Taffe's Ice Land Essay

1002 words - 4 pages

Running Head: TAFFE'S ICE LAND IMPROVING PROFITABILITYTaffe's Ice Land Improving ProfitabilityTaffe's Ice Land Improving ProfitabilityIntroductionTy Taffe has been quite effective in creating his fortune through his business which he named as Taffe's Iceland. People have got very much attached with his style of business and what he brings to the table. Besides his Ice rink business he also runs a hockey program. Infact his hockey program was launched earlier than his Iceland business. Therefore he is able to get more money from his hockey venture than his Iceland. It is not all that same as he is able to get more profit sometimes but sometimes it is almost below his expectations (Perreault, McCarthy & Cannon, 2009).DiscussionTaffe's Ice Land Ty Taffe, the manager of Taffe's Ice Land, is trying to decide what strategies to use to increase profits. Taffe's Ice Land is an ice-skating rink with a conventional hockey rink surface (85 feet X 200 feet). It is the only indoor ice rink in a northern U~S. city of about 450,000. The city's recreation department operates some outdoor rinks in the winter, hut they don't offer regular ice skating programs because of weather variability.Ty runs a successful hockey program that is more than breaking even but this is about all he can expect if he only schedules hockey. To try to increase his profits, Ty is trying to expand and improve his public skating program. With such a program, he could have as many as 700 people in a public session, at one time, instead of limiting the use of the ice to 12 to 24 hockey players per hour (Perreault, McCarthy & Cannon, 2009). While the receipts from hockey can be as high as $200 an hour (plus concession sales), the receipts hum a two-hour public skating session - charging $5 per person - could yield up to $3,500 for a two-hour period (plus much higher concession sales). The potential revenue from such large public skating sessions could make Taffe's Ice Land a really profitable operation. But, unfortunately, just scheduling public sessions doesn't mean that a large number will come. In fact, only a few prime times seem likely: Friday and Saturday evenings and Saturday and Sunday afternoons.Ty has included 14 public skating sessions in his ice schedule, but so far they haven't attracted as many people as he hoped. In total, they only generate a little more revenue than if the times were sold for hockey use. Offsetting this extra revenue are extra costs. More staff people are needed to handle a public skating session - guards, a ticket seller, skate rental, and more concession help. So the net revenue from either use is about the same. He could cancel some of the less attractive public sessions-like the noon-time daily sessions, which have very low attendance - and make the average attendance figures look a lot better. But he feels that if he is going to offer public skating he must have a reasonable selection...

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