3. Consider Catherine’s initial decision to hire unskilled labor to help with the walk-in business (an infrastructural decision). Was this decision consistent with the needs of her different customers? Why? Catherine Horton was an expert cook, and she enjoyed immensely the creative freedom of developing new dishes.

Her specialty was desserts—for years, her friends had raved about her creations, and many had suggested she go into business for herself.

About seven years ago, Catherine took the plunge. At first, she worked out of her home, generating sales through word of mouth and a small advertisement in the Yellow Pages.

Most of her initial sales were for special occasions, such as weddings and banquets. Catherine would plan with the customer, usually weeks in advance. This gave her plenty of time to order the ingredients and prepare the desserts beforehand.

Soon Catherine found that she was making the majority of sales to other businesses, such as restaurants and specialty grocery stores. These business customers would order more regularly, but they also wanted Catherine to quickly adjust the mix and quantity of items she made for them. These customers also were more price sensitive than individual customers.

As sales continued to increase, Catherine outgrew the ability to use her own kitchen. She thought that if she could increase sales just a little more, she could quit her regular job and work full time in the dessert business.