Risk Analysis of MacVille Cafe

This report analyses the risk for the new project through the scope of risk management, factors, and objectives of the scope of risk management, internal and external stakeholder, PEST analysis, SWOT analysis, and the risk for the expansion of the business.

RUNNING HEAD: RISK ANALYSIS OF MACVILLE CAFE
Risk analysis of MacVille Cafe
Name of the Student:
Name of the University:
Author’s Note:

1RISK ANALYSIS OF MACVILLE CAFE
Introduction:
Macville Pty Ltd has established a chain of cafes in the Australian market like the
Central Business District (CBD) of Brisbane, Queen's land, and Sydney, New South Wales.
The Board of directors of this company has decided to expand its business. By purchasing
Hurley’s café in Toowoomba, Macville Pty Ltd has decided to expand its business in
Queensland. Paula Kinski, the CEO of Manville's cafe in Queensland, has assigned Mr. Ash,
the new manager of Toowoomba Store, to conduct risk management analysis for this new
project. This report will analyse the risk for the new project through the scope of risk
management, factors, and objectives of the scope of risk management, internal and external
stakeholder, PEST analysis, SWOT analysis, and the risk for the expansion of the business.
This report will help Paula Kinski to evaluate and manage risk factors. Managing the
identified risks through an efficient manner will help the company to deliver the best service
to the consumers.
The effectiveness of Macville Risk Management Framework:
The risk management framework of Macville Pty Ltd tries to manage the significant
risk elements such as policies and procedures, monthly reporting, business planning and
budgeting, risk management review and external audit (Aithal 2016). The risk management
framework will help the company to deal with the identified risks efficiently.
Policies and procedures:
Policies and procedures are made to manage the internal operation of the company.
There are three types of policies, which are Human resources policies, financial policies, and
Corporate Governance. The human resource policies include staff travel policy, return to
work policy, parental leave policy, harassment policy, work-life balance policy,
organisational culture policy, discrimination policy. The financial policies include bad debt

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policy, Finance, Audit and Risk management (FARM), Expenditure recognition policy, and
cash reserving policy. Corporate Governance policies include sitting fees policy, board
protocol, and Director's remuneration policy.
Monthly reporting:
The senior management team of Macville Pty Ltd conducts meeting every month to
identify risks and disputes. The company is interested in taking sufficient precautions to
resolve the disputes and manage the risks so that the company can deliver the best services to
the customers.
Business planning and budgeting:
To accomplish the targeted goal, the Board of Directors of this company develop an
appropriate business plan and allocate sufficient amount of money to execute the business
planning appropriately.
Risk management review:
Report of internal controls will be submitted in the Board meeting by the Finance
Audit and Risk Management Committee. This committee prioritises the risk management
sector of the company. The report created by the FARM team is submitted to the CEO of the
company. The Board of directors gets the report from the CEO. By conducting internal and
external audits, the FARM team suggests the Board of Directors develop the best strategy for
the business organisation (Torabi, Soufi and Sahebjamnia 2014).
External audits:
External expertise of chartered accountant will conduct the final audit and control the
final financial report of the company. The external expertise rechecks the financial statement
and provides feedback to the senior managers, the CEO, and the Board of directors through
the FARM committee (Sadgrove 2016).

3RISK ANALYSIS OF MACVILLE CAFE
The Risk Management Framework helps the company to detect the risk potentials. To
manage the risk elements and resolve the disputes, the report of this framework is essential.
The senior management team can prepare an appropriate strategy to manage the risk elements
and continue its business successfully.
The scope of risk management required and the role of a new manager:
Macville Pty Ltd has decided to expand its business. The Macville Pty Ltd purchases
the Hurley's Café in Toowoomba, and the company is interested in rebranding the existing
café. The risk management framework can detect the underlying risk factor. However, Mr.
Ash has the responsibility to identify specific risk factors for the Toowoomba project. To
govern the new projects, this company will conduct risk analysis through the framework, and
the report of Mr. Ash will help the framework to complete.
The risk elements of Macville Pty Ltd can be divided in to four parts, which are
operational, financial, governance, and project management. Operational risk includes
technology, marketing, communications, logistics, consumer interaction, product quality, and
market needs. The financial risks include accountability, capital investment, finance, fraud or
theft, interest rates. The governance risk includes conflict of interest and conduct of the Board
of Directors. The project management risk includes financial resources, processes, and tools
for project management, human resources, and relationship with stakeholders. This
framework covers most of the potential risk elements. The driving distance between
Toowoomba and Queensland is a problem for MacVille Café. Due to distance, it is difficult
for suppliers to deliver fresh food and raw material. Fresh food and raw material are needed
to maintain the quality of the café. The increasing competition in the Toowoomba area is
another problem for MacVille Company. Several international café companies are interested
in setting up a new branch in this area. Another issue is the traffic in this area. There are

4RISK ANALYSIS OF MACVILLE CAFE
several trucks parked in front of the café. These are the problem which should be managed by
the MacVille Café.
Paula Kinski, the CEO of the Queensland café of MacVille Company, has assigned
Mr. Ash to analyse the risk with the operational aspects of the takeover of the Hurley’s Café.
Mr. Ash, the newly appointed manager of this new store in Toowoomba. Mr. Ash has to meet
James Mansfield, the present senior supervisor of that store, and Ron Langford, the landlord
of the store. These two meetings will be helpful for Mr. Ash to understand the present
scenario of Hurley’s café and the business situation of the previous store. James Mansfield
and Ron Langford will spend time with Mr. Ash and will try to provide the answer to every
quarry of Mr. Ash. To analysis the operational risk of the new store, these meetings will help
Mr. Ash. The risk analysis report, created by Mr. Ash, will be delivered to Paula Kinski. The
risk analysis will be reviewed by the senior manager and the Board of Directors of the
company.
Success factors, objectives:
MacVille Café, which an Australia based café company, is successful in running the
business in Australia. There are several significant success factors and objectives of the
company, which helps the company to run the business successfully. Customer focus is one
of the significant success factors for this company. The employees of this company focus on
the consumer. Getting the importance in the café by the employees will create a positive
impact on the customers. The employee of this company engages with customer and conduct
customer research to identify the food culture of this area. After the customer research, this
management team will focus on the foods which have the highest demand in the local market.
This company prioritises the safety of customers and employees. Through this step, this
company retains its employees and customers. ‘Excellent performance of the employees’ is

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the third success factor of this company. Providing the best customer service in the café is the
aim of this company which helps this café company to build its brand reputation. The quality
of food and coffee will enhance the brand reputation of this company. If this café provides
the best quality food and coffee in the local area, then it will create a positive impression of
the café. MacVille Café delivers comparatively high quality foods and coffee in comfort,
entertaining and safe environment.
MacVille Pty Ltd is following its vision. To achieve the vision, the management team
of MacVille Café is following the policies and rules and regulations of the company. The
vision of this company is to provide the best café experience in the local area to enhance its
business. Maintaining the quality of coffee and food is another target of this company.
Another objective of this company is by providing premium customer service to the
customers by friendly and trained employees. Another objective of this company is to expand
its business in the popular location of Australia to enhance its market share and brand
reputation. This company is interested in expanding its business in Queensland and New
South Wales of Australia. There is another objective of MacVille Pty Ltd, which is improving
and inventing new food for the café and deliver the best quality of customer service in the
café.
Stakeholders:
Stakeholders
Internal/
External
Role in process Stake in process
CEO Internal The expansion
procedure is
supervised by him.
Achieving the goal
of expansion in the
new café with

6RISK ANALYSIS OF MACVILLE CAFE
minimal risk.
Manager Internal
Managing the new
store and assuring all
the procedures of the
store are done
appropriately.
Assuring the
maximum profit
from the new store.
Investors External
Contribute to the
improvement of the
business
organisation and
ensuring profit.
Expect the
maximum number of
profit as a return of
investment.
Suppliers External
Continuing the
supply of ingredients
and processed
products to the new
shop to maintain the
daily business.
Develop a
relationship with
Macville Pty Ltd to
become the largest
supplier of the
company for the new
store.
Workers Internal
Contributing their
maximum effort for
the company and
deliver the best
customer service.
Retaining their
position in the
company and earn
money as a salary.
Customers External Get their desired Receive the best

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product of Macville
Pty Ltd and thereby
contributing to the
income of the
company.
products and the best
services available in
the area.
Shareholder Internal
Retaining the
company’s shares as
much as possible
Continuous
development of the
company will
enhance every share
unit of the company
PEST analysis:
PEST analysis will help the MacVille Pty Ltd to identify its risk related to political,
economic, social, and technological areas.
Political:
The new legislation discussed by the federal government will be beneficial for the
MacVille. The water-related issue will be resolved by the new legislation, which will help
this business organisation to operate its new business in Toowoomba (Chernysh and
Chelembiienko 2019).
Economic:
The present store of Hurley’s café has the necessary infrastructure. After buying this
store, the MacVille café has to modify this new store. The Macville has to spend less amount

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of money to modify the new store (Drake, Rancilio and Stafford 2017). The new café can
become a prosperous place because the customers of Hurley café, are familiar with the place
so they will come to the new café.
Social:
The new café of Macville in Toowoomba can get a benefit of the location. The place
where the Hurley café was located is known to the regular customer of Hurley cafe. The
regular customer will come back to the new café if the new café can provide better service.
The new café has to retain regular customers by providing the best services.
Technological:
Macville Company invests a vast amount of money to use modern technology for the
water supply system. The usage of latest technology is beneficial for the company to avoid
the extra-fine because of water usage (Schrader 2015).
SWOT analysis:
The SWOT analysis will be done to identify the strength, weaknesses, opportunities,
and threats of the new café of Macville in Toowoomba.
Strength:
The strength of this new café is an attractive location. The new café is situated on the
intersection of two main streets. The location of the store is well connected by public
transport. Customers can come to this café without any hassle and spend time in this café.
The interior of this café is another strength of this new shop. Macville Pty Ltd has to modify
the interior a little bit, and it will attract not only the regular customer of Hurley’s café but
also the new customers (Sarsby 2016).

9RISK ANALYSIS OF MACVILLE CAFE
Weakness:
As the location of this new shop is at the intersection of two streets, this new shop has
two weaknesses. This new store faced obstacles for the parking of trucks. Heavy traffic jam is
created because of a massive number of trucks (Adamowicz and Ziółkowska 2018).
Opportunity:
Macville Pty Ltd has an excellent opportunity to expand the business in the
surrounding premises by establishing several branches. Ron Langford, the landlord of the
shop, refers that the population of this area is rising, and in the future, the café can get huge
customers by providing the best services. The people of this area have a high purchasing
power. This establishment of café in this area will help the company to enhance its profit. The
new ordinance will be implemented, which will allow cafés in this area to use the footpaths
and put more tables. The law is in favour of the business organisation and provides new
opportunities for the business growth of Macville Pty Ltd (McDONALD 2016).
Threat:
There are two threats to the new store. Firstly, the law regarding the excessive use of
water will be implemented by the government. For excessive use of water, every company
has to levy $50000 as fine. The business of Macville Pty Ltd will be affected by this new law.
The new café has to use the latest technologies for water usage to avoid the penalty. The
second threat is increasing competition in this sector (Gürel and Tat 2017). According to Ron
Langford, several international café chains are interested in establishing café in this area.
Method of research:
To complete the research, the method that was used will be discussed in this part. The
method would help to find business information, the legislation of local government,
regulations, risk factors, and problems for setting up new café in Toowoomba. To do the

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PEST analysis and SWOT analysis, information is needed. The method of research helped to
collect information. James Mansfield, the present supervisor of Hurley’s café, provided
valuable information about the business culture of this area, work culture. Ron Langford, who
is the landlord of the shop and local councillor, provided valuable information, which was
used in SWOT analysis and PEST analysis. A government report named ‘Economic Brief, ’
which was provided by Ron Langford, helped Mr. Ash to collect information about
government laws and regulations. Ron Langford offered to assist in the establishment of the
new café in Toowoomba. The local councillor provided information about the technological
development of Toowoomba. The seller of the shop provided the store information about the
shop. The head office of MacVille café has a report about the risk of expansion, which was
conducted by the NSW team. To understand the structure of risk analysis, that report, which
is in the head office, was used. The legal information was collected from the legal firm
Goldsmith Partners. Goldsmith Partners is helping the MacVille Café to complete the
acquisition procedure. From the site visit of Toowoomba important information such as the
employee of the café, work culture is identified.
Summary of the risk analysis of the new café in Toowoomba:
The summary of the risk analysis of MacVille Café will be done in this part. The risk
analysis identified certain risk factors and issues in setting up a new café of MacVille
Company in Toowoomba. The management team of MacVille Company should resolve
several issues. The continuously increasing competition in the local area, new laws of the
local government regarding water usage, bank-related issue, the distance between Queensland
and Toowoomba, the technological problem are those risk factors. While expanding the
business, the senior management team and the manager of the new café of Toowoomba has to
evaluate the significance of these issues and prepare the strategy to handle these situations.
The CEO of MacVille Company analysed the risk analysis report. An appropriate plan and

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actions would be taken to manage these risk factors and problems. Mr. Ash did a risk analysis
for setting up the new café in Toowoomba. The CEO, senior management team and the
manager will evaluate the risk analysis report. For the business growth of MacVille
Company, this risk analysis is crucial. Based on this report, the new plan and policies will be
prepared by the Macville authority to manage risk factors.

12RISK ANALYSIS OF MACVILLE CAFE
Email for the stakeholders:
To,
The Stakeholders of MacVille Pty Ltd,
Queensland
Subject: Risks regarding business expansion in Toowoomba
Dear Stakeholders,
We are hereby informing the stakeholder that MacVille Pty Ltd is planning to expand its
business. The company has a target to set up a new brunch of MacVille Pty Ltd in
Toowoomba. Before expanding the business, this company has conducted a detailed risk
analysis for the new brunch in the Toowoomba region. Through this risk analysis, the
company has come up with several substantial risks. To resolve these risks, the company
requires substantial attention. The risk analysis conducted by the company has identified
several risks. The senior management team of the company categorised these risks, which are
new rules and regulation of the local government, increasing competition in the sector, the
distance between Brisbane and Toowoomba, water issues, and cash handling. To overcome
these obstacles, the authority of MacVille Company recommends the stakeholders to get
detailed information from the management. The management team will provide every detail
information about the risk analysis and the whole situation. The authority of this company
requests every stakeholder of the company to assess the information and provide valuable
advice to overcome the critical situation. The management team will analysis every
suggestion provided by the stakeholders. The management team will use the best suggestions
to resolve the problem. Advice from the stakeholders will help the business organisation to
server better. The management team of the MacVille business organisation is expecting

13RISK ANALYSIS OF MACVILLE CAFE
contribution and cooperation from every stakeholder by delivering suggestions. The company
is interested in keeping serving the stakeholders in the best possible way.
With regards,
Mr. Ash
The Manager
MacVilleCafe,
Toowoomba Shop

14RISK ANALYSIS OF MACVILLE CAFE
Summary of the meeting with the CEO:
Paula Kinski, the CEO of MacVille’s café in Queensland, has assigned Mr. Ash to
analysis the risk related to the operational aspects of the takeover and set up a new café in
Toowoomba. Mr. Ash informed Paula Kinski about the new issues and risks for setting up the
new café in Toowoomba. The important points related to risk issues are provided below.
 Critical issues and several risks were identified.
 A brief description of the present scenario of Toowoomba was provided to the CEO
of MacVille Café. Paula Kinski was agreed with the recognised risk factors.
 A brief discussion was done with the CEO. To resolve the problems and manage the
risk factors, several steps are taken. The steps and its procedures to solve the issues
were informed to the CEO.
 Mr. Ash, the new manager of the new café of Toowoomba, was granted full authority
to control the new café. The new manager will manage every situation and prepare a
plan to run the café successfully.
 In the future, several investigations will be done to find new risks. To manage those
newly identified risks senior management team, manager of the new café of
Toowoomba, will prepare the plan.

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