Oscar Lee - Stardoe Coffee

473 Words2 Pages
MEMO FOR: Oscar Lee (Stardoe Coffee) ------------------------------------------------- SUBJECT: Recommendations & Analysis for Stardoe Expansion Summary Stardoe is a true success story in terms of its operating model as well as start up story. As the organization looks to the future and considers expansion options, several key elements need to be considered – talent acquisition, operating costs, advertising, customer service, etc. A major expansion would need to be strategically approached and ensure that no comprises in terms of quality or customer experience are made. In analyzing Stardoe’s expansion plans, I have found that expansion into 5 new areas would require over 11% of the targeted households to purchase Stardoe products. While this target is within reason, it also can be construed as aggressive considering the company’s liquidity concerns and target for a one year ROI. As such, I have illustrated a suite of options/recommendations below. Analysis Option 1 – Aggressive Growth Given the 11.4% requirement (above 10% anticipated figure from other statistical work), pursuing the expansion into all 5 new locations would yield a strong return, but requires a significant financial investment and has a greater likelihood of not achieving the 1 year ROI. However, the blitz marketing could result in first mover advantage and with the correct talent acquisition on the sales and management team achieving 11.4% is not unrealistic either. Pros | Cons | First mover advantage | Potential for longer than 1 year ROI | Blitz Marketing | Significant investment (finances and people) | Talent Acquisition & Growth Opportunity | Talent Sourcing Challenge | Greater Risk = Greater Reward | Greater Risk | Option 2 – Moderate Growth An option could also be to explore opening 3 or 4 locations rather than all 5. This eliminates several
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