Buckstar Coffee Case Study
BuckStar Coffee has seen tremendous success over the past five years, and with this success comes opportunity. With the excess capital that has accumulated in the past years, BuckStar Coffee has the chance to invest in an expansion project that can increase our annual revenues in the coming years. There are two possible alternative uses for the excess capital: expanding BuckStar’s product offerings and services or to expand the company’s footprint. Our aim is to best satisfy the following goals: increase profits and maintain a workable supply chain. After considering the two alternatives, the best choice is to expand the company’s product line and services.
If BuckStar were to expand into Canada by adding 1,500 locations, it would take one …show more content…
Research and analysis indicates that people like to drink coffee between the times of 6am to 9am and 11pm to 1am, and when they do drink coffee, they like to pair it with donuts above any other food. Not only would BuckStar be able to adjust store hours immediately, but it could also begin selling a variety of donuts within four weeks. Also, adding a drive-thru window would attract on-the-go customers. BuckStar would need to invest $5,000 in a donut machine for each store and a little under $20,000 to add drive-thru windows to the stores. However, this investment would allow for increased profits in a short amount of time. BuckStar only has one distribution center located in Albany, NY, but it is still able to maintain a steady and workable supply chain because it is located at a midpoint between the most northeastern store and the most southwestern store. Revamping BuckStar’s current products and services will not only increase profits but also continue to allow a workable supply chain.
Expanding into Canada would be costly, time consuming, and inefficient. However, extending store hours, adding an assortment of donuts, and installing drive-thru windows would enhance customer experience and therefore increase profits. This combination of convenience, accessibility, and variety would allow BuckStar to cater to a larger consumer base than before. The decision to expand BuckStar’s product offerings and services adhere to the company’s agenda and is an effective way to invest the excess
If BuckStar were to expand into Canada by adding 1,500 locations, it would take one …show more content…
Research and analysis indicates that people like to drink coffee between the times of 6am to 9am and 11pm to 1am, and when they do drink coffee, they like to pair it with donuts above any other food. Not only would BuckStar be able to adjust store hours immediately, but it could also begin selling a variety of donuts within four weeks. Also, adding a drive-thru window would attract on-the-go customers. BuckStar would need to invest $5,000 in a donut machine for each store and a little under $20,000 to add drive-thru windows to the stores. However, this investment would allow for increased profits in a short amount of time. BuckStar only has one distribution center located in Albany, NY, but it is still able to maintain a steady and workable supply chain because it is located at a midpoint between the most northeastern store and the most southwestern store. Revamping BuckStar’s current products and services will not only increase profits but also continue to allow a workable supply chain.
Expanding into Canada would be costly, time consuming, and inefficient. However, extending store hours, adding an assortment of donuts, and installing drive-thru windows would enhance customer experience and therefore increase profits. This combination of convenience, accessibility, and variety would allow BuckStar to cater to a larger consumer base than before. The decision to expand BuckStar’s product offerings and services adhere to the company’s agenda and is an effective way to invest the excess