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The Pudong

The Pudong. Coffee Shop. By Chasedream. Case analysis. Advice &strategy. Case overview. Forecast &valuation. Quality Control. content. By Chasedream. ●One of the 4 cities where coffee consumption is highly concentrated in ● open and changeable culture.

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The Pudong

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  1. The Pudong Coffee Shop By Chasedream

  2. Case analysis Advice &strategy Case overview Forecast &valuation Quality Control content By Chasedream

  3. ●One of the 4 cities where coffee consumption is highly concentrated in ● open and changeable culture ●Emerged as China’s financial and commercial hub ● Rapid development Pudong Shanghai ●in Pudong New Area ●Close to Century Park , several office buildings and a private business school Coffee shop Case overview Introduction By Chasedream

  4. Case analysis 1. Good Location 2. Goodwill 3. Excellent Customer Service 4. Knowing well about western culture 5. Environmental friendly 1. Limited business experience 2. Similar product 3. High rental 4. A loan to purchase new furniture and equipment 5. Unskilled staff 6. Inaccessible to customers’ complaints Strengths Weakness Opportunity Threats 1. Huge population with a low base 2. Rapid growth 3. Shanghai’s development 1. Chinese traditional culture of drinking tea 2. Competitors as the Italian-style restaurant and the ice cream café. 3. Potential competitor like Starbucks and McCafe 4. Financing methods limited By Chasedream

  5. Case analysis-Problem Profitability drops! Gearing and liquidity also deteriorate!! By Chasedream

  6. Case analysis-Problem Solution Deduct cost Increase revenue Year 2009

  7. 1. Increase retail 2. Pull single consumption Hold parties 3. Improve purchasing frequency Others Case analysis-Problem Solution Increase revenue

  8. 1. Discount 1. Free Wi-Fi 2. Coupon 2. DIY Service Pull single consumption 3. Free food salon on trial Improve purchasing frequency 3. Membership system Case analysis-Problem Solution

  9. Why Wi-Fi? -Low cost but high return -More café in industry provide it free Why DIY? -A new way of leisure -Personalization -Still profitable Case analysis-Problem Solution Supporting Data

  10. Overall advice & strategy Promotion Position 6P Strategy Price Product Place Package By Chasedream

  11. Position-Multi-cultural atmosphere Promotion -Coupons -Free food salon on trial -Membership policy Product -Providing diversified food -Offering free Wi-Fi Price -Discount Add Your Title Place - sell the self-made cakes in other coffee shops Package -Take-away service -Delivery service Overall advice & strategy By Chasedream

  12. Quality Control -- SERVQUAL Responsiveness Assurance Empathy Tangibles Reliability ◆Modern coffee machine ◆Waiters’ uniform ◆Punctual service time ◆Magazine available in waiting time ◆Courteous and approachable staff ◆Individual care for specific requirement

  13. SERVQUAOL Control Quality Management & Customer CareSERVQUAL control Pudong coffee shop Dimension Weight Perceptions Expectations Gap ──────────────────────────────────────────────────────────────────── Tangibles Reliability Responsiveness Assurance Empathy ──────────────────────────────────────────────────────────────────── Weighted averages

  14. Best, worst Flexibility Risk Control Forecasting Scenario Planning Decision making forecasting & Scenario planning By Chasedream

  15. Best, worst Forecasting Forecast: comparison of two years The coffee shop will witness improvement in 2010. Both profitability and gearing recover.

  16. Best, worst Forecasting Forecast:break-even point At break-even point,Total contribution = Fixed cost 18600<19100 20116>18814 19100>18225.8

  17. Flexibility Best, worst Risk Control Decision making Forecasting Scenario Planning Staff motivation disrupted: Working hours and intensity may increase ---challenge the paradigm represented by Starbucks ---breaking the routine is very useful ---foster the culture of changing and facing challenge bravely ---communications and monitoring are vital ---the existing culture must be got across ---all the staff have to be engaged in the changing process Forecast: Possible unintended consequences caused by the changing program How to solve? Obstacles: New initiatives may suffer from the resistance force of current process. Ivory tower change: When change imposed from the top down, manager may out of touch with the operational reality By Chasedream

  18. Valuation: Net asset or DCF Net asset valuation: Net asset =Total assets-Total liabilities =owner’s equity =￥418,590 DCF-Discounted Cash Flow Assumption: constant profit since 2010(￥37,705) Discounted rate: R=7% NPV of future cash flow =37,705*(1+r)/r=￥576,348 Assume the loss he suffered in 2009 is an accident, which will probably not happen in the future again. And the loss in 2009 make it unstable to assure the cash flow. So we use The figure of 2009 for net asset valuation since it’s relatively actual and reliable. By Chasedream

  19. Shop owner’s eco-awareness Tips: Social Responsibility Representing good social responsibility Gain popularity and more customers Recycled paper made menu; Non-smoking Increasing awareness of environmental protection among white-collars and students The shop can also use plates and cups and even VIP cards made of eco-friendly materials! By Chasedream

  20. thank you By Chasedream By Chasedream

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