Mystic Monk Coffee Case Study

1473 Words3 Pages

This case discusses the future of the Carmelite Monks of Wyoming and their monastery, the strategic approach they must take in regards to their coffee business, and the vision to purchase additional pieces of land. The study illustrates how and to what magnitude the Monks can rely on their coffee enterprise, Mystic Monk Coffee (MMC), to contribute as a financial resource towards the success of purchasing new land; an $8.9 million ranch in the Rockies. MMC must create improvements and efficiencies to enhance their overall performance levels. This ranch would allow Father Daniel Mary to establish a 500 acre monastery to accommodate a convent for Carmelite nuns, a Gothic church, a retreat center for lay visitors, 30 monks, and a hermitage. In …show more content…

The first recommendation is to hire additional workers. These employees will be used to continue the operations of the coffee business during the time the Monks are devoting towards their worship. It will help them keep up with increasing demand numbers and allow work to continue to move fluidly. The second recommendation is for MMC to spend the $35,000, and obtain a new coffee roaster to increase the level of production in a day. An advantage of pursuing this course of action increases the production from 540 pounds to 780 pounds per day. This new level of productions can create a higher profit margin. It also can be seen as an advantage for economies of scale, which in turn will maximize cost. MMC must also realize some of the disadvantages associated with this new roaster. This includes a product surplus if demand doesn’t meet supply, creating a higher inventory …show more content…

Advantages involved with pursuing this venture include a decrease in shipping costs since the retailer they distribute to will be in charge of delivering the product to the consumers, higher inventory turnover, and MMC will be a brand consumers associate with high quality and praise because of their location within respectable coffee shops. Since they are new within the coffee industry, the negotiations process may become a disadvantage for them as buyers may attempt to control the entire process, causing MMC to lose potential profits. The coffee shops have a high level of bargaining power, making it difficult to have all your needs met in the process. The costs associated with these negotiations can become significant and make possible deals not as profitable as simply keeping the business within their own location. Conclusion The greatest, most efficient option for MMC is to utilize is the second alternative; purchasing a new coffee roaster. The higher level of productivity allows them to meet all the demands they receive from their customers, increasing overall income. Weighing the advantages and disadvantages of all three alternatives, this offers MMC the greatest opportunity to succeed in reaching their go and purchasing the ranch. The increase in production also benefits the Monks by making their time of devotion not such a burden on the business. A new

Open Document