ABC Bakeries
Task 1
Dear Seamus O’Kane,
This memo is expressing my views on the Economic Feasibility of the proposed internet based system for ABC Bakeries.
The plan for the internet based system is to provide more profits than the actual shops that ABC Bakeries have open on the street.
The areas I wish to investigate are:
- Setting up the internet based system – premises, hardware, number of developers needed, time period required.
- Costs – price of pastries, price for delivery, number of delivery staff and vehicles required, development costs, testing, premises bills.
- Benefits against problems – fewer staff, maintaining staff morale, good customer service, ease of system use for customer
First of all ABC Bakeries needs to find a premises in which to set up the internet based system, and in this premises they need to set out how many computers they will need and the number of staff required to deal with the demand. They need a premises large enough to house all of the computers and staff, but have some spare room incase they happen to ned to employ more people, depending on the demand from the internet based system. After this they will need to set out a time period for the internet based system to be set up, the quicker it gets done the quicker it can be implemented into the business. To get it done quicker more developers would be needed to create and test the system before it gets launched, and also get customer feedback during the testing period, to see whether it would be beneficial or not. The reason all of this needs to be into consideration is because they will want to be able to create it for as little as possible, but as quickly as possible, so that the revenue from the wholesale and retail sides of the business are covering the cost of the internet based system development, but also bringing in enough profits to keep afloat in the meantime.
With regards costs, ABC Bakeries need to take into consideration the price of the pastries and delivery, will the pastries be of good enough quality and taste to justify the higher retail price PLUS the addition of delivery charges? And if not then can they keep the pastries at the same price as the retail shops and conduct free delivery? On top of that they need to figure out how many delivery drivers they will, need, and will they need large or small vans for delivery. They might also consider selling the pastries online for store pick up, but would the customer use the internet based system when they could just go to the shop anyway in that case? The internet based system also needs to be set up for as little as possible, but make it as fancy looking and easy enough to navigate through for the user, to keep them coming back. All of these costs need to be thought of when considering whether the system be worth it or not.
They then need to weigh up the benefits against problems. With the internet based system they will need fewer staff because it is all automated, but with fewer staff then they need to think of ways to keep the staff morale up so that everything runs as efficiently as possible. They want the customer to be able to use the system easily and quickly so that they will be more inclined to keep using it, but combine this with good customer service, ie getting their order processed and delivered as quickly as possible, with friendly staff to greet them. Is it likely that the internet based system will be popular enough and bring in enough revenue to compensate for the lack of profits made during the development and testing period of the set up?
Overall I will be looking to see if the benefits outweigh the costs during the set up period. The fact of the matter is that more and more people are using the internet to order things that they want or need, so the internet does seem like the most positive way forward for the business, due to the declining wholesale demand. The way to work out all of this is to work out the revenue coming from the wholesale and retail sides of the business, and then work out how much money they are willing to spend on creating the internet based system, including money for premises, staff, and the time required to set it up, leaving enough to keep producing and distributing the pastries to the same high quality that is expected from customers.
Task 2
I think that the team should consist of about 6 people, 2 to analyse, 3 to design, and 1 to implement. The reason I think it should be roughly these number of people is because the business is only small, so there would be no point in hiring a large number of people to create the online system. I would get two analysts so that one could ask the company what they want from the system while the other asks potential customers what they would want, then they could combine their information and pass it onto 3 developers who could work in sync and get it done pretty quick, then the person who would implement the system could get to work and set it all up with the business. Then finally when all of that is done the analysts could once again go to the business, and customers, and see whether it is satisfactory or not.
