Conversational AI Chatbots Sample College Essay

Introduction

Businesses do not operate in isolation if they have to achieve to competitive advantage. In essence, they interact with both the external and internal factors that shape the way they traverse the market. Marketing consultancy services, with vast technological knowledge and experience in situational analysis and marketing campaign strategies, are essential for the successful running of Chatbots company.

Reasons for Selecting ABC Marketing Consultancy

ABC has been operational for several decades and it comprehends the global technology market. The years of operations have enabled the company to acquire relevant skills and expertise that can help its clients navigate the competitive international technology market. ABC’s presence in different countries also gives it an upper advantage over its rivals in the consultancy industry. With its presence in the Americas, Europe, Asia, and parts of Africa, the company understands the technological market environment in both developing and developed nations. Notably, the use of chatbots and data privacy is a regulated domain in various countries. Subsequently, successfully investing in this area requires proper comprehension of the legal requirements as well as the cultures of various countries if the client wishes to expand his or her operations internationally. By selecting ABC consulting company, clients are protected from the need to understand this legal and cultural nitty-gritty associated with global operations. With an increasingly diversified team of professionals, ABC helps clients overcome the legal and cultural challenges of competing globally.

The mission of ABC Consulting Company is to assist customers to attain their business objectives by offering innovative tools that improve customer experience. The success of ABC in the technology consultancy market has been attributable to its unique selling point that is appealing to different cultures globally. The company understands that differentiation from its rivals is pivotal to its success. Subsequently, ABC presents itself as a profitable technology company that gives back its earnings to the community in which they operate. Unlike other technology consultancy companies, with the primary goal of maximizing profits and shareholder value, ABC’s unique selling point is that for every chatbot purchased or installed by its clients, the company donates a computer to a school or community. With this USP, the company has opened avenues to different countries internationally because of its charitable approach to marketing.

Situational Analysis

The environment in which businesses operate constantly changes, compelling them to adapt to survive. The situational analysis identifies business strengths and weaknesses as they relate to external opportunities and threats. Chatbot AI technology is vulnerable to these external factors, shaping its development in the global market environment. By definition, external factors refer to issues or aspects beyond the control of the business, affecting it positively and negatively. Businesses can only respond to external decisions to remain successful, compete, or survive.

The first notable external factor driving the need for Chatbot AI technology is faster responses to repetitive queries. Telecom companies frequently face repetitive queries, which keep human agents and call centers busy and ineffective (“Conversational AI Chatbots in Telecoms are Improving Customer Experience,” 2020). As the waiting time increases, customers become more dissatisfied with the services. For telecom companies, a simple chatbot, such as Actionbot and Whatsapp for Business, can reduce the waiting time for repetitive queries. Such AI solutions can decrease query resolution time and occupancy by live agents to resolve customer issues.

The second factor is the changing design of websites that do not conform to user knowledge or expertise. While mobile websites are attractive, they tend to squeeze contents into a small window. By squeezing contents, users can get lost on the website. Besides, while such advancements in website designs are notable, they have not adhered to user expertise. Making such designs usable requires a better alternative, and chatbot AI can address this challenge. For instance, the Actionbot can proactively and constantly appraise customers’ behavior on the web (“Conversational AI Chatbots in Telecoms Are Improving Customer Experience,” 2020). If users cannot decide what to click, the chatbot can make suggestions to them; subsequently, guiding them to achieve their tasks rapidly with minimal help from human agents.

The third factor is the increase in dropouts from unfinished transactions. Currently, the majority of people are accustomed to doing automatic top-ups through regular or mobile transfers. The telecom industry is not immune to this trend. Nevertheless, not all customers are used to doing automatic top-ups. Some customers prefer using the old-fashioned way on websites in which certain transactions are dropped due to several complications (“Conversational AI Chatbots in Telecoms Are Improving Customer Experience,” 2020). The absence of proper design of digital channels can create arduousness in the entire process. Rather than redesigning the website to reduce dropout from transactions the chatbot can be applied as a third arm. If the chatbot recognizes that a customer has challenges with a transaction, the conversational chatbot can assist in finishing the process. Besides offering help, the AI tool can suggest suitable offers by considering external data sources, such as customer relationship management (CRM), customer’s location, and transaction history to become a proactive advisor.

The fourth external factor in the telecom industry is faster data usage from a select package. Telecom packages are often proposed by operators massively while disregarding customer preference (“Conversational AI Chatbots in Telecoms Are Improving Customer Experience,” 2020). The operators often focus on the telecom product that they want to sell and not what the customer needs. Consumers in the telecom industry are seeking personalized offers that meet their preferences. For instance, a massive marketing campaign offering a new data package accompanied by a new iPhone is not efficient anymore. With chatbot AI, a telecom company can appraise customer preferences or behavior during various periods or seasons.

Competitors in the Chatbot AI Marketplace

The chatbot AI marketplace is extremely competitive and dynamic. Customers can switch easily from one provider to another, without incurring huge costs. The competition is fueled by the influx of AI companies into the market. The key players include Netomi, ChatGPT, and WP-Chatbot.

Netomi’s AI platform assists organizations to resolve customer service automatically via email, messaging, voice, and chat. According to Max (2023), Netomi has the highest level of preciseness because of its improved Natural Language Understanding engine, which allows the tool to understand a human-like conversation. In the absence of human intervention, the Netomi AI platform can address 70% of customer issues.

ChatGPT has recently emerged as the most popular AI, although it is not a chatbot. ChatGPT is accurately defined as a natural language process (NLP) model. As an NLP model, chatGPT is trained on large volumes of data to produce responses resembling those of human beings. Since the core of this tool is GPT-3, it is capable of eliciting highly plausible and coherent reactions to several topics (Max, 2023). Hence, ChatGPT is useful for different NLP tasks, including text summarization, language translation, and conversation generation.

WP-Chatbot is popular with the WordPress environment, offering several thousands of websites web chat, and live chat capabilities. This tool incorporates Facebook Business and allows automated and live interactions on the WordPress website through a native Messenger chat widget (Max, 2023). With this tool, user messages are contained in a single inbox for messages across all platforms, giving efficient management of feedback.

Campaign Strategy for University

Campaign strategies for universities aim at increasing enrollment in the institutions. The elements of the strategy should link back to the website and prevent users from dropping out of the application process. As such, the website should be fast and offer easy navigation. In most cases, the process of applying for enrollment can be lengthy and tedious, leading individuals to drop out or select other institutions. The key element in a campaign strategy for increasing enrollment is the chatbot AI which can help applicants navigate the website easily and answer their questions immediately. Driving more traffic, clicks, and people to the university landing page of the institution is not beneficial if they do not decide to enroll. As a recommendation, the campaign strategy should be appealing to the target audience.

Conclusion

Technological advancements in artificial intelligence present both an opportunity and a threat to businesses. As an opportunity, artificial intelligence, particularly chatbots, can improve customer experience by offering 24/7 support while reducing operational costs. However, data privacy regulations associated with using or selling such systems might expose businesses adopting AI for their customer service to additional requirements that might be costly depending on different countries.

Reference

Conversational AI chatbots in telecoms are improving customer experience. (2020, August 1). Retrieved from https://action.bot/blog/ai-chatbots-in-telecom/

Max, D. (2023, March 14). The 17 best AI chatbots for business in 2023 in and beyond [Review and key features]. Retrieved https://www.netomi.com/best-ai-chatbot

An ERP System For Etisalat Telecommunication Company Free Sample

Executive summary

Like many telecommunication companies, Etisalat typically collects customer data to increase customer interactions and improve their experience with the company, thereby increasing the profit margin. The organization has used this data to its advantage to a considerable extent, forming a competitive edge over other companies.

However, the organization has yet to utilize this information entirely. In particular, one of the biggest challenges is converting the collected data into meaningful information. Converting this data into meaningful information that can increase the company’s value is expensive. However, this process can significantly increase the company’s value by increasing the number of sales—an increase in sales leads to increased revenue.

According to the information above, analyzing this data is essential to determine its impact on the organization’s performance. After examining various strategies, a Customer Relationship Management (CRM) system that integrates collaborative and analytical features will be essential to the organization.

Etisalat Telecommunication Company can benefit from a CRM system that ensures all the crucial departments and team representatives, such as sales and marketing, and the customer care desk, have access to the same up-to-date information on customer experience. In addition, the organization will still stand a chance to benefit from a CRM system that analyzes customer data to gain meaningful insights that drive customer interaction and sales.

Much as the company has experienced employees, considerable assistance will be needed from external sourcing to help carry out this process. Additionally, establishing an efficient data warehouse and digital tools for this examination will be costly for the company.

Introduction

Major problems

Etisalat is the largest telecommunication company in the United Arab Emirates and the vast Gulf Cooperation countries. The organization serves approximately 11.6 million people, from small to large private and government enterprises. From this perspective, the company has a considerable share of positive trends. However, there is an even bigger market for the company, especially after its rebranding and expansion to other countries in the GCC region (Ahmed et al., 2019).

According to the analysis of the current information, one of the company’s biggest problems is the maintenance and growth of the sales volume. Consistently, there is an increased demand for services and decreased resources to implement these services. Arising from these facts, using a hybrid CRM system that combines both collaborative and analytical features will go a long to analyzing the customer’s data to improve their experience with the company. In addition, the hybrid CRM will also enable the company to develop a priority matrix for services that will be matched with the right resources for execution.

Plan of action and justification

The company should develop a hybrid CRM system that integrates collaborative and analytical features to address the above-detailed problems. This type of system is essential. This is because the collaborative aspects will enable the company to interact more with the customers and hence gain essential insights which will be used to promote the customers’ experience. On the other hand, the analytical aspects will analyze the customer data collected by the system and the essential aspects of the services required by the company. This will then inform the service matric and match the rights and resources needed for the implementation.

It is important to note that the hybrid CRM system will enable every important department, from the customer care desk to the sales and marketing, access to the exact and up-to-date information concerning the customer’s experience. Access to exact and up-to-date information is essential as the employees will collectively work toward solving the company’s challenges (Al‐Mashari et al., 2018).

In the same spirit, in implementing the hybrid CRM system, essential digital tools such as Google Analytics software will enhance better integration and analysis of the customers and service information. The primary focus of the analytical aspects of the hybrid CRM is to assist the organization in analyzing the customer’s data to gain meaningful insights that drive sales and revenue.

In summary, a better customer experience enhances the company’s operations by promoting an increased customer retention ratio and revenue. In addition, enhancing customer experience increases efficiency and enables customers to spend more, increasing sales and revenue.

Description of the business drivers for ERP implementation

Business problems

As indicated earlier, the company’s problems include maintenance and sales volume growth. Though the company has a considerable number of customers in the government and the private sector, it cannot maintain and grow the sales volume. The sales volume registered by the company has been varying over time. The company has yet to register a sizeable growth in sales. Instead, the company has, over the last two years, registered a decrease in sales volume (Mohamed et al., 2019).

In the same spirit, the company needs more resources to facilitate the implementation of the increasing demands of the services that the company is required to provide. More specifically, the company cannot meet the customers’ increasing needs. This inability projects the need for more exploitation of the available opportunities, which leads to low sales volume and decreased profit and revenue for the company.

Description of the business drivers

As indicated before, Etisalat must have a concise and well-structured CRM system. As a result, the organization does not have the best form of interaction it would wish to have with its customers. Failure to have this system has resulted in poor customer interactions and experience, which leads to low sales and income, lack of exploitation of the potential markets of the company, and reduced operational and communication efficiency, which leads to a reduced customer retention ratio.

Therefore, the hybrid CRM system aims to collect detailed information about the customers to use in marketing to maintain the existing and add more customers. In addition, the CRM system is also meant to analyze the customer’s information and identify their needs to meet these needs. Extensively, the system is also supposed to analyze the services customers are supposed to be offered and the relevant resources required to establish a service-resource matrix that prioritizes a particular service and the necessary resources that are meant for the execution.

The company should develop and integrate the hybrid CRM system from the information detailed above. This system will form the basis upon which critical and meaningful insights are formed to increase customer interaction and experiences. By integrating a collaborative and analytical CRM system, the company will collect detailed information about customers from all sources and use this information to formulate better strategies in marketing that promote sales and revenue.

In summary, the business drivers are the need to maintain and add even more customers to increase the company’s sales volume. In addition, the need to meet the increasing demand for services to the customers with the right resources to promote the execution of these services. Meeting the customers’ needs promotes more sales and a high retention ratio. Finally, developing the hybrid CRM systems boost inventory control and revenue for the company. This is because the system will offer automation in all the departments of the economy, which promotes efficiency and productivity in the company.

The business model for implementation of the ERP system

The business model for implementation of the ERP system Designed for Etisalat Telecommunication Company Date:
Important activities Important partners Customer relations Customer segments Value proposition
Implementation of the ERP process.

Implementation of the hybrid CRM system.

Training of employees.

Maintenance of the hybrid CRM system.

Resources

Digital tools and supporting softwares such as Google Analytics.

Sales and marketing departments, the customers care desk and

Customers.

Enhancing customer interactions and experience increases the sales and profit of the company.

Meeting the demands of the customers’ ever-increasing needs with the right resources for implementation.

Both new and existing customers are pursued. Utilizing the untapped potential in the collection of customer data. s

Channels

Execution of a CRM system to study interaction data from previous customer interactions and improve on the new trends to increase revenue

Revenue streams

Development funds of the company.

As indicated before, the foundation of the telecommunication company is technology. From this perspective, IT strategies are critical in the company’s running. By definition, the IT strategy is an integral part of the business strategy that focuses on aligning technology with business operations.

More specifically, the IT strategies Etisalat focuses on are the development of a hybrid CRM system that will, in turn, promote customer interactions with the company, enhance their experience, and develop a service-resource matrix that aims at meeting the customers’ needs, and, as a result increasing the productivity of the company. The IT strategies set clear goals for implementing the integrated CRM system and using it in the company to promote aspects such as customer interactions that promote the sales volume.

Analysis of Porter’s 5 Forces and value chain

The threat of new entrants

The threat of new entrants is low as the business is expensive. With only two players, Etisalat and DU, it becomes even more difficult for new companies to enter the market.

The bargaining power of suppliers

The bargaining power of suppliers is high. This is because there are only two suppliers in the telecommunication industry in the UAE. One supplier provides the human resources while the other provides equipment. From this aspect, the companies must agree to the prices set by the two suppliers.

Competition in the industry

Etisalat has one competitor, DU. However, there is stiff competition between the two providers of telecommunication services, and each company wants to outdo the other.

Bargaining power of customers

Customers have a high bargaining power in the industry. This is of the high competition in products and services offered by the two companies in the region. As a result, the customers can easily switch to the competitor once their preferred company does not fulfill their needs.

Threat of substitution

The threat of substitution is low. This is because the company has already established itself in the market; hence, a competitor would need the same amount of investment and time to get to where the company is.

Proposed ERP Vendor selection plan

The basis for the plan

The focus of the strategic ERP system is first to increase customers’ interactions with the company. Increasing these interactions enables the company to understand the needs of its customers better. As a result, the ERP system will enhance their experience and solve the company’s number one problem, i.e., maintaining and increasing the sales volume. Therefore, the company will increase its profit and revenue generation.

Secondly, the analysis of the current data projects an increase in demand for services by customers and inadequate resources to meet these needs. From this perspective, the focus of the strategic ERP system will be to prioritize the services according to the customers’ needs. In addition, the system will then match the necessary resources required to implement the particular service (Noureldeen et al., 2022).

The goals associated with the plan include a customer retention ratio of approximately 70 percent. The company intends to develop strategies that promote customer experience, which in turn increases the customer retention ratio of the company. More specifically, the company will implement this plan by enhancing the products and services offered to the customers. Customers will get a selected product and service category at lower prices than competitors to motivate them to increase their purchases.

Another goal of the system is to establish a trusted central repository system to collect all customer experience data. Nonetheless, to undertake this process, a data integration process is necessary. While the advantages of executing a hybrid CRM system that increases customer interaction seem compelling, there is still room to increase sales and profit from first-time customers.

Extensively, the hybrid CRM system should run in real-time for the practical vendor management analysis of the customer’s data. This analysis presents another opportunity for the business to sell customized products to the customers, increasing sales. However, much as this is the case, there is a need for ERP standardization for the company to streamline its business activities, technology, and even the processes in all its operations which should align with the company’s overall business strategy.

Once these processes are over, the company will stay considerably ahead of the competition. This is because the company will meet the demands of the increasing needs of the customers. In addition, almost all the processes will be automated. Subsequently increasing the efficiency and productivity of the company.in summary, the company will combat the threats by meeting customer needs and staying ahead of the competition. Consistently, the company will increase efficiency and hence better customer experience, which promotes productivity.

Impact on other organizational components

This system will lead to better task coordination and communication among the various departments highlighted in the report. In particular, the sales and marketing department and the customer care desk will have improved communications and collaboration of activities, leading to enhanced efficiency and greater output from the operations.

Additionally, the company will have to lay off some of its employees by implementing the ERP system. This is because the system eliminates the various layers of management, which automatically reduce the number of employees in the company. As a result, the company will enjoy increased efficiency and lower operational costs. In addition, this system will enhance time and better decisions for the company.

Finally, the company’s CEO will have enhanced command of the business. This is because decisions from these crucial departments, such as the customer’s desk and the sales and marketing, will be made on time. Therefore, the CEO will get this information through the ERP system on time, thereby making conclusive and data-driven decisions that improve the operations of these departments and the company’s overall operations.

Discussions: Assessment of the plans fit the organization.

The hybrid (collaborative and analytical) strategy for implementing customer relationship management best fits the telecommunication company. This is because, as indicated before, the company’s management stands a chance to make better decisions that will improve the company’s overall operations (Alwadai et al., 2021).

In addition, the management is in a better place to make data-driven decisions. Data-driven decisions are more precise and speak directly to the company’s problems. These decisions will, in turn, increase the company’s efficiency, profit, and revenue. Additionally, the plan will increase customer interactions and experience and the overall sales and profit of the organization.

Since maintaining and increasing the sales volume is the company’s main problem and arises from customer interactions and experience, the customer experience theory will be critical in analyzing this information.

Customer experience theory

This theory suggests and promotes a strong finishing as a result of offering better customer interactions, a better understanding of the customer needs, and providing the necessary customer experience in the present and future operations of the company. Etisalat Telecommunication Company can enhance the customer’s interactions to provide a sustainable and great overall impression of the customer experience. By intentionally developing this experience, the company can outweigh earlier inefficiencies and pain points, which create a sustainable positive impact on the company (Bleier et al., 2019).

ERP benefits and advantages

Among other benefits, the organization will benefit from operational efficiency. In addition, the various significant departments will have access to up-to-date and accurate customer data, which removes extraneous information and processes and helps in the easy flow of information between these departments (Ahmed et al., 2019).

Consistently, the company stands to reduce redundancy, generally presented as duplicated records. The return of this process is increased productivity. The employees doing the redundant work are now freed to engage in more productive tasks, which increases the overall efficacy of the telecommunication company. In summary, the company has developed a more enhanced competitive advantage against its competitors in the UAE and worldwide.

Approach for implementation of the plan

The first step in the implementation approach is planning the project. After planning, the team will engage in the programming exercise. This exercise will establish the most efficient programming language employed in this process. After analyzing the programming language, the team will consider the processing and management of the data that will guide the implementation process. This information decides the specific aspects which should be converted. Consistently, the team will evaluate the system and train the employees to use this system. Finally, the team will test and integrate the system into the company’s processes, starting with the identified departments.

Critical issues associated with the implementation of the plan

Data integration is a crucial issue during a change of system. More specifically, although the ERP developed a central integration system, the migration process was an issue. This is because only some of the information in the old system was required in the new system. In addition, critical data was not transferred to the new system during the migration process, which is essential in the operations and running of the new system (Muneeb et al., 2018).

In the same spirit, the initial setup and planning of the approach for the system could have been more efficient. Finally, processes such as data cleaning were necessary while conducting the digital data migration. This is because the old and redundant data were unimportant in running the new system. This process was not budgeted for, which required extra cash for operations.

The most outstanding issue in vendor selection is the company’s preference for a cloud-based solution instead of one that runs in the company’s server systems. The reasoning was that once the servers failed, the system failed, hence the need to integrate it into the cloud solution. The ERP system will require extensive maintenance and updates for five years. Once this time is over, the system will need to be upgraded.

Conclusion

In conclusion, a hybrid ERP system will solve the telecommunication company’s problems. In particular, the system will increase more efficient customer interactions, enabling the company to enhance its experience and promote sales and revenue. In addition, the system will also enable the company to meet the increasing demands of services by the customers. The system will match the services with the right resources by creating a service-resource matrix. However, prior selection and planning will be required to make other processes, such as vendor selection and implementation, smoother and more effective.

References

Ahmed, A., & Ayman, M. (2019). The effect of ERP system implementation on business performance: An exploratory case study. Communications of the IBIMA.

Al‐Mashari, M., & Al‐Mudimigh, A. (2018). ERP implementation: lessons from a case study. Information Technology & People.

Mohamed, A. L. A. (2019). Improving processing cycle time of multi-cash payment collection at Etisalat, UAE (Doctoral dissertation).

Noureldeen, A., Salaheldeen, M., & Battour, M. (2022). Critical success factors for ERP implementation: a study on mobile telecommunication companies in Egypt. In Proceedings of International Conference on Emerging Technologies and Intelligent Systems: ICETIS 2021 (Volume 1) (pp. 691-701). Springer International Publishing.

Ahmed, A., Mateen, M. A., Hussein, H., & Hamad, M. (2019). Communication and Collaboration: The Key Factors to Project Management. In The Digital Project Management Evolution (pp. 7–16). Productivity Press.

Alwadai, R. A (2021). CONTRIBUTIONS OF INFORMATION SYSTEMS AND TECHNOLOGIES TO THE SAUDI TELECOM COMPANY.

Muneeb, A., & Shinwari, M. (2018). Customer Relation Management (CRM) and its Impact on Organizational Performance: A Case of Etisalat Telecommunication in Afghanistan.

Bleier, A., Harmeling, C. M., & Palmatier, R. W. (2019). Creating compelling online customer experiences. Journal of Marketing83(2), 98-119.

Dutch Bros Coffee Swot Analysis University Essay Example

Executive summary

It is discussed that the privately owned Dutch Bros Coffee is an American coffee franchise with more than 400 stores spread across 11 states. In Grants Pass, Oregon, the business began as a single coffee cart in 1992 and has since grown quickly. For example, Dutch Bros Coffee offers various coffee beverages, smoothies, teas, and other specialty drinks. The enterprise has an established brand image and a devoted customer base, and its distinctive workplace culture and dedication to community involvement are credited with its continued prosperity. Therefore, this study will seek to audit Dutch Bros Coffee’s past, examines the market and industry, and assesses the company’s strengths, weaknesses, opportunities, and threats. The report also gives recommendations and conclusions determined by the analysis and forecast, as well as a forecast of the economy, industry, and company for the year after that.

Historical overview of a company

The two brothers named Dane and Travis Boersma, came up with the idea of creating the Dutch Bros Coffee in Grants Pass, Oregon, in 1992. The firm was founded by the brothers as a single coffee cart, which quickly gained popularity because of the superior coffee and the helpful service offered by the staff. In 1996, the business launched its first drive-thru site after undergoing fast growth. Typically, Dutch Bros Coffee opened new stores in Oregon, California, Washington, and Idaho in the early 2000s as part of their ongoing expansion. The company’s loyalty program, the Dutch Mafia, rewards clients with free beverages and other goodies was created in 2007. The program has significantly contributed to the company’s development and has assisted in creating a strong base for the consumers to thrive.

The firm Dutch Bros Coffee has recently expanded to over 400 outlets throughout 11 states. The company’s positive, collaborative, and community-focused culture has earned it widespread recognition. Among the fastest-growing privately held firms in the United States, Dutch Bros Coffee has also won multiple honours for its social and environmental consciousness.

Analysis of economy and industry.

The analysis of the economic set and industry shows that the coffee shop business is a subset of the larger food and beverage sector, which is highly sensitive to macroeconomic indicators like unemployment and inflation. For example, the demand for specialized beverages and nutritious meal alternatives is impacting the food and beverage industry. Additionally, the unemployment rate in the United States is at a historic low, and personal incomes are on the rise. The food and drink business, including coffee shops, has expanded thanks to these factors. Opportunities have arisen for businesses like Dutch Bros. Therefore, coffee results from the rising demand for specialty coffee and healthy food alternatives.

Moreover, a lot of competition has been seen in the coffee shop business, as both huge chains and small businesses strive to attract customers. Despite the competition, Dutch Bros Coffee has succeeded thanks to the strength of its brand and the dedication of its consumer setup both locally and internationally.

The SWOT Analysis of The Company.

Below is the SWOT analysis of the Dutch Bros Firm:

Strengths:

  • Solid consumer base and widespread brand recognition
  • Distinctive corporate values that prioritize giving back to the community
  • Healthy eating and artisanal coffee are two trends that continue to rise in popularity.

Weaknesses:

  • Compared to rivals, it has a smaller geographic footprint.
  • Risk of Over-concentration on a Singular Product (Coffee and Associated Beverages)

Opportunities:

  • Entering Untapped Markets and Expanding Geographic Reach
  • Launch of brand-new wares and fare
  • There has been a shift in emphasis toward online and mobile ordering to reflect the rising demand for convenience.

Threats:

  • The threat posed by more well-funded, larger competitors
  • Changes in the cost of commodities such as coffee beans
  • Altering tastes and fads among consumers

Forecast Of the Economy, Industry, And Company

Revenue at Dutch Bros Coffee Company has grown steadily over the last three years, increasing 48.43% in 2022, 52.06% in 2021, and 37.36% in 2020. Their gross profit also increased, from 96 to 181, reflecting this progress. However, their running costs have grown significantly, more than tripling in size, from 66 to 184. We realize that the operating gap was negatively obstructed, dropping the margin from 12.71% to -22.34%. Additionally, their profit margin decreased, going from 2.55 in 2021 to -0.64 percent in 2022. This is probably a result of their rapid growth-related greater costs. Additionally, their free cash flow has dropped, from 7.25 % in 2019 to -17.1 % in 2022. This suggests that the company is losing money relative to its income.

Although the sales and gross profit of Dutch Bros Coffee Company have increased overall, this gain has been tempered by rising operating costs. Their free cash flow and profit margin have both decreased. Arising from its well-known brand, dedicated customer base, and ambitious growth goals, Dutch Bros Coffee stands to gain substantially from the industry’s projected increase in size. In 2022, the company aimed to open 60 additional locations, continuing its rapid expansion. The company has distinguished itself from rival coffee shops by emphasizing quickness, quality, and effective customer service delivery.

Pro-forma Income Statement and Balance Sheet

The following pro-forma income statement and balance sheet have been created for the company based on its financial statements for the previous year and its growth plans:

Proforma Income statement(in a million dollars)

Revenues $1200
Cost of goods sold $360
Gross profit $840
Operating expenses $600
Operating income $240
Interest expense $10
Net income before tax $230
Income tax expenses $69
Net income $161

Proforma balance sheet ( in millions of dollars)

Assets
Cash and equivalents $100
Accounts receivables $40
Inventory $30
Property, plant and equipment $500
Total assets $670
Liabilities and Equity
Accounts payable $50
Short term debt $20
Long term debt $200
Equity $400
Total Liabilities and Equity $670

Recommendations and conclusions.

  • Concerning the projections and findings of the analysis, Dutch Bros. Coffee is in a solid position to continue growing and extending its business activities. On the other hand, the company will have to deal with some obstacles in the coming years, such as the growing rivalry from other coffee chain businesses and the rising cost of the initial supplies in the market segments.
  • As an alternative to achieving these obstacles, the company needs to preserve its selling points, such as its priority on quality, swiftness, and providing excellent service to its clients. In addition, the corporation needs to investigate ways to lessen its dependency on raw materials, such as by purchasing goods from local vendors or forming partnerships with businesses committed to environmental responsibility and growth.

Therefore, in summary, the future looks bright for Dutch Bros Coffee; the company has a powerful brand, a large customer base that is committed to the company, and growth plans that position it well to benefit from the continued expansion of the coffee industry, in general, both today and shortly. By putting appropriate measures in place, the company could achieve all these.

References

Yang, Y., Wang, X., Ruan, J., Huang, L., & Gao, S. Identifying Financial Report Fraud of US Listed Chinese Companies. https://aemps.ewapublishing.org/media/caa1d880983f4b8684f4b0dbf37c18a1_uBwKt66.pdf