Marvin & Smith's Coffee Shop: Expansion Plan and Financial Analysis

Case Study: Marvin & Smith's Coffee Shop

Contents
Introduction...........................................................................................................................................3
Selection of a Country...........................................................................................................................3
Effects on Profitability and Liquidity......................................................................................................5
Conclusion.............................................................................................................................................7
References.............................................................................................................................................8

Introduction
This case study gives a view of expansion plans of coffee shops run by Marvin and
Smith, two veterans of food industry. It selects Cyprus as a new location for their expansion
plans and provides a suitable justification for it on the basis of various parameters. The
second part presents the effect of business decisions on profitability and liquidity of the
organization.
Selection of a Country
Marvin & Smith are two veterans of food industry and catering industry. After taking
into consideration all financial and non-financial factors, Cyprus presents a good opportunity
for expanding their coffee business. Cyprus has a history of coffee culture. Large number of
locals and tourists consider it one of the most important drinks on the island. Coffee shops are
present all around the island and can be found next every second grocery shop. They present
a nice opportunity for family and friends to gather and enjoy their daily conversation. On can
easily find large international coffee chains in Cyprus but traditional coffee shops are best
way to experience local coffee culture. Therefore Cyprus naturally becomes a good market
for coffee industry and shops and ideal location for expansion of their business (Cyprus for
travellers, 2018).
Cyprus is a located in Mediterranean Sea near African continent and has a natural feel
of East African culture. Hank and Patty believe in providing coffee made of high quality
beans sourced from Uganda. They are also interested in delivering to their customer’s world
class tea and herbs from Uganda; and African snacks. Overall they want an East African
experience for their clients and such a culture can be easily replicated in Cyprus. Logistically
it is easier to import and source their raw material from Uganda to Cyprus as compared to
importing them to other EU countries. Transportation costs will be considerably saved as