Upgrading a Coffee Shop Upgrading

Upgrading a Coffee Shop

Upgrading the Broadway Cafe Coffee Shop

Having operated in much the same manner since 1952, the Broadway Cafe is due for a marketing, process and technologically oriented makeover. Beginning with marketing, the Cafe relies primarily on word-of-mouth, which has been proven over decades of research to be one of the most successful strategies there are for gaining customers. The perception of customers is also the reality of any business (McKenna, 1995) and the Broadway Cafe must upgrade its marketing and brand to stay in step with the times and deliver experiences it customers prefer. The quaint aspects of their business, form taking orders by hand to managing their supply chains manually, needs to give way to automated order management and more efficient supply chain practices, which other restaurants have found to be strong contributors to profitability due to reduced errors and greater efficiency (Ritchie, 1990). The intent of this analysis is to evaluate the strengths, weaknesses, threats and recommendations for making the Broadway Cafe more in step with this century's customers.

Analysis of Strengths, Weaknesses and Threats

The greatest strength the Cafe has today is the personal service customers receive when they choose to dine out or meet there. As they have customers who have been coming there for years, the Broadway Cafe has built up a strong level of trust in the community. This is critical as a foundation for building out their 21st century services as well, including adopting social networking, integrating Wi-Fi into the Cafe and asking customers to recommend them and provide incentives for doing so. The Cafe has a strong catalyst of trust, which is essential for attracting and gaining new customers for their business through social networks (Bernoff, Li, 2008). As social networks are often discussed in the context of starting a conversation with the customer, the Broadway Cafe needs to look at automating their marketing efforts over social networks because customers spend the most with the retail establishments they trust (Kim, Kim, Hwang, 2008). Because of the inherent strengths of the Cafe there is much potential to grow the business through electronic channels and also social networks.

The weaknesses of the Cafe are first at the process level and second at the information systems and automation levels of their business. The breakdown of the process and IT investments can be seen in the incorrect orders and the need for re-doing them to please customers. Incorrectly filled orders are the most common error in restraints, arising from transcription errors between the service staff and the cooks and kitchen staff (Kator, 2007). This lack of coordination in orders can also cost companies ten to twenty percent of their inventory costs over time (Ritchie, 1990). Automating these key tasks will save the Broadway Cafe at least 10% of their inventory costs over time and lead to greater customer satisfaction over time as well. Another weakness is the lack of automated inventory management and replenishment with suppliers that is also costing the Cafe valuable time in being responsive to customer demand (Ritchie, 1990). Third, the lack of a single, centralized database that is recording transactions, supply chain activity and orders, services revenue and customer preferences puts the Cafe at a disadvantage in terms of managing their costs over the long-term. The lack of a unified computing platform is costing the Cafe valuable time in being responsive to customers while at the same time costing this small business potential costs savings in managing its inventory and supplier relationships.

The biggest threat the Cafe faces is that its customers will find the quaint experience of being in a Cafe that is completely manually based and in many respects caught in a time warp, too predictable and not unique enough anymore. Customers' perceptions are a company's reality (McKenna, 1995) and for the Cafe being boring in an age of always-on Wi-Fi and continual innovation is a big threat. The Cafe must change with the times or face the threat of being seen as anachronistic. The second series of threats emanate from the lack of control the company has over its suppliers and inventory. If there were an unforeseen spike in demand or supplier prices, the Cafe would be hit hard financially. At least with an IT system they would be able to anticipate the costs and potentially mitigate the excess costs.

Recommendations

First, the Cafe needs to invest heavily in making the customer experience of this century. Investing in Wi-Fi (Brus, 2005) and excellent security online to protect customers using their connections (Potter, 2006). Second, going full speed ahead with social networking strategies including creating a Facebook Fans page and also creating Twitter accounts will serve to create a more effective customer conversation online and most likely attract new visitors as well (Bernoff, Li, 2008). The Cafe should find this transition easy to navigate as they have a high degree of trust from their customers.

Second, the most critical areas of the Cafe in terms of transactions and inventory management need major investment. Beginning with the development of a wireless distributed order management system that captures the customers' order electronically and instantly places it on the kitchen's planning grid of meals to produce is critical. A menu planning system is also critically important as well, so that meals that can be fulfilled only are shown to customers. Daily menu planning using these systems and a laser printer can drastically increase customer satisfaction because the Cafe will only offer for sale what they can produce.