Mystic Monk Coffee
Mystic Monk Coffee: Case Study
BUS5480: Strategic Management
Group A
Oluwatoba Afolabi
Timothy Beard
James Carnrite
Jared Fawcett
Submitted to:
Uchena Nwabueze (Professor)
On
March 17, 2013
EXECUTIVE SUMMARY The Carmelite Monks of Wyoming are a religious order of the Catholic Church, founded by Father Daniel. Father Daniel Mary has a vision of moving the monastery from the current small makeshift home to a 500-acre Irma Lake Ranch capable of housing up to 30 monks, a Covent, a retreat center, and a hermitage. The current price of the Irma Lake Ranch is listed as $8.9 million, which presents a considerable financial obstacle in this pursuit. The Carmelites Monks of Wyoming currently run a coffee business called Mystic Monk Coffee (MMC). Father Daniel Mary, while looking at the financial capabilities of the monastery, is evaluating the possibility of achieving the Monastery’s strategic goal with current resources. This is a relatively large leap – compared to the current 4-bedroom range style home, which currently houses only 13 monks. Father Daniel Mary, who lacks the business experience, is considering to what extent the Carmelites can rely on the Mystic Monk Coffee operations to fund the remaining balance of the Irma Lake Ranch purchase. Our recommendations take into account the following considerations: • The received donation of $250,000 and current plea for additional funds. • The capacity and profit potential of the current roaster. • The capacity and profit potential along with ROI of upgrading to the larger roaster. • The market potential for sales and growth. • The time constraints resulting from the strict Carmelite schedule and routine. • The needed $445,000 down payment (assuming 5%) on a negotiated $8.5 million purchase price and the $40,365 monthly mortgage payment on a 30yr loan at 4% rate.
Our research provided some possible scenarios that will guide our recommendation: • Invest in the
BUS5480: Strategic Management
Group A
Oluwatoba Afolabi
Timothy Beard
James Carnrite
Jared Fawcett
Submitted to:
Uchena Nwabueze (Professor)
On
March 17, 2013
EXECUTIVE SUMMARY The Carmelite Monks of Wyoming are a religious order of the Catholic Church, founded by Father Daniel. Father Daniel Mary has a vision of moving the monastery from the current small makeshift home to a 500-acre Irma Lake Ranch capable of housing up to 30 monks, a Covent, a retreat center, and a hermitage. The current price of the Irma Lake Ranch is listed as $8.9 million, which presents a considerable financial obstacle in this pursuit. The Carmelites Monks of Wyoming currently run a coffee business called Mystic Monk Coffee (MMC). Father Daniel Mary, while looking at the financial capabilities of the monastery, is evaluating the possibility of achieving the Monastery’s strategic goal with current resources. This is a relatively large leap – compared to the current 4-bedroom range style home, which currently houses only 13 monks. Father Daniel Mary, who lacks the business experience, is considering to what extent the Carmelites can rely on the Mystic Monk Coffee operations to fund the remaining balance of the Irma Lake Ranch purchase. Our recommendations take into account the following considerations: • The received donation of $250,000 and current plea for additional funds. • The capacity and profit potential of the current roaster. • The capacity and profit potential along with ROI of upgrading to the larger roaster. • The market potential for sales and growth. • The time constraints resulting from the strict Carmelite schedule and routine. • The needed $445,000 down payment (assuming 5%) on a negotiated $8.5 million purchase price and the $40,365 monthly mortgage payment on a 30yr loan at 4% rate.
Our research provided some possible scenarios that will guide our recommendation: • Invest in the