Kaffeine The Nepalese Cafe Opportunity Case Solution

2. Problem Statement

The choice of the product that would be offered is the main issue. The choice needs to take the competition, target audience, and profitability into consideration.

3. Porter’s Five Forces 

i. Threat of new entrants

The threat of new entrants in the coffee industry is high because of the potential for growth. The growing popularity of Nepalese coffee is a factor that can attract many new entrants. 

ii. Threat of substitute products

Since coffee is a growing sector, the threat of substitute products such as tea is low. 

iii. Bargaining power of suppliers

The bargaining power of local suppliers is medium since locally grown Nepalese coffee is majorly exported; however, since the market is fragmented, quality and increasing quantity is an issue that reduces the power of local suppliers. The power of international suppliers is low because of the wide range of international suppliers available. 

iv. Bargaining power of buyers

The bargaining power of tourists and corporates is high since Himalayan Java coffee is a highly advertised spot. The bargaining power of students is low since they do not have options that provide affordable and quality coffee.