Utopia IB Business Management Case Study May 2017
Business & Economics
March 8th, 2017 Last updated: December 8th, 2022
John sets up a holiday villa business on a Pacific Island. He also develops a locally sourced coffee business, with a coffee shop in a main tourist destination. He’s keen on a socially responsible business model. Both businesses grow and he invites his twins, son and daughter, to help with the coffee business.
Unfortunately, a storm wrecks most of the villas, which dents sales. He needs to raise funds to rebuild the villas. He uses internal sources again, rejecting external sources. Along with his children, he wants to expand the coffee business, though each child has a different perspective.
Click here for a list of business terms in the case study.
Sole owner of private limited company Utopia. Starts company around 2000. Grows company from 12 to 24 villas. Clear he is passionate about maintaining the culture of the local island and retaining local sources for suppliers. Ethically inspired decision-maker. He has a paternalistic approach to leadership. In 2006 opens café (JAC) in island’s capital, which in turn becomes a significant tourist attraction in islands. In 2011 hands over JAC operation to his twin children, Paul and Liza, to concentrate on Utopia. Not keen on outside investors when rebuilding the business after the natural disaster in 2016. Shows he wants the final say on all business decisions when considering growth options. Doesn’t want to compromise the vision or social responsibility. Realises that the company structure will need to change if they need to expand
Liza (probably around 26 years old)
JAC human resource and finance manager. An IB graduate. Entrepreneurial and visionary, thinks globally rather than locally for coffee brand. Wants to expand around the Pacific. Not so keen on Paul’s plan for souvenirs. Interested in exploring strategic alliances, joint ventures or franchising for JAC business.
Paul (probably around 26 years old)
JAC head of marketing and operations. An IB graduate. Well-travelled post-graduation. Has experience in coffee café culture, and more inspired by small, socially responsible chains than multi-nationals. Keen on product development and engaging with the local community. Interested in using 3D printers to produce Utopia branded souvenirs.
Key topics to explore
Business plans Reasons for devising a plan Reasons for changing a plan
Ethics Benefits and costs of being an ethical company
Social responsibility Benefits and costs of being socially responsible
Suppliers and supply chain Benefits and costs of using local suppliers – cost v convenience v relationships v social responsibility
Marketing Income elasticity of demand (HL) Price elasticity of demand (HL) Methods of promotion for both businesses Product development Market research Distribution channels Brand loyalty
Operations Technology – pros and cons of 3D printers JIT for food and coffee Quality control Capacity utilization
Business structure Private limited company v PLC
Finance Sources of finance – internal v external Gross profit margin, net profit margins Capital expenditure / investment appraisal
Human Resource Management Pros and cons of paternalistic style of management Organizational structures/charts Why organizational design is important as a business grows
External influences Exchange rates
Crisis management and contingency planning
Growth of a business Strategic alliances, joint ventures, franchising
Conflicts Possible conflict between Paul and Liza on direction of business Stakeholder conflicts – John avoids external finance – why
Dan - Available 10 hours per week
Dan was a successful head of Economics and Business Studies at Cranleigh School for eight years, where his students achieved top results year after year. Before that, he taught Economics at RGS Guildford, where the school's results were in the top 5 in the UK...
Dan - Available
Dan was a successful head of Economics and Business Studies at Cranleigh School for eight years, where his students achieved top results year after year. Before that, he taught Economics at RGS...
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