Kem Chicks Case Study

I. Time Context 1985 II. Viewpoint Bob Sadino, owner of Kem Group of melody III. Major insurance Statement Kem Chicks is the best gourmet lifestyle supermarket in the Kemang atomic number 18a that serves upper and middle cosmopolitan customers delighting the customers by means of better harvest calibre, delightful ambiance and display with depth of knowledge of specialty foods and products.IV. Statement of the ProblemHow get out the Kem Chicks expand its supermarket by its own enthr 1ment while sustaining its growing operations and without putting the quality of their products into a risk? V. Statement of ObjectivesLong-termTo maintain and develop a competitive position in the growing exertion To moldulate a strategy in order to take up economies scale for existing supermarkets. To occupy more(prenominal) than 1% of the supermarket space in Jakarta, Indonesia To increase the public aw arness of Kems goal to be the Meat hatful To become the market scater in the national ma rketShort-term To give excellent serve To improve go To establish a good rapport with the employees To provide goods or services that is cheap and affordable to consumers or the public To meet the trains of customers by constantly seeking and actin on their opinions regarding innovation, product quality, choice, store facilities and service VI. SWOT AnalysisStrengths (S) Weaknesses (W) Have valuable merciful Assets Good personnel focus Responds and caters the needs of immediate community. poke outs show clip quality meat products The organization is leading Have a harmonious relationship between employer and employees flexibleness (Bob Sadino doesnt consider any problems, beca engagement he is flexible) They lack marketing strategies Un go awayingness of Bob Sadino to know the significant details of the financial information about the fraternity Weak long-term strategic planning hassle with tot wholey over-the-counter communication Lack of internal control No particular designation of business organisation Opportunities (O) Threats (T) learning of rival firms Diversification of the business Expansion of the business Customers word of mouth Declining price of oil form in customers preferences Increasing in Bargaining Positions of the consumers, thus, resulting in the increased risks in capital expansion The investing risk is at high level Increasing competition Rising interest rates natural calamities Government regulations, rules and policiesVII. Alternative Courses of ActionThe Kem Chicks case study given the facts that the best altenative for them to expand is to engage in franchising. This has been soundly studied by groups of individuals for Kem Chicks existing problem. Therefore, thealternative courses of action will focus on the types of franchising alternatives.1. Product dissemination 2. Product licensing 3. Enter into a franchising agreement c entirelyed Entire blood Format franchising VIII. Analysis of Alternatives 1. Product Dis tributionIt is the simplest form of franchising contractual arrangement in which Kem Chicks as the franchisor offers the franchisee the right to market Kem Chicks products in an essendially unchanged introduce within a designated market bea. In return the franchisee would pay a fee to Kem Chicks AdvantagesDis avails Increase in exchanges volume of the parent company Will non cater development of KemChicks internal c encrypting thus it does not support the supermarket as a whole.2. Product Licensing Arrangement Under this term, the franchisee would be offered nearly the whole operation of the franchisor. The franchisee would have the right to manufacture or modify Kem Chicks in a current area of distribution to maintain its standard product and service quality. Kem Chicks would exert tight control over the manufacturing and selling process and set and control specification. In return, the franchisee would pay a royalty and other fees.Advantages Disadvantages either the franc hisor or franchisee or both can have more benefits Improve its quality control policies slump to manufacture or modify Kem Chicks in a certain area of distribution No effrontery of success Will pre-empt all important positions in the organization KemChics could lose control over the management of the business3. Enter into a franchising agreement called Entire Business Format franchising Under this arrangement, the franchisee would be an imitation of what the franchisor is. The franchisee would be offered the right to manufacture, to sell the product, to use the franchisors name of trademark and other symbols, management system, architecturedesign, and would be provided with supervision, a account system and management consultation. Kem Chicks would require certain initial fees, continuous fee based on sales (royalty), management fee, nurture and consultation fee, and a fee for design and reporting system. AdvantagesDisadvantagesKem Chicks will have full control of the business. Possibly have a chance to develop and to promote human resources Enables the franchisee to enter the sedulousness without know-how and hold up and it can hold out to them the chance of success while minimizing risks Security in the protection of the rights and property of the company Mistake of one franchisee will bear to the image of the companyIX. Decision StatementConsidering that the industry is reaching toward the peak of its growth phase, Kem Chicks faces tough competition with a limited choice of land and location. Also, an increase bargaining position on the part of the shopper, each element of the key success factors should therefore not be neglected. Since the profitability of the investment in a new outlet is highly dependent on the level of sales and cost, each of the success of this investment.Therefore, we concluded that the best alternative solution to the problem is a to enter into a franchising type called entire business format franchising because of the followin g reasons Franchisee operates exactly the same as franchisor because the entire franchise was provided by Kem Chicks. Kem Chicks will generate different types of income such as management fees, training fee, reporting system fee and other from the franchisee.The privacy of their field of expertise or specialty will be maintained by Kem Chicks on their own because under this type of franchise, Kem Chicks is the sole provider of all information and needs of the franchisee upon proper earnings. X. Implementation ProgramIn order to materialize the said recommendation and just analogous the real process in the world of franchise, Kem Chicks should 1. The franchise relationship is founded upon a contract, which should contain all the footing agreed upon. 2. The Kem Chicks must develop first a successful business format (the system), which is identified with a brand name, be it a trademark, service mark and/or trade name Kem Chicks must bulge out and set a period wherein they will trai n the franchisee in the operation of the system prior to the initiation of the business so that the franchisee is equipped to run the business effectively and successfully.Kem Chicks must also assist with the overting. 4. subsequently the business has opened, the franchisor must maintain a continuing business relationship with the franchisee to provide the franchisee with support in the operation of the business. 5. The franchisee is permitted, under the control of the franchisor, to operate under the branding and the business systems developed and owned by the franchisor and to benefit from the goodwill associated therewith. 6. The franchisee must bake a significant capital investment from own resources. XI. Proposed Business PoliciesManagement Generate periodic computer reports for management information, such as reports showing the sales income, cash balance, sale of shopping vouchers and issue of the gift coupons and refunds to customers Franchisee must pay initial fee and pe rcentage of salesThere should be a monthly regular meeting of the management and an annual regular meeting of the management with the franchisees with regards to update reports for the business Marketing Advertise supermarket through local newspapers, brochures/billboards/posters Advertise through local radio ad Offer discount coupon Can offer weekly sales discount Operations Open12-hours a daylightlight from Mondays to Sundays Tight security Inventory Control Acceptance of goodsTo enhance accountability, the supply credi devilrthy should be necessary to inspect and count goods/food items upon delivery against the quantity specified in the delivery note, cross-referencing the relevant secure orders if any, and to certify acceptance. There should be a procedure for staff to record defective or briefly delivered goods or food items and to follow up promptly with the supply department or the supplier direct. The types and quality of food or goods to be replenished directly by the concession counter staff should be correction to checks before sale. Random supervisory checks should be conducted on the quality and quantity of accepted food or goods, especially those of high value. Ordering and Delivering StockStandard requisition form, preferably in an electronic format to facilitate electronic data interchange between the operator and the supplier or sending of electronic fax, should be employ to provide an audit trail. The form should show details such as the description, quantity and place of commencement of the goods/food items required, the agreed price, the delivery address, the expected date of delivery, the name of the requesting person, and the approval authority as appriate.Phone orders should be confirmed in writing afterwards. Any deviations should be approved by the appropriate authorities. Extension of the lead time should be justified and approved by senior staff Over-deliveries or short-deliveries should normally not be accepted unless justi fied and authorized Suppliers performance in stock delivery should be appraised payConduct inventory Generate daily and periodical sales and receipt reports Cash Handling To hold on manipulation, the following control measures are recommended The guidelines on hadling of cash should set the maximum amount of cash hunt down per day for each store, the banking frequency, and the requirement for daily cash position reports Notes intervention procedures should specify, among others, the bank notes, to be tested using a money tester by a sales assistant and notes by a store supervisor CCTV with tape recordingfacilities could be installed to monitor cash handling at the sunder counters if necessary Responsible staff member at the appropriate level should be designated to conduct day-end atonement of electronic sales records against the cash in hand and to make spot checks on other operative activities daily at random Compliance with cash collection security requirements by staff re sponsible should be subject to supervisory and audit checksHandling of Credit Card informationBriefing sessions whitethorn be arranged for staff to raise their awareness of the criminality of such activities and the companys disciplinary action if such activities are discovered. Clear instructions should be given to staff on the handling of credit card transactions, e.g. requiring the handling staff to sign on the credit card payment slips to hold them accountable for the transactions hard-hitting security measures should be adopted to minimize the risk of information leakage, e.g. to keep the credit card payment slips in a secure place with restricted access. Staff should be informed of the channels for reporting approaches by criminal syndicates and incidents of suspected corrupt practicesInternal AuditSales and accounting operations should be subject to internal audit. Human Resources Employees prepare in 2 shifting schedules Conduct training for employees Bereavement LeaveAn excused paid absence seizure of up to 3 days for missed work time will be granted for purposes of arranging, be and resolving personal social functions with regard to a death in your immediate family. Your immediate family is defined as spouse, parents, grandparents, sons, daughters, sisters, brothers, stepparents, stepbrothers and stepsisters, mother-in-law and father-in-law. The company will also pay employees for time lost from work for up to one day for relatives beyond the definition of immediate family. The company may allow an unpaid leave of absence for up to two weeks to be taken in connection with the death of a relative or virtually friend. Such absences must have the prior approval of the employees supervisor and managementDress CodeProper attire is expected for all employees Employees who do not meet the standards for appropriate business atture should be counselled by their supervisors and may be sent home to change. It is the supervisors responsibility to ensure th at his or her staff presents a professional appearance.Equal troth OpportunityIt is the policy of Employer Name to provide equal opportunity in employment to qualified individuals regardless of race, color, reigion, age, sex, matrimonial status, national origin, ancestry, physical or mental disability, sexual orientation, genetic information, or any other legally protected class in accordance with all applicable laws.Inclement WeatherThe company maintains the policy of remaining open during bad weather, unless the severity of conditions and/or municipal or state government rulings close the office. If operations are canceled after a shift has started, hourly employees will be paid for the time worked, or two hours minimum, whichever is greaterMoonlightingOutside employement must not be engaged in during the employees regularly scheduled work hours. The use of the companys supplies, equipment, telephone, materials, and personnel is prohibited.Open Door PolicyThe management recogn ize the accumulation of unspoken, unanswered problems, complaints and questions. It is everyones advantage to bring these matters out in the open.OvertimeIt may be necessary at times to ask the employees to work beyond their regularly scheduled hours. Overtime will be paid at the rate of time and one-half the hourly rate for all hours worked in excess of 40 hours in any one week. With the exception of holiday pay, hours paid but not worked, such as personal itme, jury duty, disappointment pay, etc., will not be considered timeworked for the basis of computing overtime. The management will make every feat to distribute overtime fairly and equitably.The selection of who is to work is based primarily on the job experience and ability to handle the work that needs to be done, and on seniority, ones productivityand job performance. There is no guarantee of overtime work, and employee are cautioned to not become financially dependent upon it. Anyone working unauthorized overtime will be subject to discipline.Workplace Threas and ViolenceAny person who makes threats, exhibits threatening behaviour, or engages in cherry acts on company property shall be removed from the premises as quickly as preventive permits, and shall remain off company premises pending the outcome of an investigation. XII.Management Lessons Learned from the caseIn every company established, growth must be sought after. Big things come from small beginnings. Just like Kem Chicks, they may have earned income initially and started good yet Bob has never stopped expanding his business. We shall see not only whats inside our company but also whats happening outside. Almost all businesses have competitors competitors whom we need to compete with. Jakarta has a growing population which meant more demand. We cant just let our competitors benefit from them while we stay like the old times, watching our opponents beginning to rise up and then eventually stay at the same level we are in. Who can miss the need for a bookkeeper?Money, as one of the essentials in a business shall be handled properly. Accountants play a essential role in todays establishments. Its possible that a company may gain success even we have poor systems (as we have observed from Kem Chicks itself), yet we know that we cannot stay like that forever. Every organization shall be organizedthats why its called an organization. There shall be positions change with the right personnel, with the right ability. Employees potential shall be carefully studied and continually improved. People who work for us are indispensable. Without them, we may be limited.We shall care for them, the same way they care for us just like how Bob valued his relationship with his workers and how he took care of them. Of course, the group has also learned about franchising and investment risks. Its not just the expansion that we care for but also what it may do for our company. We are reminded to take care of our product. Company name may be copied over multiplied outlets, but if the product quality and employee morale are not retained, this could destroy a companys reputation and may start its ruins.We cannot say that we hit the hay our company if we dontlove every bit of it. When we love something, we care for its growth, we care for how it is being managed and we consider the hazards it may go through. Life is not a matter of chances, its a matter of choice.