Xavier University-Ateneo De Cagayan

School of Business and Management

CASE STUDY CATHERINE’S CONFECTIONARIES

In Partial Fulfilment of the Requirements for MRKM 6 D 1 - Distribution Management

Submitted to:

Anthony Atterviry III

Submitted by:

Mocsana, Mohammad Ibrahim T.

 August 25, 2020

Executive Summary

Catherine Horton is the owner of Catherine’s and her business has been in operation for seven
years. Eventually Catherine made the move from selling out of her house to leasing a retail
location, she always encountered several problems that includes a high leasing cost and a larger
than necessary building space which caused Catherine to increase her initial business model of
providing dessert for made to order customers and that includes walk in customers as well.
Which results that Catherine need to hire an additional to manage the side of the business. These
Catherine actions will leads to unexpected cost have contribute to her minimal profitability in the
last few years. Also it led to a loss in her passion for the business.

Statement of the Problem

How can Catherine cope up with her problems when her business are falling apart and also she is
losing interest to the business and has no time to indulge in her initial passion of creating new
recipes.

Alternative Course of Action

1. Catherine’s need to hire a one full-time worker at a higher salary instead of two
minimum wage employees and a part time worker the books, once or twice a month.

Catherine’s needs to consider to hire a one full time worker because a higher salary will
help attract more qualified staff which will help to eliminate the need for constant
supervision that it will also results to reduce the turnover ratio which can reduce the
training time. Catherine will now be paying one full time worker and two part time
workers instead of three full time workers and one part time workers. It will reduced costs
which can help to contribute to increase profitability.

ADVANTAGE:

- Choosing excellent staffing option for small businesses due to the potential for
flexibility and the relatively low cost.

- Full-time worker develop company loyalty and to feel a sense of ownership in the
business
 - Less work for the owner

DISADVANTAGE:

- Temporary workers tends to have no loyalty and dedication to the job

Recommendation

Catherine should at least lease a smaller place and eliminate the walk-in business because walk-
in business initiated from the unexpectedly high cost of the lease. If Catherine eliminate the
walk-in business she will not need extra space provided by the former restaurant. Although
Catherine will lose revenue from eliminating walk-in business in the other good side is that
Catherine cost savings in the reduced lease and salary expenses will outweigh and increase her
profitability. Also Catherine will reduce her hours in her work week and rediscover her passion
of creating new recipes.

Questions:

1. What are the three major types of customers Catherine serves? How do
they differ from one another? What do you think the order winners are for
each group?

 Business customers: Business customers provide large volume orders and also
opportunities of repeat business. This segment of customer looks for higher standard
of quality and also timely delivery of order. Order winner for this segment includes
timely order fulfilment, quality standard and pricing.

 Individual order on special occasion: This segment of customer need personalized

services and provides flexibility based on the demand. Order winner for this segment
 includes personal relationship as well as good customer service on the special
occasion.

 Walk-in customers: They normally make small order which are predictable since it’s
based of available menu of deserts. Customer service is important for this segment
of customer since it includes physical interaction. Order winners for this segment of
customer are the taste quality as well as reputation of reputation.

2. Consider Catherine’s decision to lease the restaurant space (a structural

decision). Was this decision consistent with the needs of her different
customers? Why or why not? How did this decision change Catherine’s
business?

 Catherine decision to lease the restaurant space was not consistent with her original
intent of business. Since restaurant had seating capacity which was being unused.
To capitalize this space Catherine started to serve walk in customer. Hence she
changed her business model because of leasing the restaurant and decided to serve
walk in customers

3. Consider Catherine’s initial decision to hire unskilled labor to help with the
walk-in business (an infrastructural decision). Was this decision consistent
with the needs of her different customers? Why or why not?

 Hiring the unskilled labor was not consistent for different customer segment. This
was focused only for walk in customers. Also there was lot of attrition and ongoing
training required for these laborer.
4. Catherine is clearly unhappy with the way things are going right now. What
would you suggest she do? What information would you like to have before
making a decision?

 Catherine needs to make a clear decision with that she needs to reflect on what
her profits are comparing how much time she is putting into the business. If she
is spending more time on the business than what she is making it might be the
best time to rethink the she is doing currently.