Operations Management in the Coffee Industry

This assignment delves into the realm of operations management within the coffee industry. It requires a critical analysis of various aspects, including supply chain networks, business process orientation, quality attributes of specialty coffee products, and customer service in coffee shops. The focus is on understanding how effective operations management contributes to the success and sustainability of businesses in this competitive sector.

Operation Managment

Contents
INTRODUCTION...........................................................................................................................1
TASK...............................................................................................................................................1
Q1 Justifying the best suited Marvin coffee shop by considering the entire factor and assuming
that Brexit will not be causing any difference to trading.............................................................1
Q2 Marketing mix for Marvin and Smith coffee shop................................................................3
Q3 Impact of geographical areas on culture and supply chain of organization...........................4
Q4 Impact of decision making on profitability and liquidity......................................................5
REFERENCES................................................................................................................................7

INTRODUCTION
Marvin and Smith are working together since long time in the food and catering business.
They are running their business successfully in the year 2016 they have opened new coffee shop
in South London. They are planning to expand their business across the world. The report will
suggest country where cited firm can expand its business. Furthermore, it will explain marketing
mix element for the food and catering business.
TASK
Q1 Justifying the best suited Marvin coffee shop by considering the entire factor and assuming
that Brexit will not be causing any difference to trading
Marvin & Smith planning to open new coffee shop in European market and choose Italy for his
first choice (Heizer, (2016). It is the best choice according to climate and effective market
condition. People of Italy are very fond of coffee and according to survey people are loved to
have the coffee shops in the city. They loved the different types of variety of coffee such as
cappuccino, cafe latte, latte macchiate or milky etc. According to the people they always start
their day with one cup of coffee a cappuccino with their breakfast they people also loved Italian
roasted coffee and alike all the other cultures in ltaly is also very mysterious law ( Jang, Kim &
Lee, (2015). Throughout the whole day every Italian drinks 3-4 average coffee in a day. This is
the reason for which M&S planning to open coffee shop in the Italy. For making ordering like as
be (Davis & et.al.,., (2018). fore they purchase their coffee beans from Uganda in order to earn
independent income from Gumutindo that the place from which they purchase beans for its
coffee. In Italy M&S adopt the sane process of purchasing coffee beans (Jang, Kim & Lee,
(2015). For plantation of coffee beans in Italy environment is very bad according to their bad
weather and environmental conditions. People of Italy growing coffee in indoor plant as no
coffee are grown in Italy.
In Italy market there is only available roasted coffee is grown for espresso rest of the
beans are used for exporting in another country. For M&S it is the best option to open coffee
shop in Italy market (Mahadevan, (2015). In 2015 Britain decided to leave EU by the of mid of
2019. In according to the impact of M&S decision will not get affected. Italy is the very small
part of UK this is the reason it was not get affected by the effect of Brexit. Italy is the best choice
for M&S coffee shop to get coffee beans from Uganda and mainly employing the staff from
Italy. They need to consider while they making planning to establishing their coffee shop.
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Logistic consideration
It refers to look upon those factors which may affect the company in terms of
resourcing. This process helps to make the planning of resources which is required for coffee
shop (Jang, Kim & Lee, H., (2015) It helps to arrange the quantity of raw material such as
labour, capital and raw material which is essential factor for running the coffee business. Before
starting the process of opening coffee shop in the Italy market M&S needs to analyse the market
situation of Italy in order to reduce the uncertainty and risk. Along with that city of Rome which
is the capital of Italy. They need to plan about the labour, location and other resources which are
required. They also decide to plan about the financial resources which they will take from bank.
Ethical consideration
Another factor which is required to be considers, that is ethical consideration si
the most required work for Marvin & Smith (Taj & Mousavidin, (2015).). Ethical refers
what is to be done or what is not to be. M&S needs to research about the ethical
consideration of Italy like there people likely to prefer coffee in morning, breakfast,
afternoon and in dinner.
Structural challenge
Structural challenge is the most challenging situation for the M&S. M&S needs to
adopt legal structure of Italy
Foreign law: after the presence of Brexit effects Britain will be affecting the relationship
of UK with that of other countries at Europe (Taj & Mousavidin, (2015). In terms of Italy
market it is likely flexible and convenient for opening the coffee shop in Roman.
Pricing strategies: another factor to be considered that is most significant that is price of
all types’ coffee which they would be offering in Italy.
On the other side it is also very necessary for M&S to measure all legal
consideration for the coffee shop. It helps to mitigate the future risk and interference of
government. It also makes good presence of the coffee house which helps to establish best
productive output. Marvin & Smith import coffee beans from Uganda to reduce their
additional cost. For that, they also need to consider import services and their cost (Taj &
Mousavidin, (2015). Along with that, to make good position in the market of Italy they
also need to analyse the needs and wants of the customers related to the coffee shop
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services. M&S acquire proper legal format through which they focus on the main
objectives.
Q2 Marketing mix for Marvin and Smith coffee shop
Marketing mix is considered as one of the most important element for the business. It
assists in relieving high quality products to consumers and satisfying their needs (Gasperazzo,
Toffanin & Larese, (2017). It includes: product, price, pale, promotional strategies of the
business that help the entity in gaining success. Marvin and Smith coffee shop wants to enter into
the new market, for that it is essential for the company to adopt effective marketing mix element
so that it can meet with its objectives. 7P's of marketing mix are described as below:
Products
Company needs to considered more on their products and have to provide products as per
the needs of consumers (Godos & et.al. (2014). As it is planning to enter into Italy thus, it is
required to identify needs of their population so that it can offer them satisfactory products. Italy
peoples like to use Cappuccino coffee with breakfast, cafe macchiato in noon. Thus, cited firm
need to offer them same products so that people get attracted towards the location. Marvin and
Smith has huge experience of working in the industry, it has strong relationship with its
suppliers. Its imports beans of coffee from Uganda Gumutindo coffee plantation. This products
will be liked by consumers of this country. Company needs to offer Wi-Fi services to its buyers
so that they come to this frequently (Özen, Pons & Tur, (2014).
Place
Marvin and Smith coffee shop needs to open the shop in most visible place. It can open it
near high street or in mall. This will attract more people towards the coffee shop (Cardoso and
Shikida, 2016).
Price
It is considered as one of the most important aspect of marketing mix, prices influences
mind of consumers to great extent (McCormack & Johnson, (2016). Cited firm is planning to
provide high quality food and coffee products to its buyers thus, it has to take effective pricing
decision. There are various types of pricing strategies that can be adopted by Marvin and Smith
coffee shop. These are such as competitive pricing, skimming etc. Cited firm will adopt
skimming pricing strategy. At the initial phase it will keep low prices of products so that people
get attracted towards the location and once they start liking the products then company will
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enhance prices (Miura & et.al., (2014). But it is able to recover its liabilities soon. All these
financial decision help the cited firm in sustaining in the market for longer duration and
conducting its business in the new country effectively
Promotion
It is the most essential aspect, that helps the firm in making strong connection with the
consumers and circulating message to the mass audience. Marvin and Smith coffee shop will
promote its product through social networking sites. It will make connection with people through
Facebook and Twitter (Niinomi & et.al, (2014). It will ask for their interest and will offer them
attractive discounts so that they make their mind to come to this place. It will also organize
promotional camps in mall so that mass people of Italy can get to know about its new products.
Physical evidences
Layout, equipments of the shop will have standards. There will be attractive designing
and infrastructure in the coffee shop so that people feel happy in the place.
People
Marvin and Smith coffee shop will hire skilled employees those who can communicate
well with the people of Italy. Furthermore, it will give training to its staff members so that they
can deal with consumers well and can offer them delicious and amazing coffee and food (Pei-
rong & Bureau, (2014). Company make people aware with the requirement of consumers and
what they want in services. By this way staff members become able to deal with them effectively
that enhance satisfaction level of consumers.
Process
process of the serving the products to consumers will be smooth. Clients will not face any
difficulty .
Q3 Impact of geographical areas on culture and supply chain of organization
Organizational culture
Marvin and Smith coffee shop is planning to enter into the Italy market. It is completely
different geographical area from London and company needs to understand this area and
accordingly it has to conduct its operations in the new market (Marketing mix, (2017). As
people of Italy are very soft and they trust on the firm easily if they get satisfactory services. In
order to cover wider geographical areas of Italy cited firm needs to make changes in its
organizational culture significantly. Company needs to give raining to the staff members about
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how to deal with consumers if they face language barriers. This will help the person in dealing
well with consumers (Miura & et.al., (2014). Company needs to understand the culture of this
geographical area and have to make changes accordingly. People are Italy like traditional things
so company needs to design its culture traditionally. Employees needs to behave well in
traditional manner with the consumers. By this way it will be able to enhance satisfaction level
of costumers and will be able to sustain in the market for longer duration.
Supply chain
Marvin and Smith coffee shop current running its shop in London market. Now it is
planning to enter into Italy which is completely different from London. Brexit has created huge
difficulty for the European countries. After Brexit organization have to face export and imports
difficulties. Though government has put hard efforts and now European countries are able to
provide full support the business. Cited firm needs to consider the effect of Brexit on its
suppliers (Gasperazzo, Toffanin & Larese, (2017). As currently Marvin and Smith coffee shop
is receiving the beans from Uganda because it has strong relationship with the suppliers. This
supply chain can get affected if it conducts operations in the Italy. But company will be able to
make connection with new suppliers and will be able to get high quality raw material at
affordable rates. This will be helpful for the growth of business. As there are many cited which
are connected with it such as Amalfi coast, Venice etc. from where entity will be able to get
quality raw material. This will be beneficial for the entity (Godos & et.al. (2014).
Q4 Impact of decision making on profitability and liquidity
Marvin and Smith coffee shop recently operating in London and where company does
not have taken any formal loan and other external debt. Thus, it is beneficial for the company to
take a loan in order to expand its business in the Italy. As recently cited firm does not have any
liability so it can manage this loan easily (Özen, Pons & Tur, (2014). In the year 2016 sales of
Marvin and Smith coffee shop was 360000 and it has earned gross profit of 20800. Net profit
earned by the entity in the same year was 2680. This reflect that decision making impact on
profitability and liquidity of the business unit. As it has taken correct decision and has invested
in right direction which has helped the firm in earning more revenues. Marvin and Smith coffees
hop can perform well in Italy as well but it needs to look upon its major competitors in the Italy.
Company needs to make strategies in such manner so that it can gain competitive advantage and
can earn profit in Italy as well (Marketing mix, (2017).
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People like to have coffee with their friends and families. This helps them in spending
quality time with their loving ones. people of Italy also like to have coffee that can help the
coffee shop in increasing its sales revenues and earning more profit. As per the statistical report
of Marvin and Smith coffee shop in London expenses of the firm are less as compare to its profit.
It has good control over its expenditures hat support the entity in earning more revenues and
minimizing its wastage (McCormack & Johnson, (2016). It makes good decision of utilizing
resources well (Taj & Mousavidin, (2015). That has helped the firm in earning net profit of
268000 in the year 2016. Cited firm has taken good decision of utilizing assets well that is why
entity is able to get high return over its assets as compare to liabilities. Its debt are in control that
helps the firm in earning more profit. All its decision of the firm assist in sustaining in the market
for longer duration and expanding its business operations well. Good assets' management helps
the firm in making effective planning for the future so that it can grow well and can earn more
profit. Company has purchased two coffee machines in its shops which occur cots of 5000
(Özen, Pons & Tur, (2014). But it is able to recover its liabilities soon. All these financial
decision help the cited firm in sustaining in the market for longer duration and conducting its
business in the new country effectively.
CONCLUSION
From the above section it can be concluded that the case study of Marvin & smith coffee
shop in London with 2outlets. Now they planning to open another start-up in Italy start-up will
be going to held in January 2016 and since that time them earning good profit in London market.
The idea of opening the new outlet will take very quickly and fast. They require taking time and
getting perfect result of the Italy market according to that they need to plan. M&S needs to
measure the more information about the market and their rival firms in the Italy. Moreover,
coffee house in Italy is not a bad ides of M&S but before the opening the coffee store they need
to analyse the competition and social level. Along with that, M&S also needs train their staff
according to the customer to ensure the productive environment in the business. M&S should
make strategic planning to make the good presence in the market. Along with that, they also
needs to offer new attractive services to attract the customers towards the store.
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REFERENCES
Books and Journals
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in dock workers in Trieste (Italy). La Medicina del lavoro. 108(5). p.6224.
Godos, J., & etal. (2014). Coffee components and cardiovascular risk: beneficial and detrimental
effects. International journal of food sciences and nutrition. 65(8). pp.925-936.
Özen, A. E., Pons, A. & Tur, J. A., (2014). Consumption of functional foods in Europe; a
systematic review. Nutricion hospitalaria. 29(3).
Cardoso, B.F., & Shikida, P.F.A., (2016). The Italian coffee import: a gravity model analysis.
Rivista di Economia Agraria. 71(1). pp.127-133.
McCormack, K. P. & Johnson, W. C., (2016). Supply chain networks and business process
orientation: advanced strategies and best practices. CRC Press.
Miura, K., Sakai, M. & Kobayashi, A., Fujitsu Limited, (2014). Storage system and operation
management method of storage system. U.S. Patent Application 14/279,380.
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vehicle, vehicular traffic system, and program. U.S. Patent Application 14/763,155.
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loyalty to green stores: The moderating role of green consciousness. International Journal of
Hospitality Management, 44, 146-156.
Taj, S., & Mousavidin, E. (2015). Using discrete event visual simulation to teach process
modelling in MBA operations management courses. International Journal of Simulation and
Process Modelling, 10(1), 45-64.
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Carvalho, J. M., Paiva, E. L., & Vieira, L. M. (2016). Quality attributes of a high specification
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Ivanov, D., Tsipoulanidis, A., & Schönberger, J. (2016). Global supply chain and operations
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Marketing mix. 2017 [Online] Accessed through
<https://www.scribd.com/document/292738656/7-Ps-of-Starbuck-Services-Marketing-Strategy>
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