ENT Group Presentation

1. KaBloom Case
Laura Malis, Ting Ting Hu, Miku Anraku, Zahed
Faheem, Khanh Pham, and Kuangdi Xu

2. SWOT Analysis
Strengths:
● 3 different ways to purchase flowers: in stores, online, over the phone
● Appealing brand recognition
● Located in a high vehicle/foot traffic areas
● Well trained associates
● Store managers were service-oriented

3. Continued...
Weaknesses:
● Hartstein had no background in the florist industry
● Flaws in the flower distribution system
● Low employee morale
● Low cash inflow resulted in increased debt

4. Continued...
Opportunities:
● Franchising
● Went from 34 stores to over 100 stores in just two years
Threats
● With franchising comes slow path to high returns
● Debt

5. Success
how to define success
1.become the Starbucks of flowers
2.staunch the outflow money and make more profit
The advantages that we have can help us be success
1.have over 100 franchised operations
2.diversified selling ways
3.mature operation system

6. Success
The stone in front of the success road
1.Outflow Of Money
2.Distribution of flowers
3.New operation model problem

7. Categorize
Within control
● Bleeding cash
● Distribution of flowers
Out of control
● Decentralization

8. Stakeholders
Low Interest, High power:
Customer
Growers
Distributors
Retailers
broker/shipper
Importers
Foreign owners
Wholesaler
Mass market, supermarket, mart
High interest, high power:
Store managers and employees
Florists
Friend and family
Accountants, bookkeepers
Franchisees
Competitors
The federal Trade Commission

9. Define Criteria
Criterion:
- To centralize design, distribution, and expand the span of control.
- To departmentalize, or having a cross functional self-managed team.
- To hire a biologist or a botanical gardener
- To have more customer oriented
Important:
- employee turnover was high, decrease the payroll
- Giving employee time and place
- The flowers are shrinking
- Hartstein is targeting away from the quality and a customer oriented
service.

10. Financial Situation
● Expected to reach $15 million in 2000 in sales- only reached $8 million
● Reached goal of $15 million in 2001 (only had 34 stores)
● After franchising- expanded from 34 stores to 100 stores in 2005
● Issues with distribution caused inventory shrinkage of 15%
● Exceeding the estimated fixed cost per store by 40,000 (22.33% increase in
cost)
● Because the cost of labor is $130,000, the store would have to generate
sales of $520,000 to cover labor costs

11. Financial Suggestions
● Hire part/full time employees
● Cut down on hours
● Hire a franchise business consultant who
knows the floral industry