Our Daily Bread Co

20 Pages Posted: 21 Oct 2008

See all articles by Kamalini Ramdas

Kamalini Ramdas

London Business School - Department of Management Science and Operations

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Abstract

Our Daily Bread was a small boutique bakery producing a variety of daily and specialty breads. The company had excess capacity and was considering several options to increase revenues by entering the wholesale bread production business. The case allows students to perform process analysis in a multiproduct setting with seasonal demand and evaluate the impact on capacity, as well as the profitability of, potential wholesale orders. The case also enables analysis of the option to purchase new equipment. A teaching note and video supplement (OM-1018V) are available to registered faculty. The videos highlight the stages in bread making and provide a bird's-eye view of the entire operation.

Excerpt

UVA-OM-1018

OUR DAILY BREAD CO.

Alice and Dan Malcolm sat in their living room on a beautiful spring morning in April 2000, contemplating their next move. A large potential wholesale account had just refused the Malcolms' bid to deliver one-pound loaves of their Peasant White bread at $ 2.25 a loaf. The potential client, a food service organization affiliated with the University of Virginia (UVA) had countered that they could only pay $ 1.25 a loaf. The potential order was for two hundred loaves a week, with sixty loaves to be delivered each Tuesday and Thursday, and eighty loaves to be delivered each Saturday. Before responding to UVA's price, the Malcolms needed to check on their ability to handle such a large order.

Over the past six months, the Malcolms had enlisted the support of a consulting team from Opportunity Consultants, Inc., a nonprofit student organization at the Darden Business School, to review their business. This team had provided them with an analysis of their current situation and some recommendations on how to increase their sales and improve profitability. They needed to decide which of these ideas to implement, and how to deal with the possibility of a wholesale account with UVA.

History of Our Daily Bread

Neither of the Malcolms had backgrounds in bread making or the retail food industry when they started Our Daily Bread Co. (ODB) as a husband and wife team in 1997. He was trained as an artist and started his career as a painter in New York City. After abandoning his art career and spending a short time in sales, Dan dedicated the ten years prior to starting ODB to a career in the ministry in Virginia. Alice was similarly untrained in business or bread making, having spent a significant portion of her adult life raising their three sons and then more recently completing her master's degree in English literature.

. . .

Keywords: capacity analysis, cost analysis

Suggested Citation

Ramdas, Kamalini, Our Daily Bread Co. Darden Case No. UVA-OM-1018, Available at SSRN: https://ssrn.com/abstract=1282475 or http://dx.doi.org/10.2139/ssrn.1282475

Kamalini Ramdas (Contact Author)

London Business School - Department of Management Science and Operations ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

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