Rotary Cove Essay

852 Words Jan 21st, 2012 4 Pages
Dexter Holman October 16, 2011 CBAD 478 Rotary Cove Beach: Practice Case Analysis Rotary Cove Beach, of Goderich, Ontario, is troubled due to not having direct revenue streams, which in turn causes the beach to lose money on a yearly basis. The YMCA acquired the Cove’s operations in 2003. More recent, the Goderich Town Council gave a $20,000 donation for operations, but the unprofitability of the Cove has caused the Council to reevaluate whether they should spend taxpayers money on a tanking beach. The branch manager, for the area YMCA, was forced into a mandating of a $370,000 net loss allowance. This mandate resulted in the YMCA trying to come up with ways the Cove could become profitable based on its’ present situation. Internally, there …show more content…
First, the competitors’ audience seems to be the adult crowd, which provides as an opportunity and suffering for the Cove. They are more family oriented and therefore less directly affected, but the adult night life seems to be more of a profitable success factor in the industry. This establishes there next threat which is the competition’s high vertical integration. The competition brings in a direct revenue stream from the nightlife around the beach. Also for the future of the industry, if the economy gets better tourists may want to go outside of public beaches and go to the private beaches in the industry. These external factors show the industry norms and how well the Cove is doing in the industry.

My first recommendation would be for YMCA to try and sell the company. My first reasoning behind this statement is that YMCA’s strategy is not aligned with what the task provides. YMCA has aims for providing recreation for lower class families, which would be impossible if the Cove expects to gain any profits. YMCA is not the correct organization for the profit success of that beach. Another reason for my reasoning was the low industry attractiveness. The growth potential for the industry is very low and the degrees of risk and uncertainty are high. This in itself is reasons to leave the industry but overall the profitability is low. Both reasons provide a solid motive to sell and get out of the industry. My next recommendation would be to raise money in the YMCA’s…