MAPA UNIVERSITY

School of Industrial Engineering & Engineering Management

A Food Service Management Study on

Bos Coffee Robinsons Galleria

Submitted by:
MINA, ALLIQUE PENN R.
2014102602

As partial fulfillment to the requirements of

SVM131/B1
4th Term AY 2016-2017
COMPANY PROFILE

"Bo's Coffee" is a registered trademark of the business name of a chain of specialty coffee shops
that serves espresso beverages, specialty coffee beverages and others, in an ambiance that has been
created to cater to a lifestyle market with discriminating taste. It all started with a bean bursting
with the life-force of personal passion and entrepreneurial energy.

In 1994, Mr. Steve D. Benitez, President and CEO of Bo's Coffee, dreamt of sharing his coffee
experience in the United States and Europe to the local market. It was in June 1996, that the first
store of Bo's Coffee at Ayala Center Cebu, Cebu City, Philippines started operating.
It has since grown branching out into major urban areas of the Philippines. Bo's Coffee now
operates 85 branches strategically located in across the Philippines

Vision
Bo's Coffee envisions itself to be the premier specialty coffee bar in the Philippines, roasting high-
quality Philippine origin coffee beans, serving world class coffee beverages and the most
delectable selection of cakes and pastries, delivering an excellent branded customer service in a
friendly and cozy ambiance.

Mission
We believe that the relationships we build with others are what make our days full of life. It is
therefore our mission to create an atmosphere where people can come and nurture relationships,
make new ones, or simply flourish by themselves.

Our role is to provide that perfect cup of coffee, which has become the ideal medium to enjoy life
together with others or in the comfort of one's solitude, and deliver it with warm and friendly
customer service. It's all about human experience with Bo's Coffee being a big part of it.

Robinsons Galleria Branch

Ground Level, East Wing, Galleria
EDSA cor. Ortigas Ave., Quezon City
CURRENT SITUATION

This branch has been running for over 7 years. It employs a team of 6 members. Since it is
located inside the mall, it has a room with tables and chairs for smoking. Bos Coffee operates
from 10:00 am to 9:00 pm during Sunday to Thursday, and 10:00 am to 10:00 pm during Friday
and Saturday. It has a capacity of 65 people.

Regular customers during weekdays include office employees, and come at around 12:30
to 2:00 pm. During weekends, people who attend mass at the Victory church, card players, and
networkers are there usual customers. Unlike the other Bos Coffee branches, its branch at
Robinsons Galleria has less occurrence where people pass by the store.

Every branch of Bos Coffee has a standard target Operating Profit to hit, or better, exceed.
This is set by the Main Office of Bos Coffee. For this branch, along the other branches across the
country, except for the ones in the airport, is set to earn an operating income of 40% of the sales.
However, there are some branches unable to hit the specific target.

January February March April May June July August September October November December Total

Sales 519,485.00 394,690.00 406,120.00 421,635.00 451,515.00 416,595.00 477,850.00 468,781.00 430,286.00 434,250.00 417,265.00 427,500.00 5,265,972.00

Cost of
Goods 132,871.25 102,672.50 105,530.00 108,408.75 115,878.75 107,148.75 124,270.00 120,195.25 111,071.50 111,562.50 107,316.25 109,875.00 1,356,800.50
Sold
Gross 386,613.75 292,017.50 300,590.00 313,226.25 335,636.25 309,446.25 353,580.00 348,585.75 319,214.50 322,687.50 309,948.75 317,625.00 3,909,171.50
Profit

Operating
Expense

Salary 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 1,200,000.00

Rent (With 75,000.00 75,000.00 75,000.00 75,000.00 75,000.00 75,000.00 75,000.00 75,000.00 75,000.00 75,000.00 75,000.00 75,000.00 900,000.00
Water)

Electricity 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 240,000.00

Wifi 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 60,000.00

Total
200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 200,000.00 2,400,000.00
OpEx

Operating 186,613.75 92,017.50 100,590.00 113,226.25 135,636.25 109,446.25 153,580.00 148,585.75 119,214.50 122,687.50 109,948.75 117,625.00 1,509,171.50
Income

Tax 41,055.03 20,243.85 22,129.80 24,909.78 29,839.98 24,078.18 33,787.60 32,688.87 26,227.19 26,991.25 24,188.73 25,877.50 332,017.73
Expense
Net
Income 145,558.73 71,773.65 78,460.20 88,316.48 105,796.28 85,368.08 119,792.40 115,896.89 92,987.31 95,696.25 85,760.03 91,747.50 1,177,153.77
After Tax
Table 1 Bo's Coffee Income Statement 2016

PROBLEM STATEMENT

11.34% below target 40% Operating Profit Margin of Bos Coffee Robinsons Galleria for the year
2016
OPERATING PROFIT
MONTH ACTUAL TARGET
January 186,613.75 207,794.00
February 92,017.50 157,876.00
March 100,590.00 162,448.00
April 113,226.25 168,654.00
May 135,636.25 180,606.00
June 109,446.25 166,638.00
July 153,580.00 191,140.00
August 148,585.75 187,512.40
September 119,214.50 172,114.40
October 122,687.50 173,700.00
November 109,948.75 166,906.00
December 117,625.00 171,000.00
Total 1,509,171.50 2,106,388.80
Table 2 Operating Profit

Bo's Coffee's Monthly Operating Profit

220,000.00
210,000.00
200,000.00
190,000.00
180,000.00
170,000.00
160,000.00
150,000.00
140,000.00
130,000.00
120,000.00
110,000.00
100,000.00
90,000.00
80,000.00
70,000.00
60,000.00
50,000.00
40,000.00
30,000.00
20,000.00
10,000.00
0.00

ACTUAL
Figure TARGET
1 Operating Profit
MENU ENGINEERING
SELLING GROSS
PRODUCT QTY. SALES COSTING POPULARITY
PRICE PROFIT
BEVERAGE
ESPRESSO
Espresso 120.00 254 30,480.00 7,620.00 22,860.00 0.69%

Espresso Macchiato 120.00 158 18,960.00 4,740.00 14,220.00 0.43%

HOT & ICED
Caffe Americano 135.00 4869 657,315.00 164,328.75 492,986.25 13.15%
Cappuccino 140.00 2439 364,700.00 91,175.00 273,525.00 6.59%

Caffe Latte 140.00 3335 466,900.00 116,725.00 350,175.00 9.01%

Caramel latte 155.00 814 126,170.00 31,542.50 94,627.50 2.20%
White Chocolate Mocha 170.00 1145 194,650.00 48,662.50 145,987.50 3.09%
Drip Coffee 170.00 3719 632,230.00 158,057.50 474,172.50 10.05%
POUR OVER & FRENCH PRESS
Sagada 125.00 126 15,750.00 3,937.50 11,812.50 0.34%
Benguet 125.00 45 5,625.00 1,406.25 4,218.75 0.12%
Kitanglad 125.00 31 3,875.00 968.75 2,906.25 0.08%
Mt. Apo 125.00 40 5,000.00 1,250.00 3,750.00 0.11%
Matutum 125.00 438 54,750.00 13,687.50 41,062.50 1.18%
SIGNATURE BEVERAGE
Cold White Brew 135.00 260 35,100.00 8,775.00 26,325.00 0.70%
FROCCINO PRIMO
Caramelo 165.00 636 104,940.00 26,235.00 78,705.00 1.72%
Mocha 165.00 1828 301,620.00 75,405.00 226,215.00 4.94%
Cookies n' Cream 175.00 392 68,600.00 17,150.00 51,450.00 1.06%
Coffee Jelly 185.00 661 122,285.00 30,571.25 91,713.75 1.79%
White Chocolate Mocha 185.00 942 174,270.00 43,567.50 130,702.50 2.55%
Choco Chip 150.00 471 70,650.00 18,360.00 52,290.00 1.27%
Crumble 150.00 471 70,650.00 18,772.50 51,877.50 1.27%
FREEZE
Artisinal Chocolate 165.00 339 50,851.00 12,712.75 38,138.25 0.92%
Strawberry 165.00 333 54,945.00 13,736.25 41,208.75 0.90%
Vanilla 165.00 163 26,895.00 6,723.75 20,171.25 0.44%
Cookies n' Cream 170.00 379 64,430.00 16,107.50 48,322.50 1.02%
Mixed Berry 185.00 309 57,165.00 14,291.25 42,873.75 0.83%
Matcha Green Tea 185.00 423 78,255.00 19,563.75 58,691.25 1.14%
SIGNATURE CHOCOLATE
Hot 150.00 475 71,250.00 17,812.50 53,437.50 1.28%
Iced 150.00 143 21,450.00 5,362.50 16,087.50 0.39%
HOT TEA
Tea Bag 125.00 598 74,750.00 18,687.50 56,062.50 1.62%
 Loose leaf Tea 120.00 281 33,720.00 8,430.00 25,290.00 0.76%
TEA LATTE
Matcha Green Tea Latte 150.00 300 45,000.00 11,250.00 33,750.00 0.81%
SHAKEN ICED TEA
Tropical Breeze tea 145.00 89 12,905.00 3,226.25 9,678.75 0.24%
Peach Mangga Berry 150.00 265 39,750.00 9,937.50 29,812.50 0.72%
Apple Chia Black Tea 155.00 385 59,675.00 14,918.75 44,756.25 1.04%
BLENDED ICED TEA
Mango 160.00 290 46,400.00 11,600.00 34,800.00 0.78%
FOOD
SANDWHICHES
Farmhouse Melt 175.00 249 43,575.00 10,893.75 32,681.25 0.67%
Ham & Egg 155.00 189 29,295.00 7,323.75 21,971.25 0.51%
Sausage & Egg 175.00 105 18,375.00 4,593.75 13,781.25 0.28%
Spam & Egg 135.00 127 17,145.00 4,286.25 12,858.75 0.34%
Pulled Pork Adobo 165.00 107 17,655.00 4,413.75 13,241.25 0.29%
PASTA
Bacon Pesto 195.00 238 46,410.00 11,602.50 34,807.50 0.64%
Baked Macaroni Melt 255.00 19 4,845.00 1,211.25 3,633.75 0.05%
Spanish Sardines 185.00 403 74,555.00 18,638.75 55,916.25 1.09%
Bolognese 185.00 284 52,540.00 13,135.00 39,405.00 0.77%
Carbonara 185.00 200 37,000.00 9,250.00 27,750.00 0.54%
DESSERTS
Carrot Bar 75.00 1071 80,325.00 20,081.25 60,243.75 2.89%
Carrot Oatmeal Raisins Muffin 95.00 555 47,486.00 11,871.50 35,614.50 1.50%
Revel Bars 75.00 691 51,525.00 12,881.25 38,643.75 1.87%
Dolce de Leche 140.00 496 68,091.00 17,022.75 51,068.25 1.34%
Food for the Gods 75.00 482 36,048.00 9,012.00 27,036.00 1.30%
Fudge Brownies 75.00 447 31,720.00 7,930.00 23,790.00 1.21%
Choco Banana Muffin 90.00 423 37,125.00 9,281.25 27,843.75 1.14%
Mallow Fudge Brownies 75.00 325 24,291.00 6,072.75 18,218.25 0.88%
New York Cheesecake (SF) 130.00 380 47,936.00 11,984.00 35,952.00 1.03%
Super Moist Choco Cake 140.00 345 46,028.00 11,507.00 34,521.00 0.93%
Oreo Cheesecake 130.00 309 37,974.00 9,493.50 28,480.50 0.83%
Mango Cheesecake 130.00 308 37,844.00 9,461.00 28,383.00 0.83%
Blueberry Cheesecake 130.00 107 13,483.00 3,370.75 10,112.25 0.29%
Strawberry Cheesecake 130.00 95 12,289.00 3,072.25 9,216.75 0.26%
Classic NY Cheesecake 130.00 41 5,025.00 1,256.25 3,768.75 0.11%
Butter Scotch 75.00 196 14,610.00 3,652.50 10,957.50 0.53%
Blueberry Calamansi Streussel 140.00 141 18,178.00 4,544.50 13,633.50 0.38%
WATER
Water 60.00 691 41,955.00 10,488.75 31,466.25 1.87%
TOTAL 37013 5,265,972.00 1,318,300.50 3,947,671.50
Table 3 Menu Engineering
PARETO ANALYSIS

Beverage
CUMMULATIVE CUMMULATIVE
BEVERAGE GROSS PROFIT PERCENTAGE
GROSS PROFIT PERCENTAGE
Caffe Americano 492,986.25 492,986.25 15.25% 15.25%
Drip Coffee 474,172.50 967,158.75 14.67% 29.93%
Caffe Latte 350,175.00 1,317,333.75 10.83% 40.76%
Cappuccino 279,335.00 1,596,668.75 8.64% 49.40%
Mocha 226,215.00 1,822,883.75 7.00% 56.40%
White Chocolate
145,987.50 1,968,871.25 4.52% 60.92%
Mocha
White Chocolate
130,702.50 2,099,573.75 4.04% 64.96%
Mocha (Fp)
Caramel Latte 94,627.50 2,194,201.25 2.93% 67.89%
Coffee Jelly 91,713.75 2,285,915.00 2.84% 70.73%
Caramelo 78,705.00 2,364,620.00 2.44% 73.16%
Matcha Green Tea 58,691.25 2,423,311.25 1.82% 74.98%
Tea Bag 56,062.50 2,479,373.75 1.73% 76.71%
Hot Signature
53,437.50 2,532,811.25 1.65% 78.37%
Chocolate
Choco Chip 52,290.00 2,585,101.25 1.62% 79.99%
Crumble 51,877.50 2,636,978.75 1.61% 81.59%
Cookies N' Cream
51,450.00 2,688,428.75 1.59% 83.18%
(Fp)
Cookies N' Cream 48,322.50 2,736,751.25 1.50% 84.68%
Apple Chia Black
44,756.25 2,781,507.50 1.38% 86.06%
Tea
Mixed Berry 42,873.75 2,824,381.25 1.33% 87.39%
Strawberry 41,208.75 2,865,590.00 1.28% 88.66%
Matutum 41,062.50 2,906,652.50 1.27% 89.94%
Artisinal Chocolate 38,138.25 2,944,790.75 1.18% 91.12%
Mango 34,800.00 2,979,590.75 1.08% 92.19%
Matcha Green Tea
33,750.00 3,013,340.75 1.04% 93.24%
Latte
Bai Nature Spring 31,466.25 3,044,807.00 0.97% 94.21%
Peach Mangga
29,812.50 3,074,619.50 0.92% 95.13%
Berry
Cold White Brew 26,325.00 3,100,944.50 0.81% 95.95%
LOOSE LEAF TEA 25,290.00 3,126,234.50 0.78% 96.73%
ESPRESSO 22,860.00 3,149,094.50 0.71% 97.44%
VANILLA 20,171.25 3,169,265.75 0.62% 98.06%
 Iced Signature
16,087.50 3,185,353.25 0.50% 98.56%
Chocolate
Espresso Macchiato 14,220.00 3,199,573.25 0.44% 99.00%
Sagada 11,812.50 3,211,385.75 0.37% 99.36%
Tropical Breeze Tea 9,678.75 3,221,064.50 0.30% 99.66%
Benguet 4,218.75 3,225,283.25 0.13% 99.79%
Mt. Apo 3,750.00 3,229,033.25 0.12% 99.91%
Kitanglad 2,906.25 3,231,939.50 0.09% 100.00%
Table 4 Pareto Analysis for Beverage

Based on the Pareto Analysis for beverage, Bos Coffee should focus on improving and increasing
beverage sales of the following products:
Caffe Americano
Drip Coffee
Caffe Latte
Cappuccino
Mocha
White Chocolate Mocha
White Chocolate Mocha (Fp)
Caramel Latte
Coffee Jelly
Caramelo
Matcha Green Tea
Tea Bag
Hot Signature Chocolate
Choco Chip
Crumble
Food
CUMMULATIVE CUMMULATIVE
FOOD GROSS PROFIT PERCENTAGE
GROSS PROFIT PERCENTAGE
Carrot Bar 60,243.75 60,243.75 8.35% 8.35%

Spanish Sardines 55,916.25 116,160.00 7.75% 16.10%

Dolce De Leche 51,068.25 167,228.25 7.08% 23.18%

Bolognese 39,405.00 206,633.25 5.46% 28.64%

Revel Bars 38,643.75 245,277.00 5.36% 33.99%

New York
35,952.00 281,229.00 4.98% 38.98%
Cheesecake (Sf)
Carrot Oatmeal
35,614.50 316,843.50 4.94% 43.91%
Raisins Muffin
Bacon Pesto 34,807.50 351,651.00 4.82% 48.74%
Super Moist Choco
34,521.00 386,172.00 4.78% 53.52%
Cake
Farmhouse Melt 32,681.25 418,853.25 4.53% 58.05%

Oreo Cheesecake 28,480.50 447,333.75 3.95% 62.00%

Mango Cheesecake 28,383.00 475,716.75 3.93% 65.93%

Choco Banana
27,843.75 503,560.50 3.86% 69.79%
Muffin
Carbonara 27,750.00 531,310.50 3.85% 73.64%

Food For The Gods 27,036.00 558,346.50 3.75% 77.38%

Fudge Brownies 23,790.00 582,136.50 3.30% 80.68%

Ham & Egg 21,971.25 604,107.75 3.05% 83.72%

Mallow Fudge
18,218.25 622,326.00 2.52% 86.25%
Brownies
Sausage & Egg 13,781.25 636,107.25 1.91% 88.16%
Blueberry
13,633.50 649,740.75 1.89% 90.05%
Calamansi Streussel
Pulled Pork Adobo 13,241.25 662,982.00 1.84% 91.88%

Spam & Egg 12,858.75 675,840.75 1.78% 93.67%

Butter Scotch 10,957.50 686,798.25 1.52% 95.18%

Blueberry
10,112.25 696,910.50 1.40% 96.59%
Cheesecake
Strawberry
9,216.75 706,127.25 1.28% 97.86%
Cheesecake
Bar Nuts 8,012.25 714,139.50 1.11% 98.97%
Classic NY
3,768.75 717,908.25 0.52% 99.50%
Cheesecake
Baked Macaroni
3,633.75 721,542.00 0.50% 100.00%
Melt
Table 5 Pareto Analysis for Food
Based on the Pareto Analysis for food, Bos Coffee should focus on improving and increasing food
sales of the following products:
Carrot Bar
Spanish Sardines
Dolce De Leche
Bolognese
Revel Bars
New York Cheesecake (Sf)
Carrot Oatmeal Raisins Muffin
Bacon Pesto
Super Moist Choco Cake
Farmhouse Melt
Oreo Cheesecake
Mango Cheesecake
Choco Banana Muffin
Carbonara
Food For The Gods
Fudge Brownies
Beverage and Food Pareto
CUMMULATIVE CUMMULATIVE
ITEM GROSS PROFIT PERCENTAGE
GROSS PROFIT PERCENTAGE
Caffe Americano 492,986.25 492,986.25 12.47% 12.47%

Drip Coffee 474,172.50 967,158.75 11.99% 24.46%

Caffe Latte 350,175.00 1,317,333.75 8.86% 33.32%

Cappuccino 279,335.00 1,596,668.75 7.07% 40.39%

Mocha 226,215.00 1,822,883.75 5.72% 46.11%

White Chocolate
145,987.50 1,968,871.25 3.69% 49.80%
Mocha
White Chocolate
130,702.50 2,099,573.75 3.31% 53.11%
Mocha (FP)
Caramel latte 94,627.50 2,194,201.25 2.39% 55.50%

Coffee Jelly 91,713.75 2,285,915.00 2.32% 57.82%

Caramelo 78,705.00 2,364,620.00 1.99% 59.81%

Carrot Bar 60,243.75 2,424,863.75 1.52% 61.33%

Matcha Green Tea 58,691.25 2,483,555.00 1.48% 62.82%

Tea Bag 56,062.50 2,539,617.50 1.42% 64.24%

Spansish Sardines 55,916.25 2,595,533.75 1.41% 65.65%

Hot Signature
53,437.50 2,648,971.25 1.35% 67.00%
Chocolate
Choco Chip 52,290.00 2,701,261.25 1.32% 68.33%

Crumble 51,877.50 2,753,138.75 1.31% 69.64%

Cookies n' Cream
51,450.00 2,804,588.75 1.30% 70.94%
(FP)
Dolce de Leche 51,068.25 2,855,657.00 1.29% 72.23%

Cookies n' Cream 48,322.50 2,903,979.50 1.22% 73.45%

Apple Chia Black
44,756.25 2,948,735.75 1.13% 74.59%
Tea
Mixed Berry 42,873.75 2,991,609.50 1.08% 75.67%

Strawberry 41,208.75 3,032,818.25 1.04% 76.71%

Matutum 41,062.50 3,073,880.75 1.04% 77.75%

Bolognese 39,405.00 3,113,285.75 1.00% 78.75%

 Revel Bars 38,643.75 3,151,929.50 0.98% 79.73%

Artisinal Chocolate 38,138.25 3,190,067.75 0.96% 80.69%

New York
35,952.00 3,226,019.75 0.91% 81.60%
Cheesecake (SF)
Carrot Oatmeal
35,614.50 3,261,634.25 0.90% 82.50%
Raisins Muffin
Bacon Pesto 34,807.50 3,296,441.75 0.88% 83.38%

Mango 34,800.00 3,331,241.75 0.88% 84.26%

Super Moist Choco
34,521.00 3,365,762.75 0.87% 85.13%
Cake
Matcha Green Tea
33,750.00 3,399,512.75 0.85% 85.99%
Latte
Farmhouse Melt 32,681.25 3,432,194.00 0.83% 86.81%

Bai Nature Spring 31,466.25 3,463,660.25 0.80% 87.61%

Peach Mangga
29,812.50 3,493,472.75 0.75% 88.36%
Berry
Oreo Cheesecake 28,480.50 3,521,953.25 0.72% 89.08%

Mango Cheesecake 28,383.00 3,550,336.25 0.72% 89.80%

Choco Banana
27,843.75 3,578,180.00 0.70% 90.51%
Muffin
Carbonara 27,750.00 3,605,930.00 0.70% 91.21%

Food for the Gods 27,036.00 3,632,966.00 0.68% 91.89%

Cold White Brew 26,325.00 3,659,291.00 0.67% 92.56%

Loose leaf Tea 25,290.00 3,684,581.00 0.64% 93.20%

Fudge Brownies 23,790.00 3,708,371.00 0.60% 93.80%

Espresso 22,860.00 3,731,231.00 0.58% 94.38%

Ham & Egg 21,971.25 3,753,202.25 0.56% 94.93%

Vanilla 20,171.25 3,773,373.50 0.51% 95.44%

Mallow Fudge
18,218.25 3,791,591.75 0.46% 95.91%
Brownies
Iced Signature
16,087.50 3,807,679.25 0.41% 96.31%
Chocolate
Espresso Macchiato 14,220.00 3,821,899.25 0.36% 96.67%

Sausage & Egg 13,781.25 3,835,680.50 0.35% 97.02%

Blueberry
13,633.50 3,849,314.00 0.34% 97.37%
Calamansi Streussel
Pulled Pork Adobo 13,241.25 3,862,555.25 0.33% 97.70%

Spam & Egg 12,858.75 3,875,414.00 0.33% 98.03%

Sagada 11,812.50 3,887,226.50 0.30% 98.32%

Butter Scotch 10,957.50 3,898,184.00 0.28% 98.60%

Blueberry
10,112.25 3,908,296.25 0.26% 98.86%
Cheesecake
Tropical Breeze tea 9,678.75 3,917,975.00 0.24% 99.10%
Strawberry
9,216.75 3,927,191.75 0.23% 99.34%
Cheesecake
Bar Nuts 8,012.25 3,935,204.00 0.20% 99.54%

Benguet 4,218.75 3,939,422.75 0.11% 99.64%

Classic NY
3,768.75 3,943,191.50 0.10% 99.74%
Cheesecake
Mt. Apo 3,750.00 3,946,941.50 0.09% 99.83%
Baked Macaroni
3,633.75 3,950,575.25 0.09% 99.93%
Melt
Kitanglad 2,906.25 3,953,481.50 0.07% 100.00%
Table 6 Pareto Analysis for Beverage and Menu
Based on the Pareto Analysis for beverage and food, Bos Coffee should focus on improving and
increasing their sales of the following products:
Caffe Americano
Drip Coffee
Caffe Latte
Cappuccino
Mocha
White Chocolate Mocha
White Chocolate Mocha (FP)
Caramel latte
Coffee Jelly
Caramelo
Carrot Bar
Matcha Green Tea
Tea Bag
Spanish Sardines
Hot Signature Chocolate
Choco Chip
Crumble
Cookies n' Cream (FP)
Dolce de Leche
Cookies n' Cream
Apple Chia Black Tea
Mixed Berry
Strawberry
Matutum
Bolognese
Revel Bars
Artisinal Chocolate
 REVIEW OF RELATED LITERATURE

Consumer Behavior Towards Coffee Shop

He, Wang and Xus (2013) study attempted to discuss consumer behavior towards coffee
shops. It is said that the following aspects affect customer retention. (1) accessible and comfortable
environment, (2) product quality, (3) service quality, (4) for students and unemployed, price is also
considered.
There have been 422 respondents in the survey designed to identify factors resulting to
customer loyalty and customer satisfaction. The results include the following. (1) 88%of the
respondents answered that they go to coffee shops to meet friends, (2) 49% of them go to coffee
shops to relax, (3) 83% of them signifies importance of being in a comfortable facility, (4) 36% of
them expected staff to be respectful, and (5) 93% of them would recommend certain coffee shop
to their friends and family.

According to Jeon (2015) shops offering Wi-Fi has become a means of increasing
customer retention and loyalty. Specifically, the pressure has trickled down to restaurants as
customers' demand Wi-Fi is increasing. It is also said that customers use and prefer WiFi service
more in coffee shops than restaurants.

Discounts and Coupons

As for Pearson (2017), a survey indicates that roughly 80% of the respondents would be
influenced in purchasing a brand which consumers would not typically buy. Often, habitual coupon
users prefer to buy products with a coupon even if it means spending more money. A study by
Psychology Today, which is cited by Pearson, an instance is that, shopper would prefer to spend a
$4.29 for a six-pack yogurt, after applying a 50-cent coupon than paying 3.99 for the same yogurt
at the same store during a different week. It is also said that by choosing a purchase that require
savings, consumers feel that they control over the discount, which leads them to feel like they are
smart shoppers. A study on The Impact of Online Coupons and Promotion, published by Forrester
Research (2011), identified the following. (1) Online coupons and promotion generate new users
and increase overall spending, and (2) customers using coupons spend more money and make more
purchase.
Marketing Strategy
A research team in HandGround, identified 6 coffee shop marketing strategy. (1) Make
your store appealing to people passing by. In a they survey conducted, 34% of the respondents
said that it is through seeing the physical location that they discover coffee shops, 28% is through
word of mouth, and the rest is discovered online (Google, Facebook, Online Ad etc.). Neglecting
the storefront could mean missed opportunities for coffee shops to catch the potential new
customer wandering by. Signage is also important to direct people to coming to your shop. (2)
Word of mouth as marketing. It was stated that coffee shop experts and professionals have agreed
with the survey result of 34% saying that word of mouth marketing is an important part of earning
new customers. Another way is by offering free drinks for friend recommendations. (3) Entering
social media community. Aside from Facebook and Instagram, they could also advertise through
Youtube and Snapchat. Consistency in posting and sharing online is also a must. It was said that
Just as customers expect excellent drinks every time they enter a shop, they expect a consistent
flow of content from coffee shops online as well. (4) Engaging in community outreach. A shop
may either bring an event into their stores, or it would go into neighborhood. (5) Having positive
reviews. In the same study by the HandGround Team, it was stated that through the Barista
Magazine survey, they found that sites like Yelp and Google are the third most popular way
customers discover new shops. Tendency is that shops with numerous positive reviews tend to
show up first in Google Searches. Some WiFi services direct users to a website page of a shop,
this is an opportunity to make a customer leave a review on your page. (6) Paying for
advertisements and discount. Even though there are new ways to attract customers, these ways still
work. An employee may distribute coupons to people passing by. One way is also creating an
advertisement that moves. These include, shirts, stickers and travel mugs. Furthermore, to measure
the effectiveness of this method, offer a discount on drinks whenever a customer comes into your
shop wearing that shirt. A shop may also give discounts to people sharing their posts on social
media.
WHY-WHY ANALYSIS

It is located at level 1 of
It is not near the
the mall, while mall
entrance/exit doors
entrance is at level 2

11.34% Below People only pass by that area (East
Target 40% Compared to East Wing area primarily
Wing) usually because they need
consists of gadget stores
Operating Profit the other to gadget stores
Margin of Bos branches, its
Coffee Robinsons traffic rate is
Galleria for the lower Potential Other coffee Seeing the
Coffee shops
Year 2016 Only regular customers do shops are located physical
usually
customers tend to not know a at a different location
should be
know the location coffee shop level (level 2) attracts
easily
of Bo's Coffee exists in that near mall customer to a
accessed
area entrance shop



Figure 2 Why-Why Analysis

HOW-HOW ANALYSIS

Provide a card, wherein if he receives

Make them earn moving
certain amount of stamps/signatures
advertisement such as shirts and
Make regular customers from Bo's Coffee, he would receive a
travel mugs
recommend their friends and free shirt or travel mug
families to go and purchase at
this store Instruct them that if a recommended friend/family
of him/her purchases, he would get a free small
drink on his next visit.
Promote store through
Use Digital
different search engines'
Marketing
paid space ads
Make people Increase the number of likes and
who haven't Apply and pay for page boosters
viewers in the Facebook page
Attract entered the
customers by mall aware Require customer ,
that Bo's Upon having access
letting them see to make atleast one
Coffee has a Increase on the WiFi service,
the physical Increase review about the
shop in that positive it will automatically
store of Bo's traffic rate of Use social service provided by
Bo's Coffee mall reviews on lead to the store
Coffee media as the store branch in a
social media branch's Facebook
Robinsons platform for Facebook Page or
Page
Galleria advertising any
Make a Inform them that
person share he/she would receive a
a post on the free drink or discount
different upon sharing into
social media different social media
platforms platforms
Make people who
are in the mall Lead customers Place signages on walls from mall entrance
aware that there is to the store leading to the Bo's Coffee store
a Bo's Coffee Have an employee distribute discount
shop and where is Offer them
coupons in the different entrances
its location discount coupons
when the store is not busy

Figure 3 How-How Analysis

SERVICE QUALITY METRICS

Expectation 1: Customer expects fast WiFi connection

Quality of Service Quality of Experience Quality of Business

Perceived WiFi speed by the Perceived WiFi Speed by every Revenue earned per transaction
customer is delivered as
shop is delivered as advertised
advertised
by the WiFi Service provider Consistent WiFi speed

Table 7 Service Quality Metric 1

Expectation 2: Customer expects the service to be delivered on time

Quality of Service Quality of Experience Quality of Business

Number of instances wherein Number of customers who Revenue earned per
were served on time is equal to
baristas complied to standard transaction
the total number of customers
process from order taking to
serving the order is equal to
total number of orders
Table 8 Service Quality Metric 2
CONCLUSION

Bos Coffee is one of the leading coffee shops here in the Philippines. As it continues to
improve financial growth and stability, by increasing the number customers and transactions, it is
also set that every branch, except in the airports, are bound to hit or exceed 40% Operating Profit
Margin. Even though Bos Coffee Robinsons Galleria branch has regular customers, its number is
not enough to hit the target every month. In the year 2016, the branch was 11.34% below the target.
In this study, the researcher used different analytical tools to determine the underlying cause as to
why the branch did not hit the target, and to provide ways for this branch to be able to meet the set
Operating Profit Margin.

Based on the researchers Why-Why Analysis, the root cause why this branch of Bos
Coffee did not meet the target, is because potential customers do not see the physical store. The
customer tends to go inside the shop whenever he/she sees the physical store as per HandGrounds
Research Team. Furthermore, according to He, Wang & Xu (2013), 88% of the respondents go to
coffee shops to meet their family and friends. These statements may be considered to improve
Bos Coffee traffic rate.

To provide possible solutions for the challenge Bos Coffee Robinsons Galleria encounters,
How-How Analysis is used in this paper. The following are the ways to attract customers into
going to Bos Coffee. (1) Make regular customers encourage their friends and family to visit and
purchase at this branch, by wearing t-shirts and sing mugs in their homes that are all souvenir items
from Bos Coffee. These items may be earned by collecting specific number of stamps in their
loyalty cards, which are given to regular customers. (2) Increase traffic rate by means of digital
marketing, social media, discount coupons and mall signage that lead towards the store.
RECOMMENDATION

To further improve the services of Bos coffee, the researcher used Service Quality Metrics
to determine if customers expectations toward a coffee shop is being met by Bos Coffee.
Customers expect that a coffee shop should have a fast and stable WiFi connection. This may be
a reason why should Bos Coffee upgrade its WiFi speed connection. Evaluation of employees
performances and customer survey may be used to determine if their services are delivered as
promised.

COST-BENEFIT ANALYSIS

30-day Promo
Discounts applies to the following products only and within promo period:
Pour Over and French Press: Sagada, Benguet, Kitanglad, Mt. Apo, and Matutum

COST TOTAL COST DETAILS BENEFIT

PhP 40.00 / day PhP 1,200.00 4 to 15 likes / Day = Increase awareness
120 to 450 likes/month of the store,
in Bos Coffee promotions and
Robinsons Galleria products
Facebook Page
PhP 5.50 / card PhP 550.00 100 pieces of loyalty Customer retention
cards and referral
PhP 1.75 / flyer PhP 17,500.00 10,000 pieces of flyers Increase of 10,000
with 10% discount pax who knows
coupons attached Bos Coffee is
located at Level 1
PhP 12.50 / drink PhP 125,000.00 Total discount applied Gross sales
amounting to PhP
812,500
PhP 144,250.00 Total Promotion Cost

Applying the Pareto Law of 20%/80% rule:

Out of 10,000 flyers distributed, 2000 pax will avail the promo.

Computation:
Promo Item cost PhP 125.00
Less:
Discount 12.50
Variable Cost 31.25
Gross Margin/Item 81.25

2,000 Pax Availed:

Gross Sales 162,500.00
Less:
Discount 25,000.00
Gross Profit 37,500.00

REFERENCES

Forrester Research. (2011). The Impact of Online Coupons and Promotion.

Retrieved from: http://i.whalesharkmediacdn.com/site/pr/the-impact-of-online-coupons-and-
promotional-codes-sep2011.pdf

He, B., Wang S., Xu , J. (2013). Customer Loyalty to Coffee Shops: A study of Swedish
Generation Y.
Retrieved from: https://mdh.diva-portal.org/smash/get/diva2:628355/FULLTEXT01.pdf

Pearso, B. (2017). Whats the Secret to a Successful Coffee Shop. Retrieved from:
https://www.forbes.com/sites/quora/2012/12/20/whats-the-secret-to-a-successful-coffee-shop/

Team HandGround. (2017). 6 Coffee Shop Marketing Strategies That Cost Less Than $100 A
Month. Retrieved from: https://handground.com/grind/6-coffee-shop-marketing-strategies-that-
cost-less-than-100-a-month

Jeon, J. (2015). Examining How Wi-Fi A ects Customers Loyalty at Different Restaurants: An
Examination from South Korea
Retrieved from: http://digitalcommons.fiu.edu/cgi/viewcontent.cgi?article=3149&context=etd