caribbean internet cafe.pptx
DESCRIPTION
caswTRANSCRIPT
Caribbean
InternetCafe
MR. DAVID GRANT,AN MBA STUDENT,
IS DREAMING OF OPENING
HIS VERY OWN INTERNET
CAFEIN KINGSTON,
JAMAICA
1996The Case Background
LOW BARRIERS TO ENTRY
AGRICULTURE IS THE MAIN INDUSTRY
“EUROPEAN CAFÉ CONCEPT”
500
THOUSAND 1,250
THOUSAND
EQUITY INVESTMENT FROM JTL
LONG TERM LOAN
FROM JTL
The Case Background
COMPUTER BOOTHWINE LOUNGE
CAFÉ AREA
WOULD GRANT’S CARRIBEAN
INTERNET CAFÉ, IN PARTNERSHIP WITH
JTL, IN JAMAICA
LEAD TO A PROFITABLE
BUISNESS?
The Problem Statement
! DEPRECIATION IS
NOT TAKEN INTO
ACCOUNT
! NO LOSS SALES
! ESTIMATES ARE
UNBIASED AND
RELIABLE
The Assumptions
INTERNET WAS INTRODUCED IN
JAMAICA
1994INTRODUCTION
OF THE INTERNET STARTED
1990
The Internet Service Industry
100%INCREASE IN
INTERNET USERS
1996
1
The Internet Service Industry
HIGH
INTERNET AWARENES
S2
LOW INTERNET USAGE
AND ACCESSI-BILITY3
LOW PRIVAT
E USAGE
SW
OT
AN
ALY
SIS
STRENGTHS WEAKNESSES
OPPORTUNITIES
THREATS
FORECAST OPTIMISTIC REALISTICPESSIMISTI
C
GROSS PROFIT7,200,000 3,456,000 1,728,000
NET PROFIT (LOSS)YEAR 1
4,573,600 829,600 (898,400)
NET PROFIT (LOSS)YEAR 2
4,720,000 976,600 (751,400)
Data Analysis: Quantitative
# of VISITOR
S
# MONTHS THAT CIC WILL BE ABLE TO
RECOVER ITS INVESTMENT IN AN
OPTIMISTIC MARKET
Data Analysis: Quantitative8
MONTHS # MONTHS THAT CIC
WILL BE ABLE TO RECOVER ITS
INVESTMENT IN A REALISTIC MARKET
41 MONTH
S
The DecisionWE RECOMMEND THAT MR. GRANT
SHOUD CONTINUE WITH
HIS PARNERSHIP WITH JTL AND
OPEN HIS PLANNED INTERNET CAFÉ
BUSINESS.
The Recommendations
(Short Term)
TWEAK HIS
“EUROPEAN CAFÉ CONCEPT” TO BETTER SUIT
JAMAICA’S PREFERENCES
The Recommendations
(Short Term)
OFFER
DISCOUNTS/PROMOTIONS
TO PATRON CUSTOMERS TO
INCREASE CUSTOMER REPURCHASES
The Recommendations
(Long Term)
MR. GRANT SHOULD FOCUS ON SHIFTING
THE USP OF HIS “CAFÉ” TO A CONVENIENT
MEETING PLACE WITH A GOOD
AMBIANCE THAN A MERE INTERNET CAFÉ
BUSINESS.
Thank You!We are now open
to your questions.
AIESEC is Love!AIESEC is Love!
AIESEC is Love!
AIESEC is Love!
AIESEC is Love!
MR. DAVID GRANT, AN MBA STUDENT,
IS DREAMING OF OPENING
HIS VERY OWN INTERNET CAFE
IN KINGSTON, JAMAICA
1996
500
THOUSAND 1,250
THOUSAND
EQUITY INVESTMENT FROM JTL
LONG TERM LOAN
FROM JTL
The Case Background
Income StatementOptimistic Most Likely Pessimistic
Sales
Internet 2,400,000
1,152,000 576,000
Drink 7,000,000
3,360,000 1,680,000
Food 3,000,000
1,440,000 720,000
Total Sales 12,400,000
5,952,000 2,976,000
Cost of Sale
Internet SP 1,200,000
576,000 288,000
Drink 2,500,000
1,200,000 600,000
Food 1,500,000
720,000 360,000
Total COS 5,200,000
2,496,000 1,248,000
GROSS PROFIT 7,200,000
3,456,000 1,728,000
ExpensesSalaries
Staff 374,400
374,400 374,400
Manager 480,000
480,000 480,000
Lease 360,000
360,000 360,000
Utility 180,000
180,000 180,000
Internet link 120,000
120,000 120,000
Advertising 120,000
120,000 120,000
Admin Exp 600,000
600,000 600,000
Insurance Exp 120,000
120,000 120,000
Interest Exp 125,000
125,000 125,000
Total Expenses 2,479,400
2,479,400 2,479,400
Net Profit 4,720,600
976,600 (751,400)
Income StatementOptimistic Most Likely Pessimistic
Sales
Internet 2,400,000
1,152,000
576,000
Drink 7,000,000
3,360,000
1,680,000
Food 3,000,000
1,440,000
720,000
Total Sales
12,400,000 5,952,000 2,976,000
Cost of Sale
Internet SP 1,200,000
576,000
288,000
Drink 2,500,000
1,200,000
600,000
Food 1,500,000
720,000
360,000
Total COS 5,200,000
2,496,000
1,248,000
GROSS PROFIT 7,200,000
3,456,000
1,728,000