Biddy Bakery

In business we tend to face all kinds of situations and circumstance that we have to carefully evaluate using past information to predict the future. Although no prediction can be totally accurate it can help us to draw a conclusion on where we would be in the future if we focus on the right information. Elizabeth and “Biddy’s Bakery” faced this challenge in meeting her capacity needs. As she had stated in the case business “Initially sales were slow, and there were periods when the business operated at a loss.” (Reid, Sanders 2010). Biddy Bakery continued operations and through the next few years they began to grow just as many companies do as they get more and more established. Typically, bakeries aren’t the fastest growing business in the market nor are it the most popular type of business. If we were to look at this more analytically we would see that this is not a fast growing business and capacity is probably not a challenge, more or less and maneuver that needs to be taken to accommodate for the slow but steady growth. Another statement that supports this is by Elizabeth explaining that sales continued to grow slowly but steadily. In 1994 when she first established the business she used a first floor storage area that was expanded to accommodate the growing needs of her business. By mid 2000 Biddy’s Bakery quickly outgrew its current capacity therefore she decided to purchase the adjacent building and move into something with larger capacity and henceforth we have the problem. In particular we may have look at the lack of space as growth rather than the increase of production as growth. If we look at the timeline of growth and how long it took her to grow into her facility we would see since she started the business in 1984 to 2000 had been 16 years of slow, but steady growth. This is what she should have considered before moving into the larger facility. I think other option would have been considering longer hours of operation, outsourcing some prep space (pre-mix batter), or possibly just updating equipment which had probably been there since 1984. This shouldn’t have been a challenge, but a good opportunity to maneuver the space she had to hopefully increase sales and most importantly profits.
Determine what is wrong with the proposal made by the team of the business students and why.
In all aspect I can’t say that the proposal that was made by the team of business students was wrong, however I can say that it did overlook some special function or missions of the bakery. As said before in business we face many challenges and challenges are those that are solved overnight. I think the group of business students took the challenge and made it a problem and gave it an immediate solution which was mass production. Unfortunately, Biddy’s Bakery niche was being a home-style bakery that strayed away from the commercial and focus on a variety of baked goods with old fashioned style and taste. Although they did have a signature product, the “McDoogle” that they wanted to brand, they also wanted to produce other baked goods. The students felt that this would solve both the need of using the extra space in the room and also by allowing Biddy’s Bakery to possibly reach a new market by going into grocery store chains. “Marketers believe that brands have value above and beyond the benefits of the product itself.”(Lacobucci, 2011). So, with that being said they were hoping to take Biddy’s Bakery into something that she didn’t want it to be…commercial.
There would be total difference if Elizabeth were to accept the proposal that was made by the students. As Elizabeth stated, the mission of Biddy’s Bakery was to produce a variety of baked goods with old – fashioned style and taste. With the proposal from the student Biddy’s Bakery would only produce one pie which was the bakery specialty the McDoogle. Biddy’s Bakery was operated by its customer base and orders. Meaning for the most part the customer placed advanced orders and occasionally they would assist in special request as any bakery does. This type of production is more of a customer driven production. In a customer driven production process you have to be aware of the demands of the customer to set up a production process with minimal waste. This will allow for the right amount of products to be manufactured and sold to consumers. One part of this approach is not making the product until the customer orders it. This is part of that “old – fashioned, home style bakery appeal that Biddy’s was referring to in her mission for the bakery. However, with the new plan this couldn’t be possible. With the amount of pies that would probably have to produce it would be hard to produce exactly when a customer orders it. In the new proposal Biddy’s Bakery would have to mass produce. “Mass production is a system for manufacturing products in large quantities through effective combinations of employees with specialized skills, mechanizations, and standardization.” (Kurtz, 2012). When you mass produce you make larger quantities available which would mean more pies, however possibly more than you would need for that run. This would also completely disregard the variety of goods that was part of her initial plan.
In this particular situation I would just look at the numbers. There is no way to precisely predict growth therefore it can be a risk. However, by retrieving the right amount of data, trends, and consumer information for two to three consecutive years you may be able to figure out an average of what is needed. There has to be a way to maneuver around the slight increase in sales without having to move. However, if the move is final another possibly quick fix solution is being able to sub lease the extra space to someone for the hours that you’re not using them. Nonetheless, proper forecasting could have prevented this ordeal in any business situation. The one thing in business that doesn’t lie is the numbers. We have to be able to closely analyze the data that we retrieve monthly, quarterly, yearly to be able to decide our next move and keep us in the best situations we can possibly be in.