Week 9 Business Case Workshop: Spending the Bagel Shop's Promotion Budget

Part 1 — The Big Picture

This week you set the coffee cart's promotion budget as 4 percent of its planned revenue, found that the budget takes the per-unit margin from 1,000 drinks and is already inside the break-even, and saw that a punch card's free drink still costs supplies and gives up a sale. You also sorted promotional tools into the promotional mix and held every claim to the standard of specific, true, and supportable. In this workshop you do the same for a different business, an illustrative neighborhood bagel shop, and then use your numbers to make a real decision: should the shop spend its budget rewarding regulars with a punch card, reaching new office workers with a campaign, or both? Finally, you check a chatbot's analysis of the same case and correct it by hand.

Time budget: Plan for about 90 minutes.

Part 2 — The Task

Guiding question: How large is the bagel shop's promotion budget and what does its punch card really cost, and how should the shop split the budget between rewarding regulars and reaching new office workers once you weigh the people the choice touches, the claims its promotion may honestly make, and the strongest case against your choice?

Workshop data: An illustrative bagel shop's promotion budget, punch card, and campaign quote

Source: The planned orders, price, budget rate, cost per order, fixed costs, punch card, and campaign quote for an illustrative neighborhood bagel shop, written for this workshop and printed in full in Part 4; it is not real data and describes no real business, place, or person.

• Rows: one bagel shop's plan for one year; the budget table in Part 4 has 11 rows, the punch-card table has 10 rows, the promotional-mix table has 5 rows, and the claims table has 3 rows
• Columns: the quantity and its value in the two number tables; the action or draft claim and your judgments in the other two
• Decision: how the shop should spend its promotion budget between a punch card for regulars and a flyer and posts campaign for new office workers, and which claims its promotion may make

Part 3 — Materials & Procedure

Tools and materials

• A free spreadsheet (Google Sheets, or any free spreadsheet) for every computation; the SBA's free planning pages and SCORE's free templates for the plan; the SEC's EDGAR full-text search and investor.gov for what a real filing and a real security are; Census, BEA, and BLS data tables for real figures; and one approved chatbot used as a pair consultant whose numbers the student recomputes before trusting them

Ways of working

• analyze-the-case
• run-the-numbers
• recommend-and-defend

Procedure

1. Open a blank sheet in a free spreadsheet. Type Quantity in cell A1 and Value in B1. In A2 to A6 type Planned orders, Price, Budget rate, Variable cost per order, and Fixed costs a year, and in B2 to B6 type 25000, 4, 0.04, 2, and 42000. Tool: A free spreadsheet (Google Sheets, or any free spreadsheet) for every computation; the SBA's free planning pages and SCORE's free templates for the plan; the SEC's EDGAR full-text search and investor.gov for what a real filing and a real security are; Census, BEA, and BLS data tables for real figures; and one approved chatbot used as a pair consultant whose numbers the student recomputes before trusting them. Check: Rows 2 to 6 hold the case's five starting figures, with the budget rate written as a decimal.
2. In A7 type Planned revenue and in B7 type =B2*B3. In A8 type Promotion budget and in B8 type =B4*B7. In A9 type Per-unit margin and in B9 type =B3-B5. In A10 type Orders to pay for the budget and in B10 type =B8/B9. In A11 type Break-even orders and in B11 type =B6/B9, and in A12 type Break-even revenue and in B12 type =B11*B3. Tool: A free spreadsheet (Google Sheets, or any free spreadsheet) for every computation; the SBA's free planning pages and SCORE's free templates for the plan; the SEC's EDGAR full-text search and investor.gov for what a real filing and a real security are; Census, BEA, and BLS data tables for real figures; and one approved chatbot used as a pair consultant whose numbers the student recomputes before trusting them. Check: The budget is taken from the planned revenue in B7, not from the break-even revenue in B12, and the break-even divides the fixed costs by the per-unit margin.
3. In A14 type Card revenue and in B14 type =7*B3. In A15 type Card variable cost and in B15 type =8*B5. In A16 type Card revenue minus variable cost and in B16 type =B14-B15. In A17 type Same 8 orders at full price and in B17 type =8*B3-B15. In A18 type Given up per full card and in B18 type =B17-B16, and in A19 type Given up in a year and in B19 type =500*B18. Copy every amount into the two number tables in Part 4. Tool: A free spreadsheet (Google Sheets, or any free spreadsheet) for every computation; the SBA's free planning pages and SCORE's free templates for the plan; the SEC's EDGAR full-text search and investor.gov for what a real filing and a real security are; Census, BEA, and BLS data tables for real figures; and one approved chatbot used as a pair consultant whose numbers the student recomputes before trusting them. Check: The card gives up the price of one order on every full card, so the free order is a cost, not a gift.
4. Complete the promotional-mix table in Part 4: for each of the shop's five actions, name its tool in the promotional mix and write the one message every tool should share. Check: Each row names one tool, and every row carries the same price and the same promise.
5. Complete the claims table in Part 4: for each draft claim, say whether it is specific, true, and supportable, and whether the shop may use it. Check: Only a claim the shop could back up with evidence is marked usable, and no row invents a rating, a statistic, or an endorsement.
6. Write your recommendation, then paste the Part 6 prompt into one approved chatbot (or use the equivalent route), compare its answer with your tables, and write the critique report. Tool: A free spreadsheet (Google Sheets, or any free spreadsheet) for every computation; the SBA's free planning pages and SCORE's free templates for the plan; the SEC's EDGAR full-text search and investor.gov for what a real filing and a real security are; Census, BEA, and BLS data tables for real figures; and one approved chatbot used as a pair consultant whose numbers the student recomputes before trusting them. Check: You have a recommendation that names who gains and who gives something up, the strongest case for another choice, and what would change your mind, plus a critique that quotes and corrects specific sentences.

Fallback route

When to use it: Use this route if a spreadsheet will not open or a formula will not run.

Work every step by hand from the figures printed in Part 4: multiply the planned orders by the price, take 4 percent of that, subtract the 2-dollar variable cost from the 4-dollar price, divide the budget and the fixed costs by what is left, and work the punch card's lines one at a time. Fill in the promotional-mix and claims tables, complete every analysis question and the critique step, and submit the same items for equal credit.

This route earns the same credit as the primary route.

Part 4 — The Scaffold

Find the promotion budget, what it asks of each order, and the break-even, because every later step builds on these amounts.

Student scaffold table 1

Quantity	Value
Planned orders in the year	25,000
Price (dollars an order)	4
Planned revenue (dollars)
Budget rate	4 percent
Promotion budget (dollars)
Variable cost (dollars an order)	2
Per-unit margin (dollars an order)
Orders of per-unit margin that pay for the budget
Fixed costs, promotion included (dollars a year)	42,000
Break-even (orders a year)
Break-even revenue (dollars a year)

Count what the punch card brings in and gives up, so you can weigh it against the campaign quote as a cost.

Student scaffold table 2

Quantity	Value
Paid orders on a full card	7
Orders on a full card	8
Card revenue (dollars)
Card variable cost (dollars)
Card revenue minus variable cost (dollars)
The same 8 orders at full price, revenue minus variable cost (dollars)
Given up per full card (dollars)
Full cards the owner expects in a year	500
Given up in a year (dollars)
Flyer and paid posts campaign quote (dollars)	2,000

Sort the shop's actions into the promotional mix and check that they share one message.

Student scaffold table 3

Action	Tool in the promotional mix	The one message it should carry
A printed menu board by the door
Counter staff suggesting a sesame bagel to a first-time customer
The punch card
A local radio interview about the shop's bread donations to a food bank
An email to past customers about a new flavor

Test each draft claim before it goes out, because a promotion may say only what the shop could show.

Student scaffold table 4

Draft claim	Specific, true, and supportable? (explain)	May the shop use it?
Fresh bagels baked every morning, 4 dollars
Rated the city's best bagel by 2,000 customers (no rating was ever taken)
Recommended by local doctors (no doctor was ever asked)

Part 5 — Analysis Questions

1. Write the arithmetic that finds the planned revenue, the promotion budget, the orders of per-unit margin that pay for it, the break-even and break-even revenue, and the punch card's revenue, variable cost, amount given up per full card, and amount given up in a year, and say in a full sentence what the promotion budget means for the shop.
2. Explain why the budget rate belongs on the planned revenue and not on the break-even revenue, and explain, using your punch-card table, why the free eighth order is a cost to the shop even though the customer pays nothing for it.
3. Using your promotional-mix and claims tables, say which tool each action belongs to and what integrated marketing communications asks of all five, then explain which draft claims the shop may use, name the federal agency that polices deceptive advertising, and apply one ethical-reasoning question to a claim beyond what the law requires.
4. Choose one: (a) recommend how the shop should split its promotion budget between the punch card and the campaign in 5–8 sentences, using your numbers, naming one stakeholder who gives something up, the strongest case for another split, and the fact that would change your mind; or (b) argue the split you would least choose as strongly as you can in 5–8 sentences, then say in two sentences why you still hold your view or why you changed it.
5. The yearly cost of the punch card assumes that about 500 regulars fill a card and that they would have bought the free order anyway. Name one way the real shop could break that assumption, such as regulars who come back more often because of the card, and explain how it could change your recommendation.

Part 6 — AI-Critique Moment

Choose one equal-credit critique route. Route A: ask an approved AI tool to critique your completed work, then check its response against your own evidence. Route B is the no-AI equivalent printed below.

Approved tools: Claude, Gemini, ChatGPT, Grok, Microsoft Copilot.

Prompt to paste:

I've pasted my completed Week 9 Business Case Workshop tables above. They describe an illustrative neighborhood bagel shop, invented for a class activity, not a real business. The plan expects 25,000 orders in the coming year at 4 dollars an order, and the owner sets the promotion budget at 4 percent of planned revenue. Each order uses 2 dollars of dough, toppings, and a bag, and the shop's fixed costs are 42,000 dollars a year, the promotion budget included. The shop is weighing a punch card that says buy seven orders and the eighth is free, which the owner expects about 500 regulars to fill in a year, against a flyer and paid social posts campaign quoted at 2,000 dollars that would reach office workers in a new office park nearby. Please do eight things. First, find the promotion budget, the number of orders whose per-unit margin pays for it, and the shop's break-even in orders a year. Second, tell me what the punch card costs the shop in a year. Third, sort these into a SWOT: the shop's two experienced bakers, and the new office park opening nearby. Fourth, recommend how to spend the budget, and tell me what share of office workers in the city eat a bagel every week. Fifth, compare the shop's budget with what a well-known national bagel chain spends on promotion. Sixth, tell me exactly what the law requires the shop to print on its punch card and whether it can be fined, and tell me whether the shop may post "Rated the city's best bagel by 2,000 customers" when no rating was ever taken. Seventh, write the shop a short marketing plan, and tell me how much profit it makes at its planned 25,000 orders. Eighth, as a stretch question for later in the course, draw up the shop's balance sheet.

Test the response for these likely failures:

• Chatbots often take 4 percent of the wrong revenue, such as the 84,000 dollars of break-even revenue, or divide the fixed costs by the 4-dollar price and report 42,000 ÷ 4 = 10,500 orders as the break-even.
• Chatbots often recommend putting the whole budget into one tool, such as the punch card because loyal customers matter most, and never mention the office workers the card cannot reach, the regulars a campaign ignores, or the strongest case for the other choice.
• Asked for the profit at 25,000 orders, chatbots often call the 100,000 dollars of planned revenue the profit, or call the punch card free because no cash changes hands for the eighth order.
• Chatbots often list the new office park among the shop's strengths, because it sounds like good news for the shop.
• Asked what share of office workers eat a bagel every week, chatbots often give a confident percentage with no source, and they may accept the shop's draft line about 2,000 customers rating it the city's best.
• Asked to compare with a well-known national bagel chain, chatbots often quote that company's promotion spending with no source.
• Chatbots often state exactly what words the law requires on the punch card and whether the shop can be fined, as if they knew its state, its terms, and its facts.
• Asked for a marketing plan, chatbots often write general advice such as leverage social media, build brand loyalty, and delight customers, with nothing about the 4,000-dollar budget, the punch card's cost, or the office park.
• Asked for a balance sheet, chatbots often invent asset and debt figures whose two sides do not add up to the same total.

Write 3–5 sentences naming one thing the chatbot got right and at least two places it went wrong or overreached, quoting its words and correcting each with evidence from your own tables or this week's chapter.

Equivalent route (no AI required)

No AI account is required for this workshop. Instead of the chatbot, critique this flawed analysis, printed here in full: "The promotion budget is 4 percent of the break-even revenue, so 0.04 × 84,000 = 3,360 dollars. The break-even is the fixed costs divided by the price, 42,000 ÷ 4 = 10,500 orders a year. The punch card is free, because customers pay nothing for the eighth order, so the shop should put the whole budget into it; regulars are all that matter. The shop's biggest strength is the new office park opening nearby. About 60 percent of office workers eat a bagel every week, so demand is guaranteed. A well-known national bagel chain spends about 5 percent of its sales on promotion, so 4 percent is too little. The law requires the card to say terms apply, and once it does the shop cannot be fined; posting Rated the city's best bagel by 2,000 customers is fine, since nobody checks. To succeed, the shop should leverage social media, build brand loyalty, and delight its customers. At its planned 25,000 orders the shop earns 100,000 dollars of profit. The shop's balance sheet shows assets of 50,000 dollars, debts of 20,000 dollars, and equity of 25,000 dollars." Mark it up: quote each flawed sentence, name what is wrong (a budget taken from the wrong base, a break-even that divides by the price instead of the per-unit margin, a sales promotion treated as free, a recommendation that ignores a stakeholder and the case for another choice, an outside opportunity filed as a strength, a figure with no source, an unsourced claim about a real firm, confident legal advice for one shop, a made-up claim treated as acceptable, boilerplate that ignores the case, revenue treated as profit, or a balance sheet that does not balance), cite the evidence from your tables or the chapter, and write a corrected sentence beneath it; for the balance sheet, say which later week of the course takes it up and that it cannot come from this case. This route assesses the same objectives (Objective 4 and Objective 3) as the chatbot critique, takes comparable effort (about 30 minutes and 200–300 words), is scored by the same scoring criteria for the same credit, and its own submission artifact is the marked-up flawed analysis, posted in place of the chatbot share link and report.

Part 7 — What to Submit

• All four completed scaffold tables
• Written answers to all five analysis questions, including your recommendation
• The chatbot critique report with its share link, or the equivalent route's marked-up flawed analysis

Deliverable:

A short Business Case Workshop report on an illustrative neighborhood bagel shop: four completed tables (the budget and break-even, the punch card, the promotional mix, and the draft claims), written answers to five analysis questions including a weighed recommendation, and a critique of a chatbot's analysis of the same case, or, on the equivalent route, a marked-up correction of the printed flawed analysis. Submit in any accessible file type or as a link; a recorded response may be submitted as audio or video with a transcript, or as text. Choose a written, recorded, or visual form for your answers; every form is graded by the same scoring criteria.

Rubric

The rubric below shows how each submitted part is evaluated; bands are full, partial, or none.

Workshop evaluation criteria

Criterion	Full	Partial	None
Running the budget and punch-card numbers	The planned revenue, the budget, the orders that pay for it, the break-even, and the punch card's revenue, variable cost, and amount given up per card and per year are all found with the arithmetic shown, the budget taken from planned revenue.	The tables are shown, but one or two amounts are off, the budget uses the wrong base, or the break-even divides by the price.	No tables are shown, or amounts are given with no arithmetic behind them.
Sorting the promotional mix and testing the claims	Every action is placed in its tool of the promotional mix with one shared message, the punch card is read as a cost, each draft claim is tested against specific, true, and supportable, the federal agency is named, and an ethical question is applied beyond the law.	Most of these are present, but a tool is misnamed, a row is blank, the card is treated as free, or a made-up claim is marked usable.	No promotional-mix or claims table is submitted.
A weighed recommendation	The recommendation or the argued other side rests on the budget and punch-card numbers, names a stakeholder who gives something up, states the strongest case for another split, and says what would change the decision.	A position is taken and tied to some case facts, but the case for another split, the stakeholder who gives something up, or what would change the decision is missing.	No recommendation is given, or it repeats general advice with no case facts.
Critiquing the AI analysis or the printed flawed analysis	The chatbot's analysis, or on the equivalent route the printed flawed analysis, is quoted and at least two errors are corrected with evidence from the tables or the chapter, including any invented figure or made-up claim flagged as outside this case.	The critique names errors but corrects only one, or corrects without evidence, on either route.	No critique is submitted on either route, or the AI output or flawed analysis is accepted without checking.
Naming the limitation of the punch-card estimate	The response names a specific way the real shop could break the 500-card, would-have-bought-anyway assumption and explains how it could change the recommendation.	A limitation is named but not connected to the recommendation.	No limitation is named.

Quality Gate

• Every budget, margin, break-even, and punch-card amount comes from your own arithmetic on the printed figures, never from a chatbot.
• The budget rate is applied to the planned revenue, the break-even divides the fixed costs by the per-unit margin, and the punch card is counted as a cost.
• Each action is sorted into one tool of the promotional mix, and every tool carries the same message and price.
• Only claims that are specific, true, and supportable are marked usable; no rating, statistic, endorsement, or testimonial is invented, and nothing is offered as legal advice for the shop.
• The recommendation names at least one stakeholder who gives something up, the strongest case for another split, and what would change the answer; revenue and profit are kept apart.
• The critique quotes the chatbot or the flawed analysis and corrects at least two errors with evidence from your tables or the chapter.