Case Study

Topics: Management, Entrepreneurship, Strategic management Pages: 11 (3648 words) Published: February 4, 2013
Masters in Hospitality Management
FND 502 : Hospitality and Tourism Information Technology



‘Maybe we should start our own business.’ As soon as Paul said it, his two friends put down their coffee and stared at him. Paul Clermont, Sarah Odell and Christina Healy were second-year hotel and restaurant management degree students and they were looking over the business and travel news and lamenting the sluggish job outlook in their chosen field. They had always joked about starting a business together, but this time Paul was serious. With few prospects in the job advertisements, the three friends were worried that travel and entertainment wouldn’t pick up by the time they graduated. They’d begun their job searches in the autumn but weren’t interested in the available positions. So, like many other young people, they considered heading out on their own and becoming entrepreneurs. ‘Well, you know that I’ve always wanted to open a restaurant eventually, Paul,’ said Sarah. ‘I love being a chef. But aren’t we getting ahead of ourselves? How could we get enough cash together to rent a place and staff it? Rental space is really expensive locally and we don’t have the funds to pay anyone right now. We still have student loans to pay off when we graduate.’ ‘What about a pushcart in the university concourse?’ suggested Christina. ‘We could start small and take turns manning it ourselves. That’d keep our labour costs and store rental low. Besides, you’re always complaining about the greasy food at that burger place, Sarah. We could offer better alternatives to burgers and fries. The student concourse has been improved recently with new benches and tables, too. It’d be a perfect spot to open a small lunch business. All we would need is permission from the University Director of Services.’ ‘We’d still need a business plan to get a loan for start-up,’ Paul advised. He was excited about organizing a new firm, but knew they needed a detailed plan. ‘We have to think everything through carefully and show people that we know what we’re doing, or we’ll never get off the ground. ’ Sarah laughed. ‘You’re good with facts and figures,’ she said to Paul. ‘Must be the business and finance modules you took. With my restaurant management background, I’d love to develop the new menu. That’s the fun, creative part of this for me. Christina, you have so many contacts through your student union experience. That could come in handy down the road, don’t you think?’ ‘Looks like we each have some strengths that could help us get started,’ observed Christina. ‘So, what do you think? Shall we try it?’ The three friends stood up and raised their coffee cups in a formal toast to the new business – Better Bites

Assessing business needs

When Paul, Sarah and Christina agreed to start their business, they had no clear idea of the amount of work involved. They each had certain skills to contribute – innate skills and skills they had polished in their modules – and they were excited about becoming entrepreneurs. But as they continued to meet to sketch out their plans, they quickly realized they’d need to collect quite a lot of information and allocate responsibilities: They needed facts and figures on the local lunch business to draft a business plan. They needed to negotiate an agreement with the university to set up their cart and rent the cart itself. They needed to ensure that they met health and safety regulations. They needed to plan a menu and price items and then track which offerings generated the most revenue. They needed to advertise their business and print menus.

They needed a system to record food inventory, plastic serving utensils, paper wraps and serviettes – both costs and quantities. Keeping track of so much information could be a headache, but computer systems would provide part of the solution. The three friends had grown up using computers in their classes, surfing the Web for fun and sending emails...
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