Green Mountain
After reviewing the information regarding Green Mountain Coffee Roasters, it would appear that they have achieved a tremendous amount of success over the previous years, although there is still room for improvement. Green Mountain Coffee Roasters were first to market with the introduction of their single-serve K-Cups, and looked to capitalize by creating a monopoly. This would allow extremely high prices and margins, but only so long as their patens held. A reliance on these patents to protect their revenue was relatively naïve, as many other companies looked to capitalize on single-serve coffee cups once it expired.
It also hurt GMCR when their growth began to slow. Not keeping up with expectations caused many investors to sell, hurting the overall business. During 2011, there was also a large amount of shares sold by insiders, which is also generally not desirable to other shareholders outside of the company.
With their increased growth in overall size and market share, they should have been achieving high economies of scale, but their capital expenditures were outgrowing the business. GMCR needed to find a more efficient way in terms of capital spending on their fixed assets in order to improve margins.
Another problem that was apparent was one involving the employees of the company. Revenue had been improperly recorded; causing reports to claim that business had been more successful than the reality. Much of this can be attributed to the hiring of many temporary workers and college interns. This implies that the company accountants are relatively inexperienced, and that there is a low retention rate. If GMCR were to hire more experienced workers and retain them, then problems such as miscalculations and bad reports can be avoided. By cutting corners, it ended up hurting them in the long run.
Perhaps the largest problem of all was that pertaining to the IT systems and inventory. Business analytics are a crucial part of any business