Café xaragua case study

Document Type:Case Study

Subject Area:Accounting

Document 1

The critical point of focus, in this case, is to present information why I feel the debt financing option to the investment rather than giving up 60 percent of equity. In line with the goal and mission of the Café Xaragua of providing quality coffee and simultaneously focus on the Haitian Culture, our need is to be able to reach to different target customers across each market segment in order to improve our sales revenue. The choice of the current location in Downtown Calgary is an ideal area to support the growth of Café Xaragua. The location is strategically placed to tourists and is the major lucrative location considering the number of clients and other businesses that may be used together with the beverage products Recommendation In a bid to finance its operation, the company needs to check the loan financing options and terms of the loan and whether the business is sustainable and can be paid.

Sign up to view the full document!

Furthermore, for growth purposes and continuity of the business aggressive sales and marketing strategies need to be explored to improve the profit levels of the firms. I believe having the business plan will also be able to give a guideline on the business to be implemented in the creation of a sustainable environment. The business needs to evaluate the financing option by assessing whether the benefit of financing will exceed the cost. Thus, a time interest earned ratio will be computed to assess the feasibility of the loan. The otherwise lower level of the TIE will imply that the business will struggle in servicing the loans together with interest. This means that focus on having higher TIE would be favorable to the business which will enable Café Xaragua to adopt its long term growth strategy.

Sign up to view the full document!

Based on the aforementioned findings from the report I have annexed the financial statement and the three years projected income statement as an approach to gauge the financial performance periodically. Looking Forward to Hearing from You SoonYours Sincerely, Xxxx Manager Café Xaragua What entrepreneurs need to Do As far as enhancing the performance of the company it is advisable for the entrepreneurs to carry out the market research as part boosting their strategy on the market. The consumer needs to also analyze what product the customers prefer and innovatively brand the product to support the investment decisions. Additionally, in spite of the fact that the entrepreneurs are risk takers, they need to support the future plan. Other Questions The three types of information evident in the case study is the selection of the business location for expansion, evaluating the debt financing option, and the business future plans and growth strategy, profitability as evident in the income statement and balance sheet.

Sign up to view the full document!

From $10 to earn access

Only on Studyloop

Original template