Feasibility Report For ABC Bakeries

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At first ABC Bakeries produced traditional range of bread products and pastries. They were wholesalers who specialised in supplying to local supermarkets. This system gave the company assured sales and therefore assured profits. However there has been a decline in net profits due to pressure for the supermarkets to reduce prices. ABC Bakeries decided to develop a retail side of their business. Profits from the retailing side are quite promising. Problems with the current system They are only fit for large scale production. They are geared up for large deliveries to supermarkets; small irregular quantities to shops are causing problems.

They have little knowledge in the management area of the retail sales end of the firm and also managing the staff who work in these areas. Property management is also causing problems. Proposed new system The proposed new system is to develop an internet based business selling the speciality products on line to customers. In order to identify the needs of the new system I have to conduct a thorough investigation. Investigation into proposed new system For the proposed system to work the financial return must outweigh the cost. Fact finding information I will need to look into is some documentation.

First I would need to look at the profits from the wholesale area and the profits from retail area. This would establish that the specialist products are making more money. I would also like the information on how much it cost to rent out premises and how much will it cost to produce a e commerce site. If ABC Bakeries were going to open an e commerce site how many people would take to maintain the running of it, how much would it cost? I intend to get information about the e commerce site from http://www. paceretail. co. uk. If the company were to open e commerce site will it reduce the number of staff needed?

By moving to e commerce the company will have to realise they will now be selling to a wider market. Are the company going to be able to meet this higher demand? The company may have to employ more delivery drivers to help distribution. The company should be prepared for different scales of orders. The company should research the market to see if there is a demand for this type of service out there. Someone might only order one product but that order is 100 miles away. The company will have to establish how they are going to get the product there. Will this situation cover cost and enable profit?

For the company to be prepared for different scales of distribution how much will it cost for staff training? Will the company have to buy more Lorries, car etc? If the company intend to use e commerce the production of the company and its workers are biased toward larger scale production. The company has to ask itself are they willing to give up the wholesale area of the company to concentrate on making the specialist product. How much would it cost for staff training? How much will it cost for staff morale? Taking into consideration that the staff will have to work at a higher speed of production which can be de motivating.

The company should also look into appraisal in order to keep employees motivated. There are different methods of appraisal in which the company can use. The management are also biased toward large scale production and have little experience in retail sales. The company should consider in sending the current management team to an off-the-job training session to hopefully increase the knowledge. The company needs to know how much this would cost. However the company should consider is it cheaper to advertise and recruit a new management team than it would be to train the existing management team and if so the company should look into this.

The company should also consider employing more permanent staff instead of the transient staff. The company should look into how many permanent staff the company would need to employ and how much this would cost. I recommend that the company looks into great detail of the question that I have asked above. Given that the wholesale area of the company will not improve. It may be beneficial to the company to produce an e commerce site. The company should research on the web if another bakery company has used the same idea and find out if it has worked.

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