Case: By the Sea Biscuit Company Venture Analysis

Team 2 PGDM ExP 2023-25

Problem Statement:
Whether Pat Jobe and Paul Finney should leave their current full-time job in order to start
this frozen biscuit production or should they continue with their job.

Criteria:
STRENGTH WEAKNESS

-There is no major player particularly in frozen -Anecdotal information available regarding

biscuit market. frozen biscuit industry
-High quality of raw materials. -They will have to start with lower prices to
-Low energy cost and competitive overhead cost. attract retailers.
-Pat has prior experience regarding the
establishment of frozen Biscuit processing line.
-Paul has prior experience of running business.
-Canada is the major exporter of bakery products
to US.
-Low rental expense of CBIRC facility

OPPORTUNITY THREAT

-Many people have started preferring Frozen -Established industry leaders might also venture
biscuit as a part of their meal in US. into producing a Frozen Biscuits.
-Healthy Omega 3 Flax Enriched Biscuit

1.Business Should be profitable

2. Market Potential

3.No delay in project execution.

Options:
1. Leave the Job & Start the Business

2. Continue with Job & do further research regarding Market potential

 Option Analysis:

Initial Operating
Expenses Testing 30000
Second hand Per Unit Selling
Equipment Cost 80000 Equipment Price 13.5
Rent & Electricity PM 7500 Capital
Salary Managers (PM) 3333 Loan 100000
Production labour cost 1750 Investment 60000
Employ insurance
Manager 400
Production Labour
Insurance 210
Marketing & Travel
Expenses 1583
Office Equipment 200
Cogs 7.78
Interest payment 625

Month Production Revenue Expenses Profit/ Loss

1 0 0 122058 -122058
2 0 0 11858 -11858
3 0 0 11858 -11858
4 0 0 11858 -11858
5 21000 283500 178782 104718
6 21000 283500 178782 104718
7 21000 283500 178782 104718
8 21000 283500 178782 104718
9 21000 283500 178782 104718
10 21000 283500 178782 104718
11 21000 283500 178782 104718
12 21000 283500 178782 104718
*Prices are in $

Recommendation:
From the above analysis By-The-Sea-Biscuit Company Business can be initiated, with a loan of
100,000 $ and 30,000 $ investment from each partner (Pat & Paul).