Eric Beardmore Brendan Bonner Kevin Leung Anne Marie Sullivan

Overview Problem StatementInternal/ External AnalysisAlternativesRecommendationRisk Analysis/ MitigationImplementation

Our Initiative We must determine how to grow efficiently given the seasonal demand by most optimally managing our inventory Problem Statement Smart Growth Model Data AnalysisQ- System Geographic Expansion

External Analysis Geographic Climate- seasonal weather changes Political India’s growing economy- social middle class Economic Growing cultural ice cream preference Social Greater data processing capability Technological Fund Direct Investment

SWOT Analysis Strengths Growth rate High quality/variety product Aim to educate consumers Product transportation Business structure- franchised Stores located close to warehouse Weaknesses Seasonal sales- manufacturing costs Quality ice cream= time & money Sells some flavors at a loss Take-out discontinued Display limitation 28 flavors Equally priced- production demand Threats Competition between organized & unorganized investments FDI bringing new competitors Currency fluctuation Instability of Rupee Opportunities Fund Direct Investment (FDI) Expansion to Mysore & Surathkal Convert Go Geddy  Just Sundae Franchise growth

Alternatives Alternatives & Criteria Smart Growth Model Target Service Level Policy Scaled Stocking Level Policy Common Service Level Target Level for Top Margin Capital Requirements --++ Service Level Profitability Seasonally Adjusted Inventory Waste+0000 Alignment to Core Competencies Total5311-2

Our Solution: Smart Growth Model Upgrade Data Processing Systems Implement a Q- System for Inventory Expand Geographically through Franchising

Upgrade Data Processing Transaction Processing System at Retail Locations Share Data in Real Time with Manufacturing Facility Use Data to Make Inventory Systems

Real Time Data Data SharingPeak Hours Market Research Monitor Performance Transaction Processing System Capital Spending Requirement 700,000 Rupee (Debt Financed)

Use Meteorological Forecasts Issue Link the our demand forecasting to 10 day weather forecasts Focus on three criteria: temperature, cloud cover, and precipitation Solution

Reduce Stock Outs Issue Send trucks when inventory levels are low rather then sending them each week Solution

Reduce Inventory Waste Issue Forecast Demand based on Historical Figures, Meteorological Forecasts, and Current Sales By Reducing Variance of Projected Demand we can reduce safety stocks Improve Cash Conversion Cycle Solution

Q-System (Continuous Review) Use Current Data in Real Time to Meet Demand Send Inventory to Retail Locations when needed Lower Inventory Waste and Increase Service Level

Transition ‘Go Geddy’s’ to ‘Just Sundaes’ format Implement TPS system Increase franchise ownership in Bangalore ~25% annually. Short Term Growth

Construct warehouses at strategic locations to foster growth. Expand facilities to support franchises outside of Bangalore Grow profitably to new markets. Long Term Growth

Geographic Expansion Manufacturing Campus Storage Warehouse Store Location

Financial Analysis Implementing Data Analysis System Net Present Value Increased Sales Decreased Inventory Costs Change in EBIT Decrease In NWC Requirements Capital Expenditures FCF Discount 15% Net Present Value

Risks and Mitigation Better receivable turnover ratio (franchises pay cash immediately) More prompt payment Continued focus on quality Expanding Too Rapidly Hedging to create fixed costs Ex. For the next year we will buy oranges at 5 rupees Fluctuation of Currency Backup controls in case of emergency Regular maintenance Technological Overreliance

Strategic Implementation Plan Q1Q1 Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4 Design TPS Test TPS Install new TPS system Convert all stores to Just Sundaes Transition to Q-system Open 15 New Stores (2014) Build New Warehouse Open 15 New Stores (2015) Open 15 New Stores (2016) Build New Warehouse Open 15 New Stores (2017) Build New Manufacturing Plant Implement Q-system Transition Store Model Open New Franchies Expand Capacity

Q & A

Appendix 1: Emergency Recovery Manually record sales transactions – Include type, amount, and method of payment Call in results to central production facility daily Continue distribution with Q-system

Appendix 2: Analysis of Inventory Systems Inventory System Profitability AverageStandardized Target Service Level Policy Scaled Stocking Level Policy Common Service Level Target Level for Top 3 Margin Target Level for Top 2 Margin Overall Averages: