separately. Those
ingredients will form the base of the product and 100% natural and real fruits are combined to
bring out different flavours in the ice-cream.

Value chain and networking with external parties

I
11
l I =============Pr=oc=ur=em=e=m================

Outbound Marteting &

Opera ·a s Logistics Sales

------ PRJMARV ACTIVITlfS- -----

Value chain elements are very important to plan the business. The value chain activites can be
divided into two types; primary activities and support activities.

• Inbound logistic is where purchased inputs such as whipping cream, fruits, sweet
condensed milk, cups etc. inbound logistics is important to keep contact with external
companies such as suppliers and delivery agent.

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