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Cold Stone Essay

789 words - 4 pages

Summary
Case 8.1
Heartache and Financial Failure
Introduction
When a business struggles financially, not only is its budget stressed but the people who own and operate the business are often stressed as well. That’s why it’s so important that a business practice prudent financial management.
Cold Stone Creamery
Cold Stone Creamery was founded in 1988 by Susan and Donald Sutherland. The couple liked ice cream that was neither hard-packed nor soft-serve, and opened the first Cold Stone Creamery in Tempe, in the U.S. state of Arizona. In 1995, Cold Stone opened its first franchise in Tucson, Arizona, and grew quickly through the late 1990s and early to mid-2000s. in June 2008, a Wall ...view middle of the document...

Emotional and Financial Toll
A web search will produce many articles and blog posts from former Cold Stone Creamery franchisees who talk about both the financial toll and the emotional toll that losing their Cold Stone franchise has imposed on their lives. The company argues that the ultimate success of an individual store depends on how well it’s operated.

Discussion Questions
1. Financial information that I’ll looking are: income statement, balance sheet, and cash flow. Income statement reflects the result of operations of a firm over a specified period of time. From here we can know this franchise making a profit or a loss in period of time. In balance sheet, we can know how liquid the firm is, this is a snapshot of a company asset which listed as their “liquidity”, liabilities in which they must be paid, and owner’s equity at a specific period of time. And cash flow show us firm’s cash position for a specified period of time and details why the changed occurred.
2. In my opinion, the franchisees in Cold Stone not well-read the market. In this case many Cold Stone franchisees invest when the company is strong, so, many people want to open the store. it make the Cold Stone franchise can be found in many place, even some stores is too close between each others. It make...

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