Introduction.

The Cape Breton Rental Business (CBR) was established in 1988 by Bruce MacLean at

Munro Park, North Sydney, Nova Scotia. The major business activities of CBR were; tourists

and locals can rent canoes, kayaks, sailboards, sailboats, paddleboats, and motorboats. Cape

Breton Boat Rentals was open seven days a week from June 17th to September 5th, 1988, and

was run by MacLean's younger brother, Malcolm. According to all reports, the company's

services pleased the public. Many users applauded the reasonable costs, saying the programme

"must have been available a long time ago.

Problem Identification.

In financial terms, the issue is Cape Breton Boat Rentals' diminishing profitability and

financial insecurity. The company's revenue drops while costs rise, resulting in negative cash

flow and diminishing profitability. CBR's first year of operation was rather disappointing, with

sales totaling just $14,699, less than half of the estimated sales income of $33,000. The dismal

sales performance, along with costs of $22,024 resulted in a $7,325 first-year loss and a tight

financial situation (Rose, 1990).

Statement of Causes (s).

Inadequate promotion and marketing activities is one of the key issues that resulted in

low booking rates hence lower revenues. According to Emeritus (2023), Marketing is important

for your company because it raises consumer awareness of your goods or services, attracts them,

and assists them in making a purchasing choice. A marketing strategy, as part of your company

plan, also aids in the creation and maintenance of interest, importance, standing, rivalry, and so

on. As a result, because marketing is so important in making your company a tremendous

success, it may be tough to manage and maintain a lucrative business in today's world if you
don't grasp the necessity of marketing. Besides the inadequate promotion and marketing, CBR

has an inefficient cost management system and poor pricing policy, hence resulting to these

losses.

Possible Alternatives.

To provide a concrete solution to financial troubles of CBR business, its imperative to consider

the following;

Examine your options for diversification, such as providing water sports, fishing charters,

and guided excursions. Over relying on only the revenues from the rentals of the boats might not

be sufficient enough to offset the operation cost of CBR, therefore having additional streams of

income such as tour guide, water sports and many other that might not require a lot of additional

cost.

Put cost-cutting strategies into action by lowering needless overhead costs, improving

supplier contracts, and scheduling maintenance more efficiently. Successful business mostly is

not those that have a lot in revenue’s however those that control their cost in order to earn profit.

For example, if you have 4 boats and you employ 4 captains for these boats yet your weakly boat

hire rate is 3 time a week. This means you will be having a lot of expenses in wages to pay the

captains and less in revenues. Therefore, in this situation it would be profitable to go for a part

time captains who will only be paid for the tripes they make.

Conduct market research, examine the prices of competitors, and modify its pricing

strategy as necessary. By using value-based pricing, you may choose your prices based on what

customers deem the worth of your product. This pricing model for gives confidence to new

customers who would like to try the product or services for the first time. Kelly (2023) asserts

that, businesses need to keep a close eye on consumer sentiment in order to survive in a world
that is changing quickly. To do this, they can use comprehensive data collected from a single

source of truth a centralized hub that houses market research tools, methodologies, and

intelligent processes to produce actionable insights.

Recommendations and Action Plan.

In order for CBR to Alleviate its self from the financial insecurity, it needs to adopt the below

recommendations or action plan.

 Investigating and putting into practice new sources of income via diversification.

 Completing a comprehensive cost study to find areas where expenses may be cut and

productivity can be increased.

 Creating a thorough marketing strategy to raise consumer awareness and bookings.

 Putting into practice a revised price plan based on competition and market research.

 Keeping a close eye on and regular assessment of financial indicators like cash flow,

ROI, profit margins, and sales growth.

The success of the improvement will be determined by the suggested financial measures, which

will also assess how well the plan was carried out.

Relevance of the Case Study to Business.

The Cape Breton Boat Rentals case study is significant and pertinent to business studies

because it sheds light on typical problems small firms have, like diminishing profitability,

inefficient marketing, and subpar financial management. It offers the chance to evaluate and put

into practice a variety of business ideas, such as cost control, marketing strategy, financial

analysis, and diversification. Students can learn about practical business issues and hone

problem-solving techniques that they can use in their future employment by studying this case.

Reference.
1. Emeritus. (2023, July 26). What is the Importance of Marketing for Businesses? Discover

the Undiscovered. Emeritus Online Courses. https://emeritus.org/blog/what-is-the-

importance-of-marketing-for-business/

2. Kelly, R. (2023, June 1). Market Research: An Important Investment For Long-Term

Viability. Forbes. https://www.forbes.com/sites/forbestechcouncil/2023/06/01/market-

research-an-important-investment-for-long-term-viability/?sh=79a73c53551b

3. Rose, D.G (1990). Cape Breton Boat Rentals Acadia Institute for Case Studies. Acadia

University.https://web.archive.org/web/20190619161618/http://aics.acadiau.ca/

case_studies/caprebretonboatrentals.html