About An Underperforming Bakery Business That Karen Faulkner Runs

This case study has gave us the insight on an underperforming bakery business that is ran by Karen Faulkner, who is the only owner/entrepreneur. She just recently brought the bakery that lacked profitability due to pricing concerns. Since she purchased the bakery, she concluded that she has to turn it around by changing the prices that it currently has so that she can continuously make a profit in the future. The problem is not the quality of the food, because the bakery has better quality than the larger grocery chain and bread shops because their bread is bad.

Karen had decided to start by reducing the price of the bakery’s signature product, which is the honey wheat loaf. It was overpriced in 2002 due to the cost of production. (Hackert, Brookman, 2014)

Bakery Atmosphere

Karen’s bakery is known to have a bright, clean, and nice atmosphere. It is a local business that is centrally located in the heart of downtown. There is seating in the bakery as well as outside in front of the establishment on the sidewalk. The Artisan bread that they sell, is healthy with no preservatives and it has superior taste and texture. The well liked bakery foods taste of high quality from the premium products that they use.


The bakery community is classified as being medium in size with an average income that easily attracts its customer base. The primary reason that the business remains to have a stable economy is due to the lunch crowd. The frequent customers come from the nearby high school, businesses, and the local university who supports them greatly. Since it is centrally stationed, it contributes to the strong value of customers who are more than willing to pay more for better quality and their uniqueness.

Pros and Cons

A few of the pros are the frequent reevaluation of the variable costs which will give a better estimate. Making general trends about consumer wants, needs and interests, and changing the total costs can be most beneficial to the bakery. Having another type of bread and more variety can assist in increasing profits. Also, having accurate estimates on the total costs gives an even easier pricing method.

Some of the cons is that it can have more variable costs which makes it harder to estimate the coverage of commodities. No consideration to rapid fluctuation of prices and too large of a scale for a small business is a huge issue. Lowering costs is more difficult for small business which give them less power over supplies is a problem to consider. Another is that there is much competition from the local larger grocery chain and other bread shops. This leaves for there to be a heavy amount of competitive disadvantage for the bakery. Plus, it does not include financial goals or fixed costs such as the taxes and the electricity.


As a first solution, she have to suite the nature of the small business by not ignoring the aspect of mainly focusing on the quality of the bread, and what ingredients that could help in lowering the cost to make her money. Periodically, she can strategize a pit fall of assumptions of a contribution analysis that is negligible. As a second solution, she have to keep in mind that she cannot ignore the aspect of not considering the creative attraction of the bakery business. Lastly, operate from a break-even point to estimate: (Per Unit Production Cost) X (2 or 3) = Price which will allow the financial records to increase the cash flow of the bakery.


In conclusion, Karen should be focused on the qualitative pricing strategy aspect which should be focused on a small scale of the cost analysis by focusing on income before taxes. With a focus on covering costs by estimation, she should be able to lower any of her operating costs. The shifting relative price of the contribution margin: Price of Bread – Variable Cost = Income, Tax, Fixed Cost and the Profit Margin % = Income/Revenue is necessary in order for the business to stay alive.

Calculate the price
Make an order in advance and get the best price
Pages (550 words)
*Price with a welcome 15% discount applied.
Pro tip: If you want to save more money and pay the lowest price, you need to set a more extended deadline.
We know how difficult it is to be a student these days. That's why our prices are one of the most affordable on the market, and there are no hidden fees.

Instead, we offer bonuses, discounts, and free services to make your experience outstanding.
How it works
Receive a 100% original paper that will pass Turnitin from a top essay writing service
step 1
Upload your instructions
Fill out the order form and provide paper details. You can even attach screenshots or add additional instructions later. If something is not clear or missing, the writer will contact you for clarification.
Pro service tips
How to get the most out of your experience with MyhomeworkGeeks
One writer throughout the entire course
If you like the writer, you can hire them again. Just copy & paste their ID on the order form ("Preferred Writer's ID" field). This way, your vocabulary will be uniform, and the writer will be aware of your needs.
The same paper from different writers
You can order essay or any other work from two different writers to choose the best one or give another version to a friend. This can be done through the add-on "Same paper from another writer."
Copy of sources used by the writer
Our college essay writers work with ScienceDirect and other databases. They can send you articles or materials used in PDF or through screenshots. Just tick the "Copy of sources" field on the order form.
See why 20k+ students have chosen us as their sole writing assistance provider
Check out the latest reviews and opinions submitted by real customers worldwide and make an informed decision.
Business and administrative studies
Thank you
Customer 452773, March 19th, 2023
Business and administrative studies
looks good thank you
Customer 452773, March 3rd, 2023
thank you so much
Customer 452749, June 10th, 2021
Business and administrative studies
excellent job thank you Your Score 166.25/ 175- A 1. Current Culture 15% of total grade 18.37 Criterion "1. Current Culture" has textual feedback Criterion Feedback I see interesting points, though, in general they are not about the culture.
Customer 452773, June 4th, 2023
Social Work and Human Services
Although it took 2 revisions I am satisfied but I did receive it late because of that.
Customer 452603, March 25th, 2021
Leadership Studies
awesome work as always
Customer 452773, August 19th, 2023
Business and administrative studies
Excellent job
Customer 452773, March 9th, 2023
Leadership Studies
excellent job as always
Customer 452773, September 2nd, 2023
Human Resources Management (HRM)
excellent job
Customer 452773, June 25th, 2023
Leadership Studies
excellent job
Customer 452773, August 3rd, 2023
Business and administrative studies
Thank you for your hard work
Customer 452773, October 19th, 2023
Business and administrative studies
Customer 452773, March 3rd, 2023
Customer reviews in total
Current satisfaction rate
3 pages
Average paper length
Customers referred by a friend
15% OFF your first order
Use a coupon FIRST15 and enjoy expert help with any task at the most affordable price.
Claim my 15% OFF Order in Chat

Sometimes it is hard to do all the work on your own

Let us help you get a good grade on your paper. Get professional help and free up your time for more important courses. Let us handle your;

  • Dissertations and Thesis
  • Essays
  • All Assignments

  • Research papers
  • Terms Papers
  • Online Classes
Live ChatWhatsApp