Guilty Pleasures Meeting - Assignment Example

Guilty Pleasures Meeting Table of Contents Task 3 Options Available to the Company In Terms of Future 3 Issues to be Faced and Concerned 4 Human Resource (HR) Issues to be Faced and Dealt With 5 Issues to be Faced and Dealt with if Neither Managers nor HR  5 Task 2 5 Discussion of the Implications of the Decision of Accepting a ‘Buyout Offer’ 5 Task 3 7 Task 4 8 Preliminary Market Research and Market Analysis 8 Marketing Plan 9 Issues Relating to Production and Distribution 9 References 11 Task 1 Options Available to the Company In Terms of Future Based on the information provided, Guilty Pleasure is a London based small to Medium Enterprise (SME), which basically deals with cakes, pastries and coffee shop. The different options available to this SME have been elaborately discussed below. Innovation and Up-gradation: Guilty Pleasures must possess the option of adopting and executing innovative ideas in making cakes, pastries and coffees with utmost focus on quality. Skilled Manpower: Guilty Pleasures may also possess the option of employing skilled manpower for strengthening its customer base mainly in London and other home nations. Though the information provided stating that the SME is facing financial difficulties, the SME may employ a minimum number of skilled people for performing varied operational functions in the above discussed markets. Interaction: Personal interaction with customers generally leads a business to attain greater success in future. This could be one of the other important options available to Guilty Pleasures. Delivery Time: If Guilty Pleasures could cut the extra time of delivery and order placed within minimum time, it can address and mitigate the financial difficulties that have been facing while performing operational functions. Expansion Plan: For future retailing, expansion is important. Guilty Pleasures must establish multiple store chains outside the regions of London as well, once this SME is able to cope up with the financial difficulties (British American Tobacco, 2012). Issues to be Faced and Concerned As a management team of Guilty Pleasures, the following issues could be faced: Threat of Substitute Products: In London, there exist various shops that sell cakes as well as pastries to the customers. In this regard, the customers of Guilty Pleasures may found an alternative to purchase these items, if the SME fails to meet their requirements. Threat of new entrants: In the world of cakes and pastries, innovation is always welcome. New companies are often observed to create impression on their customers, which may create obstacles for Guilty Pleasures to conduct its operations efficiently. Power of Suppliers: Guilty Pleasures might face the issue of selecting suitable suppliers, as the suppliers’ bargaining power in the business filed wherein this SME serves is deemed to be much high. Power of Customers: Considering the fact there lays the presence of several companies that sell similar products to that of Guilty Pleasures, the SME might face the issue of retaining its existing customer base. Internal Threats: Lack of skilled people, quality fluctuation, problem in time schedule, customer service related problems and financial complications (British American Tobacco, 2012). Human Resource (HR) Issues to be Faced and Dealt With In accordance with the provided information, it could be found that the management team of Guilty Pleasures is quite open with its staff and the SME tends to issue regular updates to them. In this regard, one of the issues that might rise is increased enthusiasm and self-confidence level amid the staff members, resulting in performing with maximum aggressiveness. This might restrict the SME to keep greater control of such aggressiveness, which in turn, can cause operational flaws. Issues to be Faced and Dealt with if Neither Managers nor HR  If not acting as neither managers nor HR, certain issues are also likely to be emerged within Guilty Pleasures. In this regard, such issues can be reckoned as rising disagreements amid the staff and improper utilisation of available resources among others. Task 2 Discussion of the Implications of the Decision of Accepting a ‘Buyout Offer’ The senior management team of Guilty Pleasures has decided to go with ‘buyout offer’ from a large multinational company with the condition that the SME will have to lessen its staffing by 30%. Thus, the implications of the above stated decision on the management team of the SME can be better understood from the discussion below. The management team of Guilty Pleasures should remain careful while lessening its staffing by 30%. In this regard, the following implications have been framed: 70% of staffs 30% of staffs Age Must be young people who are willing to take part in making of cakes and pastries and deal with the customers, developing customer relations Unable to work properly Skills Semi-skilled staff may be considered Unskilled people must be removed Experience The SME always need experienced staff to ignore unwanted situations Inexperienced staff After ‘buyout’ situation, Guilt Pleasures has to deal with allotted premises for performing varied functions. Because, the SME needs much bigger space for kitchen area with cooking and backing facilities, storage area for cakes and pastries and also shop area for making coffee with display outlet area of the stated products. More importantly, introduction or the application of new machines would help the staff of Guilty Pleasures to ensure the promotion of quality management (British American Tobacco, 2012). HR team of Guilt Pleasures must possess the responsibility of designing an effective salary structure for the staff members based on experiences, skills and work areas. After ‘buyout’ situation, the HR team will need to redesign the existed salary structure for making the activities normal, which would in turn form an effective communication between staff and management team (British American Tobacco, 2012). ‘Buyout Process’ is deemed to be a tough situation for the staff of Guilt Pleasures. As per the terms of agreement, the management team of the SME has to cut down 30% of its staffing for accepting ‘buyout’ offer. This decision may create a critical situation for the existing staff members of the SME, which could be determined in the form of rising conflicts between them and the respective management team members (British American Tobacco, 2012). Task 3 The new business corporation has decided to change the product line into a new range of cigarettes aimed at young generation. New business relating to the product of cigarettes production should be the profitable one for the company but not in Corporate Social Responsibility (CSR) terms. As per CSR guidelines, companies must perform those activities that do not hamper the environment. It is projected in this regard that the product line of cigarettes would certainly create health issues. Guilt Pleasures must arouse objections to this new idea and thus seek for framing an alternative business idea that can satisfy both the involved parties. It will be vital to mention that Guilt Pleasures basically deals with cakes as well as pastries and it would be much favourable for the SME to make an attempt of refurbishing the other similar products including biscuits, cookies, chocolates and new range of cakes along with pastries (British American Tobacco, 2012). Task 4 Preliminary Market Research and Market Analysis The new management team of the SME would determine about its previous concept of business. It would like to develop new brand of cigarette. Before launching this new brand, it is essential for the company to conduct a preliminary market research and analyse the same. Based on this notion, the report published by the Department of Health and Human Service revealed that adult smokers of nearly 80% commence smoking prior to the age of 18 years. People are identified to consume cigarettes on a regular basis for refreshment and other purposes. Thus, the market area is vast, which must be considered by the SME to develop a new brand of cigarettes for the young people. There lays the existence of certain Global Drive Brands (GDB’s) including Dunhill, Pall Mall, Lucky Strike and Kent who are continuing to perform well in the respective product line within the business markets of London (British American Tobacco, 2012). The performance of these companies based on the performance of 2012 in the respective segment can be better understood from the following tabular representation: Dunhill Kent Lucky Strike Pall Mall Cigarettes Sold 49 67 33 83 Volume Growth +2% +1% +11% +3% Number of Market 130+ 90+ 80+ 110+ Source: (British American Tobacco, 2012) Based on the above provided information, it is evident that Lucky Strike has performed well in the dimension of volume growth relating to the product line of cigarettes in the business markets of London. Thus, in order to get aligned with the business market competition, Guilty Pleasures need to frame effective marketing plan that entail pricing, marketing strategies and cost estimation. Marketing Plan Pricing: Initially, Guilty Pleasures need to introduce low priced cigarettes in the business markets of London for capturing the same and getting aligned with the existing business market competition. Marketing Strategies: Competitive market strategies basically depend on market environment along with product positioning and product portfolio among others. This particular strategy can be adopted by Guilty Pleasures in order to make effective penetration into the competitive business markets of London. Cost Estimation: For the initial year, the total cost for the business of cigarettes that is estimated to incur by Guilty Pleasures is £100, 00,000. The profit or loss for the first year is ascertained to be 2.5%. Issues Relating to Production and Distribution Certain issues are required to be considered while producing and distributing the new product line of cigarettes to the end users. In this regard, one of such issues could be ascertained as problems persisting supply chain management (SCM) procedure. This issue mainly gets emerged by inappropriate suppliers’ selection and failure to determine the inventory levels as well (Action on Smoking and Health, 2014). References Action on Smoking and Health, 2014. The Economics of Tobacco. Fact Sheet. [Online] Available at: http://www.ash.org.uk/files/documents/ASH_121.pdf [Accessed March 30, 2015]. British American Tobacco, 2012. Downloads. Annual Report 2012. [Online] Available at: http://www.bat.com/ar/2012/downloads/batannualreport2012.pdf [Accessed March 30, 2015]. Read More