How the Coffee Industry Minimizes costs
Also, Dunking’ introduced Iced Green Tea made with tea sourced from Rainforest’s Alliance Certified”* farms. In their 2012 CARS report, Dunking’ Donuts stated that they would continue to work with their partners, such as The Humane Society of the United States, to develop a plan by the end of 2014 to increase the percentage of cage free eggs and establish a timeline for eliminating gestation crates. Packaging: Dunking Brands remains committed to creating sustainable packaging solutions that will teeter their guests’ experience and reduce their environmental impact.
Dunk’s main criteria for their innovation of their foam cup is: keeping hands cool and coffee hot, is better for the environment. In 2013, the company announced that it is working to develop an alternative cup within the next 2-3 years. In the meantime, they launched a hot and cold reusable cup program, as well as an in-store foam cup- recycling program that they will work to expand to all their stores in the months ahead. Cataracts is seeking to minimize costs by working to shrink their environmental footprint. The company is working to reduce the waste that comes from their cups and increase recycling while promoting reusable cups.
In 2012, Cataracts introduced the Earthenware’s
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Cataracts often faces some roadblocks in the recycling department: the Cataracts locations operate in leased spaces; so recycling is dependent upon the landlords who control the waste collection or who decide to provide recycling. There are over 20,000 locations globally so the recycling conditions may vary from city to city and from store to store, making it a challenge for the company to implement efficient and effective recycling strategies. By 2012, Cataracts’ ultimate goal was to develop a wide range of recycling options for their paper and plastic cups.
Their strategies proved true in their cups in the U. S, Canada, and Germany. In 2013 Cataracts had a new goal in mind; to serve 5% of drinks sold in store in personal tumblers by 2015. The company struggled with their goal even though they offered a cheap reusable cup and a discount on personal tumblers. They are continuing to look at new ways to encourage customers to bring their own personal cups and help in the effort to reduce waste. In 2012, 1. 8 % of drinks were served in personal tumblers (35. Million drinks. ) In the year 2012, more than 1. Million pounds of paper from landfills were saved. 2013 saw an increase of 22 percent of drinks sold in personal tumblers, bringing the company now to 1. 84% (46. 9 million drinks). Cataracts quotes that, “Ultimately, it will be up to our customers who control whether or not we will achieve continued growth in the number of drinks served in reusable cups. ” Both Dunking’ Donuts and Cataracts are seeking to implement the cost minimization theory into their inputs.
Since I am measuring the tastes, preferences and opportunity costs that come along with coffee on the Demand end, I must analyze owe each company is choosing to cut costs with the addition of multiple constraints to their overall goals. When dealing the jazz coffee size, Cataracts has chosen to take a bigger leap in their corporate cost minimization and in their environmental footprint while Dunking’ has chosen to focus on long run sustainability. To minimize the cost of producing a quantity, a firm should choose a point that has the lowest cost.
They should also explore all feasible input combinations to find the cheapest one. The firm should produced at the rate of technical substitution is equal to the price ratio of the inputs. Both Dunking Donuts and Cataracts have chosen multiple constraints or goals for their companies. They are both seeking to minimize their costs while increasing their environmentally “green” goods. Cataracts has chosen to eliminate plastic waste by using post consumer recycled fibers for cups. Dunking has traveled down the path of sustainability since their desired changes may not lower costs immediately.
By choosing to promote sustainability, Dunking’ can now attract new customers who are on board with being “green”; here this perfect example as to how cost minimization will lead to profit minimization. Cataracts’ firm is choosing between paper and plastic and how they can cut costs while bettering the environment and saving trees. In 2006, they began offering a cup made with 10% post consumer recycled paper fiber. The introduction of their of post consumer content used in production; these adjustments correlate to a savings of nearly 100,000 trees a year.
The company has spent countless hours of labor and capital in ways to improve the company by working to decrease the material used in their packaging. Their new advancements in the “environmentally green world” have widen the market but ultimately, it will be up to their customers ho control whether or not they will achieve continued growth in the number of drinks served in reusable/recycled cups. Compared with Cataracts, Dunking Donuts has concentrated their cost minimization into three areas: climate and energy, sustainable sourcing, and packaging.
Dunking’ Donuts was able to determine where their restaurants and franchisees could reduce energy consumption, while also cutting back on utility costs. Dunking’ used their new their constraints to focus on cutting costs and making space. To accomplish their goals in big cities, such as New York, without forcing franchisers to pay outlandish monthly rental payments for a full-size store, the company decided that its outlets wouldn’t require the same spacious and attractive uniform layout of a Cataracts.
Dunking’ Donuts’ stores come in many shapes and sizes and have an entire design team dedicated to fitting their products into whatever space is available. While remaining flexible, Dunking’ can now attract costumers in all areas while simultaneously minimizing their costs and maximizing their profits. In 2013, Dunking Donuts’ invested their capital in research that would potentially lead hem to the use of cage-free eggs and gestation free pork. By doing this, the company is changing their MRS., substituting capital and research in order to have healthier food options.
Dunking explored all feasible input combinations to find the cheapest one. In doing so, Dunking Brands created sustainable packaging solutions that would hot, is better for the environment. To minimize the cost of producing a quantity of inputs, a firm should choose a point that has the lowest cost and in this case be environmentally acceptable; in 2013, the company announced that it was working to evolve an alternative cup within the next 2-3 years.