Ireland Expansion Strategy: Marvin and Smith's Coffee Shop Report

This report assesses the potential for Marvin and Smith's coffee shop to expand its business into Ireland. It begins with an introduction highlighting Ireland's favorable demographics and international connectivity. The report then delves into the marketing mix, including product, price, place, and promotion strategies tailored for the Irish market. It explores the implications of information systems, emphasizing the need for technological advancements to reduce costs and improve customer loyalty. The management structure section proposes a flatter organizational structure to enhance communication and efficiency. The financial ratio analysis provides insights into the company's financial health, including gross profit margin and return on capital employed. Finally, the report concludes with a summary of key findings and recommendations for successful business expansion in Ireland, including the integration of information systems and an effective management structure.

Running head: IRELAND
IRELAND
Name of the student:
Name of the university:
Author

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Table of Contents
Introduction:...............................................................................................................................2
Marketing Mix:..........................................................................................................................3
Implications................................................................................................................................4
Management Structure...........................................................................................................5
Financial ratio.............................................................................................................................6
Gross profit margin................................................................................................................7
Net profit margin....................................................................................................................7
Return on Capital Employed (ROCE)....................................................................................7
Liquidity current ratio............................................................................................................8
Liquidity Acid Test Ratio.......................................................................................................8
Conclusion..................................................................................................................................9

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Introduction:
Ireland is such a country which is perfect to expand the business of the Marvin and
Smith's coffee shop and growth of population in terms of the age is the youngest in the EU.
As per the facts provided by CSO in the year 2011, the population of Ireland is about
4,588,252 where in Dublin there are about 1,273,069. It is rather considered as the proper city
in order to start an enterprise due to the fact that it is one of the largest cities. Drinking coffee
is sort of a addiction for the young people in Ireland as it has multifunctional influence in the
body of the human as it provides strength, stamina and further stimulates the brain for better
performance (Smith 2017).
On the other hand, Ireland is internationally linked with the other states in the world
which further provides the access to the international markets. As per the facts of the EU-
Start-ups in the year 2016, Dublin is considered as the 8Th European cities for their start-up
eco-system. This further states that Expatistan in the year 2016 that Dublin is considered as
the most beautiful city to live due to the fact that it took the 28th position of Living Rankings
Cost in the world.
Ireland has an effective logistics consideration and as it is a part of the United
Kingdom it has established effective delivery services within the countries. The company saw
this as an excellent opportunity to utilize the finest coffee beans from the region Gumutindo
Coffee, a Fairtrade supplier in Uganda, in order to entice additional customers by providing
high-quality coffee and service.
Some of the reputed companies also provide services regarding the shipping goods
which include the coffee beans. As per the facts of the DPD in the year 2017, the company is
regarded one of the best transportation in International and Europe as it has recognized in
both the countries. There is same service providing another company named DHL transports
goods from England to Ireland by the medium of sea, air, railway and road.
Ethics are considered as the significant part of the business in terms of the abroad
expansion as there may be large number of changes in terms of the payment rates, working
hours and cultures of the respective countries. In order to recruit employees in Ireland it is
further needed to register in the Employers PRSI with the Revenue Commissioners. On the
other hand, IrishStatuteBook in the year 2017 states that regarding the payment made to the

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employees minimum wages which must be considered is around €9.25 (£7.91) per hour. The
working time of the organization should not surpass 48 hours for 7 days period.
Davenport in the year 2010 recognized that Gaelic is the Irish language and is the
second largest language after English which actually consists of the three main dialects which
are Munster, Connaught and Ulster Irish. It might be Irish workers who further known for the
Irish coffee maker which is a mixture of the whipped cream and Irish whiskey considered as
the hot coffee.
The Irish City named Dublin includes more than 1 million populations in the
metropolitan area and the city always remains quite busy. As per the facts to Dublin in the
year 2017, Ireland is quite effective in providing transport opportunities by bus, coastal rail,
light rail, and bike scheme, which further makes travelling relaxing and comfortable makes
the customers comfortable in term of travelling.
Marketing Mix:
The products of Marvin and Smith’s products are needed to be promoted and for that
the significant thing is that to generate an effective marketing mix. The market further leads
to the elements of the organization marketing strategy which are inclined towards the
demands of the clients. The marketing mix within an organization comprises of the following
key elements which are the product, price, place and promotion (Mitchell and Calabrese
2018).
Market segmentation of the products of an organization plays significant role in the
marketing mix by targeting potential customers in to increase the profit of the business that
Marvin and Smith are aiming to ensure. The segregation of the customers is based on the
elements which are age and occupation is students, travelers, and workers. The significant
purpose of market segmentation is to classify the products in the market in order to attract the
target market.
 Products – The products comprises in the marketing mix offers the complete benefits
to the potential customers. Marvin and Smith sells the products in the UK by raising
the coffee beans produced in Uganda which further ensures highest quality coffee
beans. The company deals with the various types of coffee flavors, hot chocolates,
various type of tea, snacks and many more.

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 Price – The customers have to bear the price of the products and must show rates
compared with the alternatives. The customers accordingly make the choices by
advising the product styles at different rate of prices. From the facts and figures it can
be said that the average price of the Dublin is about €2.50 (£2.13). Hence the business
partners in this scenario will reduce the prices of the products. By increasing the
pricing of the medium cup of Americano to be €2.20 (£1.88) in order to attract the
potential customers in the market.
 Promotion – The term promotion refers to a certain term of activity which varies as
per the nature of the product and deals with the distribution of the products in free. As
per the business of Marvin and Smith, the promotion activity plays significant role in
order to enhance the sales of the products. For example, the local radio and newspaper
can be an option for this matter. If the products are sold at a discount of 10 percent,
then it will possible for the business to attract the potential customers in the market.
Further an offer regarding discount of 15 percent off and chance to win club card in
order to win a free coffee (Renz 2016).
 Place – The term place refers to the ways by which the goods are transacted in the
market. The significant parameters in this case are location, accessibility and
performance of the channels. It will be convenient to open business at the centre of
the Dublin which is near to the River Liffey by the National Wax Museum Plus. As
the best universities/colleges in the Dublin located in the city centre such as Trinity
College Dublin which further makes it a convenient place to start the business. Due to
the above facts this is exactly the right place to start the business of Marvin and
Smith.
Implications
Information Systems
Information system is basically an integral part of the wide variety of activities from
gathering, storage and processing data to information. This further assistances to check the
present performance along with that care decision taken by the management. Investing in the
new information system is required to put tough competition in the current market. Business
actually uses the information in order to prepare the financial accounts. The duty of the
human resource is to recruit and manage the current employees of the organization. Training

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on the other hand is provided in order to attract the potential customers through the online
promotion (Pandey 2015).
For the purpose of expansion abroad, expansion of information systems are essential.
The significance of the necessity of the technology is to cut labour costs and maximize the
profit. The equipment will help to decrease production cost and time as the computers can
perform many automated tasks which may be performed with the addition unit. In such a
situation, self-service technology of the customers may be useful to bag, scan and pay for
purchases without any manual help. As per to Release (2017), the perfect example to avoid
extra cost related to labour and errors related to human in such businesses is to adopt the self-
service technology (Zietlow et al. 2018).
On the other hand, new information system will help to enhance the interest of the
customers through the process by applying the loyalty point system. The loyalty card holders
will have distinctive features like the reward scheme and purchase discounts. The
development of loyalty cards through technology have develop a prosperous basis of data that
companies offers to the customers. The business will have benefits regarding the finances as
the system will store and analyze the data of what customers are procuring through the
process of applying the loyalty card strategy (Martin 2016).
With the help of the technology, it will be possible to connect supplier to inventor and
at the same time meet the requirements of the customers. The information systems on the
other hand will add to create a rich database regarding the details of the employee's on all
coffee shops. This further allows the partners to supervise them through the system. Rahim
(2017) states in order to ensure that the business runs effective as it requires stringent
network planning.
Management Structure
Management structure is the method where the position of the company is sorted
accordingly. The internal fabric of the industry means the labor force role of accountability,
employee and communication channels within a cluster.
The significant objective of the Marvin and Smith's business is to earn profitability
which further depends on the performance of the employees. The performance of employee
and the customer service are correlated. The goodwill of the business is completely based on

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the employees' performance. The customer’s expectation on the other hand remains always
high (Libby 2017).
This confirms that the staff comprises of such as managers, team leaders, directors
and operatives who plays significant role within an organization. In order effectively operate
the business, the partners will rather opt for a ‘flatter’ management construction. Marvin and
Smith are looking to service a local manager of a branch in order to pact with abroad job
distributions and report related to the partners. The appointment of the supervisors in that
case happens in order to delegate the managers and the workers responsible for that position
(Schaltegger and Burritt 2017).
The compliment organization arrangement efforts to up the lines of collaboration and
communication while segregating sheets within the group. The partners needs to maintain
focus on fresh information systems where employees can work together and gain way in to
each other and information everywhere at any time and devices within the organization. This
announce that electronic communications have been famous in today’s technological world.
Effective communication allows communicating with the other people surrounded within an
organization (Li and Sloan 2017).
This further announces that compliment structure within an organization helps the
firm to accomplish the significant results in short period of time deals with the resource
distribution with minimal effort. In case of Marvin and Smiths the model regarding the
management structure is the most suitable for the business (McKinney 2015).
Financial ratio
Financial ratios are one of the most significant tools for people in order to understand
the current financial status of an organization. These are prepared based on the information of
the financial statements of the company. The financial indication is provided by dividing one
number with the other one. Hence it is based on the current financial statements of the
Marvin and Smiths coffee shop (Hoyle, Schaefer and Doupnik 2015).

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Gross profit margin
This states that the Gross profit of the company is based on the difference between the
revenue earned and the cost incurred by the company. On an organization has after taking
into account the variance between net sales revenue and cost of goods sold incurred by the
company (Kaplan and Atkinson 2015).
Gross profit margin 208,000/Sales Revenue 360,000 x 100 = 57.77% or 57.8%
As the gross profit margin of the company is about 57.8% which further states that the
financial health of the organization is satisfactory. In terms of the distribution and the
production process the partners can further expand the business in abroad (Cornwall, Vang
and Hartman 2016).
Net profit margin
The net profit margin is evaluated by the process of company’s sales and the
operating cost of the firm. The bellow formula in this case is used to determine the net profit
margin which is as follows:
Net profit 26,800/Sales revenue360,000 x 100 = 7.44% or 7.4%
The net profit margin of the company is about 7.4% where it indicates that the net profit of
the company is positive. The business of the company has too many risk associated which is
needed to be optimized. The business will face much issue in abroad which will bear more
expenses in the EU country. The reason behind the small net profit percentage is that the
company is facing some of the extra costs which is pretty high in this case (Bowman 2016).
Return on Capital Employed (ROCE)
ROCE determine that return on capital employed of the company evaluates the
financial performance of the business. The ratio actually indicates the relationship between

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the average long term capital and the net profit of the firm within the period. It is calculated
in the following way as follows:
Net profit 26,800/Share capital100,000+ Reserves 6,800 x 100 = 25.09% or 25.1%
The return on capital employed of the firm is about 25.1%. The percentage of the
return on capital employed actually computes the average use of capital which becomes quite
challenging for the investors to invest in such kind of risky business (Bryce, H.J., 2017).
Liquidity current ratio
Liquidity ratios of the firm evaluates the firm’s ability to meet the current obligation
from the current assets (Taulli, 2004:202). It is calculated in the following way such as
Current assets 35,400/Current liabilities 6,200 = 5.709 or 5.71:1
The current ratio of the firm is about 5.71:1 which further indicates that the business
is able to meet the current obligations. Hence, it can be said that the business is capable of
meeting the current financial obligations. In this case Marvin and Smith will further invests in
the business in order to take a competitive advantage of the market (Barr and McClellan
2018).
Liquidity Acid Test Ratio
Khan and Jain (2009:67) note that the acid-test ratio of the firm computes the ratio
between the current liabilities and quick current assets and further by dividing the quick
assets by the current liabilities. This is evaluated as follows:
Current assets excluding inventories 27,400/ Current liabilities 6,200 = 4.419 or 4.42:1

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The acid test ratio of the company is about 4.42:1 which further means that the
company has the ability to meet the current obligations. The business is particularly focusing
to convert the liquidity of the business into cash.
Conclusion
As per the data and information of the business it is significant for Marvin and Smith
to open new branch in abroad. The partners in this case needs to take care of the management
and the information system in order to gain the competitive advantage and further to provide
high quality of product and services abroad.
Further Marvin and Smith will further allow the business to work more effectively by the
process of upgrading the current information system. The Marvin and Smith will enhance the
business of the organization by the process of upgrading the present information system. The
records and communication system must be secured and protected within the company in
case of both the country. In order to accomplish success within the limited period with less
effort and distribution of resources it is significant for the partners to recognize compliment
organizational structure with less effort. This will help the employer to enhance the
collaboration, innovation, adaptability and creativity.
As per the financial ratios of Marvin and Smith, it can be said that the expenditure of the firm
is large. The operation of the firm must be conducted in such a manner that the net profit
margin of the firm can be increased. Expanding the EU country will enhance the business
cost of the firm which will put positive influence on the profitability of the firm.
As liquidity asset ratio and the current ratio of the business of Marvin and Smith is quite high
and must be effective in order to convert the current assets of the firm into cash. The

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company is further not utilizing the existing assets effectively which is the reason behind the
problems in the working capital management.

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Barr, M.J. and McClellan, G.S., 2018. Budgets and financial management in higher
education. John Wiley & Sons.
Bowman, W., 2016. Tools and Techniques of Nonprofit Financial Management. The Jossey‐
Bass Handbook of Nonprofit Leadership and Management, pp.564-593.
Bryce, H.J., 2017. Financial and strategic management for nonprofit organizations. Walter de
Gruyter GmbH & Co KG.
Cornwall, J.R., Vang, D.O. and Hartman, J.M., 2016. Entrepreneurial financial management:
An applied approach. Routledge.
Hoyle, J.B., Schaefer, T. and Doupnik, T., 2015. Advanced accounting. McGraw Hill.
Kaplan, R.S. and Atkinson, A.A., 2015. Advanced management accounting. PHI Learning.
Li, K.K. and Sloan, R.G., 2017. Has goodwill accounting gone bad?. Review of Accounting
Studies, 22(2), pp.964-1003.