Barclays and Todd SWOT, PEST and Porter's Five Analysis

Executive Summary

In this assignment, we look at Barclays and Todd and their company. We analyze the company with its structure and business functions. With different factors of the company analyzed, we are able to create recommendations for the company in order to grow the company and generate more business.

We first analyze the strategic position of the company and where they stand in the market compared to their competitors. Aspects such as cost and differentiation are looked at and used in order to compare the firm to other similar firms.

We then analyze the external environment and asses B&T in its industry. Multiple analyses are used such as PEST analysis, Porter’s five forces and SWOT analysis to compare Barclays and Todd’s capabilities to the external environment. By doing this, we are able to see the capabilities of the company and base recommendations depending on how the company is able to function in the analyzed industry.

Internal analysis is then done in order to analyze the structure of Barclays and Todd.  We are analyzing the business functions of the company and valuating the company. In order to form a recommendation, we need to understand the company internally and understand their business functions. With an internal analysis, we will have a better idea of the capabilities of the company and can determine a recommendation that would be fitting for Barclays and Todd.

Lastly recommendations will be made. The recommendations will have multiple parts in order to cover the full spectrum of business functions that Barclay and Todd covers. These recommendations are based on the internal and external analysis of the company. Contingencies are also stated as a backup in the event the recommendations are not able to be executed successfully.

Strategic Position

Barclays and Todd (B&T) is located and does most of their business in the Niagara region which expands to Hamilton. Barclays and Todd’s main business function is to provide affordable coffee solutions to both small businesses and restaurants. In this market, Barclay and Todd are known to be the market leader in their competitive industry. Their main competitors are Sysco systems. They also provide restaurants with the same services as B&T but do not specialize in this service as they supply the service alongside with other services offered to the restaurant.  Barclay and Todd’s business actions encompasses many different aspects associated to the industry such as supplying espresso machines and services relating to maintaining the machine and supplying the coffee beans. Barclay and Todd’s strategic positioning revolve around low cost and average differentiation. Barclay and Todd provide low costing beans to its customer without sacrificing quality. Barclays and Todd focuses on supplying their customers with their beans rather than profit from their espresso machines. The espresso machines require a large investment which is incurred by both Barclays and Todd and their customers. If B&T marks up the cost of espresso machines, value will be harder to see in these espresso machines. Therefore B&T creates a large portion of their profits with their supply of coffee beans. Barclays and Todd’s level of differentiation is average as they product and service is available but need the right channels of supply to efficiently. B&T’s competitors are able to compete but are not to compete in every aspect B&T as they have been more established.

External Analysis

PEST Analysis

According to PEST analysis, we evaluated the B&T’s environment based on several factors. In political segment, import and export policy settled by government may have influences on the B&T business since they import coffee beans from other counties. Also, they will get some benefits since B&T is a small business corporation. They can pay at lower corporation tax rate from 9% to 11% and have limited to $500,000 small business deduction. In social segment, Canada is the third coffee consuming country in the world (Sophia Harris, 2016). Since middle classic group increases, the member of people who drink coffee also increased over time. Moreover, healthy lifestyle becomes popular now. Organic coffee beans may be a trend in the future. In technological segment, with the technology development, customers are more looking for good quality and creative products. If the coffee machines are used in restaurants, people would like to use the coffee maker that can brew more coffee in the short time. If B&T can provide good quality and faster machines than others, it can be an advantage compare with their competitors. In environmental segment, Canada is not a suitable environment for the growth of coffee beans. So, the raw materials must be imported. Finding the good quality and price coffee beans is a significant part of B&T’s business.

Porter’s Five Forces of B&T

Threat of new entrants

Nowadays, coffee is so popular in our society especially in urban area. Due to a lack of barriers of entry, coffee products tend to appear regularly in the market. Currently, there are not many competitors in the Niagara region competing with B&T because the current business model that B&T uses mainly on business-to-business. However, as the development of Niagara, more and more competitors will be appear because there are no policy restriction of government to operate a coffee company. In urban area with large population, the threat of new entrants will much higher largely depends on the higher demands of customers. According to the research ⁸, “Coffee is Canada’s most consumed beverage amongst adults – even more than tap water. 67% of adult Canadians enjoy at least one cup of coffee a day with the average at 3.0 cups/day.” As the increasingly demand of coffee, the threat of new entrant will be higher.

The bargaining power of supplier

Suppliers have medium bargaining power because B&T has relationships with very few suppliers, it will impact the sales of B&T if there are not enough coffee beans to provide from its suppliers. Currently, most of coffee beans are imported from developing countries and there is the vast competition between those suppliers. Although it may easily to find another supplier, the quality of coffee bean can not be guaranteed and the cost of switching to another supplier will increase. As the increasing demand for eco-friendly or organic coffee and the other conditions change such as labor, land, climate, the bargaining power of suppliers will change and depends on the economic situation of countries. Establishing a policy for diversifying its supply chain can reduce the influence of negative effects from suppliers.

Threat of substitute

Many products such as soft drinks, energy drinks or any other drinks that contain caffeine are in competition coffee and tea. As coffee and tea are also considered as morning drinks, beverages consumed such as juices and smoothies are also the threat of substitute. According to the Juice in Canada (2017), “ Due largely to the growing concern over sugar intake and artificial ingredients as well as the growing number of alternatives. Moreover, conventional offerings such as orange juice and apple juice lack the cool and fun factors that consumers, particularly younger generations, desire, and consequently exotic flavours are increasingly appealing. ” which indicated that healthy concerns within the society are more important, with the increasing alternative of drinks, tasty and healthy drinks will be more popular.

Bargaining power of buyers

The bargaining power of buyers is high because there are many coffee retailers that customers can choose. Although B&T has more than 30 years of experience in coffee bean and has 70% marketing share in Niagara region. The bargaining power of people who live in Niagara is lower than people in GTA area. To be success into the GTA area, or cities with more population and competitors than Niagara, product’s differentiation is the key to influence the customers’ decisions.

Rivalry among existing competitors

B&T company faces the strong force of competitive rivalry or competition. The rivalry among existing competitors is high. Competitors include Sysco, McDonald’s, Starbucks and local brands, which different target markets, sizes or strategies. As a small business in Niagara region, B&T’s mission, vision, and value needed to be different between those big companies. The strong force of competition is also due to the low switching cost, which means that it is easy for customers to shift from B&T to other brands if both of them provide with similar coffee products and prices. Furthermore, since those big companies have established their brand awareness, once they provide coffee machines or packaged coffee beans with similar services, it will be a big threat to B&T.

SWOT Analysis

Strengths

The B&T coffee beans that they provide are imported from South America. They are differentiated on providing high quality coffee beans with moderate prices in the market. Also, the service which company provides is different than others in Niagara region. Shipping to your location is the other strength to compete other coffee companies. Comparing with large company with a lot of employees and expensive equipment, the cost of B&T is much lower and it gives more money to maintain the customer relationship and to train employees to improve the service quality and long-term relationships. Another strength of B&T is their immense care for their customers and their diligence for great customer service. The reason why Barclays and Todd is the leading provider of coffee related products to businesses in the Niagara region is because of their complete focus on consumers and their satisfaction. With competing firms being international, they are not able to cater to consumer needs as well as Barclays and Todd. Related to this, Barclays and Todd is located closer compared to their big competitors so they are able to provide service or any thin else in a timely matter. These are Barclays and Todd’s main strength.

The last strength of Barclays and Todd is their ability to cover multiple aspects of the industry instead of focusing on one specific part. Barclays and Todd sell their products and services to restaurants as well as hotels, business offices as well as sell their own products. Their competitors are not able to cover the same business actions as Barclays and Todds but rather cover one segment they are involved with. This is a particular strength for Barclays and Todd because this allows them to cover different markets that complement each other and all their business functions would be related to one another.

Weakness

As the expansion of B&T, renting a new warehouse is necessary. The costs of operation will be increase including advertising, labour costs, rental expenses and so on. Although there are a lot of opportunities in the north of Niagara region, there are more competitions in there especially in GTA area. A lot of restaurants and hotels have contracts with coffee companies such as Sysco that has established relationships with those customers. With this said, B&T’s current capacity can be seen as a weakness for the company as they do not have the capacity to expand. They are central to the Niagara area and having a reach outwards to other areas like the Toronto area would be hard for them.

In addition, Barclays and Todd has a specialized worker that focuses on repairs for the company’s espresso machines. He is sent out daily to repair machines in different locations of the customers. The farther the location of the espresso machine, the longer it takes for the repairs and for the employee to reach back to the company. Sometimes the employee will spend a whole day focusing on a certain repair at a certain company. Travel time and traffic will have to be factored in and this can be a cause for inefficiency. With a small work force, employees cover more business functions but may struggle to cover them all efficiently.

Opportunity

As the demand of coffee and tea is increasing, the coffee product is more popular now. People, who living in the urban area, have higher expectation of service and quality of coffee beans. It provides a good opportunity for B&T to use their core competitive advantages with marketing strategies to introduce their coffee beans in those areas. More, the number of restaurants and hotels are increasing every year not only in GTA area, but also in Niagara region due to the large tourists during summer. It also gives a good opportunity to B&T to find new customers. With B&T good relationship with their current accounts, recommendations through their current customers to future customers is very possible. This would allow Barclays and Todd to receive more business as a result of their attention to their customer service. As a well-established company in the Niagara region, they have the reputation needed to expand into farther territory. With those local companies wondering what the past of B&T was like, their good standing reputation and well established history would benefit them compared to smaller and less established firms that would be competing with Barclays and Todd.

Threat

There are major threats for Barclays and Todd at the moment since they are well established in their industry and are doing really well. The small threats they do have relate to substitution of their products and services from their competitors. Nowadays, coffee is so popular in our society especially in urban area. Due to a lack of barriers of entry, coffee products tend to appear regularly in the market. According to the Juice in Canada (2017) ¹, it indicates that healthy concerns will be a threat to Barclays and Todd, with the increasing alternative of drinks, tasty and healthy drinks will be more popular. This is a threat to Barclays and Todd as they are at risk of losing health conscious consumers.

Competitors

Barclays and Todd have been a well-established company and is able to maintain a large portion of the market share in the Niagara region. B&T’s competes in the food service industry, office coffee industry as well as selling roasted coffee beans individually. They also focus on Business to business. All of these segments of business have different competitors. Their competitors are only competing with Barclays and Todd in the given segment and not 2 different segments. All of these competitors are competing within the Niagara region that stretches to the Hamilton area and ends right before the Skyway Bridge.

The first segment revolves around the food service industry. This can include anything and everything from restaurants that supply coffee to hotels that supply coffee to consumers. In this specific segment, B&T is estimated to have 70% of this segment while the remaining 30% I owned by other competitors. Barclay and Todd’s main competition in this segment is Sysco. Despite not doing as well as Barclay and Todd in this section, Sysco is able to provide services alongside with their other food products. Sysco caters to a wide range of products for their customers but does not focus on one specific item compared to Barclay and Todd. They are able to focus and do better compared to Sysco in this segment because they have a repair service focused on their services as well as specialized services available to their customers.

The second segment revolves around selling coffee within a business environment. In this business environment, Barclays and Todd is estimated to also have 70% of the market the while competitors have 30%. B&T competitors in this segment are different from those in the food industry segment. Their main competitor is Van Houte. Van Houte is a large company that is foreign. Despite this, B&T is able to cater to their customers with higher quality of service and response times as they are local. This allows the service that is provided by B&T feel more personal and requests can be catered according to the customer’s preference.

The last segment revolves around their unique product that they sell through their company. These products range from coffee blends imported directly by the company to multiple offerings of teas. In this segment, there are numerous competitors when it comes to companies that sell coffee beans but the main difference is that Barclays and Todd is able to offer these upscale coffee beans to their current customers. This way, Barclays and Todd is able to tend to their current accounts and offer a larger variety that would complement with their service. If current customers decide to purchase coffee beans from B&T instead of outside brands, they will benefit through ongoing business with their service provider and may benefit from loyalty programs.

In the Business to consumer segment, Barclays and Todd faces large corporations such as McDonalds, Starbucks, Sysco, etc. This is a very competitive market but the firm is not greatly affected by this segment. This is a result of the company focusing on B2B instead of B2C where greater competition exists.

Internal Analysis

Core Competencies

Barclay and Todd’s core competencies are being a full-service coffee distributor that specializes in procuring equipment, coffee roasts, tea blends, repairing equipment, and delivery for various account sizes in commercial offices, and restaurants with 30 years of experience, and its over 70% market share in Niagara. With the current state of operations in Niagara, Barclay and Todd’s will need to adapt when it expands growing its base outside of Niagara while maintaining its current market share within the region taking into consideration their model being proven in Niagara, the competition when expanding towards Toronto itself, the franchise-like model with a partner in Georgian Bay, seasonal trends in coffee consumption, the increasing popularity of nitro coffee in the US, and its customer service experience being a full service coffee distributor. With experimenting with new roasts, Barclay and Todd’s can expand this further by allowing for all levels from roasting, distribution, and procurement to further grow its full-service image.

Barclays and Todd is a small but well established company. With only a handful of employees, Barclays and Todd are considered to be a small company with a total of 6 employees. Despite being a small company, their financials are in great standing. B&T make a total of an average of $2 million in sales in a normal fiscal year (excluding recent years). 40% of the sales are gross margins and net income averages from 20% to 25%. With these numbers, it is safe to say that Barclays is profitable and is able to make a profit and support its company.

Despite the small firm, Barclays and Todd has been a well-established firm for 30 years and dominates in the Niagara region. Their business expands to different areas of the Niagara region and expands as far as the Hamilton region up to the skyway bridge. Barclays and Todd also endeavours in franchising and licensing options that would help expand the brand image to areas that are remote to Barclays and Todd.

Barclays and Todd is successful in their industry because they are able to cater to their accounts and provide them with timely, high quality service that competitors have a hard time competing against. With their bigger accounts, they benefit from a loyalty program that enables them to receive discounts if payment is made within 30 days. This allows continuous service with B&T and supports long-term business relations. In addition, Barclays and Todd offers inclusive services for companies that use their espresso machines. If these machines break down and are in need of repairs, B&T sends out a technician that specializes in the repair of this specific machine. These repairs do not come at any cost as well. This shows B&T’s immense care and attention to customer service and their satisfaction.

To further grow, Barclay and Todd do sell their own coffee beans and other products. In the future, B&T plans on importing their own beans and exploring the idea of roasting and selling their own beans commercially. Currently, their warehouse is not able to manage this future business function due to its mass but with plans of growing the business, a new warehouse would benefit this idea which could lead to more opportunities for the company.

Financials

Looking at Barclays and Todd’s financials over the past 8 years, we can see that the company is profitable with their business. Excluding the two most recent years, Barclays and Todd have netted total sales exceeding $2 million every year. Their gross profit averages around $800,000 or 40% and their net income averages around 20% of their total sales. With these numbers, it is safe to say that Barclays and Todd is able to make a safe profit margin for their company given its size and location. With a 60% mark up on their products, they are able to sell their products are a higher price than their costs. This is the cause of their large net profits as they do not incur large amounts of costs. Their main costs relate to products they obtain for their consumers. These products include products such as coffee beans, tea bags, espresso machines, etc. Other costs include agent costs for their imports of coffee beans. The initial espresso machine costs as well as warehouse costs are also related to these as they are required costs. Employee pay is not as big compared to other costs because of their small employee size in the firm.

Physical Assets

Barclays and Todd’s physical assets range from their products they import internationally. These are arguably their most important asset because they are unique from their competitors. Compared to the more generic coffee beans that are being sold in the area, B&T’s coffee beans are specifically chosen for their higher quality and exoticness compared to other beans. Barclays and Todd also plans on importing and roasting their own coffee beans and sell them as their own unique product branded under their company. This would be a huge step for the company as this would be their biggest physical asset and give them a huge competitive advantage.

Human Assets

Barclays and Todd is composed of 6 total employees in the company. This is not a large employee size but they are able to make do. One of their employees is dedicated to repairs of espresso machines that are used with their products. Barclays and Todd also employees an agent that helps with the process of importing their unique coffee beans for them.

Intangible Assets

Barclays and Todd’s most important asset are intangible. Their competitive advantage is based on their great attention to their customer service and relationship with their consumers. This competitive advantage is the reason why they are the leading firm in their markets. Combined with their well-established history, this makes Barclays and Todd a very well structured company that would be capable with any future ventures that B&T plan for the future.

Product Offering

Barclays and Todd product offering is very basic and simple. They offer a service that provides hot beverages to businesses. Their service is offered alongside their product. Majority of their income is made from selling their products of coffee beans and teas. These products are sourced internationally and sold to their customers. A range of products are offered that can be used with their hot beverage service. The machines provided are there to support the use of their hot beverages.

Value chain analysis

Barclays and Todd value chain is comprised of multiple parts. It starts in two areas. The first area is the service segment of their business. Value is added immediately due to Barclays and Todd’s attention to their service. B&T’s services provide espresso machines for the customer and also provide the coffee beans as well. Most of the value is added with Barclays and Todd’s imported coffee bean that is done in house. They assign a specific agent that imports the coffee beans for them. The imported beans are chosen according to B&Ts specifications in order to be of higher quality compared to local beans sold in the industry. This sets them apart from local competitors and their choice of coffee beans. This process adds value to the beans as they are of higher quality without sacrificing affordability and maintaining the quality. By importing these coffee beans and selling them to their consumers of their service, they are able to combine both values of the product and service together in order to obtain one large amount of value obtained by doing business with Barclays and Todd. Every business action involved in the process is received by the customer at the end of the day. They receive the value through great products and services that are unmatched by competing companies in the industry.

Research and Development

Barclays and Todd is a small firm but they do endeavour in new future products or ventures that would benefit the company and help it grow. B&T plans on investing on an in house roaster in the future. By doing this, they are able to import the coffee beans and roast them in house to their specifications in order to create a unique product to the firm. Instead of buying roasted coffee beans, they are able to create their own product line and only have the coffee beans imported non-roasted. With this new addition to their business actions, they are able to expand their offerings to their consumers and create product that will be based on their long standing company. This will be an entry to the B2C market as these products could be sold in retail stores to consumers instead of other businesses who use their services.

To incorporate in house roasting, Barclays and Todd would have to be able to accommodate the extra space that would be taken up by the machines involved in the roasting process. A new warehouse would be mandatory. Expansion would be necessary. A warehouse along the QEW highway would be efficient as it would be close to the freeway and easily accessible to the company.

Recommendations

Recommended Positioning

Barclay and Todd’s should best position itself as a full-service coffee distributor that holistically serves its customers from roasts provided, equipment used, experience serving its clients for over 30 years, and timely repairs being a service that the Niagara market trusts while looking to expand its full-service image with developing its own roasts, and providing online ordering. To encompass its positioning when expanding outside of Niagara towards Toronto, Barclay and Todd’s should consider its experience, brand trust, being an underdog in newer markets, and being a hometown favourite coming from Niagara. With it being a hometown favourite from Niagara it should avoid positioning itself with Niagara specifically in mind which would limit its growth to the region where it dominates the market. Positioning itself to “trusted by and caring for customers with our full-service coffee experts for over 30 years”.

Expansion

To grow the company, B&T would have to expand out of the Niagara Region and test different regions. The most attractive yet risky region would be the Toronto region. This region is denser compared to the Niagara region because of its highly developed and populated cities as well as the cities that surround it  such as Markham, Oshawa, Scarborough, Vaughn, Etobicoke, Mississauga, Brampton, etc. Demographics will be different compared to the Niagara region. Despite this, Toronto would be a good region to expand to because there are untapped consumers that have not been exposed to the Barclays and Todd. Despite having more competition in this region, the immense amount of new possible customers outweighs the competitiveness. These firms in the more developed region will also be larger than similar firms in the Niagara region. These big firms focus less on quality and customer service and focus on quantity in this region. It would be refreshing for Barclay and Todd to reintroduce great attention to customer service into what they offer in the new region.

If expansion into the Toronto region is not attractive for Barclays and Todd, they can slowly expand into the Toronto area starting from the borders at the Skyway Bridge. Expanding into the bigger cities like Oakville and Mississauga will be a good test to see how well they perform in these markets and forecast their success in the bigger regions in Toronto. These cities are bigger than the regions in the Niagara region but are small enough for the company to handle. These regions would also be a perfect location for their second warehouse if they plan on expanding. These specific areas are located near two major highways, the 403 and the QEW. Having a new location in this area would benefit them by having a location closer to their farther customers (Hamilton/ Burlington) but also mark a check point. This checkpoint would be crucial if they are successful in the specified area and plan on expanding towards the Toronto area.

With a new warehouse located closer to the Toronto region, in house roasting would be feasible as the company would be able to accommodate space for the machines in the new warehouse. This is a strategic location for the in house roasting because it would be less central to the regions that Barclays and Todd have built themselves around. With these markets, in house roasting can be tested and developed to the new customers in small amounts to develop a roast that is catered to the specific customer or a taste that is liked by a large majority of their consumers. The in house roasting does not have to be done in a large scale. A small scale is plenty as the roasts are used to survey consumers and determine preference in consumer taste buds. This will lead to development of well-liked in house roasted coffee beans that can be sold to the consumers down the road.

Blue Ocean Strategy

Considering that Barclay and Todd’s offers coffee roasts, tea blends, equipment, service, and delivery which other food service providers, and distributors have not matched along with their responsive customer relations, Barclay and Todd’s should seek to expand their full-service to roasting, and online ordering. With roasting, and larger clients Barclay and Todd’s can cater unique tastes of its client’s locations offering small batch blends that can be tested out to see if consumers will enjoy a new roast which it then can start selling to other clients with an exclusivity period for the roast to be at the initial client’s location. To automate ordering so that Barclay and Todd’s can focus on getting new accounts, the company can establish an online ordering system so that clients can have full control over the products they need with descriptions of its various product offerings, be able to pay immediately online for their orders reducing the time an accounts payable is paid for, and be able to cross sell different roasts online a client may be interested in due to taste preferences which would increase sales in the clients’ stores increasing sales for Barclay and Todd’s. With automation of ordering online Barclay and Todd’s sales team will have less time wasted for reordering, and can focus on growing their business outside of Niagara instead.

Product Strategy

Existing Product Line-up

Barclay and Todd’s should maintain its current existing line of products excluding SKUs that do not break-even for the company, maintaining its diverse selection with its positioning as a full-service coffee distributor. Since clients rely on Barclay and Todd’s to provide their coffee clients should be able to reasonably get whatever roasts suits the client’s taste, and with SKUs that don’t break-even Barclay and Todd’s should offer similar roasts to the client’s preferences that would break-even. Barclay and Todd’s should maintain its tea offerings being a substitute for coffee but a complement for cross selling to its clients whose consumers would be seeking tea as an alternative to coffee.

Nitro Coffee/Cold Brew Coffee

With nitro coffee, and cold brew coffee having complementary brewing processes with nitro coffee involving pumping nitrogen ² in addition to the lack of heat steeping a cold brew coffee for over 12 hours, Barclay and Todd’s should seek to expand its business due to the growing popularity of these brews driven in the US by small cafés, and Starbucks ³.Barclay and Todd’s would need to procure the machines that would introduce nitrogen into the cold brews which it already provides the roasts for which it can test with hotels with bar taps before expanding into restaurants, and offices it provides to. Barclay and Todd’s would ensure a first mover strategy with nitro coffee as it would be the only provider within Niagara and its surrounding regions to provide the ability to install, and purchase the equipment to produce nitro coffee itself with Barclay and Todd’s technicians being adaptable to new equipment.  Existing, and new clients would have to seek Barclay and Todd’s as the supplier for producing nitro coffee itself since no other competitor provides it currently. Cold brew roasts can be created through repurposed roasts that Barclay and Todd’s already provides or new roasts it can developed as discussed later.

Creating Roasts/Blends

To further expand Barclay and Todd’s image of being a full-service coffee distributor, being able to develop its own roasts of coffee will allow for the company to fine control its delivery of the coffee to the consumer for its clients. The cost of green coffee beans to the consumer typically costs between $5 to $7 per pound ⁴ for small batches of roasts to be tested by Barclay and Todd’s if they were to seek their own roasting in-house. Considering that the company does not have its own roasting facility, and that is has a roaster providing the company their own generic roasts, Barclay and Todd’s should consider a partnership with their roaster to develop new roasts with catering to larger clients to have exclusivity of roasts for a period of 90 days or so to test out the popularity of their new roasts. With this partnership with the roaster, and targeting larger clients with creating new roasts for them, Barclay and Todd’s can leverage their customer service to ensure a complete full-service image with them wanting to work together with their clients to allow consumers to have the best roasts possible. The cost of development would be minimal for Barclay and Todd’s but would allow them to be an innovative full-service company that is willing to partner with the clients it works with to provide the best possible coffee to consumers. With the data analytics recommendation discussed later on, leveraging consumer taste preferences, and its insider view of being a supplier, it would have the best market insights to develop customer a roast that satisfies any customer’s palette through trend analysis, and relationships it builds with its clients.

Online Ordering

Purpose of Online Ordering

To develop its online ordering system Barclay and Todd’s would need to need to hire a developer to integrate an online ordering system which clients could log onto or if the company is using WordPress for its site then it can install the WooCommerce ⁵ add-on to the site which a client login can be put into the top left corner of the website in place of the order now button with an existing customer button, and a second button being a new customer button which would lead to an account creation form creating a new user which a salesperson at Barclay and Todd’s would later get into contact with to establish the account as a client. Since the company’s website is scalable, the convenience of the client being able to use their phone to order or a computer would increase the value of the company’s service being flexible to the customer’s needs. Barclay and Todd’s can achieve this through installing WooCommerce’s extensions which maintain secure payments online through SSL certificates with PayPal, Stripe, or Amazon Pay, WooSubscriptions would allow clients to maintain a recurring subscription, and adjust order levels as needed based on seasonal factors of their clients with the ability to thank the customer for their orders, and cross sell products that customers may be interested in without the need of a salesperson on site unless requested, and sales data can be analyzed through WooCommerce or imported into a program such as Microsoft Excel or IBM SPSS which salespeople can use to correlate popular purchases to cross selling in person to new or existing clients, and be able to sell new products based on traits of existing products that Barclay and Todd’s sells. To increase security on their website, Barclay and Todd’s should consider implementing 2 factor authentication on their website to protect customer data adding another layer of security increasing trust in the company allowing for clients to become long term customers of the company creating another competitive advantage which other food service providers, and coffee distributors would not normally provide.

Costs of Servicing Clients Online

Barclay and Todd’s having a well-developed site currently would only require an e-commerce extension to its website to be able to serve its clients online with cutting out the time wasted in standard reordering over the phone with standard orders being able to redirect its salespeople to focus on gaining new clients expanding out towards Toronto. The cost of the website with Barclay and Todd’s being under $6,500 with their website as a service based e-commerce site, and hosting costing under $2,000 annually⁶. With the costs of e-commerce, website hosting, and development decreasing, running the website with an extended focus on online service e-commerce would allow Barclay and Todd’s to maintain a consistent or lowering cost to their website that would save the organization time to focus its resources elsewhere. Platforms such as the Woo Commerce add-on for Word Press would further minimize the costs, and allow Barclay and Todd’s to adapt their e-commerce strategy based on how fast they are growing.

Data Analytics

Data Analytics Strategy for the Organization

With Barclay and Todd’s seeking to grow outside of Niagara with being a full-service coffee distributor having experience selling to restaurants, and offices within the region for over 30 years, the company should seek to import, and analyze their existing transaction histories to find trends which may otherwise go unnoticed creating knowledge for new salespeople who can be hired to the company can rely on to provide consistent feedback to Barclay and Todd’s clients, and new accounts being able to make better recommendations the more clients it gains, and learns of their wants. With Barclay and Todd’s experience with being a full-service coffee distributor this would be an opportunity for the company to take its existing strength of its current level of customer service while adapting to technological changes in the market providing itself with an incremental innovation to its current business model establishing its value chain further. Along with analyzing historical trends, and predicting new trends in the market considering external factors, this can support Barclay and Todd’s experimenting with new roasts to cater to client needs increasing their margin with its ability to develop its own product with unroasted beans being a commodity adding to its full-service, and customer service propositions.

IBM SPSS

IBM SPSS costing 99 USD monthly would allow Barclay and Todd’s to analyze its historical transactions from current, and former clients being able to use it to predict future purchasing trends of customers which should be taken into consideration with marketplace trends with the growth of cold coffee beverages such as cold brews, and nitro coffee. This would be done through importing a transactional database or invoices that Barclay and Todd’s has collected historically being inputted into the program then choosing either the direct marketing techniques tab to learn how to use the factors that the organization has to target specific client sizes or types, using forecasting to predict the change in consumer tastes in different types of roasts, and blends, decision trees can be created from customer transaction history where Barclay and Todd’s would be able to figure out the process in which consumers buy their products, and what factors influence a client to purchase its different products or to rely on the company’s service. Barclay and Todd’s may consider with the transactions that are conducted that they would include a feedback form which can be included in their online ordering system, to where clients that are involved with Barclay and Todd’s services can evaluate their positioning, and be able to improve on areas where it lacks in its customer service or focus on the qualitative variables that influence a customer to stay increasing customer retention. Statistical summaries through IBM SPSS would allow Barclay and Todd’s to see their average client purchase sizes through average dollar sales per order, units per transaction either through weight or units purchased, ensure that all clients are profitable for Barclay and Todd’s, find the optimal client size to target to maximize its return on investment, and analyze the performance of the company’s salespeople to encourage key point indicators are exceeded, and to challenge Barclay and Todd’s salespeople to improve their performance which clients can additionally evaluate. Sales data can be imported from its website through its online sales seeing if client preferences change with its online versus in person sales interactions, and look at trends in the market being able to cater to localized demand.

Microsoft Excel

Barclay and Todd’s if not willing to afford the cost of IBM SPSS can use Microsoft Excel costing 9.99 USD monthly for 5 monthly licenses as an alternative but importing its sales data would have to be done manually to be analyzed within the program taking up company time from selling but it would allow for a basic insight as to the sales of the company, and trends in purchasing of its clients. The initial setup of an Excel dashboard to analyze its performance with its salespeople, products, and expansion efforts may take a few months to perfect based on organizational needs, client needs, and salesperson preferences. With having a dashboard created on Excel it can be used as a company dashboard to see its performance by set time ranges being daily, weekly, monthly or quarterly, and would provide a visual of the company’s performance which can be communicated throughout the organization.

Contingencies

If these listed recommendations are unsuccessful, Barclay and Todd should focus on the Niagara region. They dominate the Niagara region by owning 70% of the market share. If the suggested recommendations are not feasible or not doable in the near future, Barclays and Todd should try to obtain the remaining market share available in the Niagara Region. This would solidify the company as the leaders in B2B coffee sales and services and prepare the company for growth later down the road.

References

¹ Reference:Juice in Canada(2017), COUNTRY REPORT Retrieved from http://www.euromonitor.com/juice-in-canada/report

² http://www.esquire.com/food-drink/drinks/a35593/nitro-coffee-explained/

³ https://www.thestar.com/business/2016/10/20/starbucks-taps-keg-for-new-nitro-cold-brew.html

⁴ https://ineedcoffee.com/the-quick-economics-of-home-roasting-coffee/

⁵ https://woocommerce.com/

⁶ https://www.atlanticbt.com/blog/how-much-does-ecommerce-website-cost/

⁷ https://www.coffeeassoc.com/coffee-facts/

⁸ http://www.cbc.ca/news/business/canada-coffee-tim-hortons-1.3745971