WEEK 8

For the past six months or so, The Daily Grind has been talking about opening a new location in town. Your department and the executive team have been working closely to gure out when would be the best time to invest in The Daily Grinds 12th location. After lots of nancial analysis and future forecasting, the decision has been made to move ahead with the new location. The executive team has scouted out several potential locations and wants your input on which would be the best new site for The Daily Grind.

1. Near the river. The riverfront area of town is approximately 12 miles long, with ve of those being lined with restaurants, shopping, businesses and event venues. Its one of the most tourist-lled areas of the city as well as the one with the highest amount of foot trafc. The Daily Grind already has one location at the very end of the riverfront that is its third most protable location. There are three other options for coffee in the area, including two belonging to a popular national chain and one location of a well-known regional chain, the closest being two blocks away. The stand-alone building for this new location is four miles down the river, in the last mile of developed land. Its a 2,400-square-foot, three-oor building positioned on the lot in such a way that it would allow for a drive-thru, but at the cost of losing several parking spots in an already small lot. The lease would be for 10 years and build out costs (which include adding a drive-thru) would be approximately $50,000, of which the landlord will cover $30,000. Rent is $35 per square foot per year, but includes all additional fees (property taxes, insurance, etc.). The plan would be to have cold storage, kitchen and service on the rst oor, guest seating on the second oor, and additional guest seating and storage on the third oor. Both the second and third oors have balconies large enough for seating with small caf tables. Based on its sizewhich is larger than all of The Daily Grinds other storesthis location would likely require stafng of around 34 employees.

1. Close to campus. Just a few miles from downtown, sit two universitiesa large 24,000-student public university and a private womens college with close to 4,200 students. The local community colleges largest campus (which serves about 3,500 students) is also within a one-and-a-half-mile radius of the universities. This location sits exactly halfway between the two universitieswithin walking distance of both. The local hospital is also located nearby, approximately two miles in the opposite direction of the community college. The Daily Grind has two other locations nearby, one that is a mile past the community college campus and another that is half a mile past the hospital in the other direction. A popular national coffee chain has two locations on the public universitys campus (in the student union and its largest library), along with three campus-based coffee concepts that all operate out of outdoor kiosks. A well-known regional coffee chain also has a location directly across the street from the hospital. The prospective building is just a quarter mile from the major highway running through the city. It is 1,900 square feet and shares a large parking lot with the building next door. Rent will be $17 per square foot per year, plus $200 per month to cover property taxes, insurance and common area maintenance. The previous tenant was an ice cream shop, so the location is already set up with a drive-thru, which would make the build out costs roughly $40,000. The landlord is proposing a ve-year lease and will give a $15,000 allowance for build out. This location would require a staff of approximately 24 baristas.

1. In the mall. Of the two major shopping malls in town, the available space that The Daily Grind is considering is at the mall in the nicer area of town. In addition to most major department stores, this mall includes high-end specialty stores for everything from jewelry, shoes and designer handbags to stores for all things cooking and outdoor adventuring. The mall is centered around a food court, with four wings going out from there. The space that The Daily Grind would be going into is on the second oor in a wing that has a mens clothing store, a video game store, a tailor, a book store, an eyeglasses boutique, a perfumery, an art gallery, a Thai restaurant and a large department store at the end. There is a very popular national coffee chain location, as well as one other location (a dessert caf) that serves coffee in the mall, but both are located in different wings. While The Daily Grinds hours of operation in all other stores are 5:30 a.m. to 6:30 p.m., mall hours are from 10 a.m. to 8 p.m. With no access from the exterior, The Daily Grind would have to adjust its hours at this location to t within mall hours. The space itself is 1,200 square feet. The lease term is ve years and the property management company is offering $15,000 toward the build out, which The Daily Grind anticipates being around $28,000. Rent is approximately $40 per square foot per year with a variable common area maintenance (CAM) fee that runs anywhere from $120-$300 per month. Due to the size of the store and its adjusted hours of operation, this location would need around 16 baristas.

Create a new post. Briefly summarize the issue and decide which of the three options the company should move forward with. Explain your reasoning. Write in full paragraphs including a topic sentence, supporting sentences, and a concluding sentence.