Recommendation to open a café in Monarch Books store The Board of Directors believe(s) that opening a café will increase the number of customers, thereby Monarch Books will be able to compete better with its rival – Regal Books. However, this argument relies on a series of unproven assumptions that should be checked before implementing such a decision. First of all, every market has its maximum capacity that is determined by the number of potential customers and their ability to pay. There is no clear evidence that Monarch books can attract significant amount of people who were not their customers before. For example, the area the bookstore is situated in may be not much populated. Attracting people with too low income is another possible consequence. Thus, the first question for examining is: how many new clients can Monarch books get and how much will revenue from them be if opening a café is truly successful? Secondly, the Board of Directors should remember about business efficiency of opening a cafe. This initiative may be rather costly: we are supposed to buy new equipment, to hire new personnel, to arrange cooking and so on. As it follows from the memo, Monarch Books have no experience in such projects, so far. Because of that, costs can be higher due to mistakes and need for additional training. In other words, the second question is connected to calculating: will revenue increase exceed costs of opening and operating a café. Thirdly, discontinuing the children's book section may have pernicious effect on volume of sales. On the one hand, decline in the percentage of the population under age ten and sales of children books have no close correlation. It is quite possible that in future parents will buy a greater number of books and/or books that are more expensive. On the other hand, according to the recommendation, wide selection of books on all subjects is the reason that Monarch Books has a large customer base. Therefore, we can assume that at least some customers prefer this bookstore because of its children books section. Summing up, the third question that need to be answered is: how will discontinuing the children's book section affect customers? If it causes considerable drop in sales, Monarch Books will not achieve the goal of opening a café. To conclude, the Board of Directors should examine consequences of opening a café more thoroughly. The questions mentioned above can help the Board of Directors to make weighted decision and avoid critical risks of this venture.