Expanding Business - Case Study Example

Expanding your business Expanding your business Ohio Downtown Deli is situated in Franklin county of Ohio. The deli serves snacks and drinks, which are alcoholic and nonalcoholic. Since the business has been in the market for a long time, it is significant to expand to other markets in order to increase the company’s profit margin. The competitive business strategy for this business would be a coffee shop, which sells organic food. In order to reach for more customers, the business will open a Wi-Fi Java in some cities in the country (Miles, 2014). Financial plan for Downtown Deli Company The firm needs to increase its Retail sales in order to realize high profits. The firm needs to announce IPO on stock market to increase the number of shareholder The Company needs to increase its market capitalization and Total Enterprise Value (TEV) for over 25.1, which is greater than the total average for companies in U.S at 14.5 and that of Canadian companies at 17.9. This would record a net margin of 6.0 percent and increased joint ventures will contribute significantly to the company’s total sales in future. Expansion and guerilla marketing strategies In the current information age we live in, people have found the internet through social networks to be an indispensable tool for connecting and communicating with each other. Through social networks, public forums, media sharing websites or blogs, people today can have interactive dialogues with others to share experiences and any important information (Kerpen, 2011). The business aims to open a new store in Columbus, Ohio. Further, the new store will aim to achieve the following objectives. i. To ensure that the Wi-Fi Java Café utilizes the ability of people to use the internet in its marketing strategy ii. The Wi-Fi Java Café should be situated along the highway where is high population and possibility of people to stop over for a cup of coffee or snack iii. In order to attract many customers, the café offers free Wi-Fi to its customers so that they enjoy a meal either a burger or a cup of coffee, they are able to read emails, get updates on what is happening in the country and on global arena or even read books. iv. The new Java Café aims to recognize personal autonomy and freedom that the internet provides, which allows people to share their opinions and experiences about products and services they have seen, heard of, or even tried comfortably. Therefore, we aim to offer an opportunity for people to share what they have by providing unlimited access to the internet. After opening the Wi-Fi Java Café, we have seen an increase in number of customers. The numerous videos, news, status updates on social networks, video views, and comments clearly reflect the enormous participation of people surfing the internet for more information. As such, the large numbers of people use the internet to market their business. Therefore, as they relax at our new Java Café, they will be able to make all necessary updates because we have opened free Wi-Fi network to our customers (Kerpen, 2011). Opening WI-Fi has been an aspect for the establishment of the business since people will tell one another about their adventure while at Java Café. For instance, as some customers update their status on social network; they can inform their friends that Wi-Fi is available at new Java Café. This in turn has the ability to increase product and brand awareness, customer loyalty and web traffic while at the same time improving a business’s Search Engine Optimization. Further, the internet has presented competitive edges and various advantages for our business This is because internet surfing and information sharing promote communication around products, services, and brands and by so doing enhancing both positive and negative word of mouth around a business and its goods (Miles, 2014). The internet has increased brand exposure in major highways where traffic is high in that we have seen an increase in number of customers who visit our café to eat and surf the internet. The introduction of internet at our café has also exposed our brand. Many people both our customers and potential customers are aware of our services. In turn, they work in our favor since people pay attention to our adverts. In addition, the internet channel has helped our new brand to establish itself in the market. It helped foster awareness among future customers. In conclusion, internet marketing helped the brand to penetrate the foreign country since it exposed the brand to people (Seeley, 2013). Marketing insight for the company or business Also known as research and competitor monitoring, social media allows businesses to collect data on both consumers and competitors. People leave numerous amounts of data in the archives of social media sites. Therefore, businesses can easily access information such as demographics, behavior, and characteristics of customers. This data facilitates market insights helping business heads make wise and informed decisions. On the other hand, the same media channels allow businesses to spy on their competitors and therefore adjust accordingly. The business will be in a position to watch on its competitor (Kerpen, 2011). The company has established very strong and close relationships with its exporters. It provides relevant training to its exporters and works directly with them. They have established commendable consistency and customer service that makes its partners willing and able to work with the company for a long time. Downtown Deli aims to be the highest buyers of high quality coffee in the world, which will enable it, develop good relationships with suppliers. The strategy is to develop loyal suppliers. When most suppliers are loyal to the company and they would give priority to Downtown Company even in seasons when harvest of quality coffee is low. The company would have enough coffee to supply its customers at times when other companies have deficits (Miles, 2014). The company intends to use current technology in its processes. Downtown Deli aims to apply computerized coffee roaster that guarantees consistency in quality of coffee produced. The company has seriously taken the roasting process as a technological art enabling it to produce high quality coffee because the essence of good coffee is how it is roasted. Additionally, the company has done considerable research in the art of roasting high quality coffee. From many trial and error attempts to get the right roasting conditions, Downtown Deli would finally be able to get the perfect signature roasting curves for its coffee. The company developed the curves into computer software to ensure that in the event a roaster defected to one of their competitors, they would not manage to duplicate the signature roast from Downtown Deli (Seeley, 2013). The company also has unique packaging techniques that ensure freshness and a longer shelf life of its products. It has an integrated supply chain model that allows it to maximize efficiency and eliminate redundancy. The real estate opportunistic approach is beneficial to the company’s expansion strategy. Downtown Deli seldom waits for a perfectly designed location to establish its stores. The design team is able to fit many retail spaces into any location be it a triangle, a trapezoid, or a corner. The flexibility in location in addition the company’s store clustering concept allows it to optimize its market share in strategic areas where Downtown Deli in turn builds its regional reputation. In addition to the design team, Downtown Deli has real estate managers in various locations who work together with people experienced in identification of best retail locations. The use of espresso carts and kiosks would help to widen the company’s customer base and succeeded in branding the coffee cart to its name. It will allow Downtown Deli to utilize special sales sites such as malls, street corners and train stations (Seeley, 2013). Debt financing for the second store in Columbus Ohio Downtown Deli looks forward to finance its debts for the second store in Columbus, Ohio via methods such as overdraft agreements, trade credit, factoring, and loans from stakeholders. In terms of factoring, the business will be in a position to sell a certain percentage of its receivable accounts to a factoring firm that will gather cash customers. The business will get trade credit from its coffee suppliers with an option to pay later. Additionally, the business will also establish an overdraft agreement with its bank whereby the bank might allow the firm to withdraw limited amount of money (Miles, 2014). In conclusion, Downtown Deli has sustained a competitive advantage in the coffee industry and in order to maintain that position, it needs to focus on its main strength, brand identity, to avoid spreading itself to thin. To tackle competition, the company needs to create innovations that enhance customer experience and quality of their coffee. They need to focus less on new products and maintain their brand image and retain their loyal customers in order to separate itself from its competitors References Kerpen, D. (2011). Likeable Social Media: How to Delight Your Customers, Create an Irresistible Brand, and Be Generally Amazing on Facebook. New York: McGraw-Hill. Miles, B. (2014). Marketing Health Conscious. Retrieved March 2, 2014, from http://www2.qsrmagazine.com/articles/outside_insights/140/healthconscious-1.phtml Seeley, M. (2013). Demand for organic food at an all time high. Retrieved March 2, 2014 from http://www.examiner.com/article/demand-for-organic-food-at-an-all-time-high Read More