The primary purpose of Nats Sweets is to ensure that the customers of the company are satisfied with the Ice Cream products it offers. The company's current headquarters Breckenridge, Colorado. A study in the market shows that its sales and market share have reached a peak and are at a saturation point. There is also an increasing competition with many new ice-cream companies opening up shop in Colorado.
Georgia is a vast state that is home to many profitable businesses, and it should be the headquarters to Nats Sweets for the following reasons:
- It is home to companies like Coca-Cola among many other major companies. With these many companies, it means that there is a massive population of employees of these companies. These employees thence have a disposable income, which can go towards recreation facilities and products, including ice-creams; hence the company can take advantage of this.
- The minimum wage requirements in the states are favorable to returns on investments of the company. The minimum wage in the state is lower than the national average, hence making it an attractive investment area.
- Annual revenues are one of the considerations for the relocation, the relatively low sales tax in the state of Georgia is favorable to the company as well. With a low sales tax, prices charged can be low, hence optimizing sales, which in turn maximizes revenues.
Nats Sweets should adhere to several crucial recommendations when relocating the headquarters to Atlanta. First, the company should invest in delivery trucks to move large quantities of supplies needed in the ice-cream shops. An investment into the tracks to transport the inputs and some finished materials in large amounts will enable the company to benefit from economies of scope and economies of scale. It would then be able to offer reduced pricing. It should also invest in the purchase of ice-creams shops which have a strong brand and goodwill and have all the necessary equipment. Such an investment may at times mean buying an entire building, especially if it is still new, in good condition, and would not require much renovation.
Every company that grows steadily year by year reinvents and diversifies its products and services. The relocation to Atlanta should, therefore, have creativity and innovation at the core. The processes and in-store services should undergo constant reinvention to move with the demands of the customers. Also, the ice-cream products should be personalized, in a phenomenon known as "glocalization," whereby the products follow the general theme of the company but follow the needs and demand of the local people.
Purpose and Rationale of Relocation
Georgia is a state that suites businesses like Nats Sweets because many companies in the state are big businesses; hence, they also have many employees. Many people thence have relatively high disposable income, and there are sufficient amenities in all the major towns and neighborhoods. These working people, therefore, stay with their families. Ice Cream shops such as Nats Sweets would have enough customers consistently. Also, the state's government has set up favorable conditions that businesses can thrive extensively through sale tax returns and minimum wage requirements which positively impact the returns on investments of the company. Lastly, Georgia has been ranked seventh in the United States for having a good business environment.
The Criteria used to choose Atlanta as New Headquarters
Below is a description of the criteria used to select Atlanta, Georgia as the most appropriate relocation for Nats Sweets headquarters.
- Ability to optimize revenues due to the presence of favorable sales tax returns.
The state of Florida has a tax rate return of 6%, which Georgia has 4% (Cammenga 2020). The sales tax rate is a massive advantage for Nats Sweets since it will allow the business to retain more money through a reduction in tax returns. It will result in loans borrowed for expansion, reducing significantly as more money remains to service the loans. As the company continues to grow, a difference of 2% in sales rate can result in higher returns on investment of Nats Sweets. All these allow Nats Sweets to charge lower prices, thence optimizing on its revenues since price-sensitive customers are one of the target markets.
- Minimum Wage Requirements.
According to the U.S. Department of labor (2020), the labor requirements in the state of Georgia are lower on an hourly basis compared to Florida. Nats Sweets will enjoy better economies of scale in terms of labor as it grows gradually. Therefore, relocating the headquarters to Atlanta will ensure that the company access affordable labor in large numbers. According to the department of labor, the minimum hourly rate is $5.15, while Florida's is $8.56.
Acquiring the most appropriate location for setting up the headquarters is crucial since the growth and development of Nats Sweets depend on it. The decision is mainly for the following reasons:
- Existence of big businesses which means that there are many people with higher disposable income that can purchase products such as ice cream.
- Presence of favorable sales tax rates compared to Florida.
- The minimum wage requirement in Georgia will allow the company to hire more staff members at manageable costs at the new company headquarters.
Several recommendations should be considered by Nats Sweets to have a good transition when it relocates its headquarters to Georgia. First, the company should borrow a significant loan purchase delivery trucks, purchase buildings, and buy out small ice-creams shops which have a strong and attractive brand. Also, the top management employees from Florida should lead operations in the new headquarters to continue profitability in the new setting. As mentioned above, tax rate reliefs, favorable minimum wage requirements and the existence of a suitable business environment at Georgia will enable the company to grow even more.
Despite the expected prospects of the company as it ventures into a new world, few demerits need solving. First, setting up the headquarters in Atlanta can be very costly, and this is a move that will require heavy borrowing to finance the new project. However, every bold business move requires risk in the form of loans taken against the available collateral. Expansion and business growth are the natural and right thing to do; hence Nats Sweets should pursue this opportunity.
Guta, M. (2019). Best states to launch a start-up revealed. Small Business Trends. https://smallbiztrends.com/2018/07/best-state-to-start-a-small-business-2018.html
U.S. Department of Labor, Wage and Hour Division. (2020). State minimum wage laws. https://www.dol.gov/whd/minwage/america.html
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Paper Sample on Nats Sweets: Satisfying Customers & Reaching Peak Sales in Colorado. (2023, Sep 17). Retrieved from https://proessays.net/essays/paper-sample-on-nats-sweets-satisfying-customers-reaching-peak-sales-in-colorado
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