– 3 –
Paul graduated from an IB school in Australia in 2008. He travelled worldwide to develop
his business and life skills. He spent time in Seattle working in a youth hostel and became
fascinated with Seattle’s coffee culture. Paul’s business thinking was inspired by a small
chain of coffee roasters and retailers that make signicant donations to charities with the
aim of eradicating human trafcking. Paul was not interested in a multinational coffee chain
headquartered in Seattle. At JAC, Paul is in charge of marketing and operations. He has a
special interest in product development and is constantly looking for ways to contribute to the
Liza is JAC’s human resource manager and is in charge of nance. She is entrepreneurial and
a visionary, and is frequently looking for new ways to expand the business. Unlike her father
and brother, Liza imagines business opportunities on more than a local level. Liza argues that,
given JAC’s considerable capacity for growth and brand loyalty, the business is not reaching its
full potential and not following its original business plan. She argues that JAC could enter many
coffee markets around the world.
In 2016, a natural disaster occurred on Ratu, damaging seven villas and destroying the
remaining seventeen. Although John’s customers could continue to rent the seven remaining
villas, Utopia experienced a sudden and substantial decrease in bookings. Later in that
nancial year, Utopia recorded its rst nancial loss in sixteen years. John decided to create
a crisis management plan and carry out contingency planning for cost, time, risks and safety.
Believing that businesses should nance internal growth from internal sources, John refused
offers of help to rebuild Utopia from external investors. Only internal sources of nance were
used. John believed that outside investors would interfere with his vision for Utopia and JAC.
Thinking of all his business interests (Utopia and JAC), John realized that he has to consider
new revenue streams. The natural disaster damaged Utopia’s positioning and threatened
its long-term viability. He has asked Liza and Paul for advice on future options for growth.
However, it was made clear that John would still decide on which option would be chosen and
that the vision and social responsibility of Utopia and JAC would not be compromised.
Paul is considering developing the brand of Utopia by selling customized souvenirs produced
by a three-dimensional (3D) printer. Improved internet connections and technology make the
expensive 3D printing process a possibility. The gross prot margins on these customized
souvenirs would be high, despite the xed costs of the equipment. In addition, gaining
experience with 3D printing might enable them to recognise and think about more opportunities
for its use throughout John’s businesses. Capital expenditure of $10 000 would be required to
set up this untested printing service. Liza, however, is concerned that some people will perceive
the souvenirs as inauthentic or cheap, which would devalue the Utopia brand.
Liza favours expansion through the sale of JAC coffee to other markets, initially the Pacic
islands of Fiji, Samoa and New Zealand. Her market research includes stratied sampling of
these three markets. The market research has indicated some prot potential in Fiji and Samoa
and considerable prots in New Zealand. A concern for Liza is the challenge of delivering coffee
beans from Aora to the three markets in a timely fashion so that the beans remain fresh (were
cafés to serve coffee brewed from unfresh beans, the reputation of JAC’s coffee could suffer).
JAC would also face many external factors in creating new distribution channels. Possible
approaches to selling in these new markets could be through a strategic alliance, a joint venture