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Internal Control
Marketing Consultant: Priya Sethi
Setting Key Performance Indicators (KPI) for an operations team member. These need to be worked out
by the managers, preferably in consultation with employees.
KPIs are generally used by an organization in terms to evaluate their success and also the success of a
particular effort which an individual or they are doing.
It can be measured as per the role and responsibilities of each worker.
Time spent from order to delivery (3 5 minutes). Example: Speed service
Therefore, Coffee Connection may consider placing small affordable items near the counter or along the
shelves in the waiting line cause certain coffee shops having this strategies
Suggestions are supported by an article by Prof. Nandini Srivastava, Key Performance Indicators (KPI)
in Hospitality Industry: An Emphasis on Accommodation Business of 5 Star Hotels of National Capital
Region, Volume 2, Issue 1, 2016, International Journal of Research in Tourism and Hospitality (IJRTH).
A 2014 POPAI study reveals that 16% of impulse buyer are driven by display the
shopper saw while shopping.
Advertising insights group KDM says that win at the in-store purchase decision game,
merchandising displays are great bet.
This means having a good system of screening job applicants, selecting employees, and
providing employee orientation, on-the-job training, and periodic evaluation.
John must evaluate each and every barista. Should monitor their performance base on
punctuality to work, knowledge of the menu, especially the signature coffee, ability and
capabilities to approach guest based on the KPI.
Suggestions are supported by an article by Chad Halvorson on Is Your Coffee Shop Out of
Control
Organizations Chart
John
Staff 1
Manager
(Operation)
)
Supervisor
1
(Production
)
Staff 2
Staff 3
Supervisor
2
(Marketing)
Staff 4
Staff 5
Staff 6
Need to educate your staff about your coffees so they can explain them to your customers.
Make sure they watch The Passionate Harvest, the award-winning and definitive film that
chronicles coffee production from seed to cup. The film was written by world-renowned coffee
expert Kenneth David and directed by Bruce Milletto.
When you sell beans, your baristas need to understand more about coffee so they can
educate customers.
The credibility of your operation is at risk when a customer asks detailed questions about your
coffee beans and your baristas cant provide convincing answers.
5) Lack of cleanliness
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Every time customer would not prefer to call barista to clean up the table. The same situation
happened in Coffee Connection, no want clean up the table until the customer call up.
Must have a person-in-charge to monitor to clean up every table. Every customer should sit
down at a clean table. The table and chairs should be clean and there should be no food on
the floor around them.
Can monitor through CCTV or from door bell.
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The monitoring of customer satisfaction to continually check on the extent to which the
operation is meeting customer needs and achieving customer satisfaction.
John have to solicit customer feedback in order to stay on the right menu path. Request
feedback on social media and via comment cards.
Another method is a mystery shopper. However, you can have a different kind of mystery
shopper. What about a mystery shopper who sits in your shop and drinks a coffee. How long
would it take to pick up a conversation between other customers? People often discuss how
well they like the product and it's really not that hard to find out when you sit in a coffee shop
and drink a coffee. We are not saying that you should listen in to conversations or anything!
Suggestions are supported by an article on Can You Offer Me Any Starting Advice On
Setting Up A Coffee Shop
7) No hands-on management
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Communication between staff and management is virtue, it reflects the operation of coffee
shop as a whole. The interdependent of management on front line staff to approach clients,
customers is vital. There shouldn't be communication error between staff and management.
A good understanding of staff and relation with management plays major role in business,
they were in service industry, providing better hospitality to customer is very important.
With good communication established with your staff, they should feel able to talk to you
about any issues.
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Reasons to expand the menu is to sell costly F&B which can generates the maximum revenue.
In Coffea Coffee has the menu details and the bean origins. This will help the customer to know
the ingredients of each menu.
This will help the customer to make fast decision in ordering.
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15
So how come Coffee Connection selling coffee below market price which will not increase the
profits. Based on my surveys, most the coffee shops doesnt know how the process to set a
competitive price for each menu items.
Eliminate items that dont sell well, reducing your food costs.
Example:
Menu items
Menu 1
Menu 2
Menu item
Selling Price
Cost (RM)
(RM)
2.50
7.5
3
Ratio
2.0
2.0
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For example, if they have a bad year and need to increases prices to offset a poor crop they are
going to undoubtedly pass this cost onto you. Having more than one vendor, or at the very least
knowledge of more than one, gives you the flexibility to quickly shop around for the best price.
This set up allows you to monitor external variables and be a proactive buyer instead of a reactive
one. What this means is that weather patterns, seasonal ups and downs, supply chain anomalies
and more can ultimately affect the cost of your food and supplies.
Work hard to develop relationships with your vendors but make sure to be open and honest with
them that you have to balance quality and cost. This open communication will ensure that nothing
is taken as personal if other vendors are chosen from time to time.
Great quality food and drink requires great care and attention to detail in terms of sourcing and
supply. And never forget, in the early days at least, you need the great suppliers more than they
need you. Treat them well.
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Cash-control procedures should limit the number of people per shift who have access to a cash drawer and
should include regular counting of drawers between shifts.
Coffee Connection should reconcile their daily deposit reports and compare these reports to both what is
deposited in the bank and reports from the point of sale. They should also perform monthly bank reconciliations
timely and without fail, and the person preparing bank reconciliations should not be the individual making
deposits in the bank.
John should established a dual control system where you can took an inventory of cups and reconciled it to the
daily sales and quickly determined where the problems were. Reconciling cash to inventory is key in many cash
businesses.
A physical inventory stock count conducted monthly can then be compared to POS inventory reports.
Can use CCTV footage to investigate.
Suggestions are supported by an article by Chris Legler on Caf Finance: What You Need To Know To
Succeed