Should Sports Nutrition Superstore expand its capacity to produce fresh salads, granola, and other healthy options in the smoothie bar?
Rationale
Sports Nutrition Superstore is located in Newport Beach, California. It is locally owned and operated, so there is no corporate headquarters for the business. Currently, the company focuses mostly on selling athletic supplements; however, in recent months, the smoothie bar has become very popular in the store (Yelp, Sports Nutrition Superstore). The growing desire for healthy food options in the California beach culture may present this company with a unique opportunity to provide another potential healthy choice for a market desiring healthy food options (Johnston).
Theoretical Framework
The strengths of the Sports Nutrition Superstore are significant. The organization has a loyal local following, and a reputation for being the best supplement store in the area. It also has some of the best prices when compared to other similar stores (Sports Nutrition Superstore). However, the shop is also small and locally-owned, so it does not have the same advertising power that many of the larger supplement shops have. It also has limited space, so the owner must choose what supplements and services he provides wisely (Sports Nutrition Superstore, Yelp). The company has a unique opportunity to expand into the health food market and become part of a larger network of customers; supplements, of course, appeal usually to people who are invested in working out and remaining fit. Healthy food appeals to an entirely different and much larger subset of individuals within the general population. The biggest threats to the organization are competitors with more significant budgets and much wider name recognition; in addition, when supplements are recalled, the company faces a significant potential for loss as a result of those recalls.
Secondary Research
These key areas will be used to analyze the potential financial implications of making changes to the current paradigm at Sports Nutrition Superstore. The research will use qualitative and quantitative techniques to investigate each facet of the problem.
Financing. There are a number of potential sources for financing that this company can choose to explore. Perhaps most interestingly, Sports Nutrition Superstore could choose to outsource the food production to other local companies; this kind of partnership would cut down on the production and extra staff that would be necessary to run this new part of the organization.
Forecasting. It is likely that this would take some time to develop into a profitable enterprise, given that supplements are such a niche product (Yasmin). However, if the food is good, word will spread and the company will be able to recoup potential losses in the early stages.
Ratio Analysis. The type of ratio analysis needed for this particular problem is a profitability ration analysis; because this is a locally-owned, private business, the owner and employees are the primary stakeholders and there is no market analysis necessary.
Organization and Planning. Changing the services offered would be a serious undertaking for the organization, and planning will be a significant part of the development for the organization as a whole.
Works Cited
Johnston, Gene. "Food Trends: Consumers Want Healthy, Local Foods". N. p., 2016. Web. 23 Feb. 2016. http://www.agriculture.com/farm-management/food-trends-consumers-wt-healthy-local_298-ar52302
Sports Nutrition Superstore,. "Sports Nutrition Superstore - Simply Better". N. p., 2016. Web. 22 Feb. 2016. http://www.sportsnutritionsuperstore.com/
Yasmin, Seema,. "The Risky Business Of Dietary Supplements". N. p., 2013. Web. 23 Feb. 2016. http://www.dallasnews.com/opinion/sunday-commentary/20131129-the-risky-business-of-dietary-supplements.ece
Yelp,. "Will S.'S Review Of Sports Nutrition Superstore". N. p., 2016. Web. 22 Feb. 2016. http://www.yelp.com/biz/sports-nutrition-superstore-costa-mesa?hrid=sI6ZQM1NawY9Xk4FC-8Ziw&rh_type=phrase&rh_ident=ryan
