Easyinternetcafe Cafe Essay Example for Free

Easyinternet coffeehouse Cafe EssayThis case report addresses the challenges to implement a forward-looking logistic system that if well implemented it can improve operations and can convert easyinternetcafe into a profitable company. EasyInternetCafe (eIC)is a chain of Internet cafes with put ins in the UK, the USA, Holland, Belgium, France, Germany, Spain and Italy. eIC is part of the Easy Group, headed by the Greek entrepreneur Stelios Haji-Ioannou. The sea captain business nonplus is to build and operate on the principle of economics of scale or slacken off Management most stores would be open 24 hours a day, 7 years a week, and to each one has an average of 350 PCs. In 2003, with losses continuing to mount, eIc solicitude has decided to radically revamp their operations. In order to eliminate the need for future investments in late stores, the strategy was changed.It has been decided to appoint franchisees for the new stores and also, if possible, for the existin g legacy stores. According to the new strategy, the franchisee would be required to bear the costs of the property and the hardware. It was also decided to move from mammoth stores to smaller stores with 20 to 30 PCs. The current logistic situation represents a chokepoint and it is one of the major causes for the ongoing losses at easyinternetcafe. After reviewing different logistics scenarios and providers, I strongly recommend taking a closer look to support the logistic alternative that Ingram Micro is proposing. If we do that, we could benefit in the warehousing, accounting and transportation areas, through all this areas, it will help us decoct the logistics costs and labour per new store, from almost to 2,000.00 to 1,357.00, this and the benefits mentioned before, will help us to achieve our overall physical object of being a profitable company. This will be the strategic perspective that will be present throughout the report.Issue(s) Identification1. Yield Management do es not work for every company. eICs first store opened in June 1999 opposite in London. Soon afterwards, it was quickly recognized that eICs yield management had certain characteristics that later affected the business model elC was offering a highly perishable fruit 1 hour of Internet attack cadence, cannot be put in inventory, once that hour is gone, on that point is no way of reselling that hour of internet access time. Although stores are large, capa city is limited Internet access demand varies, not only by time of day, day of week, but also across different time and seasonal horizons. Incremental costs are next to nothing it doesnt matter whether thither is one person or 500 in a store, the bandwidth is already there. By the time the encourage and third stores were opened, eIC had built yield management into its store management system.2. Current Logistics SystemLogistics is not a core competency at elC, but it has become one of the integral activities. Logistics for elc means to supply the new stores with their initial assests, including all of the furniture and PCs. This system is a drag on scalability, efficiency and a bottleneck for growth and the main reason for spiraling high cost and ongoing losses.Environmental and Root dumbfound AnalysisAggressive use of yield management is a recognized and admired business model of Stelios. EasyJet was a profitable company after just a few years of operation. However, with EasyInternetCafe profits face a long way off, the assumption that offering very low prices would increase the demand importantly lead to losses of 80m-100m from 199 to 2002. Below are some root causes of the symptoms above * The stores are too large economies of scale dont materialize if occupancy is half empty. * Fixed costs were too high due to the meter of Pcs per store. * Staff overheads were excessive.Assumptions* Are there sufficient customers who want to use an internet cafe? To-day, most of the homes pay back internet access , and many others have (free) access at their place of work or at colleges or university. * Are the stores located in the right place to attract customers throughout the day and the whole week? Downtown cafes might attract business people needing to keep in touch, but many city centres are quiet in the evenings and at weekends. By mid-2001, with cash running out a forceful action was necessary a franchising plan is being developed. It is important that every cafe looked the same, with common signage, furnishings and PCs.The time to sign a contract with a franchise is one week. If the franchisee did not already have musculus quadriceps femoris for the caf, eIc would assist in recommendations with locations within 28 old age. The broadband internet connection had to be installed by the topical anesthetic telecoms supplier within 28 days. Also they need to Desk installed within seven days. Server delivered and installed 2 days and PCs delivered and installed 2 days. CVM delivered an d installed 1 day Signage delivered and installed 1 day. Chairs delivered and installed 1 day. Testing complete system 2 days and also Open for business within one day. So, how much time should it take to open the cafe once the contract is signed? From the predecessors plan we see that average duration of time for all activity. below bellow we discuss about time of the contract are signed.