...It was 2:00 a.m. and Paul Livoria sat in the corner stall of his restaurant staring out the window into the parking lot. His brother Sam was in the kitchen cleaning up after a very long day. Paul felt very restless, partially because of the seven cups of coffee he had had, but mostly because he was feeling very overwhelmed. He thought to himself, “Running these two restaurants shouldn’t be so complicated.” At age 46, maybe it was time for a change. The Birth of Livoria Sandwiches Inc. Brothers Paul and Sam Livoria founded Livoria Sandwiches Inc. as a Canadian Controlled Private Corporation (CCPC) in December 2001, but began operations in January 2002. Both brothers had worked for Link Motor Company in the City of Dawkins (a major city of 275 sq. km) in one of its manufacturing plants. Paul was a truck production supervisor and Sam was an automobile line worker. Unfortunately, in 2001, both brothers were laid off as there was a huge decline in the automotive sector. With the severance packages they received, Paul and Sam opened up their first store. Both of them have no formal business training and many decisions have been made through “trial and error.” After five years of positive growth, Paul and Sam decided to open up a second location in a high-traffic area in Zone 1 (five kilometres away from each other) in Dawkins. Below is a map of the city: © 2013 The Society of Management Accountants of Canada. All rights reserved. ®/TM Registered Trade-Marks/Trade-Marks are owned...
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...MODULE 1, ASSIGNMENT 3 August 2, 2011 Livoria Sandwiches Inc. It was 2:00 a.m. and Paul Livoria sat in the corner stall of his restaurant staring out the window into the parking lot. His brother Sam was in the kitchen cleaning up after a very long day. Paul felt very restless, partially because of the seven cups of coffee he had had, but mostly because he was feeling very overwhelmed. He thought to himself, “Running these two restaurants shouldn’t be so complicated.” At age 46, maybe it was time for a change. The Birth of Livoria Sandwiches Inc. Brothers Paul and Sam Livoria founded Livoria Sandwiches Inc. as a Canadian Controlled Private Corporation (CCPC) in December 2000, but began operations in January 2001. Both brothers had worked for Link Motor Company in the City of Dawkins (a major city of 275 sq. km) in one of its manufacturing plants. Paul was a truck production supervisor and Sam was an automobile line worker. Unfortunately, in 2000, both brothers were laid off as there was a huge decline in the automotive sector. With the severance packages they received, Paul and Sam opened up their first store. Both of them have no formal business training and many decisions have been made through “trial and error.” After five years of positive growth, Paul and Sam decided to open up a second location in a high-traffic area in Zone 1 (five kilometres away from each other) in Dawkins. Below is a map of the city: © 2011 The Society of Management Accountants of Canada. All...
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...Subject: Review of Strategies for Livoria Sandwich Inc. Fiscal Year 2013 – 2015 To: Paul and Same From: Des Cas, CMA Date: Dec 31st, 2012 Introduction This report gives recommendations to Paul and Sam, founders of Livoria Sandwiches (LS) Inc for fiscal 2013 to 2015. LS own two stores selling custom-made Italian sandwich in Dawkins. Vision statement is “Livoria will be the first choice of Dawkins residents who are seeking a variety of high- quality fresh sandwiches at reasonable prices.” Mission statement is “We are the highest-quality sandwich shop in Dawkins because of our legendary sandwich-making processes and our commitment to using the highest-quality ingredients.” Situational Analysis The following are facts important to LS analysis. * Paul and Sam aims for 1.1 Million Net Income in 2015. * LS maximum 6 employees. * LS must maintain $20,000 at the bank. * Must pass city quarterly health audit. * Paul purpose franchising alternative and highlighted eggplant sandwiches strong forecasted growth. * Sam purpose vegetarian menu expansion and highlighted strong vegetarian sandwich demand due to health concerns and customer’s concern over limited sandwich selection. * Key success factors are highlighted in LS vision and mission, which is making high-quality fresh sandwiches with highest-quality ingredients. * Tax at 20% payable on March 31 of the following year. Tax audit found $22,500 in payables due 2013. * Refer to Appendix 1...
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...Date : October 11, 2013 To : Brothers Sam and Paul Livoria From : Dev Das Subject : Strategic Review and Recommendations INTRODUCTION This report examines strategic alternatives that would help owners of Livoria Sandwiches Inc. gain competitive advantage in a growing market, achieve its profitability target and maintain its strong reputation of having a high quality and unique product in the industry. This report provides an analysis of the company’s current situation, identify strategic issues and analyze strategic alternatives. These also provide recommendations as to courses of actions the brothers should adopt to reach their goal, and proposed implementation plan. CURRENT SITUATION Stakeholders Preferences: * Go franchising (Paul) * Enhance vegetarian menu (Sam) * Preserve quality and control (Sam) * Realize $1.1M net income by 2015 (both Paul and Sam) *Avoid using line of credit (both Paul and Sam) Constraints: * Cash * One supplier of all store requirements/ingredients * Bank requires $20,000 minimum cash balance at any given time * Number of hours work * Working space Environmental Scan : SWOT Analysis Exhibit 1 Current Financial Assessment - Lowest profit of .29% compared to industry wide due to $500,000 contingent liability booked in 2012. Removing this extraordinary item would result to 24% operating income which is higher than Dawkins industry benchmark - 52.93% highest Contribution margin than industry average ...
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...Date : October 11, 2013 To : Brothers Sam and Paul Livoria From : Dev Das Subject : Strategic Review and Recommendations INTRODUCTION This report examines strategic alternatives that would help owners of Livoria Sandwiches Inc. gain competitive advantage in a growing market, achieve its profitability target and maintain its strong reputation of having a high quality and unique product in the industry. This report provides an analysis of the company’s current situation, identify strategic issues and analyze strategic alternatives. These also provide recommendations as to courses of actions the brothers should adopt to reach their goal, and proposed implementation plan. CURRENT SITUATION Stakeholders Preferences: * Go franchising (Paul) * Enhance vegetarian menu (Sam) * Preserve quality and control (Sam) * Realize $1.1M net income by 2015 (both Paul and Sam) *Avoid using line of credit (both Paul and Sam) Constraints: * Cash * One supplier of all store requirements/ingredients * Bank requires $20,000 minimum cash balance at any given time * Number of hours work * Working space Environmental Scan : SWOT Analysis Exhibit 1 Current Financial Assessment - Lowest profit of .29% compared to industry wide due to $500,000 contingent liability booked in 2012. Removing this extraordinary item would result to 24% operating income which is higher than Dawkins industry benchmark - 52.93% highest Contribution margin than industry average - High...
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...MODULE 1, ASSIGNMENT 3 September 12, 2013 Topics: Performance Management, Financial Management and Financial Reporting Overview In this assignment, candidates get a chance to apply all the steps except for steps 6 and 9 in the Steps for Approaching Business and Corporate Strategy to a small business case. As mentioned previously, these steps provide candidates with a systematic approach for addressing a case involving business-level strategic issues. Applying this approach effectively is one of the important competencies that candidates will learn in the CMA Canada Professional Programs. The starting point for solving a business problem is to analyze the current situation and identify the problems that need to be addressed. A major component of the situational analysis is to take a close look at the environments within which an organization finds itself. One of the methods commonly used in such an environmental analysis is “SWOT” (an acronym for Strengths, Weaknesses, Opportunities and Threats), which considers the strengths and weaknesses in the internal environment as well as the opportunities and threats in the external environment. Candidates can refer to the required reading Situational Analysis Tools mentioned below for more information on how to go about doing a SWOT analysis. The next major step is to identify the issues and analyze various alternatives for addressing the major issues. In this case, a shortage of available cash is a major issue and needs to be addressed...
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