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Stella operates a Cuban themed food truck that sells sandwiches and drinks to office workers in the downtown area of a mid sized city. Stella
Stella operates a Cubanthemed food truck that sells sandwiches and drinks to office workers in the downtown area of a midsized city. Stella has been approached by the GrabOn coupon company to enter a partnership arrangement with them, whereby GrabOn would, on their own website, sell coupons good for $ worth of Stella's food and beverage products. The $ coupons would sell for $ each, and GrabOn would split the sales proceeds with Stella. I nee The sold coupons would have a day expiration period, and GrabOn states that, in their experience, only percent of the sold coupons will be redeemed prior to their expiration date.Stella operates a Cubanthemed food truck that sells sandwiches and drinks to office workers in the downtown area of a midsized city. Stella has
been approached by the GrabOn coupon company to enter a partnership arrangement with them, whereby GrabOn would, on their own website, sell
coupons good for $ worth of Stella's food and beverage products. The $ coupons would sell for $ each, and GrabOn would split the
sales proceeds with Stella. The sold coupons would have a day expiration period, and GrabOn states that, in their experience, only
percent of the sold coupons will be redeemed prior to their expiration date.
Stella has already begun forecasting the next day's sales and product expenses without the coupon program as well as her estimated guest
count and CM per guest. Recalculate Stella's projected financial results assuming her original forecast and the sale of and GrabOn
coupons.
HINT: For coupon revenue, you are
only collecting of the coupon
price per person
HINT: For coupon product cost, you
are only bringing in of coupon
holders; and each is spending $ in
food; so use the food cost when you
have coupons. In this case, your
coupon cost will be over
HINT: Look at other formulas for answers
What will be the total change in her contribution margin if coupons are sold?
If negative, use red and parantheses format with digits
Would you recommend to Stella that she agree to the proposed partnership?
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