The increase in dual income households coupled with an increase in the number of hours people spend at the office in recent years has lead to a scarcity of time for many consumers to spend with their family or doing things the enjoy. It is for these reasons that the Time Merchants concept is appealing to many people. Time Merchants provides consumers with a little more time each week to spend doing the things they want to do. A cost benefit analysis of the TM concept can be seen in Appendix C.
Consumer-direct on-line shopping and home-delivery is a growing niche market within the $425.7 billion grocery and food distribution industry. Factor in the revenue generated by other services (provided by some home delivery companies) such as dry-cleaning, video rental, film processing, stamp purchasing, and UPS shipping, the industry sales rise to an estimated $778 billion per year. The shift to on-line shopping may be influenced by the high percentage (60%) of Americans who dislike their current shopping experience, coupled with the fact that 67% of dual wage earning households own PC's and use technology to simplify their busy lives.5
To confirm our assumptions TM recently surveyed over 160 consumers in the San Diego metropolitan area. The results of the survey show that 80 percent of respondents are interested in trying one or more of the services offered by TM. Because the services are divided into two tiers, each of which is designed to meet the needs of a different segment of the market, TM offers something for everyone.
The Referral Service (1-888-FOR-TIME), is appealing to all consumers who want assurance that they are dealing with a reputable home service provider; and because this service is free to consumers, it will be attractive to all income levels. The Premium Service is designed more for professionals whose time is worth more to them than the cost of relinquishing household responsibilities. Eighty-three percent of survey respondents with incomes greater than $60K expressed a willingness to pay for a service such as TM. Time Merchants views $60K as a baseline income level of consumers to afford the Premium Service. The survey revealed a higher degree of comfort with computers and the Internet from consumers in this segment. Those respondents who expressed reservations toward the idea were primarily concerned with trust and dependability. Summary results of the marketing research are shown in Appendix D.
At present, there is no direct competition to TM in the San Diego metropolitan area. Indirect competition (or "alternatives") may exist in several forms: 1) traditional grocery stores and home improvement centers, 2) the Yellow Pages, 3) manufacturer service contracts, 4) property management firms, and 5) on-line grocery delivery service companies. Grocery and department stores could pose a threat to TM if they decide to enter the home delivery business on their own. Home Improvement Centers, such as Home Depot and Lowes, could start referring customers to selected service providers. Consumers who prefer to shop for best prices rather than quality may prefer to use the Yellow Pages to find their own service provider. Manufacturer's who offer service agreements on consumer goods will also reduce reliance on TM. Property management firm's that bid on the management of entire housing complexes will reduce the need for consumers to utilize the home service referral segment of the business. Lastly, the growth and expansion of on-line grocery delivery companies such as Streamline and PeaPod could impact market share for the Premium Home Delivery Service.
|Guaranteed Top Quality Service||Guaranteed Quick Reaction Time||Regularly Scheduled Delivery Schedule||Access to a variety of service providers||Consolidated Billing for all home Services Online||Consumer Familiarity/Comfort Level|
|Grocery/Home Improvement Centers||x||x|
|Manufacturer Service contracts||x||x|
|Property Management Firm||x|
|On-line Grocery Delivery Companies||x||x||x|
Table 2 Competitive Analysis (Referral and Premium Home Delivery Service)
The fact that at present there are no direct competitors offering all of the services provided by TM serves as a definite advantage. Being the first to successfully consolidate the segmented home service market will enable TM to brand itself as the premier provider of time and home services.4 As mentioned earlier, GIS and ArcView software will be utilized to identify the best markets for expansion.
|Table of Contents||Appendices|
1. Executive Summary|
2. Company Overview
3. Market Analysis
4. Marketing Strategy
5. Operational Strategy
6. Critical Risks
7. Management Team
8. Financial Plan
Cost Benefit Analysis
Potential Service Providers
|© 1999 Time Merchants|