Working Capital Management of Yudron’s Delight – 'Everything is a New Delight'

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In the economy of production, manufacturing, tourism and micro business industries, the management of working capital is out most important to maximize the profit or sales of the business. The management of working capital is the managerial accounting strategy designed to monitor and utilize the two components of working capital, current assets, and current liabilities.

The Objective of Working Capital

Smooth operating cycle;
Lowest working capital requirement;
Minimize the rate of interest and cost of capital;
Optimal return on current assets investment.

Importance of Effective Working Capital Management

Ensures higher return on capital;
Improvement in credit profile & solvency;
Increase profitability;
Better liquidity;
Business value appreciation;
Most suitable financing terms;
Interruption free production;
Readiness for shocks and peak demand;
Advantage over competitors.

The Benefits of Management of Working Capital

To ensure the most financially efficient operation of business/company.
Evades interruption in operation.
To avoid the risk of blocking the capital without the yield.
Sufficient liquidity and profitability.
The better financial health of the firms.
Competitive advantages.

Background of Yudron’s Delights

Yudron’s Delight bakery is one of the most popular bakeries among others with the speciality of café serving products such as pastries, drinks, bread and cheesecake which is located at Shaba on the way towards Paro and established in 2017.

Dawa is the proprietor of Yudron’s Delight bakery and she did hotel management from the University of hotel management in Kolkata. With her sole interest and determination in baking, she was interested to start baking business. Further, she was made more decisive on her ambition and her father was the role model to support and to begin with the commencement of her business. The establishment of her business begin with purchased the imported ingredients and the machinery that is required for the business as well as to encourage to earn more profit in the business and also to achieve her goals. Yudron’s Delight had a passion for learning to bake and come up with fashionable bakery products that suit the taste of Bhutanese economy.

Dawa, on the other hand, had gained much experience in the period of a year and has decided to open Yudron’s Delight in a bigger and more spacious location. Even with the change of the location, the people kept coming to the café as they have before and the consumer became larger in numbers with time.

She began to face challenges in the shop with the rise in consumer percentage, which she was not very prepared for. The delight shop gained much fame due to its quality of product and the reasonable price the products were tagged with. She began to bake much more and tried different recipes. Sometimes it turned out perfect in the first try but most of the times it never went as she has expected which would leave a profound mark of failure in her, but her father and the customers always encouraged her which would help her gain motivation to try new recipes even if it became an inevitable failure. As she ventured into new flavors and baking art she gained more confidence in herself and she began to expand her variety of pastries, which led to the incoming of more consumers who were mesmerized by her art and innovation in the bakery.

With the development of her business, Dawa began to invite orders for a cake for most occasions like birthdays, wedding anniversaries, new year, promotion and other traditional occasions. Her baking fame reached out as far as the national capital as the people from Thimphu also started ordering cakes from her bakery. The business became more busy day by day and Dawa decided to employ young recruits who were as passionate about baking as herself, she taught them the basics for the art of baking and with time she gained five employees who helped her with the baking and her father continued to bring in freshly imported ingredients. She faced many challenges like making time to bake for the list of orders she received most days by staying up late at times and preparing proper transportation to take the cake to its designated areas. At times the Bhutan Airlines also ordered many pastries to serve in the catering department at the airport. She says, “Although business is good she faced challenges in making the right amount of pastries and other delights as if it was not sold out in a day it would be a waste as the quality was the first priority of the business”.

Her assorted bakes became more famous as the people passing through the road became more accustomed to her pastries and took it as a gift to their families and relatives living in boarding schools and in dzongkhags elsewhere. The quality of her bakes became the foremost reason for the satisfaction of her consumers promising a visit again in her delightful shop.

At present Dawa has bought a bungalow worth Nu. 8.9 million with the money she has earned from Yudron’s delight and she now has a van for the transportation of the bakes to faraway places, which has made her job more approachable for most people who seek home delivery. Her monthly income has become more than enough to pay her rent that is a sum of Nu. 30,000 per month. Her pastries and delights have been recommended in renowned magazines of Bhutan like Yeewong in an article by Zhimmey the ultimate food guide of the country and her baking has gained more popularity with time. She also started advertising her bakes in social networking forums like Instagram and Facebook.

Dawa now has future plans to develop her Yudron’s Delight to make it homely for the customers and she also wants to open a baking institute for the many young minds passionate about baking and starting their own entrepreneurship journey. Meanwhile, Nima is content with her business that is enough to support her family.

“The success story of my entrepreneurship journey was not solely due to my baking like most people believe, but it was the combined encouragement and help that was rendered to me by my family, the support staff and the customers without whom I wouldn’t be the entrepreneur I am today”, says Dawa during the conclusion of her interview. Though her friends and family believe she has reached the pinnacle of her glory she believes that her road to success does not stop here and she still has a long way to go to improve herself and make her future dreams a reality.

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Working Capital Management of Yudron’s Delight – ‘Everything is a New Delight’

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