Essay on Beanz Coffee Case

799 Words Jun 27th, 2016 4 Pages
What are the key problem(s) Lori and Doug are facing?

Enjoyed ownership and working with staff
Desire for more free time
Wanted to stay involved in community

Looking for new opportunities within the existing business
Stratford Waterfront Development (New Beanz)
Sell Beanz to the Highest Bidder Focus on a Management Buyout (Gradual ownership transfer method) Work with an Angel Investor (150,000 for 50% ownership) Considering their commitment to producing fresh and consistent homemade food, loyal staff base and a strong sense of community, to ensure its continued growth and presence

Which option(s) should they pursue to address the problem(s) you’ve identified?

Please be sure your recommendation(s)
…show more content…
Beanz' current financial situation is also an area of concern, as they have been operating at a net loss, and have a significant, and increasing, deficit.

The key issue that Lori and Doug face is making a decision about the direction they want to go with Beanz. They want to find a balance between their love for business ownership, and their need for free time. They are also extremely dedicated to their employees, and wanted to stay involved with the community. The market is quickly changing, and Lori and Doug know that they must make a decision about the direction of Beanz fairly quickly.
Lori and Doug narrow down five options for the future of Beanz: * Look for new opportunities to grow Beanz and increase profits * Open a new Beanz location in Stratford * Sell Beanz to the buyer who offers the highest bid * Gradually transferring ownership of Beanz to an existing employee * Sell half of Beanz to an angel investor who offered $150,000 to update and expand the business

Due to Lori and Doug's desire to have more free time, I eliminated the first two options almost immediately- looking for opportunities to grow Beanz, and opening a new Beanz location. Both of these require a significant amount of time, which is something that Lori and Doug are short on, and would like more of. These also require a lot of capital, which is not currently a strong point of Beanz.
Selling Beanz would make Lori and Doug's free time much more available.

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