Business Observation Report
Business Observed: Don Macchiato’s Café
Observation Time: 30+ minutes
Location: Ozamiz City
Observer: Chennen Brigette O. Angelio
Date of Observation: April 21, 2025
I. Business Description and Observations
In Ozamiz City, there is a tiny café stall called Don Macchiato's. The constant flow of young customers
during the monitoring period indicates that it mostly serves students. The café has a loyal customer base
despite not being in a busy area, probably because of its reasonable prices and student-friendly
atmosphere.
Visible Capital Investments:
Coffee Machines and Equipment: The café has a visible espresso machine, blender, and other beverage
preparation tools behind the counter, suggesting a moderate level of capital investment in equipment.
Interior and Furniture: There’s no table and chairs for customers to dine.
Technology: A point-of-sale (POS) system is in use, likely for managing orders and inventory.
Branding/Signage: The signage is simple but clear, with the café name and a minimalist logo visible
from outside.
Location and Space Quality:
-The café occupies a small commercial space that fits about 10-15 customers at a time.
- It is not located in a high-foot-traffic area, but it is just a walking distance from Misamis University and
Lasalle University, which explains the high student turnout.
- The setup maximizes available space to accommodate more people in limited square footage.
Customer Traffic and Pricing:
- During the 30+ minutes of observation, multiple groups of students entered the café and bought coffee.
- The average purchase per customer ranged from ₱39-78, suggesting a low to mid-range pricing strategy
that’s very accessible to students.
II. Assumptions About Financial Elements
Interest:
Don Macchiato's probably needed funding of a sort to get started, whether in the form of a modest
business loan or the owner's personal investment. Monthly financial commitments would be impacted by
interest payments on any borrowed funds. If combined with consistent sales, the debt may be small due
to its small setup, enabling reasonable monthly payments.
Rent:
The rental price is probably less than those in busy commercial areas because of its tiny size and distance
from major thoroughfares and shopping centers. By doing this, the company is able to maintain low
overhead expenses and provide competitive prices without compromising profitability.
Profit:
The café sells reasonably priced goods to a large number of students, seemingly maintaining a
volume-based strategy to profit. They produce consistent sales by maintaining low prices. Sustainability
is ensured by steady foot traffic, even though profits per item may be minimal.
III. Reflection on Financial Elements in Business Decisions
This finding makes it clearly evident that financial choices like controlling loan interest, picking a prime
yet reasonably priced site, and establishing a long-term pricing strategy are all essential to the survival of
the business. Don Macchiato's has centered its business strategy on comfort, affordability, and reliable
service, suggesting that it understands its target market, which consists primarily of students.
By striking a balance between cost control (low rent and manageable debt) and customer appeal
(affordable pricing and student-centric branding), they have been able to operate in a less crowded area
while still drawing in a large number of customers. These financial strategies not only support day-to-day
operations but also influence long-term investment decisions, such as whether to expand, renovate, or add
new menu items.
In conclusion, Don Macchiato's is a fantastic illustration of a tiny business that makes strategic financial
choices to succeed in a specialized industry.
