Report

Harry’s Bakery

Aman

Katie

Marcelo Vieira da Silva

Simon

June 2014

English for Academic Purposes - Murdoch Language Centre/Murdoch Institute

of Technology

Perth, WA

EXECUTIVE SUMMARY

The report explains some problems related to a small bakery business which is runned

by Harry Jones and his wife. Their first problem is high management costs, which includes

high staff turnover and corruption. The owners have to recognize that an outstanding

characteristic of an enterprise, a company and or a firm is its quality service delivery, and it

depends on a good recruitments policy and staff retention strategies. Another problem is

reduction in the customer base ... So, they have to ... Thirdly, delay in bank payment is

another problem. They should ... Moreover, there is wastage of supplies of fresh ingredients.

Therefore, they have to reduce the menu list … to reduce wastage ... Finally, there is ...

CONTENTS

1 INTRODUCTION..............................................................................................................3

2 PROBLEMS, CAUSES AND SOLUTIONS.....................................................................4

2.1 Problem 1........................................................................................................................4

2.1.1 Causes..........................................................................................................................4

2.1.2 Possible Solutions........................................................................................................4

2.2 Problem 2........................................................................................................................0

2.2.1 Causes..........................................................................................................................0

2.2.2 Possible Solutions........................................................................................................0

2.3 Problem 3........................................................................................................................0

2.3.1 Causes..........................................................................................................................0

2.3.2 Possible Solutions........................................................................................................0

2.4 Problem 4........................................................................................................................0

2.4.1 Causes..........................................................................................................................0

2.4.2 Possible Solutions........................................................................................................0

2.5 Problem 5........................................................................................................................0

2.5.1 Causes..........................................................................................................................0

2.5.2 Possible Solutions........................................................................................................0

3 CONCLUSION...................................................................................................................0

4 RECOMMENDATIONS....................................................................................................0

APENDIX (if it will needed).....................................................................................................0

REFERENCES...........................................................................................................................0

LIST OF FIGURES

1 INTRODUCTION (Katie)

The objective of this report is to identify main problems, to analyse the causes as well

as to propose some potential solutions accompanied by the recommendations. The report has

been requested by the Jones who are running a great bakery business called “Harry’s Bakery”

with three branches. Despite the growth of their business, they are faced with enormous

financial difficulties. In order to reach its findings, the report involved group discussion and

survey associated with evidences deriving from the Internet. Firstly, the report examines the

problems and the causes. Then it might suggest the solutions of each problem. Subsequently,

conclusions are drawn, followed by several recommendations.

2 PROBLEMS, CAUSES AND SOLUTIONS

2.1 Problem 1 (Marcelo)

Management costs - High staff turnover and Corruption.

2.1.1 Causes of problem 1

The cause of this problem is the overexpansion of business and the necessity of an

effective recruitment policy as well as, staff retention strategies.

2.1.2 Possible Solutions of problem 1

2.1.2.1 The first solution of problem 1:

Harry Jones and Sandra must as first step recognise that an overexpanding of business

demands preliminaries strategies that should consider all possible challenges to be faced in

short and long term, as well as, estimate the finances to cover future expenditures. The

decision to extend the scope of your business must be a result of thoughtful consideration of

various factors, including the financial, logistical, even your emotional readiness. The rule of

thumb is that you should only expand when there are untapped opportunities that can benefit

your business. There may be a niche that you want to capture; or a location not serviced even

by your competitors. Therefore, without these strategies, Harry’s Bakery shops shall be

reduced from 3 to 2, eliminating that one which has fewer profits. This decision will reduce

the expenditures with extra managers, training for new staff, renting, and will save money for

future investments. http://www.powerhomebiz.com/managing-and-growing/growth/business-

expansion-6-things-to-consider.htm

2.1.2.2 The second solution of problem 1:

Even closing one of three Harry’s Bakery branches, it is essential an effective

recruitment policy on hiring talented staff to help in new strategies to guarantee efficiency of

output of the enterprise. A concise staff recruitment policy would add new ideas, techniques,

innovations and realistic plans on improving the quality of the goods and services to the

business. This policy will guide Harry Jones and wife in recruiting or hiring the most capable,

efficient and energetic staff with relatively low expenses on their enterprise in maintaining

them on the staff list.

2.1.2.3 The third solution of problem 1:

Apart from developing effective recruitment policy, staff retention is very essential in

keeping the business running and viable in a competitive market. Every potential business

including Harry’s Bakery must ensure that it has the capacity to pay staff entitlements

including salaries and benefits within or on the stipulated days. Besides salary, Harry Jones

and his wife must introduce a scheme that is carved to motivate staff. Such scheme includes,

commissions, medical insurance for employees, profit margins competition between the two

Harry’s Bakery and as a ward, the owners give same bonus for employees that belongs to the

winner shop. This kind of motivation always promotes hardworking staff and complimenting

creating fringe benefits that will raise their morale and increase individual and collective

expected outputs. As result, this eventually will improve quality productivity of goods and

services and maximise profits for the business and employees.

2.2 Problem 2 (Katie)

Another issue which Harry’s business has to face is the qualified worker shortage.

2.2.1 Causes of problem 2

Finding skilled employees is significantly challenging because of irregular working

hours in a bakery or low salary as well as poor management.

2.2.2 Possible Solutions of problem 2

2.2.2.1 The first solution of problem 2:

So as to deal with this problem, the bakery should have a reasonable working schedule.

On one hand, working in shift can be carried out with flexible schedules which become easier

for workers to choose. It is necessary to establish alternative timetable to help workers avoid

suffering overloaded work and feel more comfortable.

2.2.2.2 The second solution of problem 2:

Moreover, it may be helpful that a range of motivating methods should be applied not

only to inspire the employees but also to attract skilled workers. For example, suitable

commission for high qualified employees estimated by the number of products sold can be an

effective way to motivate them. Besides, monthly contest among group of workers with

valuable prizes based on the efficiency may push the productivity. Addition to commission,

vacation time to refresh and relax seems to be effective in attracting potential skilled

employees.

2.2.2.3 The third solution of problem 2:

Not only finding qualified workers but also keeping them is probably a tough struggle.

Consequently, associated with motivating methods, the improvement in management system

should be considered to set up confidence for workers and make them devote their physical

and mental power to the company, instead of only working for themselves. In fact, a good

staff is always a good basis for the development of a business.

2.3 Problem 3 (Simon)

The third problem experienced by Harry’s business is the decrease in the number of

customers, which leads to the significant loss of profit.

2.3.1 Causes of problem 3

2.3.1.1 The first cause of problem 3:

Firstly, rise in the cost of raw ingredients due to the global recession forces the bakery

to increase the price of food.

2.3.1.2 The second cause of problem 3:

Secondly, the intense competition from another bakery named who has cheaper

price of goods and more branches in all suburbs possibly puts a great deal of pressure on

Harry’s business.

2.3.2 Possible Solutions of problem 3:

2.3.2.1 The first solution of problem 3:

The first step is that a new supplier with affordable price of stocks and bulk-

buying can be found associated with the search for new cheap sources of ingredients.

Local supplier can be considered because of the low cost in transportation. Actually

the cheaper procurement may result in the decline in the price of raw ingredients as

well as the price of goods.

2.3.2.2 The second solution of problem 3:

In addition, the service quality should be improved professionally to appeal to

customers in which the improvement in home delivery, for instance, may bring more

convenience to clients.

2.3.2.3 The third solution of problem 3:

Also, surveying favor of customers accompanied by various promotion types

should be carried out to attract more customers. Indeed, if these strategies are

followed reasonably, the business may gain the dominant position in the competition

and the issue linked to the loss of customers will be solved.

2.4 Problem 4 (Marcelo)

The fourth problem is delay in bank payment.

2.4.1 Causes of problem 4

There are two causes for this problem, low profit margin and corruption.

2.4.2 Possible Solutions of problem 4

2.4.2.1 The first solution of problem 4

Harry Jones and his wife, Sandra, could get loan from another bank with low interest

rate to pay the current bank debt, by this way they can negotiate for a long payment that is

easy to pay.

2.4.2.2 The second solution of problem 4

Helping their finances with some sponsorship is also one scape from this difficult

situation, as well as, from big companies in return for advertisements at shop, even from

suppliers.

2.5 Problem 5 (Aman)

Lack of or wasting stock of fresh ingredients.

2.5.1 Causes of problem 5

The cause for this problem is related to an extensive menu.

2.5.2 Possible Solutions of problem 5

3 CONCLUSION

This report contains a systematic review and critical analysis of Harry’s Bakery and

has identified five main problems including management cost, disqualified staff, loss of

customer base, delay in bank payments and wast of fresh ingredients, in which overexpansion

appears the most important issue. It also offers some potential solutions to help Harry’s

business overcome the financial crisis. The best solution suggested is to reduce the over

expenditure, which means closing one of the three branches of Harry’s Bakery in order to

allocate the budget on developing two main branches. When the business has enough

financial power, Harry’s Bakery may reopen another new one branch.

4 RECOMMENDATIONS

The following recommendations summarize the main solutions given to Harry’s

Bakery problems in order to heal them and improve its profitability:

1. Set up a recruitment policy;

2. Introduce a scheme to motivate staff by giving them benefits;

3. Obtain feedback and opinions from customers through market surveys and price

analysis (Survey);

4. Borrow money from bank at low interest rates and sponsorship;

5. Improve quality of service in order to attract customers;

6. Redesign and organize the bakery’s menu;

7. Give at the ingredients multiple usages;

8. Introduce discount facilities (motivation);

9. Buy ingredients from local suppliers and bulk buy;

10. Replace ingredients for low cost substituents.

APENDIX

REFERENCES