Just Us Coffee Roasters Case Solution
5.- “Although the coffeehouses offer free Wi-Fi access, why have we never been recognizing as the best Wi-Fi spot in Halifax? How many customers per day are we losing to the competition? And how much in sales? Should we cut this service and invest the money saved elsewhere?
Every coffee shop provides free Wi-Fi to its customers. However, only the top provider gets the award. Reason of getting top position in Wi-Fi spot is their larger amount of investment in service providing. Moreover, Wi-Fi is considered as their major cost and customer facilitation. Wi-Fi has now been the most essential need of customers and it cannot be left aside as providing this service at a higher level adds value and brand image of the restaurant.
Providing Wi-Fi service on a low level may affect its customers on a higher level. Customers, like students, who gather in coffee shop to complete their assignments in a better environment need high speed internet. Moreover, internet surfers, researchers and social media users also need better Wi-Fi. Therefore, Just Us! may lose its potential customers in this internet race and there might be a higher churn rate of customers who go at their competitors. However, Wi-Fi is the basic need, Just Us! cannot cut this service or invest in anywhere else, as it will cause major issues and problems to the restaurant. Therefore, Just Us! should invest in providing greater Wi-Fi services to its customers, as it will result in high potential and loyal customers.
- – “Why not buy out and merge with the three satellite coffee shops at the universities and boost the division´s sales that way? For 2011, this would solve the problem of sales growth, so what are we waiting for?
Mergers and acquisitions are always seen as an opportunity and source of increasing sales and revenues of a company.
Satellites in universities have contracted a large number of suppliers. Major universities have their own cafes and satellites.Just Us! Coffee shops cannot purchase satellite coffee shops at universities. The reasons are that it will be expensive for Just Us! to purchase an entire set up in a university. In addition, this will lessen their number of customers in other restaurants and franchises. On the other hand, Just Us! will not be able to contract the same number of suppliers because of less networking. Some of the suppliers may be its own competitors. Moreover, it won’t be able to provide the same services and facilities to students as provided by satellites owners. This may cause loss and increase in its cost over sales.Therefore, it is not possible for Just Us! to purchase or to merge itself with satellites at universities.
- – “If it is impossible to buy the satellite coffee shops, should we open new coffeehouses to compensate for stagnating sales? Maybe we could even buy and independent coffeehouse, for example the Public Gardens coffeehouse, and convert it to the Just Us! Brand?
As described above, merging with satellites is not possible. But it’s necessary for the company to take some steps to increase its sales and revenue to make itself competitive. Developing a new coffee house is a good idea, but it would require a large amount of investment. However, a perfect location and an excellent customer facility will be required. However, this investment seems to be promising to return investment with a higher profit margin.
However, buying out an independent coffee shop and converting into own brand also looks a great idea. But, on the other hand, if the previous restaurant or coffee shop does not have a good reputation or high brand image, this will affect the customer building of Just Us! However, already developed customer base and brand image of Just Us! will overcome this effect.
- – Reading the 2011 marketing budget, how much should we ask for? What arguments should I put to Tom? And how can I best promote our coffeehouses with this money, especially our flagship, the Gran-Pré coffeehouse?”
Just Us! has been earning high revenue due to its brand image and customer base. However, many new entrants have entered into the same industry of providing organic foods and drinks. Surrounded by many competitors, Just Us! has to increase its sales and customer base. In order to do this, company is increasing its marketing budget. The CEO has agreed to pay $20,000 for marketing in 2009 and 2012. However, company needs aggressive marketing strategies therefore, this amount doesn’t seem to be fair. 5% of sales has been demanded by the marketing manager. The CEO has agreed to pay a higher amount if there are any extraordinary marketing activities.
Current marketing strategies are not reliable to attract more customers. Company needs to take part in more activities, such as promotion in universities especially, after exams days when the students are in need of social gatherings and activities, which may be conducted by Just Us! Coffee Shop. In addition, company may also make promotional partnership with any well-known brand to provide promotional discount. This strategy will help to attract customers.
Gran-Pre coffee house is located on the national highway. Therefore, no promotional activities are done here. However, marketing and advertising of this place can be done by traditional advertising on television and on social media, as well as it can also be done by displaying on bill boards where there is route to and from travelling to Halifax.
9.- Which are your observations of the business plan of this case comparing with the examples we saw in class; may you explain improvements for a brand such Just Us!?
The business plan of Just Us! needs a lot of improvement. Following are the things that are not described:
- Financials of the company including cash flows and expenses are not listed and provided. Financial assumptions are most necessary when developing a business plan.
- The plan is incomplete as there areno marketing strategies and ways to attract customers are not described. Moreover, supplier’s information and pricing strategy of a product is also not described.
- The research of this plan was not done properly. There was a high threat of new entrants in this business as this is a high profitable business. However, company should find some ways and make strategies that don’tallow new entrants into the market.
- The risks involved and their measurement and solutions are not described. Therefore, whenever there would be any threat or risk to the company, there would be no possible solution to overcome these risks.
- The customers, workers, management teams and suppliers must be examining on a daily/weekly/monthly or yearly basis, so that it may bring improvement in the business. Moreover, it will exploit hidden opportunities and threats in the business………………..
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