Sprinkles Cupcakes was experiencing issues with customer traffic flow due to crowding by the entrance and an inefficient ordering system. They proposed solutions such as redesigning the store layout to display merchandise along the front counter, creating an all-in-one order/pay/pickup station, adding indoor seating, installing a cupcake conveyor belt, using a transparent door, and implementing a pull tab ordering system during high volume times. These changes were meant to improve visibility, traffic flow, and the customer experience.