The Daily Grind Coffeehouse was founded in 2007 by two friends who love nothing more than a hot cup of joe. The company has always prided itself on putting quality rstfrom the beans they brew to the knowledge and friendliness of people who serve it. Their goal has always been to be the coffee shop that makes the absolute best cup of coffee in town. They strongly believe in fair trade and donate 5% of their prots to support the communities of their farming partners.

Over the last 15 years, The Daily Grind has managed to grow from a single storefront to a local coffee chain with eleven brick-and-mortar locations. The Daily Grind Coffeehouses are decorated with a retro industrial vibe. They feature art and signage that tells the story of their crop-to-cup process and educate customers on various coffee-related topics.

This privately held, LLC offers premium coffee beverages and breakfast items. Each of their cafs average $2,750 in sales per day, with some locations performing much

higher than others depending on location, square footage and whether or not they have a drive-thru (all but two locations do). The average transaction is $5.74. Last year, The Daily Grind saw $10,900,000 in total revenue.

As the accounting department for The Daily Grind, your team is responsible for evaluating strategic decisions for the company that come down from the owner and CEO. Your advice and input provide direction for the company, so that The Daily Grind can continue to grow its prots.

Based on your item sales analysis reports for the past two quarters, youve brought it to the attention of the executive team that sales in the grab & go cases in all of the

stores have become stagnant. The executive team has tasked you with bringing them several suggestionsincluding one recommendationfor new products to try. Your recommendation will be piloted for three months in the busiest location to assess demand for this new product. After researching lots of options youve narrowed down your suggestions. Of the three options youre proposing, which one do you recommend?

a. Local fresh-pressed juices. Natures Nectar is a local artisanal juice bar that offers 12-oz juice blends at wholesale for $4.75 per unit. The drinks have a shelf-life of three days and come in eight different juice blends. Natures Nectar will offer The Daily Grind a special pack size during the trial run, as a result of the exposure theyll receive at your busiest location. This special pack includes four units (per avor), with a minimum order of six packs every-other-day, which is in line with their delivery schedule.

b. Bagel chip & avored cream cheese snack packs. This is a relatively new product from a well-known national brand. These snack packs come in four different varieties, two savory and two sweet. They have a shelf life of approximately four months and wholesales at $.65 per unit. A case includes 24 units and your distributor requires a four-case minimum for every order.

c. Local chocolate confections. A friend of one of The Daily Grinds store managers is trying to get her confectionary company off the ground. For the opportunity to showcase her products, Ellie is willing to negotiate several factors. Shell deliver product weekly for free, requires no minimum order and will provide marketing materials to promote the new product. Ellies Bon Bons include two large pieces of decadent chocolate candy per pack, have a shelf life of one week and wholesale for $1.50.