BizCafe Case – 11 –
ANE VALDEZ WAS READY for a change after 30 years of 12–15 hour workdays, 6 days a
week. Jane had grown up in Collegetown and graduated from the local university there,
majoring in engineering with a minor in business. After graduation, she worked at
Hewlett-Packard and Apple Computer in the 70s and 80s. Like many of the technology workers
of that era, she soon forged out on her own, starting several companies, failing at two, but hitting
on a successful formula with her third venture—handheld computing devices for hospital
applications. In 1995, she took her company public and eventually sold the company before the
high tech bubble burst. Soon ...view middle of the document...
– 12 – BizCafe Student Manual
Rent is $24 sq. ft. / year, or $24,000 total
for the year. A deposit equal to one
month’s rent must be paid in advance
and monthly rent of $2000 is due on the
first day of each month. In addition to
paying rent, the lessee (your company)
will also be responsible for paying
utilities – water and electricity. These are
estimated at approximately $500/month
based on historical usage of the
restaurant that had previously occupied
the location, but may vary based on
hours open and traffic.
Jane expects the coffee shop to be a success because of the good location downtown near
retailers and the business school. For instance, businesspeople might stop by on their way to
work or for a meeting place, students could go between classes and at night, and local residents
would find the shop a great place to meet friends or relax while they are downtown shopping.
She expected long-term demand to be primarily a function of the quality of the experience
(atmosphere, length of wait, friendliness of the staff, etc.) and the price charged for the coffee.
The students had some sales information on a specialty drink shop that recently closed due to
the owner moving to another area. Though not a perfect comparison and incomplete, Jane
believed this information would be helpful to the students when trying to calculate the necessary
operational capacity for the shop.
Pat's Coffee and Chocolate: Weekly Demand (Cups Ordered)
Jane also suggested to the students that the shop could stimulate additional demand through
advertising and by offering special promotional deals. She has arranged for a team of information
technology students to create a web site for the business as a course project, and online and
radio advertising can be used to drive traffic to the site.
In addition, the local weekly circular has a weekly poll on many of the local businesses including
two awards given to specialty drink shops. Jane knows the importance of such awards for wordof-mouth and creating a "buzz" around a business. Jane wanted to be sure her students were
aiming to win one of these two awards.
BizCafe Case – 13 –
Best in town specialty drink - ambiance
Best in town specialty drink - satisfaction
Jane knew that the easy (and fun) part of running a business is creating the concept and getting
everything set up, but that most retail shop success, especially service oriented ones, is made "in
the trenches"— the day to day running of the business. Will her students hire enough quality
staff to serve the customers in a friendly and timely manner? Will they have enough supplies and
inventory so they don’t run out of what customers want? Will they be able to handle the rushes
before class / work? It sounds easy enough, but her students will likely need a cadre of part-time
college students to...