Great Cups Financials

Great Cups Coffee Company, Inc. is a specialty retailer of high-quality premium coffee and espresso-based beverages, foods, ice cream and coffee lifestyle items. GCC aims to prove it’s customers with "A Great Cup of Coffee, at a Great Price," by focusing on a single, simple idea - the larger size cup of premium quality coffee they served. From the company's inception, in-store customers were treated to various coffee blends served in over-sized ceramic mugs, and carry-out orders were always provided in cups two ounces larger than those used by competing coffee purveyors.

As of December 31, 2012, the Company’s retail segment operated 270 coffeehouses, ice cream stores, combo-marts, and delis located in Ohio, Illinois, and Pittsburgh. Of the 270 shops, 63 of them are a collection of combo marts and delis. GCC generates revenues through the sale of packaged coffee, various foods and general merchandise. The commercial segment sells high-quality premium whole bean and ground coffee to grocery stores, office coffee and foodservice providers, hotels, and entertainment venues. Of the company’s $200,000 total net sales, its commercial segment contributed $13,000 as of December 31, 2013 (6.5%) and the retail segment contributed $187,000 (93.5%) to the total net sales.

Liquidity

In analyzing a firm’s liquidity, or its ability to quickly convert assets into cash, we would look mainly at its current assets and liabilities, those that would normally remain on the books for less than a year. When looking at the Current Ratio for GCC’s, we see that their Current Assets are 1.13 times their Current Liabilities. Their Current Ratio is a 0.12 increase from fiscal year ending 2011 to 2012. GCC’s liquidity reflects its ability to pay back its debt and since that it is above 1, it does show that they’re in good shape. Anything below 1, poses a concern and when we compare GCC to one of its competitors, Starbucks (1.75) it shows that why their ratio is less than Starbucks, given...