CASE STUDY

Cat & Joe’s Pig Rig: Should We Stay or Should We Go?

In Partial Fulfillment of the requirements of the Subject

ACC 223 - Strategic Business Analysis

Presented by:

EDMUND JOHN BALBOA

ELAIZEL A. BRIGOLE
FERNANDO DELA TORRE
JETRO HABEL
JINKY L. SANCOVER

Presented to:
Ms. Rosiela Alberca
(Instructor)

Date of Submission:
 March 22, 2021

TABLE OF CONTENTS

Executive Summary …………………………………………………………………

I. BACKGROUND: ISSUES AND CONCERNS …………………………..

II. STATEMENT OF THE PROBLEM …………………………………..

Point of View

III. OBJECTIVES …………………………………………………. .

IV. AREAS OF CONSIDERATION ………………………………………….

V. ALTERNATIVE COURSES OF ACTION …………………………………. .

VI. RECOMMENDATION ………………………………………………….

VII. PLAN OF ACTION ………………………………………………….

VIII. REFERENCE ………………………………………………….

I. BACKGROUND: ISSUES AND CONCERNS

Cat and Joe was an engaged couple who had been running their food truck, Cat & Joe’s
Pig Rig. They are expert in slow cooking meat. Business had been brisk, the truck was
outperforming projections, and their customer base was growing. They had also
supplemented their day-to-day business by attending local events and doing catering jobs.
They are the first pulled pork food truck in Kamloops, Canada. The couple had just
received a request to bring their truck to an event called “Bullarama”—a rodeo held in
the nearby town of Barriere. Bullarama is a charity rodeo, with 700 people attending
according to ticket sales. Cat and Joe by only serving the sandwiches that allow for a
lower cost to customers and a shorter lead time form order to delivery. Attending the
event would add an extra $100 in fuel costs for the truck, $ 100 for donation , and $30 to
take another vehicle to their fixed cost. The couple wonders if they should stay in
Kamloops or attend the event. The couple couldn’t be sure of what to do until they fully
analyzed the opportunity in attending to Bullarama Event.

II. STATEMENT OF THE PROBLEM

Cat and Joe said that "We don't need to say yes to every opportunity .Cat and Joe
speculated what would be the right things that they need to consider before accepting the
invitation to attend the Bullarama Events and what would be the impact of the said event
to their business.

Point of view

In this study, other factors such as opportunities, additional expenses, profits, additional

costs ,business threats were also considered whether Bullarama events is beneficial to the

business.
III. OBJECTIVES

Short-Range Objectives
 Strive to become known and recognized as one of the top food provider.
 Sales will be completely higher
 All startup costs will returned a year after

Long-Range Objectives
 Opening up another food truck

 Starting a sit-down restaurant

 To be popular food truck business & quality service
 Establish other business that is quite profitable a year after.
 Cat and Joe open other branches not only in Kamloops

IV. AREAS OF CONSIDERATION

Quantitative Considerations

 Margin of Safety for attending the Bullarama shows a risk with competitors.

Stay in Kamloops

Pessimistic Realistic Optimistic

$ 807.41 $ 1, 107.41 $ 1, 407.41

Attend Bullarama

No competitor 1 competitor 2 competitors

$ 1, 783.69 $ 685. 69 $ 316.69

Qualitative Considerations- Staying at Kamloops

Pros

 Focus on current customers

 Avoid additional travel costs

Cons

 Loss of opportunity to gain new customers

 Loss of opportunity to promote their products

Qualitative Considerations- Attend Bullarama

Pros

 Free marketing

 Future business opportunities

 Increase customer base

Cons

 May lose current Kamloops customers

 Overworking and additional expenses

 They would forgo one day’s revenues in their home market

 Uncertainty on how to setup their food truck at the event

 V. ALTERNATIVE COURSES OF ACTION

1. Cat and Joe will attend to Bullarama Event

2. Cat and Joe will operate a regular day in Kamloops

VI. RECOMMENDATION

Alternative course of action No. 2 appears effective. We made a recommendation that

Cat and Joe must stay to Kamloops for the day on their regular operation. There is a big

difference on their expected profit when they pursue to Bullarama events. In addition,

there is a great probability to have more than one onsite competitor and the probability of

the customers that will not accept their product is higher.

Contribution margin Income Statement for regular day in Kamloops:

Optimistic Realistic Pessimistic
Sales @ 12 per unit $ 1,500.00 $1200.00 $ 900.00
Variable Cost ( 40% on Sales) $ (600.00) $ (480.00) $ (360.00)
Contribution Margin $ 900.00 $ 720.00 $ 540.00
Fixed Costs ($ 10,000 per year, 180 days
Operational time $ (55.56) $ ( 55.56) $ (55.56)
Income before taxes $ 844.44 $ 664.44 $ 484.44
Taxes (20%) $ 168.89 $ 132.89 $ 96.89

Net Income $ 675.55 $ 531.55 $ 387.55

Contribution Margin Income Statement for Bullarama Event

Competitors No on-site 1 onsite 2 onsite
(245)
(123) (82)
Sales @ $9 per unit $ 2,205.00 $ 1,107.00 $ 738.00
Variable Cost ( $ 2.90 per unit) $ (710.50) $ (356.70) $ (237.80)
Contribution Margin $ 1,494.50 $ 750.30 $ 500.20
Less Fixed Cost
Fixed Costs ( $ 10,000 per year, 180 days
Operational time $ (55.56) $ (55.56) $ (55.56)
Donation $ (100.00) $ (100.00) $ (100.00)
Gas to the event $ (130.00) $ (130.00) $ (130.00)
Income before taxes $ 1,208.90 $ 464.74 $ 214.64
Taxes (20%) $ 241.79 $ 92.95 $ 42.93

Net Income $ 967.15 $ 371.79 $ 171.71

VII. PLAN OF ACTION

 Create/Offer other food choices on the menu

 Develop a new marketing strategy like traditional marketing ( e.g. flyers and
posters)
 Provide discounts and bundle offer
 Create a schedule route every day
 Start new goals for growth and profitability
 Hire staff to cater more valued customers

VIII. REFERENCE

Bell, T., & Fergus, A. (2014). Cat & Joe’s Pig Rig: Should We Stay or Should We Go?
Institute of Management Accountants. https://doi.org/10.4135/9781526426536