NZ Diploma in Business (Level 5)

NZDB52102A-L-5201 – Professional Practice and Communication in Business

Portfolio Assessment – Task 1

Report on ABCCafé(Blue Tokai)

Submitted by: Vanshika Bhandari (ID: 104666)

Submitted to: Wilfred Kurukulasuriya
Table of Contents

Executive Summary.........................................................................................................................3

1. Introduction..............................................................................................................................4

2. Method......................................................................................................................................4

3. Findings....................................................................................................................................5

4. Conclusions..............................................................................................................................7

5. Recommendations....................................................................................................................8

References........................................................................................................................................9

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Executive Summary

The report below describes ABC Café’s (Cafe Blue Tokai) functioning and daily operations. It
examines the history of the establishment, crucial findings, identifying the problems and their
remedies, concluding remarks and suggestions in detail.

Interviews were held with the customers who frequented the café and the cafe management to
collect the information necessary for this report. They gave insights into the establishment. The
information gathered from the cafe staff and further research into facts and policies regarding the
business, including their advertising and marketing strategy, in identifying the issues and their
possible logical and relevant solutions.

Key Findings:

After interacting with the staff, customers, and the manager, the problems identified with the
cafe were that of improper cost-benefit analysis that has caused the cafe significant losses in the
previous quarter of March-May. Another problem identified was that of the inappropriate
structure of the Cafe’s staff and management team.

Key Recommendations:

The crucial changes that the owner can make to cut losses would be to consult an accountant to
create a restaurant budget so that the cafe keeps running smoothly and does not go bankrupt
when he least expects it. Another thing the owner needs to do is to create a few basic ground
rules for the staff and assign the workforce very carefully and only interfere when the need arises
because frowning upon the staff and correcting them now and then not only diminishes their
confidence but also weakens their interest to work, which is bad for business.

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1. Introduction

Cafe Blue Tokai is a small Maori dine-in and takeaway restaurant The business primarily serves
its customers freshly prepared cuisine and provides them with a high-quality restaurant
experience. Offering an advantage over its competitors, its location has been crucial for its
success over the last few years. Cafe Blue Tokai has a car park in the rear of a Wal-Mart, along
with being located in an elegant neighbourhood; it is situated near a railway station, a school and
a subway, which helps it attract a considerable number of customers.

But recently due to few problems the footfall of customers frequenting the restaurant has
gone down, primarily because few of the employees working there have quit (employee
turnover), which has greatly affected the restaurant service and their deliver timings, thus putting
them in a bad light. Another problem the cafe is facing is that due to the improper budget
analysis there has been wastage of food and other perishables on a daily basis which is also
causing a loss to the cafe. Therefore, in order to help the cafe to overcome this issue and give
them possible solutions, Mr. Logan, the owner of the cafe has authorised and asked for this
report and our tutor had also allowed us to help him in order to identify and solve such
challenges. A list of recommendations for the cafe will also be provided in order to succeed. The
report will be submitted as per the deadline for submission.

2. Method

Preparation of this report was via observation, interviews and a survey questionnaire to assess
customers' views of the quality of service, quality of the food, contentment and behaviour of the
staff and also through the customer reviews and comments on their social media pages. Some of
the staff and the restaurant management were also interviewed to identify concerns or problems
the restaurant might be going through. The restaurant's promotion and marketing strategies were
also looked into.

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3. Findings

The ABC cafe's essential task is to provide its visitors with freshly prepared meals. The staff
members go to the farmers market and acquire the necessary supplies every Tuesday afternoon.
Two out of the nine employees, excluding the manager who works in the cafe, visit the market
weekly to purchase the necessary supplies. During the week, they must estimate the supplies
needed to prevent wastage of commodities as most of the material they buy does not have long
shelf lives. The merchandise is then stored in the two giant fridges. This ensures the supply
persists throughout the week and stays fresh for later preparations. It was known that after
talking with one of the employees and in conversations with the management and few customers
that the following problems were there at the cafe:

Problem 1: Wastage of food ingredients due to purchasing surplus quantities

In the past several weeks there were frequent instances when the surplus was purchased, and
since most food items last not more than a week, this is causing the cafe signification losses. So,
in order to solve these issues following steps can be taken:

Solution 1: Measuring the amount of wastage

The cafe can simply discover ways to reduce wastage while still fulfilling client needs by
measuring the amount of food being prepared and being wasted. The cafe can reduce the portion
size, introduce some amends to their menu, or substitute some dishes with others and it would
also help to determine that how much and where the food was being wasted to track.

Solution 2: Preparing a appropriate Budget

Since major expenses have to be done on the food items, which includes the price of raw
ingredients, transportation costs, availability, prices, labour expenses, storage etc. However, food
is not the only item to pay for; salaries should also be paid, purchase and maintenance of
equipment, advertisements and promotions, rents and taxes, etc. In order to prevent going
bankrupt, the first step is to establish a budget that considers all of these variables. Secondly, by
employing or contacting an accounting firm/accountant who understands what and how to
anticipate and the appropriate way to evenly and judiciously spend the money not to incur losses
(Kimes & Ho, 2019).

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Solution 3: Prediction of food orders

The cafe can introduce a system for accurate food  prediction either by manual means or via
utilizing digital technology (for example, predictive ordering), meaning that the cafe can obtain
more accurate information, understand more about food order patterns and control their kitchen,
and hence wastage.

Problem 2: Employee turnover

Another concern discovered was that three employees had left the work in the previous few
weeks, thereby reducing the staff to six (excluding the manager) and increasing service and
delivery time, significantly affecting the reputation of the company the cafe. The employees left
because the cafe team structure had severe flaws. The owner wanted to do it all, i.e., to interfere
and criticize the staff regularly even when they were not responsible for several issues in the
café. Hence, three possible solutions for this problem are given below:

Solution 1: Checking-in with the Staff on a regular basis

Checking-in with the staff members on a regular basis is necessary in order to find out that if
there anything that might be bothering them or to know whether they are content with their
jobs/roles and accordingly the management can take necessary actions.

Solution 2: Find the best suitable manager to handle the staff

The owner should not be concerned about the problem-solving efficiency of the cafe managers
but should feel substantially comfortable in letting him/her do the job and handle the business.
Any HR problems should be the manager's duty in a cafe, and he/she should have solid work
ethics. Henceforth, the manager hired by the owner must be competent and trustworthy and ideal
for the job and he must assign roles as per the staff's abilities, productivity and experience rather
than to those whom the he/she favors more.

Solution 3: Creating a positive-work environment

Creating a positive work environment means being generous and grateful to employees in order
to make them feel happy and secure. And interacting and encouraging them to try new things and

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discover new things and they will not want to quit the job. Also, whenever the cafe owner can
afford to he should give the employees bonus salaries or provide them with other benefits such as
few paid holidays.

4. Conclusions

The questionnaire and interviews were utilised as a tool for this report—the sample of this
survey comprised of staff, a manager and customers. The results of the study were examined.
This report was prepared using descriptive analysis. Of all the things that may go wrong in a
restaurant, the worst conceivable scenario is to lose money. Not appropriately estimating
expenditures and not calculating the budget to cover unanticipated crises are concerns that may
put the cafe on the verge of insolvency.

Hence the best solution for the first Problem would be Solution 2 i.e. preparing an appropriate
budget with the help of an accounting consultant or a firm as it would help cut losses and run
things more smoothly.

Secondly, as a restaurant owner, one cannot do everything. The problems plaguing the café and
the owner might make everyday operations difficult and threaten the business's viability. One
should necessarily trust his/her manager or management team since they are the ones who will
maintain a smooth operation and provide much-required guidelines for restaurant employees
while enabling the restaurant to benefit.

The best solution for the second problem would be Solution 2 i.e. hiring a suitable and ideal
manager for the job, who can manage the team efficiently and also take care of their demands
among other things. A good manager can help in reducing the employee turnover and ensure that
the staff is content with their roles.

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5. Recommendations

The implementation of the best solution for problem 1 i.e. to reduce wastage and have an
efficient budget analysis would be firstly by identifying those areas where the cafe has been
spending extra. Then they should observe and identify the areas where they have been losing
money while reviewing their budget. Additionally, they should identify areas where they can
make more profit or where there is a margin to make money. They should clearly identify those
areas as well where they have to spend more but are doing the opposite. The restaurant should
also spend less on advertising and instead offer food coupons or discounts to local influencers,
who would eventually gather them a considerable attention via social media platforms. Lastly,
the cafe should establish certain financial goals for themselves.

The implementation of the best solution to the second problem i.e. to reduce the Employee
turnover would be firstly by making the owner understand that his frequent interfering on
matters that he does not need to be concerned with and can be handled by the staff and
management on their own would be that he should obviously be involved, but he should try to
focus primarily to avoid confusion or havoc and wastage of money and to organise the staff. The
answer would be to strike the ideal harmony and teach them to deal with various scenarios.
Provide resources and rewards to them when they perform a superb job and achieve individual
set objectives. It is incumbent on the owner to inspire and encourage them and bring them into
line with the idea and concept of the café (Ratasuk & Charoensukmongkol 2019). Each person
must have a thorough understanding of their tasks, their authority and organisational culture.
And this can be achieved only when the Owner will hire the most suitable and perfect candidate
as the manager who would get the job done and upon whom the owner can rely on.

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References

Jogaratnam, G. (2017). How organizational culture influences market orientation and business
performance in the restaurant industry. Journal of Hospitality and Tourism Management,
31, 211-219.Retrieved from:
https://www.sciencedirect.com/science/article/abs/pii/S1447677016301322

Kimes, S. E., & Ho, J. (2019). Implementing revenue management in your restaurants: A case
study with Fairmont Raffles Hotels international.Retrieved
from:https://ecommons.cornell.edu/handle/1813/70972

Ratasuk, A., & Charoensukmongkol, P. (2019). The Role of Team Trust and Team Conflict on
Innovative Performance of Multicultural Teams in the Restaurant. Thammasat Review,
22(2), 1-18.Retrieved from: https://sc01.tci-
thaijo.org/index.php/tureview/article/view/205119