Hello...i need some help with this case study.....

Looking to Expand, but Fearing It, Too By ADRIANA GARDELLA Published: January 20, 2010 THINKING CAPS TUTORING of Manhattan provides personalized study-skills coaching, subject-specific tutoring, enrichment programs and SAT preparation to about 300 middle and high school students annually. The business, which employs 30 tutors and part-time office help, had 2009 revenue of $500,000 to $600,000, says Alexandra Mayzler, who founded the company. THE CHALLENGE To expand while maintaining the quality of the company's services. THE BACKGROUND Ms. Mayzler, 27, started the company seven years ago from her New York University dorm room. She initially offered tutoring for the New York State Regents exams, which she had taken as a New York City public school student. As a psychology major, Ms. Mayzler, who is taking one course per semester toward a graduate degree, developed the curriculums for Thinking Caps with an understanding of the behavioral and cognitive-development issues that affect the way teenagers learn. For example, she knows her students will use the study aidSpark Notes regardless of what she says. So, she tells the students how to use such aids, making suggestions that increase the odds that they will also read the original material. The careful matching of students with tutors, who are paid by the hour, is also central to her approach, she says. She meets with each family and tries to assign the most suitable tutor, considering a range of factors, such as whether the student and tutor have had similar experiences and interests. Thinking Caps charges $110 an hour for one-on-one tutoring, which is less thantest-prep giants like Kaplan and Princeton Review (their hourly rates recently ranged from $125 to $350). While the national learning centers Sylvan Learning and Huntington Learning Center can provide one-on-one tutoring one New York branch of Sylvan recently quoted hourly rates of $68 to $85 their models emphasize working with students at Sylvan offices, with student-to-tutor ratios of three to one. Ms. Mayzler describes herself as "a control freak." She says she is interested in growth, but concerned that it will involve compromises she is unwilling to make. "I've put a lot of energy into developing a unique service," she says. But growth inevitably requires give and take, says Michael Laskoff, founder and chief executive of AbilTo, a provider of Web-based psychotherapy programs and an informal adviser to Ms. Mayzler (they met when she tutored his brother-inlaw). "Thinking Caps is a high-touch business," Mr. Laskoff says. "The quality-control mechanism is Alexandra herself, and there are only so many hours in the day." He has suggested that Ms. Mayzler consider the middle ground between providing customized tutoring to a few students and offering standardized service to a much larger group. Ms. Mayzler most enjoys meeting with students and determining how to help them, tasks that would most likely be increasingly delegated if the business expanded. She finds time spent on marketing far less rewarding. Although eager to bring her methods to more students, she has never created a marketing plan, instead choosing to spread the word through her relationships with schools and parents. She is the co-author of "Tutor in a Book," which is scheduled to be published by Adams Media in July and will be accompanied by a national media campaign. Ms. Mayzler says she is financially motivated only to the extent that she wants to maintain profitability and ensure that she can pay her living expenses.

During final and midterm seasons, she says, she works "seven and a half days a week." She knows that expansion will require even more of her time. But she says she enjoys what she does so much that she often does not realize she is working. "I've learned that my business is my priority," she says. And she plans to make Thinking Caps her lifelong career, which is why she is determined to expand. To carry itself for the next 40 years, Ms. Mayzler says, Thinking Caps must "become more of a stand-alone brand, not an Alexandra brand." Mr. Laskoff agrees, asserting that small businesses that do not choose growth effectively opt for stagnation.

Genevieve Thiers, founder of Sittercity, a Web site that matches parents with caregivers: A rough look at the numbers shows that Thinking Caps is currently providing around 5,000 hours of tutoring a year ($500,000 to $600,000 revenues divided by $110 an hour). Does it really need 30 tutors to handle 5,000 hours of work annually? You'd think this could be accomplished with a much smaller number. The rough math indicates that each tutor works 166 hours a year or less than four hours a week. Thinking Caps' ability to recruit and retain talent to take on so little paid work is dubious, and the overhead costs to identify, screen, insure and train someone for such a small payoff per employee are also doubtful. Before Alexandra scales her enterprise, she needs to be sure her current operations are optimized.

Kimberly Martinez, chief executive of Bonitas International, a manufacturer of accessories and gift products: Alexandra should carve out a territory in her current market for someone else to manage and identify a candidate to help her create nd test the pilot program. Running her first expansion program locally has several benefits. First, there is clearly additional business to capture in the New York area. Second, a local expansion creates bench strength in the event Alexandra wants or needs additional managerial help at some point. Third and most important, a local expansion allows her to test and perfect the business model in her own backyard to improve her odds of success elsewhere. Jon Bischke, chief executive of eduFire, a marketplace of live, online classes: In Alexandra's case, it would seem wise to test demand for her services in other cities before beginning there. She could do thi by taking out S.E.M. ads on Google and Bing that single out specific cities she is considering. Even though she could not fulfill this demand before starting, this exercise would provide a good sense of what the customer acquisition costs might be. For only a few hundred dollars, she could arm herself with the information necessary to make a better decision as to whether to expand nationally and, if so, which cities would make the most sense.

THE OPTIONS One is to wait and see, determining what marketing inroads Thinking Caps can achieve with the publication of Ms. Mayzler's book. Ms. Mayzler could then see whether she was better positioned to bring her message to schools and could design interactive components that would provide the studenttutor exchange she values. The other option is to embark on a full-scale expansion into other cities. To do , Ms. Mayzler would have to pinpoint the definable, repeatable and measurable tasks that she regularly executes in her current role. One advantage: Thinking Caps would not require significant capital to grow. Rather, its bigger challenge would be hiring educational consultants in other cities who could fill Ms. Mayzler's role. If and when Thinking Caps expands, Ms. Mayzler plans to stay in New York, although she would expect to commute to any new location initially to help with training. That would require surrendering some control at the home office.

What is the problem?

What are two things they should do?

What are the pros and cons of each option?

What has happened since the case study was written a few years ago?Please provide an update.