1. Arezzo Bread After taking a trip to Italy and falling in love with the bread, Julia decided to change careers from working in finance to selling her own hand-made bread in her small city. While Julia is not expecting to become extremely wealthy by selling bread, she would return to the finance industry if she is not able to turn an acceptable profit. Calling her startup Arezzo Bread, at first she made the bread out of her own home, focusing on selling sourdough loaves in the local farmer's market every Saturday. When it became clear that her biggest hit was cruffins (a combination of a croissant and a muffin), she switched to predominantly producing cruffins for each Saturday market. Using only word of mouth advertising, the lines for the Arezzo Bread stall at the market grew to be routinely one hour long on market days. Preparing for market day soon required her to stay up all night each Friday, so Julia started considering how to efficiently scale up her operations. Her first step was to begin renting space at a local business hub that has industrial ovens and other higher-volume kitchen equipment. She also hired two assistants to help her with the baking, but one quit after two weeks due to the demanding schedule, and she fired the other one for frequently being late. As the local unemployment rate has improved, Julia continues to have trouble finding reliable workers. Demand continues to be strong enough that Julia is now using the profits from Saturday markets to save up for a transition to a new shop that she will keep open Monday through Friday, in addition to selling at the market on the weekend. Several favorable reviews in local papers in addition to a constant social media buzz have given Julia the confidence that investments in more efficient machinery and ovens in her own work space will pay off. While Arezzo Bread is profitable and Julia has $50,000 in savings that she is comfortable investing. she is also seeking a loan from a local bank. The bank, however, wants her to write a formal business plan before it will consider extending the loan Question Marks 1: Explain two examples of how the business function departments will have to operate together at Arezzo Bread. 2: Describe the nature of business activity in the sector in which Arezzo Bread operates 3: In the context of Arezzo Bread, explain how businesses combine human, physical. 6 and financial resources to create goods. 4. With reference to the case study, explain three reasons why entrepreneurs may start up a business. 5: Explain the role of entrepreneurs in the context of Arezzo Bread. 4 N 6 2