The case “Expresso Espresso” gives a detailed analysis of a new coffee shop that is positioning itself as an emerging player in Mobile, Alabama. Its owner, Sylvester Todd, selected the best location since it is near a university with over 20,000 students and teaching professionals. The document reveals that the firm’s leader focuses and pursues evidence-based ideas and procedures to deliver positive results. The purpose of this paper is to give a detailed analysis of the presented case study, the problems affecting Expresso Espresso, and evidence-based solutions that can take it to the next level and make it more successful.
Current Situation
The coffee industry remains a competitive sector with many companies that meet the diverse needs of different customers. Some of the leading ones include Starbucks Corporation, Caribou Coffee, Coffee Beanery, and Deidrich Coffee (Peter & Donnelly, 2012). Despite the presence of these giant companies, Todd decided to venture into the industry and continue to produce high-quality products that would meet the diverse needs of the targeted customers.
For instance, a report presented by the National Coffee Association (NCA) indicated that around 54 percent of American citizens consumed coffee every day (Peter & Donnelly, 2012). The primary customers in the sector included persons with college degrees. Most of these individuals focused on the quality and attractiveness of the coffeehouses or shops, knowledgeable and friendly staff, and variety.
With this kind of information, the leader of Expresso Espresso decided to consider other approaches that would maximize organizational performance and profitability. For instance, he ensured that his coffee was sold at around 10 percent less (Peter & Donnelly, 2012). The firm provided T-shirts and coffee mugs with cute or humorous sayings, thereby supporting the desired conversation among customers. He also pursued a purist approach in product development while at the same time considering the needs of the targeted individuals. The concept of the 4P marketing mix was improved through effective promotional strategies, such as the use of flyers, campus newspaper, radio, and live music at the store.
He went further to consider the issue of charity to promote the company’s publicity. He also continued to focus on the existing competition from these critical firms in the region: Satori Coffee House, Carpe Diem, and Daily Grind (Peter & Donnelly, 2012). Convenience and speed in service delivery were critical aspects for promoting performance. A “drive-through” experience was considered and eventually increased revenues at the company. As the manager, Todd only worked in the shop when he was off. He trained, empowered, and equipped his employees with the relevant opportunities and resources.
Problems and Core Elements
Emerging companies will always experience a wide range of challenges that have the potential to affect performance. From the presented case, it is evident that Expresso Espresso was performing moderately amidst the emerging developments and changes. However, there are specific problems or core issues that have the potential to affect the future of this company and make it less profitable. The outstanding one is how the firm could overcome the challenge of competition from the existing companies in the region. According to Peter and Donnelly (2012), Starbucks was a significant threat since it was stealing Todd’s customers.
This was also a substantial development with the other local competitors in the selected region. Despite the fact that the owner had managed to develop a friendly and warm space for all potential customers to socialize or relax, it was still unpredictable how it was going to perform or compete in the future.
The next issue was the likelihood of recording profits within the shortest time possible. This was a significant issue since the company was not appropriately positioned in comparison with the other players in the industry. Each firm appeared to devise and implement a robust model that was capable of improving performance and addressing emerging issues (Peter & Donnelly, 2012). The leaders of such companies had managed to start new outlets and shops to maximize service delivery and ensure that positive results.
Another critical challenge or problem facing Expresso Espresso was how the leader could implement a decisive action and improve performance. Success could be defined by the ability to attract more customers in the region, maximize their experiences, open new outlets, and enhance the level of sustainability (Peter & Donnelly, 2012). These aspects explain why Todd remained unaware or unsure of the most appropriate model for combining the existing procedures and including additional ones to improve service delivery.
Alternative Courses of Action
The nature of the above challenges and problems explain why there is a need for the leader to consider a number of options or action plans that might transform performance. As described in the case, it is agreeable that Todd has managed to adopt a powerful approach that resonates with the trends and issues recorded in the industry. With his passion for business and ability to empower his customers, Todd’s model appears appropriate and capable of taking this company to the next (Peter & Donnelly, 2012). However, various courses of action will be necessary if he is to turn things around and ensure that this firm records adequate profits.
Firstly, Todd should begin by considering a new model whereby the current space is expanded to attract more “drive-through” customers, include a convenient kitchen, and be in a position to meet the needs of more customers. The presence of adequate shop space will make it possible for Todd to implement additional features, improve services, and provide timely assistance to the targeted customers (Peter & Donnelly, 2012). The shop will also be able to hire additional staff members depending on the increasing number of customers. This process will then be merged with the existing or established practices.
Secondly, a complete overhaul of the model can be considered to deal with the problems affecting this small firm. This means that the leader will have to transform the nature of the existing 4P marketing mix. The shop will then offer additional products that resonate with the demands of the customers, such as ice coffee. The products can also be improved or transformed in such a way that they meet the needs of the American consumer.
This strategy is capable of attracting more customers and leaving them satisfied. Todd will have to go further to consider the competitiveness of the current pricing strategy and ensure that it is capable of supporting and sustaining performance. The recent promotional methods appear competitive and capable of informing more people about the available products and services. However, the leader can consider the importance of using brand ambassadors in the local region since they will sensitize or encourage more people to purchase the available coffee and other additional products. The improvement or expansion of the current CSR model can attract more people and eventually maximize performance.
Thirdly, an effective action plan for changing operations at Expresso Espresso is that of introducing a superior leadership model that presents a new opportunity for continuous monitoring and supporting the demands of different people. It is evident that Todd is usually unavailable for most of the hours (Peter & Donnelly, 2012). This means that the current employees are the ones required to consider the needs of different customers, solve emerging problems, and introduce new ideas for maximizing experience. This strategy might be making it impossible for the firm to break even. This is possible since leadership remains a critical determinant of organizational performance.
The presence of a full-time manager will ensure that all emerging issues are identified, understood, and addressed. The individual will have to collaborate with Todd in an attempt to present additional insights and procedures that will eventually make Expresso Espresso a competitive player in the local market and continue to meet the diverse demands of the most significant number of customers.
Best Alternative
The above options have the potential to change the performance of Expresso Espresso and deliver positive outcomes. However, the second alternative appears to be the most appropriate since it takes into consideration all the issues and challenges that Todd seems to be facing.
This means that a new business model will be considered to deal with the problems affecting this firm (Peter & Donnelly, 2012). As described above, Todd will view a superior leadership strategy that will support the transformation of the nature of the existing 4P marketing mix. Although the current one appears appropriate, its improvement will present new strengths that can eventually deliver positive results.
With this new change, Expresso Espresso will be able to offer additional products that resonate with the expectations of more customers. The firm will go further to improve or transform the contents of every cup. Such an initiative will ensure that this organization attracts additional clients and fulfills their demands. Todd will consider the competitiveness of the current pricing strategy and reduce the cost of every cup (Peter & Donnelly, 2012). The leader will need to go further and embrace the use of brand ambassadors in the local region. The expansion of the existing CSR tactic can attract more people and eventually improve profitability.
If this plan fails, it will be appropriate for this firm’s leaders to consider the relevance of a contingency plan. This means that the leader can consider hiring a new manager who will be available at the company all the time to identify new challenges and solve them amicably. The professional will consider the most appropriate procedures for maximizing customer experiences (Peter & Donnelly, 2012). The two will collaborate and implement new processes, products, and strategies that can eventually increase profitability and make the company a significant competitor in Mobile.
Conclusion
The above analysis has identified Expresso Espresso as a new firm that has positioned itself as a potential player in its industry. The owner has managed to consider various attributes, processes, and initiatives that can take it to the next level. However, its future remains uncertain since it continues to encounter a wide range of challenges, such as competition of giant corporations, inability to record profits, and the unavailability of products that meet the needs of all customers. The proposed action plan will transform operations at Expresso Espresso and eventually maximize the level of performance.
Reference
Peter, J. P., & Donnelly, J. H. (2012). Marketing management: Knowledge and skills (11th ed.). New York, NY: McGraw Hill.