Problem Statement: What operation strategies for the banana bread product line should Ian propose that will enable the bakeshop to meet the expected demand for banana bread that will come in with the plan of expansion to 3 tourist destinations around Laguna?
CASE FACTS: The bakeshop is a family owned business and currently managed by Virginia Pahud-Castilla and Soledad Pahud. At first, the shop has no brand name, however, some competitors arrived therefore they decided to name their store “THE ORIGINAL BUKO PIE” since they are the pioneer. Banana bread making at Orient started as a way to pass the time for one of the bakeshop owners, Mrs. Virginia Pahud-Castilla. Subsequently, the shop incorporated banana bread into its array of fresh homemade “pasalubong” Banana bread accounts for 13% of the bakeshop’s revenue. The present daily demand is 90 boxes for small- 350gram. Recently, larger sized banana breads are added to the product line. The production of Banana bread has been transferred from Virginia Pahud- Castilla to her daughter, daughter-in-law and niece. Banana bread has been considered as an outsourced item since Mrs. Castilla’s daughter, daughter-in-law and niece have been given a free hand and all production costs are shouldered by them. Banana bread products are just delivered to the bakeshop on a daily basis and Mrs. Castilla’s daughter, daughter-in-law and niece are paid C.O.D.(cash on delivery). However, the current set up has been causing some angst among the family members since Mrs. Castilla’s daughter, daughter-in-law and niece only delivers around 60