Cherbet House Co.,Ltd.

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Acknowledgement

This project would not have been possible without the guidance and the help of several individuals who in one way or another contributed and extended their valuable assistance in the preparation and completion of this project.

First and foremost, my utmost gratitude to Mr.Chaiyawat Thongintr, professor of the Mae Fah Luang University whose sincerity and encouragement we will never forget. Mr.Chaiyawat has been our inspiration as we hurdle all the obstacles in the completion this project.

-Miss Supannika Khwanmuang, doctor's degree student of Chulalongkorn University who had kind concern and consideration regarding to give our project requirements the suggestion;

-Mr. Saroj Inthep, the owner of Coffee hut café for his patience to give all his business information and steadfast encouragement to complete this project;

-Work@home café, Le petit, Lalar, U-Hu, Era 127 for give us the opportunity to learn their business and compassionate concern for our project;

-The Chaingrai schools student, people and tourist who kind to answer our questionnaire and interview;

-Chiang Rai Tourism Service Center for generous to give the tourist information;

Last but not the least, Business administration colleagues and our team, for kind and their patience to work in this project and encourage us in completion this project

Chureemart Tibkaew Wanwisa Sanboonrat Supansa Donlao Sakuna Chitnoi Atitaya Ruengroeng

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4.1.1 Product Characteristics ... 81 4.1.2 Services Process ... 87 4.1.3 Location ... 90 4.1.4 Facility Layout ... 91 4.1.5 Machine/Tools/Equipment ... 95 4.1.6 Logistics Management ... 108 4.1.7 Facility Management ... 110 4.1.8 Machine/Tools/Equipment ... 112 4.2 Cost of investment ... 120 4.2.1 Pre-Operating cost ... 120 4.3 Investment Cost ... 131

4.3.1 Equipment and tool ... 131

4.3.2 Depreciation ... 134

4.4Management Analysis ... 141

4.4.1 Organization Management ... 141

4.4.2 Organization Chart ... 141

4.4.3. Administration Cost ... 145

4.5 Technical Feasibility Conclusion... 157

Chapter 5 ... 158

Financial Statements... 158

5.1 Statement of Income ... 158

5.2 Statement of Cash Flow... 164

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Chapter 6 ... 175

Risk Management ... 175

6.1 Risk Analysis ... 176

6.1.1 External risk ... 176

6.1.2 Internal Risk ... 178

6.2 Conclusion of Risk management ... 186

Chapter 7 ... 187

Summary ... 187

7.1 Summary of Project Feasibility Study ... 188

Bibliography ... 192

Appendixes ... 195

Appendix 1 ... 196

Company Limited Registration ... 196

Appendix 2 ... 206 Fire Insurance ... 206 Appendix 3 ... 211 Financial Risk ... 211 Appendix4 ... 302 Interview Format ... 302

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Chapter 1

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1.1Background and Significance of the project

Thai People are now increasing interesting in bakery. One of that reasons is getting influential from the western like French or America even though in Asia nation like Japan or Korea (BCC 2010). The trend of the beauty and delicious bakery are becoming popular especially in Bangkok where is highly leading trend in Thailand.

This bakery is identifying to the new form. It is not be exactly cake or ice cream, it is mainly mixes of Bread, Ice Cream and Fruity and it’s become the beautiful form of design and makes it unique with the other bakeries. Additional with the decoration of the bakery shop, people now like the modern style or the unique styles, they like to building sociality, network or relax time to meet with each other. As a result, this business is becoming popular now.

Normally, people still just know as cake, ice cream or Thai desert. This one is a development and adaptation form generally bakery (KungThaiBank 2010). Chiang Rai is the target location when considerations to open this kind of bakery shop because the trend is coming to as notice that there are a few shops opened there. Now it has 4 directly shop. There are Le patite, Work at home café, Au Ho and Layla. It means that few competitors if comparable with the other locations.

Moreover, form survey resulted in the old shop in Ching rai have been adapting the menu like a mixing bread, fruit and ice cream together but having different in our menu style.

Additionally political, economical also supported. Chiang Rai where is far away form the violation like the protestor protest in Bangkok and Chiang Rai is the final destination for the tourist who are one part of our target group and continuously growth (Tourism,

Tourismchiangrai 2009). Moreover, Coffee shop have continuously been opened in Chiang Rai

and bakery always come along with them by itself but still show up on the original one like cakes. Thus, this is an opportunity for us to making a development one and creates the difference of both product and the atmosphere of the shop.

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1.2Project Objectives

- To analyze the risk which possibility happened when doing bakery business.

-To analyze trend of bakery in Chiang Rai.

- To study the feasibility of market share expendable. -To study customer behavior who prefer to buy bakery.

- To Summary of the feasibility of Bakery business in Chiang Rai

1.3 Benefit of project

- Students can identify the opportunity to do a project which based on reality information.

- Students can apply all knowledge of business management for using in this project.

- Knowing the current situation and how to run the bakery business in the future. - Getting the opportunity to do the dummy business before run the real

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1.4 Activities/Time Frame

Table 1: Time frame November 2010 to February 2011

Operations Methods

November December January February

W 1 W 2 W 3 W 4 W 1 W 2 W 3 W 4 W 1 W 2 W 3 W 4 W 1 W 2 W 3 W 4

1. To study the general of bakery business in Chiangrai. 2. To study management in bakery business.

3. To study competition analysis and marketing feasibility.

4. To study the technical process in bakery business. 5. To study the financial feasibility of bakery business. 6. To study and analysis risk of bakery business in Chiangrai.

7. Making advertising to promote the shop.

8. Grand opening the shop. 9. To Summary the feasibility of bakery business in Chiang Rai.

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Chapter 2 INDUSTRY PROFILE

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2.1 Nature of Industry

Despite the historical role of bread in a number of culinary cultures, the bakery products market is generally benefiting from a global trend towards the breakdown of traditional eating patterns. The trend towards urbanization resulted in accelerated consumer lifestyles, increasing numbers of women in the workforce, the fragmentation of traditional family structures and an increase in single-occupancy households. Recent new product developments are indicative of consumer demand for products that ease the effects of increasingly busy lifestyles and the consequent constraints on food preparation and shopping time that affect consumers.

One could say unnecessary, but indispensable may be the best definition to describe bakery products that have provided pleasure to the consumer for a long time. Meanwhile the industry continues to grow. Due to factors of each region, the segment expansion and product development portfolio are different. According to the Business Insight, the expected average growth during 2008-2012 is approximately 2.9% per year. Emerging markets in the Eastern Europe and Asia will show an important role. Consumers will increasingly focus on health, ethical and environmental issues. Healthy and premium confectionery products will provide an opportunity for manufacturers. (Business Insights,2009)

The bakery manufacturers attempt to deliver products with new flavors with a variety of appearances and tastes. According to a report of the National Confectioners Association (NCA

in 2009), outstanding products in such trend include chocolate products, healthy products, fruit,

Ice cream, flavor combination products and exotic flavors.

Generation Y and baby boomers are interesting in new flavors of fruits from around the world such as mango, and banana. In addition, consumers show interest with innovations such as salted caramel and chocolate flavor. More recently, spiced ingredients became popular in bakery (especially chocolate and Ice cream), such as cardamom and ginger. Current consumption of natural products still plays a role in bakery. New products and ingredients are developed based on the naturalness. Popular fruits are berries; raspberry and cranberry, while other ingredients such as honey and lemon follow (NCA in 2009),

Young generations are not only need a good taste food but they still want to feed their heart. By the atmosphere of a restaurant they can sit and eat for a long time. It is considered as a place to relax when tired after the finished work. Restaurants need to decorated and create a

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"theme" and "character" to meet the lifestyle of customers. Give them delicious meal in every meal to attract the customers. "Concept" has become a core strategy for today's restaurant. If comparable restaurant is the "product" So it must have "flavored" Packaging or Design to look pretty to attract the customers. After the 3-4 years ago, the restaurant business is high-end Market type. Restaurants must have clear "themes" and a character. The shop service is determined by the shop design. Casual atmosphere or the third place is the trendy decoration shops and very popular to entice customers to spend time in the shop longer. Cause effected to customers to increased spending. In addition, “the style of food” will determine the format of the stores clearly. More firmly concept and theme can make the brand is trendy in customers’ heart easily.(BizWeek, 2006)

In general, the shop is separately types of bakery like some shops provide only cake; some shops provide only bakery and some shops provide only ice cream. Moreover, there are much of shops where provide as the same things which can not identify as their shop. For example, Blueberry Sheet cake if think about it, it easy to find in wherever because there are a little bit in test and character. So, we can say that it does not mush of differentiations. But in recently, many shops are becoming adaptation by mixing of these bakeries together according to the trend of consumer behavior.

The trend of the beauty and delicious bakery are becoming popular especially in Bangkok where is highly leading trend in Thailand. Recently, it is coming to Chiang Rai which now there are 4 shops continuously opened which provide both citizen and foreigners. So, it showed that people in Chiang Rai province are interesting consumed this desert.

The popularity of bakery has changed over the years. It must be a combination of fruits and bakery to be interesting and palatable. Therefore Cherbet house cerate this bakery is identifying to the new form. It is not be exactly cake or ice cream, it is mainly mixes of Bread, Ice Cream and Fruity and it’s become the beautiful form of design and makes it unique with the other bakeries. Additional with the decoration of the bakery shop, people now like the modern style or the unique styles, they like to building sociality, network or relax time to meet with each other. As a result, this business is becoming popular now.

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Figure 2.1

2.2 Situation of Industry

Nowadays there are m

popular and has a lot of customers to

cafés is responding to customer needs by providing

decorated the shop like the studio to support the customers feel relax and take a photos suitable for customer lifestyle. Moreover

provided and Social network to meeting with friends price of products. From the popular make the

companies try hardly to create their own strategies and style to compete

competition in Taste, Style of café’s decoration, Price and the created of dessert to motivate the customers.

Bakery cafés business is high competition, especi where are the center of competition of

that the customer is higher purchasing power when compared with other areas. Because there are many Bakery cafés approximate 200

in the middle and above market. But potential of new becoming increased. Moreover most of newer

stores. For the main products in each café attractively. (Kasikorn, 2008).

ice-cream which very popular and acceptable in the market such as After you, Sfree cafe, Fabulous Bar & Dessert Café. These café have a good taste bakery and good atmosphere to make customers happy with the dessert and relax with the café.

Cake, ice-cream and fruit in the term of mixed in same plate

Figure 2.1 The generally nature of bakery

Nowadays there are many Bakery cafés in Thailand. This business is and has a lot of customers to consume these products. Because

is responding to customer needs by providing Cake, Ice-Cream, Fruits,

decorated the shop like the studio to support the customers feel relax and take a photos suitable oreover customer can use the shop like a office to working by Wi provided and Social network to meeting with friends, relax and take the photo

price of products. From the popular make the Bakery cafés have high competitive. Many companies try hardly to create their own strategies and style to compete with each other such as competition in Taste, Style of café’s decoration, Price and the created of dessert to motivate the

business is high competition, especially in Thonglor and Siam Square center of competition of Bakery cafés. Thonglor and Siam Square are the location customer is higher purchasing power when compared with other areas. Because there are

approximate 200 stores there. The competitive market

in the middle and above market. But potential of new competitors to entering the market are . Moreover most of newer register in market will came with the medium size he main products in each café are Cake, Toast, Ice-Cream, Drinks and decorate the

(Kasikorn, 2008). Actually, There are many cafe where sell the dessert, cake,

very popular and acceptable in the market such as After you, Sfree cafe, . These café have a good taste bakery and good atmosphere to make customers happy with the dessert and relax with the café. Anyway, for the products No

cream and fruit in the term of mixed in same plate.

Bakery cafés in Thailand. This business is relatively presently the Bakery Cream, Fruits, Drinks and decorated the shop like the studio to support the customers feel relax and take a photos suitable customer can use the shop like a office to working by Wi-Fi is , relax and take the photo base on acceptable have high competitive. Many with each other such as competition in Taste, Style of café’s decoration, Price and the created of dessert to motivate the

ally in Thonglor and Siam Square . Thonglor and Siam Square are the location customer is higher purchasing power when compared with other areas. Because there are stores there. The competitive market of more than 50% is competitors to entering the market are register in market will came with the medium size Cream, Drinks and decorate the cafe where sell the dessert, cake,

very popular and acceptable in the market such as After you, Sfree cafe, The

. These café have a good taste bakery and good atmosphere to make Anyway, for the products No one sell

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Source: (Limited 2009)

Source: (center, K-Econ Analysis 2008)

Figure 2.2 The popular dessert café in Bangkok

Figure 2.3 The Dessert from Café’

(center 2008)

From statistics the market value of the bakery is increasing every years because of the people’s favor and the expanding of the bakery shop

Source: (center, K-Econ Analysis 2006) Source: (center, K-Econ Analysis 2007) Source: (center, K-Econ Analysis 2008)

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0 2000 4000 6000 8000 10000 2006 2007 6500 7200 Figure 2.4

Table 2.1 Total market value of Bakery in Thailand

Moreover in 2010 bakery market is expanding quickly with all size of café, big medium and small to serve premium and normal market.

of products with good looking design and set the café to Third place for relax from work

social network to chatting with friends in modern or created style of atmosphere. And in 2010 was Sweet stories event to stimulate dessert business market in Thailand

Sweet Stories by Central plaza is the exhibition and sell in comprehensive matrimony and largest in Thailand which the first and only of the One Stop Shopping is of people who want

Year 2006 Increase Market value 6,500 Million bath 2007 2008 2009 2010 7200 7500 8200 9200

Figure 2.4 Total market value of Bakery in Thailand

bakery market is expanding quickly with all size of café, big medium and small to serve premium and normal market. Nowadays Dessert cafe has full service in term of products with good looking design and set the café to Third place for relax from work

social network to chatting with friends in modern or created style of atmosphere. And in 2010

was Sweet stories event to stimulate dessert business market in Thailand (N. newspaper 2009)

2007 2008 2009 10.8 % 5 % 9 % Million bath 7,200 Million bath 7,500 Million bath 8,200 Million bath Market value

Total market value of Bakery in Thailand

bakery market is expanding quickly with all size of café, big medium Nowadays Dessert cafe has full service in term of products with good looking design and set the café to Third place for relax from work and be social network to chatting with friends in modern or created style of atmosphere. And in 2010

(N. newspaper 2009).

2010

12 %

Million bath

9,200 Million bath

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to buy the Sweet and Bakery. Centralize of entrepreneurs about Sweet and Bakery business approximate 40 shops. And expect the number of visitors about 25,000 persons. Most of entrepreneurs will select products which is high quality, good taste and beautiful design to distribute in promotions price. For the concept in 2010 is “Serve happiness with sweet” which means the customers will enjoy with the sweet and dessert in lovely image. And expected total market in this year will grow better than in 2008. (Central plaza, 2010)

Source: (plaza 2010)

Figure 2.5 Sweet stories fair in 2010

For Bakery cafés business in Chiang Rai have a lot entrepreneur in 2-3 years, especially in the main road from Viang Par Pao-Chiang Rai-Mae Sai. For the Chiang Rai city, there are 200 Cafés and those Café s are not Dessert Café actually but they are Coffee or Cake Cafe, and provide a customer just in basic of Bakery and Cake. However from the trends and customers’ needs (Students, Officers, and travelers) Bakery cafés business in Chiang Rai trends to very popular soon. (Chiang Rai chamber, 2010)

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2.3 Product and Service

2.3.1 Product

• Cake

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• Bread Figure 2.7 Bread • Confectionary Figure 2.8 Confectionary

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• Ice Cream

Figure 2.9 Ice Cream

• Dessert

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• Beverage

Figure 2.11 Beverage

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2.3.2 Service

Inside of service, there have employees ready for serving.

Figure 2.12 Employees

Normally of desert shop provide water or tea for all customers.

Figure 2.13 Water & Tea

Internet Wi-Fi is now mostly provided inside the shop.

Figure 2.14 Internet service

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Some shops provide taking photo for the customer too day or anniversary.

2.4 Vision

“Try our high Fashion

2.5 Mission

Cherbet House provides the happiness for the customers both of our beautiful testy bakery and modern studio which very good atmosphere. Fulfilling with our expert trai employees by providing excellence services. All of our ingredients

high quality. We concern with the customers want by mixing of product an shop trendy in order to meet our

Some shops provide taking photo for the customer too when having the special events li

Figure 2.15 Photo taking service

“Try our high Fashion Bakery with the Best Dressing in Town”

Cherbet House provides the happiness for the customers both of our beautiful testy and modern studio which very good atmosphere. Fulfilling with our expert trai

excellence services. All of our ingredients will be sourced fo high quality. We concern with the customers want by mixing of product an

n order to meet our every customer expectation.

when having the special events like a birth

with the Best Dressing in Town”

Cherbet House provides the happiness for the customers both of our beautiful testy and modern studio which very good atmosphere. Fulfilling with our expert trained will be sourced form where is high quality. We concern with the customers want by mixing of product and mix & match our

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2.6 Strategy

2.6.1 Corporate Level

Cherbet House is bakery business that will opening in Chiang Rai. We open the Cherbet House for the new way of bakery for the customer. The Cherbet House use integration strategy in term of forward integration strategy. We fulfill the customer want by we create the new menu of bakery for the customer satisfaction. The product of Cherbet House is different from the other shop. For the menu of Cherbet House the customer can not see in the other shop because the Cherbet House has decorated product in the new style and mix the bakery in every kind together. Cherbet shop will be sourced from the quality material from the many places such as bread will be sourced from Work AT HOME Café, ice cream will be sourced from Happy Plus and fruit will be sourced from Nunsawat.

For our service has more comfortable, has a good atmosphere that appropriate for rest in the long time. We decorate our shop to meet the customer's style because we decorate in many styles. The customer can take the photo in every corner of the shop. Our shop looks like studio that have beverage to provide.

Cherbet House will expand the business in the horizontal. Cherbet House will add the diversity of product, add the new menu, add more kind of products, create the good atmosphere in the shop and increase quality of service.

2.6.2 Business Strategy

Cherbet House is the new bakery business that entry to the Chiang Rai market.

The Cherbet House have selling point that different from the competitors. The Cherbet Houses have to create the new menu and new atmosphere for attract the customer and compete with competitor in the market. Then The Cherbet House use the differentiation strategy such different both product and atmosphere.

The difference about Cherbet House products is the menus of Cherbet House don’t have in the other shop in Chiang Rai. The product have create in the new look it mix everything such as bread, ice cream, honey and whipping cream.

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The difference about Cherbet House atmosphere is our shop has many style for the customer can take the photo it is different from competitor that have the limit the area for the customer to take the photo. By Cherbet House has decorate in mix and match in many style [Chic Chic].

2.6.3 Functional Level

Marketing Strategy

Product

- In term of our bakery name as Cherbet House, we fulfill the gap of Bakery like a mixing of Bread, Fruit and Ice Cream mainly. The characteristic will be beautiful feature in differences of each case.

Price

- Estimate price follow the cost of product.

- Setting price of product compare with competitor.

Place

- Cherbet House has shop at the city in Chiang Rai. It is near the Night Plaza. Our

shop emphasizes marketing strategy as pull strategy because that has many people in

the area so it can attractive the customer.

Promotion

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Chapter 3

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3.1 Marketing Analysis

3.1.1 General Environment Analysis Politic

The expanded business have been effecting mainly from the political. When the political unstable it tend to effect over all the whole country. It could break off the settlement of governmental policy. As a result, the investment have delayed to invest their businesses and slow down development in many cases which both have been set and can not set the new one of policy. Moreover, according to the political crisis started at the quarter 1-2 of the year 2010, it was intensely violation on April to May which mad the economic strongly slow down. (Channel

2008) The one who mostly effected is tourism industry and trending both inside and outside

country even though the SME or the citizen was getting an affected. So, the Economic and Business Forecasting Center, University of Thai Chamber of Commerce is estimating the effect of losing when there has the rally at that period of crisis time as follow; (Industry.com 2010).

Table 3.1 Estimate the impact of the Thai political to economy. From the date of 13 March 2553 onwards.

Rally 1 month Rally continuously 3 months The impact of consumption per GDP (million) is affected

500-800 million baht per day.

10,000-16,000 20,000-30,000

The impact of direct investment per GDP (million baht). Moderate impact.

1,000-2,000 10,000-20,000

Effect on Tourism (million), affect 200-500 million baht per day.

10,000-20,000 40,000-50,000

Impact on the economy as a whole (million). 21,000-38,000 70,000-100,000 Impact on the rate of economic growth (percent). 0.1-0.2 0.3-0.5

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However, Thai political is still continuously perform to the quarter 3-4. Dr, Narong Akrasanee Chairman Serani Holdings said in the seminar of “the way of Thai economic in 2011” that the expended of economic will be decreased if the government can not solve the problem of Thai political. Any how, it’s depending on the management of both government and private sectors under the political changes. If there is no effect too much violence so the Thai economic in 2011 will grow 3.5-4% from the last year 7.9% (thailand-business-news 2010).

According to Bakery business is also getting an effected because when the political unstable, people use less spend of their money, getting less consumption and spend less of unnecessary products. So, both government and Private have to accelerate supporting marketing activities to boost tourism and consumer spending.

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Economic

The economy of Thailand is an emerging economy which is heavily export with exports accounting for more

Thailand one of East Asia's best performers. purchasing power parity) (PPP).

Household income or consumption by percentage share:

lowest 10%: 2.7%

highest 10%: 33.4%

The Gross Domestic Product (GDP) in Thailand contracted at an annual rate of 0.2 percent in the third quarter of 2010. From 1993 until 2010, Thailand's average quarterly GDP Growth was 1.01 percent reaching an historical high of 7.10 percent in September of 1993 and a record low of -5.10 percent in March of 1998.

Economic Indicators

The economy of Thailand is an emerging economy which is heavily export with exports accounting for more than two thirds of gross domestic product (GDP

Thailand one of East Asia's best performers. Thailand has a GDP worth 8.5 trillion Baht (on purchasing power parity) (PPP).

Household income or consumption by percentage share: 2009

Figure 3.1 GDP Growth rate

The Gross Domestic Product (GDP) in Thailand contracted at an annual rate of 0.2 percent in the third quarter of 2010. From 1993 until 2010, Thailand's average quarterly GDP reaching an historical high of 7.10 percent in September of 1993 and a 5.10 percent in March of 1998.

Economic Indicators

Figure 3.2 Economic indicators

The economy of Thailand is an emerging economy which is heavily export-dependent than two thirds of gross domestic product (GDP) in 2009 made Thailand has a GDP worth 8.5 trillion Baht (on

The Gross Domestic Product (GDP) in Thailand contracted at an annual rate of 0.2 percent in the third quarter of 2010. From 1993 until 2010, Thailand's average quarterly GDP reaching an historical high of 7.10 percent in September of 1993 and a

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With a well developed infrastructure, a free-enterprise economy, generally pro-investment policies, and strong export industries, Thailand enjoyed solid growth from 2000 to 2004 - averaging more than 4% per year - as it recovered from the Asian financial crisis of 1997-98. Since 2005, however, a prolonged political crisis has weakened the economy; average annual growth dipped to a little more than 3% from 2005 to 2008. Investor and consumer confidence eroded, and Thailand's international image was damaged. Thai exports - mostly machinery and electronic components, agricultural commodities, and jewelry - continued to drive the economy, accounting for as much as three-quarters of GDP. The global financial crisis of 2008-09 severely cut Thailand's exports, however, with most sectors experiencing double-digit drops. In 2009, the economy contracted about 3.5%. The Thai government is focusing on financing domestic infrastructure projects and stimulus programs to revive the economy, as external trade remains weak and the persistent internal political crisis dampens foreign direct investment prospects.

(world 2011)

Index forecast business environment quarter 4/2010by inquiring business of 1,870 revenue is expected to increase of 45.2% indicates a line of business confidence in the overall economy. But still they are concerned about politics and the baht is too strong. Impact is on exports.

Expectations for business in 2011 that the economy would be better 58.6 percent and market share of food like a bakery will be better than in year 2010.

Overall business conditions improve. But entrepreneurs are not sure of the political situation. Economic are recovery of the Year 2010 at revivals in some sectors such as agro-industrial exports, etc., and the appreciation of the Baht. Affect competition in the global market.

(indices 2011)

From the information, the economic will grow in the year 2011. However, it is the sign of business opportunity for starting investment further because people tend to be more consumption, going outside their house and will have more power of purchasing. Therefore, the business doing about food and bakery are getting an opportunity too if doing factor that

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appropriate for the customer want and also setting price not high or low so, the customer in every class and everyone can buy a product.

Social

Social and environment factors of Thai society are a group of people living together. There is Thai tradition and unique cultural identity different from other society’s nation, including spoken language, writing, dress, beliefs, manners, food and lifestyle, etc. The environment determines the nature of society including natural environment and cultural environment. There are 2 parts. First is culture that creates by their own which is often consistent with the natural environment. Second is they have been influenced from other social. Then it was modified to suitable with living in society. (ido, 2009)

People in Thai society have value that they belief in social trust. It’s widely considered a guideline for appropriate behavior. The aim is, in order to live together, feel involve within that society. Inside society have the once group who have the power or the influencer so, that make the other people desire or making them want to be. That is the value of Thai people. (Social and Value, Bangkok, 2006)

In present we often hear that Thai people concern about values and favor of social. Values are associated with response to stimuli in a way that a standard where people will be encouraged to participate in behaviors to achieve values. A value is relevance to consumer behavior and marketing strategy. While each layer of society is the nature of values and behavior of consumers is different way. (Social and Value, Bangkok, 2006) Bakery is a popular current consumption. The consumers want a sweet taste that they used to eat as a child, but must contain healthy ingredients. Current consumption of natural products still plays a role in confectionery. New products and ingredients are developed based on the naturalness. Popular fruits are berries; mango and strawberry, while other ingredients such as honey and lemon follow. (Business Insights, 2009)

Young generations are not only need a good taste food but they still want to feed their heart. By the atmosphere of a restaurant they can sit and eat for a long time. It is considered as a

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place to relax when tired after the finished work. Restaurants need to decorated and create a "theme" and "character" to meet the lifestyle of customers. Give them delicious meal in every meal to attract the customers. (BizWeek, 2006) Therefore Cherbet house cerate this dessert is identifying to the new form in order to meet the need of customers. It is not be exactly cake or ice cream, it is mainly mixes of Bread, Ice Cream and Fruity and it’s become the beautiful form of design and makes it unique with the other bakeries. Additional with the decoration of the desert shop, people now like the modern style or the unique styles, they like to building sociality, network or relax time to meet with each other (business 2008).

Technology

Nowadays, technology is very important and become a rule of a daily life of human. In the other hand, technology is complex, rapidly changed and developed continuously.

Generally, technology which have been using is computer, internet, mobile phone, camera etc., especially computer and internet is something that cannot live without it. It will help to manage information, storage database etc., it can helps to reduce costs, reduce time and process easier.

And the internet is a large computer networks connected to the world. There are a large number of users and popularity continued. Internet can fasted exchanges the information, make people closely by can connect and communicate with each other around the world. It’s suitable with urgent life. So, Wi-Fi is the comfortable tool that can be used with standard wireless computer network (WLAN) to facilitate the users with a greatly.

So we can see in many shops using tool above, particularly in business of coffee, cake dessert, etc. This is a strategy for provide the convenience to customers which can satisfy the customer so much.

It not just facilitates for the customers but inside of business also use it. Because of it can help while doing business in many way such online marketing, survey, getting feedback, get more information, doing their own website for keep contact with the customers and also communicate with the supplier. Moreover, 3G are coming soon that is designed to be available in

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the fully form of multimedia. It makes we see the always changed and development of technology.

Additionally, more technology device which

Checolate Fecntain, sweet flush machines, digital scales, cutting edge of cake or bread, beaten egg automatic machines,

ice-purpose (can be mixed with either fl machine bread sandwich, oven baked bread

are all things making the operator convenient, quick and easy to make it bakery.

Thus, technology tends to play the importance rule when doing business. We have to trendy changed of technology in order to gain the competitive advantage.

Figure 3.3

Oven baked bread

Cutting cake and cutting edge bread

machine

the fully form of multimedia. It makes we see the always changed and development of

Additionally, more technology device which used in a Bakery shop will include the Checolate Fecntain, sweet flush machines, digital scales, cutting edge of cake or bread, beaten -cream machines, dough mixes, blender ice snowflakes, mixers can be mixed with either flour, egg, etc.), machine-rolled pie, machine cut bread, roll machine bread sandwich, oven baked bread (a oven gas, oven electric, oven use a paddle

are all things making the operator convenient, quick and easy to make it bakery.

nds to play the importance rule when doing business. We have to trendy changed of technology in order to gain the competitive advantage.

Figure 3.3 Technology’s equipment

Oven use a puddle

Machine of Chocolate Refrigerator

the fully form of multimedia. It makes we see the always changed and development of

d in a Bakery shop will include the Checolate Fecntain, sweet flush machines, digital scales, cutting edge of cake or bread, beaten cream machines, dough mixes, blender ice snowflakes, mixers rolled pie, machine cut bread, roll a oven gas, oven electric, oven use a paddle). These are all things making the operator convenient, quick and easy to make it bakery.

nds to play the importance rule when doing business. We have to

Oven electric

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Maker-whipping

(Yokintertrade 2008)

Wi-Fi

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3.1.2 Competition Analysis (3Cs) Analysis

Competitor Analysis Direct Competitor 1. Work @ home Café

Figure 3.4 Product

Product

- The highlight of this shop is toast bread such as Bruschetta and Tapenade with toast bread menus, and the other menus emphasized on mixing of fruits such as Mix fruit trifle and Ala Mod serve with ice cream.

- The test tend to be delicious because their bread is home made style and the other menu like yoghurt, wive cream, ice cream and cake tend to be not too sweet because all product in this shop provide directly to the foreigners.

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- There are one case of Brownie is provided in package for buying it back home and also sources home made bread for other company who prefer to.

Service

Figure 3.5 Service

- This shop also support providing service too like Ticket reservation, Car rental, Internet café and Seminar Room for both the foreigner and Officers who are their main target group.

Price

Figure 3.6 menus with price

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- Price tends to be expensive for one person with one piece because the target group in mainly foreigners.

- Their menus have clearly picture of products which can make customer are quickly decide what they want to eat.

- The menu of bread started highly from 125B. – 85.B, Yogurt mix with fruit and Bread mix with fruits are normally 75B. , and small piece of Cakes is 65B. Additional of beverage is also high price with the rate between 50B.-55B. , like fruit juice, fruit shack and Beer per glass.

Place

Figure 3.7 Location

545 Rattanakat Road, Meung, Chiang Rai

- This location is the heart of downtown where is the center of many companies around there such as SCB office, Court of justice, CR mall and close to the Night Bazaar where is lots of tourist and foreigners.

- Inside of this place is roomy and comfortable. There have good atmosphere in whole day which suitable working relaxes in there as same as their slogan Work @ Home Café.

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Promotion

- This shop are providing free for Internet Wi-Fi.

- There have nothing about promotion with related to their products because they ensure that their core competitive advantage about the good test and good quality of products. They are still healing high price of product which make the customer perception that they have premium brand image.

2. Layla

Product

This is menu recommend of this shop. It has the many menus such as Honey toast and larva it mix between bread, ice cream and whipping cream. The Layla shop will show the menu recommend at in front of the shop.

For the menu of Layla shop has many menus. In the menu don’t show the picture it shows just only the name of bakery and price of it and in the menu has the patch when

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they modify the price of bakery. For the product of Layla shop has the product is about bread, bakery and fruit juice they have many menus.

For the service of layla, the employee in the Layla has about 2 people the most of employee is the kid. For the time to make the order is about 30 minute/order because the equipment for cooking is general it don’t’ high technology.. The dishes of the shop is the general, the glass of this shop that they use the plastic glass don’t have pattern. But some menus of bakery they have beautiful pattern.

Price

The price of Layla shop is low price comparable because it suitable with their

target which mainly the student in front of Samakee school.

Place

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Layla shop is small shop and has parking less. The Layla shop is in opposite with Samakee school. Layla shop is emphasizing in the student. In the shop have more colorful have decorated in many style such as style natural, modern, Europe and cartoon the customer can take the photo and in front of the shop have counter for service customer. In the shop have 2 floor for the customer can sit, but when the customer go to sit in the floor 2 they will pass the cooking room[follower the picture show]. In the shop have narrow area and have less the table. For the advertising of Layla shop there is not promotes via internet and don’t have brochure. They use strategy in word to word.

Promotion

When the customer buys more than 100 baht the customer can get randomly coupons for some gift or discount that can be reduced when come to eat next time.

3. Le Petit Café Product

Figure 3.10 Product of Le Petit Café

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The products and services of Le Petit Cafe are including drinks cake and ice-cream, cake. In addition their products is more comprehensive, take home products etc which is the high quality products.

Le Petit Café is an direct competitor in the market because they sell Bakery and products resemble Cherbe’t House and well-know in Chiang Rai

-The products of this Le Petit Café is acceptable for Chiang Rai customer - They always provided new products to satisfy the customers.

Price

Figure 3.11 Menu

Le Petit Café provides products at a reasonable price. The prices range from 45 Baht to 100 Baht for all products. Compared to other Bakery Café in Chiang Rai, Le Petit Café is priced at the similar price to target the teenage and adult market as well.

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Place

Figure 3.12 Place

- The store is Big and good decorated.

- The store decorated in 2 style 1.Modern and comfortable 2.Relax with nature. - The store located in the City

- There have no promoted via internet.

Promotion

Le Petit Café’s promotional activities are including reduced prices for buying more ice cream.

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4. U-HU shop

Figure 3.13 U-Hu shop

(Brighten your day add color to your life) Product

The U-HU shop is the dessert and bakery shop. This shop has the main menu is ice-cream. After that they try to improving and adapting the menu by add the menu more than before such as Shibuya honey toast, Milo toast, Waffle, Nama toast Monkey, Smoothie fruit, Coffee and beverage, menu for healthy (smoothies & yogurt )etc. These are about the bread for the customer needs. And this shop has the other product such as the accessories for the women and some alcohol.

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Price

The menu price of U-HU shop

Menu: Shibuya honey toast Price: 89 -.

Milo toast 69 -.

Waffle 69-89 -.

Nama toast Monkey (bread + banana + ice-cream) 89 -.

Smoothie fruit (follow size) 29-39 -.

Coffee and beverage 29 -.

It’s price is stay middle rate if comparable with the other direct competitors.

Place

U-HU shop stay near the clock tower of Chiangrai. Parking of this shop is inconvenience. The space for walking in the shop is narrow. Not have the highlight in front of the shop for customer can know this shop stay on here. The shop is decorating style by using the bright color such as red, blue and yellow. In the shop have the other product (are not the bakery and dessert) it result to the space in the shop is narrow.

U-HU shop open 10.00 a.m. – 10.00 p.m. every day. The customer can call to U-HU shop on number 081-1349998 and 085-8268444.

Promotion

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Indirect Competitor 1. Era 127

Product: Main product is Spinny Ice

Era 127 shop sells Spinny ice that is the main product at hears. Spinny Ice is Ice fluffy snow and adds topping put on the cup. The topping are fruit, bread, and jelly act. Moreover, this shop has food, dessert, and alcohol adds in the menu. The customers are to joint with era 127 shop for eating dinner, eating Spinny ice, and drinking alcohol. The fruit of topping are frozen fruit, not fresh fruit. This shop has more menus but do not focus on bakery. So this shop is indirect competitor.

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Price:

The prices of Spinny Ice product are set by size of cup and when add the topping. The small size 1 topping is 20 bath and large size 3 topping is 35 bath and when add 1 topping is just ad 5 bath pet 1 topping. The prices are not expensive.

Place:

Figure 3.17

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The ear 127 shop is large but has parking less. The shop stays nearly the street. The opportunity of this shop is point to attract people driving through a lot of time over. In the shop is decorative older period that all things in shop bring in ancient times. There are many corners in the shop to take photographs. The customer can take the photo and in front of the shop have counter for service customer.

Promotion:

Figure 3.18 Promotion Brochure

Era 127 shop they have a lot of promotion for offer and serve to customers. The era 127 shop have special promotion such as when customers buy the second large size cup they will get 5 topping free the price just 35 bath. The era 127 shop they will change promotion every month.

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2. Swensens

Product

Figure 3.19 Product of Swensens

The products and services of Swensen’s are including ice-cream, cake and drinks. In addition their products is more comprehensive, they also have festive products and take home products etc which is the products that are beyond other competitor.

- Swensen’s is an indirect competitor in the market because they sell Ice cream and dessert and well-known in Chiang Rai

-The products of this Swensen’s is agreeable from customer well known for Chiang rai and Thais people.

-The location is closed to Cherbe’t House, The customers can hesitate to choosing the Café - They always provided a comprehensive products and variety of products to the customers to make their customer feel satisfaction and enjoy.

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Price

Swensen’s provides products at a reasonable price. The prices range from 35

Baht for one scoop of ice cream to over 250 Baht for large sundaes ice cream. Compared to other premium ice cream companies, Swensen’s is priced at the lower-end to target the teenage market as well.

Place

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- The store is Big and good decorated.

- The store located in economic street and closed to Cherbe’t House, - There are promote via internet of own website and Facebook fan page.

Promotion

Figure 3.22 Brochure of promotion

Swensen’s has a variety of ways to promote and advertise it products and brand name effectively

-Advertising is done through TV commercials, website, magazines, flyers, and store banners -Promotional activities include reduced prices for festive ice cream

-Privilege Card where at 129 baht, a customer can receive discounts from any Minor Food Group food company for a year.

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Customer Analysis

When doing business in Chiang Rai where have totally population of 1,194,933 people divided into male 588,850 and female 606,083 (Thaienergydata 2009).But when we analysis with our customer so, Cherbet House located at the heart of economic area in Chiang Rai so, the customer will be focused on the downtown of Chiang Rai which there will have the percentage to go around and see our shop frequently. Then, the population in downtown has 116,341 people and they was divided into male 56,399 and female 59,942 (Tourism, TourismChiangrai

2009)However, when we have done about our interview by choosing the sampling population in

this downtown 100 people, then our segmentation tend to category as Behavior Segmentation. It is divided customers like an attitude of 4 segmentations as Favorite, Like, So so and Dislike of our bakery.

Favorite means very like of our bakery by eating 8 times per month and they have power of purchasing per time about 80-100 Baht. Like means they often eating bakery 4 times per month and they have power of purchasing per time about 60 – 79Baht. So means they eat sometimes of bakery like 1 time per month and they have power of purchasing per time about 40-59Baht. And Dislike means they do not totally like some kinds of bakery. Someone does not like bread because they really concern on their healthy. So, our target segmentation would be the best outcome like a Favorite and like.

Then, what our target groups want is that our new style of product like a mixing of bread, ice cream and fruits. They perceive that it will be interesting, look like differentiate and yummy. Moreover, they not just want the core product but they want the comfortable, friendly, and classic corner atmosphere for relaxing and enjoyable with their friend or family in there.

Additionally, the customers will enjoy and satisfaction more if we let them involve with our shop. As a result, that why we will create one of menu for the customer can do it by themselves. This is the way we create more value and satisfaction for the customers.

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Competitive Analysis

In Thailand, The bakery shops are popular that many entrepreneurs turn to open the shop and have more competing as well. Bakery business is low capitals investment but the business will survive or not that depends on the quality of products and services that are different from the competitions. As well as the bakery shop should have target that appropriate with product because if the product is not significantly different in consumers mind. Nowadays this business is very popular with new various bakeries and be appetizing. The demands of eating bakery trends have been changed as a consequent of structure bakery industry change too. Profitability for individual companies is determined by efficiency of operations. Small companies can compete by offering specialty goods or superior local distribution services. The set of strategic is very important when doing business. The bakery shop create new product and improve the product in order to attract and satisfy customers and compete with competitors.

In Chiang Rai the bakery business has more competitive as well because Chiang Rai is tourist city and have a lot of bakery shop like coffee houses both open for s long time ago and just start opened. Each shop has different strategies for attract the customers such price, decorate shop, variety of menu and different in taste. Each shop has highlight and weakness differently. Cherbet house will be open in the Chiang Rai is about bakery but Cherbet house will use the different strategy for competition. For the bakery of our shop are different from other shop. We mix between bread, ice cream and fruit we mix it in the new style that are beautiful, attractive and the taste has delicious because trend of health has popular so we confirm what the customer want. And Cherbet house uses customize strategy, it is we have material of product already that the customer can mix and do it by themselves. This can give the customer happy in their bakery fulfill what customers want and it can complete with competitors too.

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3.2 STP Analysis

3.2.1 Market Segmentation

-Behavior Segmentation: Attitude (Favorite, Like, So so, Dislike)

Market segmentation of Cherbet House divided customer segment into Niche Marketing relies on Behavior segmentation to identify its main cu

unique benefits. The Niche marketing can better help to understand the market trend and customer needs. Then, it can penetrate into each sub market.

From interview from 13

segmentation by pie chart for easily to understand. We have 4 types of classifications. The first group is primary customer segment which can generating the most revenues for Ch

include Bakery lover. The second group is the customers who like to eat bakery which can generate secondary revenues. The third group is normal costumers who can eat bakery and the last group is the customers who do not like the bakery and othe

groups of customers which 100 interviewee per group. The first group is

and another group is High school students.

Figure 3.23 Favourite 28% Like 37% So so 30% Dislike 5% Favourite Like So so Dislike

Behavior Segmentation: Attitude (Favorite, Like, So so, Dislike)

Market segmentation of Cherbet House divided customer segment into Niche Marketing relies on Behavior segmentation to identify its main customers which each niche looking for unique benefits. The Niche marketing can better help to understand the market trend and customer needs. Then, it can penetrate into each sub market.

From interview from 13 - 14 December 2010, Cherbet House can divide the market segmentation by pie chart for easily to understand. We have 4 types of classifications. The first group is primary customer segment which can generating the most revenues for Ch

include Bakery lover. The second group is the customers who like to eat bakery which can generate secondary revenues. The third group is normal costumers who can eat bakery and the last group is the customers who do not like the bakery and other. So, we have been survey for 2 groups of customers which 100 interviewee per group. The first group is

and another group is High school students.

Figure 3.23 Behavior Segmentation: Attitude

Favourite

Market segmentation of Cherbet House divided customer segment into Niche Marketing stomers which each niche looking for unique benefits. The Niche marketing can better help to understand the market trend and

14 December 2010, Cherbet House can divide the market segmentation by pie chart for easily to understand. We have 4 types of classifications. The first group is primary customer segment which can generating the most revenues for Cherbet House include Bakery lover. The second group is the customers who like to eat bakery which can generate secondary revenues. The third group is normal costumers who can eat bakery and the r. So, we have been survey for 2 groups of customers which 100 interviewee per group. The first group is University students

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-Behavior Segmentation: Buyer

This customer group is who have power of purchasing or demand that have effort to pay. There is Officer both private and government sectors, and Tourist both Thais and foreigners. In term of Officer we just classify who working around Muang Chian

we just classify who rest in the hotel around our shop. With both tend to have more percentage to come to our shop.

Figure 3.24

3.2.2 Target Analysis

Bakery business can expand and

café is the more than restaurant but it can be the third place to make social network with delicious bakery. For Cherbet House create a product specialization. We serve the products in same style to all customers. In this market of Chiang Rai, Cherbet House provided

groups. First, the Customers who are Bakery lover, who

purchase products which mostly

network to relax with friends. Second, the Customers which

time at bakery shop and capability to purchase products lower than the first group, they look for quality and delicious products with good atmosphere which mostly

Thirdly, the Tourist who rest in the hotel where is near our shop. So, they tend to have more percentage to come to our shop because it’s convenience. Moreover, they have much of power

Buyer - Readiness

Behavior Segmentation: Buyer – Readiness

This customer group is who have power of purchasing or demand that have effort to pay. There is Officer both private and government sectors, and Tourist both Thais and foreigners. In term of Officer we just classify who working around Muang Chiang rai. And in term of Tourist, we just classify who rest in the hotel around our shop. With both tend to have more percentage to

Figure 3.24 Behavior Segmentation: Buyer – Readiness

Bakery business can expand and popular with customers, customers think now bakery café is the more than restaurant but it can be the third place to make social network with delicious bakery. For Cherbet House create a product specialization. We serve the products in

ustomers. In this market of Chiang Rai, Cherbet House provided

. First, the Customers who are Bakery lover, who very like and have capability to purchase products which mostly University students. They look for modern place and social k to relax with friends. Second, the Customers which like to eat and enjoy to spending the and capability to purchase products lower than the first group, they look for quality and delicious products with good atmosphere which mostly High school students

who rest in the hotel where is near our shop. So, they tend to have more percentage to come to our shop because it’s convenience. Moreover, they have much of power

Tourist

6%

Officer

94%

Readiness

This customer group is who have power of purchasing or demand that have effort to pay. There is Officer both private and government sectors, and Tourist both Thais and foreigners. In g rai. And in term of Tourist, we just classify who rest in the hotel around our shop. With both tend to have more percentage to

Readiness

popular with customers, customers think now bakery café is the more than restaurant but it can be the third place to make social network with delicious bakery. For Cherbet House create a product specialization. We serve the products in ustomers. In this market of Chiang Rai, Cherbet House provided 4 target and have capability to . They look for modern place and social to eat and enjoy to spending the and capability to purchase products lower than the first group, they look for

High school students.

who rest in the hotel where is near our shop. So, they tend to have more percentage to come to our shop because it’s convenience. Moreover, they have much of power

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purchasing. Lastly, the officers, who are both government and private sectors. But we choose

just only around Mueng Chiang Rai.

Segment

Product

Figure 3.25 product specializations.

3.2.3 Position Analysis

We position our bakery shop to be the studio one where we not just enjoy beautiful testy eating with our differentiate bakery but the customer will be happiness of our shop providing the comfortable, friendly, and different corner to take the photo. Cherbet House where is the

customers can be service freedom by themselves. But however, our trained staff will be ready for serving. It is suitable for coming to even enjoy with friend, lover and family which there will create society in there. When customers think about our Cherbet House shop so, thing that come up in their mind is, about enjoy beautiful testy eating and getting happiness in relax atmosphere place.

Favorite Like Buyer-Readiness Coffee Our bakery Ice-cream

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3.3 Marketing Mix Strategy

3.3.1 Product strategy

Product Differentiation would be used as

to be the modern bakery by mixing with Bread, Ice cream and Fruits. So, it will get the new test of full-flavored. Differentiate in style, it comes form beautiful Japanese and French look. Now, we have 9 menus in case. However, we have planed to make new design every month by 2 designs at lease per month by always adapt and change with demand of our customers. Thus, the older menu will be moved out after they showed lower sale in tern by analyzing from c

program. Moreover, we offer the

themselves , they can choose or mix whatever they want inside that set. So, it strategy will make the customer feel involve and create the value for them.

There are 9 menus differentiate as follow:

1. Le Bristol Honey Toast

would be used as our strategy. Differentiate in product form of bakery to be the modern bakery by mixing with Bread, Ice cream and Fruits. So, it will get the new test flavored. Differentiate in style, it comes form beautiful Japanese and French look. Now, 9 menus in case. However, we have planed to make new design every month by 2 designs at lease per month by always adapt and change with demand of our customers. Thus, the older menu will be moved out after they showed lower sale in tern by analyzing from c

Moreover, we offer the Customerization by set one of menu for the customers do it by themselves , they can choose or mix whatever they want inside that set. So, it strategy will make the customer feel involve and create the value for them.

There are 9 menus differentiate as follow:

ol Honey Toast 2. Choc Lava cove with strawberry

our strategy. Differentiate in product form of bakery to be the modern bakery by mixing with Bread, Ice cream and Fruits. So, it will get the new test flavored. Differentiate in style, it comes form beautiful Japanese and French look. Now, 9 menus in case. However, we have planed to make new design every month by 2 designs at lease per month by always adapt and change with demand of our customers. Thus, the older menu will be moved out after they showed lower sale in tern by analyzing from computer by set one of menu for the customers do it by themselves , they can choose or mix whatever they want inside that set. So, it strategy will make

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3.Panoffee

5. Angel & Demon

7. Blanc Manger

4. Orange Passion Buttermilk

6. Costa Rica

8. Anis Pear Tart

Orange Passion Buttermilk

Cherbet House Co.,Ltd.

Acknowledgement

Table of Contents

Chapter 1

1.1Background and Significance of the project

1.2Project Objectives

1.3 Benefit of project

1.4 Activities/Time Frame

Chapter 2

INDUSTRY PROFILE

2.1 Nature of Industry

2.2 Situation of Industry

2.3 Product and Service

2.4 Vision

2.5 Mission

2.6 Strategy

Chapter 3

3.1 Marketing Analysis

3.2 STP Analysis

3.3 Marketing Mix Strategy