Sam Livoria Case Study

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MEMORANDUM Current vision: “Livoria will be the first choice of Dawkin residents who are seeking a variety of high-quality fresh sandwiches at reasonable prices “ Stated mission: “We are the highest-quality sandwich shop in Dawkins because of our legendary sandwich-making processes and our commitment to using the highest-quality ingredients” Stakeholders’ Preferences: Paul Livoria * Consider franchising to increase market share and growth Sam Livoria * Expand menu to include vegetarian food Key successful factors * Excellent customer services and loyal customers * Easy access to ingredient and raw materials * High population growth and disposable household income in Dawkins * High staff retention rate…show more content…
* Meets the desire of Paul Livoria * Additional revenue source ( appendix 4) * Increasing franchising trend, 70% of restaurants in Dawkins are franchises * Takes advantage of population growth and high family disposal income in Dawkins * A strong motive for franchise managers to make their restaurants as profitable as possible * An opportunity to improve menu base on local demand, shared innovative ideas and success stories among franchisees that can help strengthened growth Cons * Risk of losing sandwich quality as managers might not comply to standard procedures or invest in people or maintenance * Additional cost of finding and monitoring company managers * In case of failure to comply to franchise agreement, terminating the contract can be costly and difficult * Increasing strict quality heath control in Dawkins and risk of losing franchises that do not adhere to these quality…show more content…
Positions Livoria to take advantage of the growing population and addresses Paul’s concerns, but fails to address the current need to generating a net income of $1.1 million by 2015 (appendix 2) * Industry trend indicates 70% of restaurants in Dawkins are franchise. This will allow Livoria to be competitive however; this will require additional capital cost for training, monitory and new management which cannot be afforded at this moment. Implement alternative 1: Diversify menu to include vegetarian food. * This will generate enough revenue to settle the litigation and a net income of $1.1million by 2015(appendix 1) with current space and employees * Livoria will be well positioned to challenge competition, quality of sandwiches and brand image will not be compromised. * Additional capital cost will not be incurred and the restaurant will be well positioned to take advantage of the growing population in Dawkins. To stay within the 90% production time, Livoria will have to reduce the estimated demand for eggplant to 88,000 increase working hours for employee 6 by 324 hours in 2015. This will provide a total working hours of 6,320 in 2015

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