Small Business Critical Thinking Taks

Small Business Critical Thinking Task

Civics SOL Review

Background

Welcome to Ten Forward, a quirky, Star Trek–themed coffee shop located in a busy city center. With decor inspired by starships, baristas dressed as Starfleet officers, and drinks like the “Captain’s Brew” and “Warp-Core-Breach Cold Brew,” the café quickly became a local favorite.

The owner, Guinan Quark, started the shop with a love for sci-fi and a passion for quality coffee. But as the real-world economy has shifted over the last few years, Guinan’s business has gone through some tough changes. Now, she needs your help to figure out how economic forces are affecting her shop—and what she can do about it.

Economic Concepts to consider:

• Supply and Demand

• Profit

• Competition and Market Structure

• Consumer Sovereignty

• Global Trade

• Entrepreneurship

• Government Agencies

Year 1

Trouble on the Farm

A coffee plant blight severely damaged crops in Central America, limiting supply and raising prices for green coffee beans.

• Guinan paid more for beans but didn’t raise prices.

• Customers noticed the taste change from using a backup supplier.

• Profits dropped.

Open Ended

How did the blight affect the supply of coffee, and what impact did that have on prices and Guinan’s profits? What could Guinan have done differently to respond to this scarcity?

Year 2

Trade Opens Up

A new U.S. trade agreement with Colombia lowered tariffs and increased access to high-quality beans.

• Guinan found a new supplier with better prices and quality.

• She launched a new drink and saw customers return.

• Profit margins improved.

Open Ended

How did the new trade agreement benefit Guinan’s business? What are some advantages and potential risks of relying on international suppliers for key ingredients?

Year 3

A Competitor Lands Nearby

A national coffee chain opened down the block.

• They offered mobile orders, rewards programs, and drive-thru service.

• Guinan lost customers who wanted convenience and cheaper prices.

• She launched a “Brew Local” campaign focused on quality and community, which helped a little.

Open Ended

How did the entrance of a large competitor change the market for coffee in Guinan’s area? What strategies could a small business use to stay competitive without directly matching the chain’s prices and technology?

Year 4

Public Pushback

The Environmental Protection Agency releases a study on the toxic effects of pesticides. A local activist group began protesting the use of pesticides in coffee farming.

• They claimed Guinan’s beans weren’t certified organic.

• Some customers stopped coming; others didn’t know what to believe.

• Switching to organic would cost 25% more.

Open Ended

Why might some consumers choose to stop supporting a business based on how its products are made? Should Guinan switch to organic coffee even if it raises his costs? Why or why not?

Open Ended

Imagine Guinan has asked you to create a plan for the future of her coffee shop. Using what you’ve learned about the U.S. economy, propose a plan with at least three action steps that help the shop:

Stay financially stable (control costs and maintain profits) and maintain or build customer loyalty (keep people coming back)

In your response, be sure to:

Explain how each action step addresses a specific challenge from the scenario

Use at least two economic concepts or terms:

Supply and Demand

Profit

Competition and Market Structure

Consumer Sovereignty

Global Trade

Entrepreneurship

Government Agency