Business Management Report: Coffee Shop Strategic Analysis

This report analyzes the business management of a small coffee shop, focusing on its vision and mission statements, and future strategic plans. It presents a business canvas model, highlighting key partners, activities, value proposition, customer segments, and revenue streams in both current and future states. The report also includes a value chain analysis, examining primary activities like inbound logistics, operations, outbound logistics, marketing, and sales, alongside support activities such as firm infrastructure, human resource management, and technology. Furthermore, it discusses the implementation of the strategic plan, reflecting on the current operations and suggesting future improvements to enhance customer service and expand market presence, including the integration of advanced technology and expansion into international markets. The coffee shop aims to become a leader in the coffee and tea industry by focusing on innovation, quality, and excellent customer service.

BUSINESS
MANAGEMENT
1

TABLE OF CONTENTS
Introduction......................................................................................................................................3
Vision statement..........................................................................................................................3
Mission statement........................................................................................................................4
Business canvas model................................................................................................................4
Value chain analysis....................................................................................................................7
Implementation of strategic plan.................................................................................................9
Reflection...................................................................................................................................10
2

INTRODUCTION
In the modern scenario, efficient management of operations and activities is vital for long
term success of a business enterprise. Furthermore, companies are required to formulate and
implement the strategic plan which can support in identify and utilization of future business
opportunities (Elder, Lister & Dauvergne 2014). It can be asserted that strategic plans also assist
organizations in getting a competitive advantage over other market players operating in the
industry.
The present report is based on a small coffee shop which is currently operating at small
scale. Further, the store is working with one manager and two staff who provide customer
services. This study reflects the vision and mission statement of the coffee shop. Apart from this,
a business model is also mentioned, and the model highlights the current and future state of the
selected business enterprise.
Vision statement
It can be stated that development of vision statement is essential as it acts as a roadmap
for companies and provides directions for long term success. The vision statement indicates what
a business ultimately wants to achieve (Chiang 2013). The statement plays a vital role in
inspiring and motivating workers to give their best towards the success of the company.
Furthermore, strategic plans of organization cannot be devised without formulating vision
statement (Schaltegger & Burritt 2014). However, it can be critically argued that communicating
vision statement to every employee is the most challenging task for a company (Friberg 2015).
According to the provided business case, certain changes are required to be carried out in the
overall operations of the coffee shop to obtain better business opportunities and attract more
customers in future. The vision statement of the coffee shop is mentioned below as:
“To become the leader in coffee and tea industry by promoting a culture of innovation,
quality and excellent customer service.”
The mentioned above statement indicates that the small coffee shop is now looking
forward to expanding its business operations and become the leader in the food and beverage
industry. In future, the coffee shop is going to give intense competition to the big coffee brand
such as Starbucks and Barista. For this purpose, the selected business enterprise is going to
invest resources in the technology and employees development.
3

Mission statement
In simpler terms, the mission statement can be defined as a formal statement which
includes the summary of company’s values and aim (Wheelen & Hunger 2017). It can be stated
that mission statement is entirely different from vision and people often gets confused between
these two (Forgang 2015). The reason for the existence of a business enterprise is reflected by
the mission statement. In adding to this, mission statement provides support to the vision
statement and help in an accomplishment of the same. Further, changes can be carried out in the
mission statement of a company by changing priorities and business environment (Hill & Jones
2013). The mission statement of the chosen coffee shop is reflected below as:
“To deliver the best quality of espresso and brewed coffee to all the customers and develop
brand loyalty among them.”
To achieve this statement, it will be required by the coffee shop to invest resources and
efforts in right direction. The business will need to conduct market research to identify the gap in
the industry and then will be required to develop products and services according to the same. In
addition to this, the coffee shop will also be expected to emphasize on training and skill
development of all employees so that they can deliver fast, accurate and satisfactory
products/services to all customers.
In the next 4 or 5 years, the business will be operating with its official store scattered in
different locations of the world. The coffee shop will emerge as one of the best global coffee
chain across the globe. To achieve these objectives, aggressive marketing practices will be
carried out so that a strong brand image of the coffee shop can be developed. The primary focus
will be laid on two major factors which are innovations and satisfying changing customer
demand in the market.
Business canvas model
Business canvas model can be termed as a chart which highlights critical areas such as
value proposition of products/services, customers, overall infrastructure (Gopinath & Siciliano
2013). Further, the existing and future business canvas model of coffee shop is reflected below
as:
4

Current state
Human
Financial Print media
Coffee bean price Offering coffee and fast foods
Tax avoidance
The mentioned above chart reflects the existing business model of the coffee shop. It has
been analyzed that the key business partners of the firm are the coffee growers and suppliers
present in the area. Further, the coffee shop has developed effective and long term relations with
all its coffee bean and food suppliers. This relationship has supported the business in carrying out
the smooth flow of activities and deliver products to customers on time (Hill, Jones & Schilling
2014). At present, the key business activities include offering fast food and brewed coffee to
5
Key Partners Key Activities Value proposition Relationship Customer segment
Key Resources Channels
Cost Structure Revenue Stream
Coffee
bean
Growers
Offering fast
food and
coffee
Quality
products
and services
Market of
UK
Youngster and
working
professionals

customers. The coffee shop is creating its value through the improve quality of products and
services. Further, it has presently targeted working professionals and youngsters. The selected
business enterprise also emphasized on negotiating of coffee beans and tax avoidance through
the use of various strategies.
The communication channels used by the coffee shop include print media where different
types of brochures and pamphlets are used to create awareness among people in the market. Fast
food and brewed coffee are considered as the two principal sources of generating revenue of the
coffee shop (Levy, Reinecke & Manning 2016).
Future Canvas Model
Future state
Human
Financial
Coffee bean price Coffee, bakery products, beverages and food
Tax avoidance
Advanced Technology
6
Key Partners Key Activities Value proposition Relationship Customer segment
Key Resources Channels
Cost Structure Revenue Stream
Coffee
bean
Growers,
Fast food
suppliers
Offering fast
food, bakery
items and
coffee
Quality
products
and
services,
Integrated
technology
Internation
al market
Youngster
and working
professionals,
High income
group
Social media
and online

According to the new business canvas model, the company will be looking forwards to
carry out certain changes in overall strategy. For example, in future, the coffee shop will focus
on developing the partnership with community and suppliers of fast food. In addition to this,
sustainable business practices will be carried out to ensure that the operations do not have the
adverse impact on the people living in the society. Bakery items and other beverages will also be
added to the menu of the coffee shop. It will directly contribute to attracting more customers and
increasing the growth rate (Kellner et al. 2014). However, it can be critically argued that the
most important change in the existing business canvas model is going to be the integration of
upgraded and advanced technology. It can be expressed that technology will be integrated into
all functions of the firm. The results of this are going to be more useful, accurate and fast
delivery of products and services to all customers. Thus, the business will be able to attain the
higher degree of customer’s satisfaction which is crucial for long term growth of any company.
Apart from this, the coffee shop is going to expand its operations international market in
future. More stores will be established in different countries of the world, and the business will
emerge as a global chain of brewed coffee and fast food. The teams working at international
level will be managed through the use of technology. For example, meetings will be carried out
through technological tools such as video conference and calling. Technology will be used to
track customer order and maintain the record (Nadiri & Gunay 2013).
Furthermore, use of software such as electronic customer relationship management will
be carried out to ensure the development of long term relationship with all customers (Kim, Song
& Lee 2014). Instead of targeting youngsters and working professionals, the business is also
going to target people who fall into the category of the high-income group. On the contrary, the
cost of operations will increase due to an integration of technology in almost every area of the
business. The coffee shop will be required to take correctives measures or increase profits
margins to manage the operational cost (Perrey, Freundt & Spillecke 2015). Beverages and
innovative fast food are going to be the extra revenue generating stream for the company.
Value chain analysis
Value chain analysis can be termed as a model which focuses on identification of a
business’s primary and secondary activities (Peppard & Ward 2016). Further, it also supports a
lot in carrying out effective analysis of these activities with an objective to reduce the overall
cost of operations. In simpler terms, the use of value chain analysis is performed to determine
7

how internal activities convert the input into final products and services. On the other side of
this, the model also assists companies to carry out product differentiation which is essential to
gain competitive advantage (Nagle, Hogan & Zale 2016).
Primary activities
Inbound logistic – It can be termed one of the most important activities for the selected business
enterprise (Wheelen & Hunger 2017). Here, the coffee shop collects high quality of coffee beans
from growers and suppliers. Apart from this, different items of food are also purchased from the
suppliers located in nearby locations. The business has developed a small storage section where
all the material is stored efficiently to maintain the product quality (Wu & Wang 2014).
Operations – The coffee beans, milk or water, and other ingredients are being processed in the
machine to extract fresh and brewed coffee. Upgraded technology and devices will be used to
improve the taste and increase the total output. The business is also making use of different
machines to make fast food products.
Outbound logistics – The goods and services offered by coffee shop are being served within the
shop only. At present, the business is not providing any form of taking away services. In future,
the store will be looking forward to expanding its operations in international markets (Nagle,
Hogan & Zale 2016).
Marketing and sales – The marketing strategies adopted by the business cannot be termed as
efficient enough as it is facing challenges regarding attracting customers and increasing sales.
The coffee shop emphasizes only on making use of print media as a form of marketing
8

communication. In future, it can opt for social media and only marketing practices to create more
awareness among people in the market and enhance the profit margin.
Services – The services of the coffee shop can be termed as very convenient and useful.
Furthermore, the staff members are highly skilled and have the capability to understand the
changing need and demand of customers (Rothaermel 2015). Fast and accurate services have
helped in developing a strong sense of satisfaction among customers and have also encouraged
loyalty among them.
Support activities
Firm infrastructure- The ambiance and interior of the coffee shop are excellent and innovative.
The shop has wooden flooring and walls are also very creative. The infrastructure of the firm has
supported in creating the distinctive image in the minds of customers (Peteraf, Gamble &
Thompson Jr 2014).
Human resources management – The coffee shop has employed one manager and two other
people. Further, these people are competent enough to carry out multitasking and therefore, are
contributing a lot to achieve a smooth flow of all business activities and operations.
Procurement – the Local supplier and grower are the key areas from where the company is
procuring the raw material required.
Technology – In future, the coffee shop will be making use of advantaged technology and
integrating the same in various functions of the business (Slack 2015).
Implementation of strategic plan
The strategic plan is developed with an objective to increase the volume of sales and
profitability. The implementation of the strategic plan is mentioned below as:
9
Mission and
Objectives
Strategy
implementation
Evaluation and
control
Strategy
formulation
Scanning of
environment

 The mission and objective – The mission of the coffee shop is to attain the higher degree
of customer satisfaction. Further, the objective is to open 25 more outlets internationally
within two years of time.
 Scanning environment – It can be stated that factor such as political, legal, social and
environment will support the coffee shop in growth and development.
 Strategy formation- The coffee shop will be integrated technology within all business
functions. Apart from this, 30 new staff members will be hired within three new stores in
the country. Social media and online channels will be integrated into the existing
marketing strategy.
 Strategy implementation - The plan will be implemented through the corporation of staff
and using changing management tools.
 Evaluation and control- Effective monitoring of the plan will be carried out, and
corrective measures will be taken in case if the desired results are not achieved.
Reflection
The present study has supported me in developing insight into the organizational
analysis. Through this study, I can understand that how mission and vision statement play an
important role in the success of an organization. The application of models such as value chain
analysis and business canvas model has provided me with the practical learning experience. I am
now aware of the key issues which can be faced by business at the time of carrying out their
operations. I can now develop an effective strategic plan which can be used by organizations to
deal with their issues and challenges. This learning will help me to get more opportunities for
professional growth and development. Earlier I was not having any form of practical knowledge
linked with areas such as business management, and it was a big hurdle for me regarding
professional development. This study will assist me in both academic, professional way and I am
now looking forward to such research in future also. I can become a good corporate manager in
future by carrying out these types of business studies.
10

REFERENCES
Chiang, WY 2013, 'Applying data mining on customer relationship management system for
leisure coffee‐shop industry: a case study in Taiwan.', Wiley Interdisciplinary Reviews: Data
Mining and Knowledge Discovery, vol 3, no. 2, pp. 129-139.
Elder, SD, Lister, J & Dauvergne, P 2014, 'Big retail and sustainable coffee: A new development
studies research agenda. ', Progress in Development Studies, vol 14, no. 1, pp. 77-90.
Forgang, WG 2015, Strategy-specific decision making: A guide for executing competitive
strategy, Routledge, Abingdon-on-Thames.
Friberg, R 2015, Managing Risk and Uncertainty: A Strategic Approach, MIT Press,
Massachusetts.
Gopinath, C & Siciliano, JI 2013, Strategize!: experiential exercises in strategic management. ,
Cengage Learning, Boston.
Hill, CW & Jones, GR 2013, Strategic management theory, South-Western/Cengage Learning,
Boston.
Hill, CW, Jones, GR & Schilling, MA 2014, Strategic management: theory: an integrated
approach, Cengage Learning, Boston.
Kellner, A, Townsend, K, Wilkinson, A & Peetz, D 2014, 'Decaf or double shot? The strength of
franchisor control over HRM in coffee franchises.', Human Resource Management Journal, vol
24, no. 3, pp. 323-338.
Kim, YW, Song, WG & Lee, YJ 2014, ' A Study on the Consumption Behaviour of Coffee
Product according to Monthly Income in Franchised Coffee Shops Consumer.', Journal of the
Korean Society of Food Culture, vol 29, no. 6, pp. 519-527.
Levy, D, Reinecke, J & Manning, S 2016, ' The political dynamics of sustainable coffee:
Contested value regimes and the transformation of sustainability. ', Journal of Management
Studies, vol 53, no. 3, pp. 364-401.
Nadiri, H & Gunay, GN 2013, 'An empirical study to diagnose the outcomes of customers’
experiences in trendy coffee shops. ', Journal of Business Economics and Management, vol 14,
no. 1, pp. 22-53.
Nagle, TT, Hogan, J & Zale, J 2016, The Strategy and Tactics of Pricing: New International
Edition. , Routledge, Abingdon-on-Thames.
11

Peppard, J & Ward, J 2016, The strategic management of information systems: Building a digital
strategy., John Wiley & Sons, New Jersey.
Perrey, J, Freundt, T & Spillecke, D 2015, Power brands: measuring, making, and managing
brand success, John Wiley & Sons, New Jersey.
Peteraf, M, Gamble, J & Thompson Jr, A 2014, Essentials of strategic management: The quest
for competitive advantage, McGraw-Hill Education, New York City.
Rothaermel, FT 2015, Strategic management, McGraw-Hill Education, New York City.
Schaltegger, S & Burritt, R 2014, 'Measuring and managing sustainability performance of supply
chains: Review and sustainability supply chain management framework. ', Supply Chain
Management: An International Journal, vol 19, no. 3, pp. 232-241.
Slack, N 2015, Operations strategy, John Wiley & Sons, Ltd, New Jersey.
Wheelen, TL & Hunger, JD 2017, Strategic management and business policy, Pearson, New
York City.
Wu, SI & Wang, WH 2014, 'Impact of CSR perception on brand image, brand attitude and
buying willingness: a study of a global café. ', International Journal of Marketing Studies, vol 6,
no. 6, p. 43.
12