Restaurant

The Institute of Chartered Accountants of Pakistan 3 September 2014 3 hours – 100 marks Additional reading time – 15 minutes Business Management and Behavioral Studies Q. 2 BBC Limited has shown poor performance during the preceding five years in spite of the fact that the company owns substantial physical assets, including modern machinery for manufacture of a wide range of products. All the assets of the company are in good working condition and marketing respects for the products are also promising.

However, the company’s organization structure is designed inappropriately and therefore has serious shortcomings and weaknesses which create impediments in its operations and are responsible for the company’s unsatisfactory performance. Identify and explain briefly the characteristics which would be apparent in the working of BBC Limited because of its inappropriately designed organizational structure. (08) Describe briefly the salient features of a Virtual Organization. (04)

Identify and describe any six leadership styles enunciated by Attainment and Schmidt. Identify the style Of leadership that is best suited for an organization which requires quick decision making and consists of highly competent staff at all levels. Give reasons for your choice. Footraces owns and operates a chain of eight high-class restaurants in different cities in the country. Employees at the restaurants include a manager, supervisors, kitchen crew, waiters and other supporting staff.

Footraces’ clientele comprises mainly of top executives/businessmen and fluent individuals who expect top quality food and attentive and courteous service at all the restaurants. The staff at the restaurants has to perform zealously during the peak lunch and dining hours as the restaurants operate at full capacity. Decisions concerning the business of Footraces have to be made at the following levels: (I) management team at the head office managers at the restaurants supervisory staff at the restaurants waiters and supporting staff at the restaurants.

Identify the levels and state briefly the reasons why you consider it appropriate to make the following decisions at these levels: reservations and assigning of tables to the customers selection of the standard menu for the restaurants offering suggestions regarding the choice of dishes to customers who seek advice decor of the restaurants, including selection of furniture & fixtures, wall paintings, crockery and staff uniforms procurement of perishable food items such as meat, seafood, chicken, vegetables, etc. At the different locations.

1. Situation Analysis Company Background & Products Existentialistic started its first outlet in a coffeepot along East Coast Road, opposite the current 112 Satang Mall in 2005. (Stations, 2009)It specializes in steak and has attracted the media interest and a group of loyal consumers for its tasty fare (steaks), reasonable pricing and good service.

With good response and feedback from consumers, Gaston Specialties shifted a few doors away and opened Its very own shop-front to provide Its customers with a better dining experience in a spacious and comfortable environment. Stations’ success can be attributed by it listening, considering and responding to discontinues’ needs and feedback. Within a few years, the company has established itself as a household name, synonymous with quality and affordability.

Stations Introduced “Stations Prime” as an market restaurant, which Is located at The Counterpoint to be part of its brand extension of Stations Specialties. It offers high-end steak cuts like Waged Grade 9, Fish, Lamb, Pork &Chicken based meals at a reasonable price compared to other restaurants. (Stations, 2009) On top of that the company also owns Stations Specialties(wealth shopping malls) ND 1 1 Stations Express outlets (heartland locations) all around Singapore.

Stations Express targets the heartlands’ market where steaks are value for money. (Stations, 2009) SOOT Analysts The following SOOT analysis is to understand our current situation and areas to reinforce. (Nell, 2010, p. 41) Strengths (Internal Factors): Household name F associated with quality and affordability Nation-wide coverage of Stations outlets all over Singapore shopping malls and heartland areas Known for its “value for money” fine dining concept Weaknesses (Internal Factors):

Brand dilution (lose focus and concentration with too many sub brands) Supply chain needs to improved to meet demand during peak periods Lack of regional/ international exposure (only well-known locally) Opportunities (External Factors): Affordable set meals to create more value to customers parties, thereby offering greater convenience Expanding company’s target market to other large foreign countries with similar lifestyles and cultural traits Threats (External Factors): Aggressive competition in the F&B industry (Competitors: Angus Steakhouse, Outback Steakhouse, Jacks Place, Sweeney’s and amongst others) Poor economy high Jobless rate, fewer Jobs, thus less spending power) Unique Selling Proposition (USPS): To offer consumers good quality meals that are value for money compared to other steakhouses like Lawyers, Black Angus and Moron’s. Benefits:Consumers are now more sophisticated and do not mind spending a bit more on a better dining experience. At Stations Specialties and Stations Prime, consumers can look forward to cost effective premium quality meals. Competitive Position:Stations’ pricing is relatively cheaper and affordable yet its steaks are of good quality compared to other competitors like Hand’s Restaurant, Jacks Place, Outback Steakhouse and others. Gomez-MeJia &Balkin, 2011 , Peggy)Stations’ menu and pricing are targeted at the young generation market where they are looking for a vibrant and fun hang out place with friends and family. In addition, the company is able to reach out to its target market easily with numerous outlets located all around Singapore. 2. Target Market Profile Stations’ target market includes thundered generation from age 15 to 35. The attractiveness of taskmaster segment is that they have relatively high disposable income/spending power. They appreciate good food and are more willing to spend. They also desire for quality meals with affordable price and good dining experience.

Most of the youths are exposed to Western cultures and often dine out due to the hectic working environment in Singapore. When ask about Stations’ brand perception, the usual response includes Convenience: With so many outlets all over Singapore, it is convenient to locate an Stations’ outlet. Friendly: Stations’ staff is young and enthusiastic. They are able to relate well to the consumers as they are about the same age group. Affordable: Consumers feel that Stations’ prices are affordable for a good dining experience. 3. Target Market Decision-Making Process Problem Recognition (Awareness of needs): Consumers would select Stations Gathering, First Date, Valentine’s Day, and Anniversary Celebration.

When selecting the choice of restaurant for dining for a special occasion, many factors would be put to consideration such as whether the place is suitable or not, type of food they are interested in and also who are they trying to impress. All these will lead to a different consumer behavior outcome. Information Search: Consumers usually learnable Stations through the following;word of mouth from friends and relatives, food review arums/food blobs, Stations’ website, advertisements, social networking sites (Backbone, Twitter) and from the experience of their previous visits. Evaluation of Alternatives: Consumers would evaluate these factors from alternative restaurants (e. G.

Jacks place, Outback Steakhouse) 0 Price: Stations is perceived to be affordable compared to other competitors of selling the same products (steaks and western food products). 0 Menu: Stations has a wide variety of products to choose from and offers the consumers to mix and match their side dishes. Service: Stations’ staffs are a young and energetic bunch, which are able to communicate well tit the younger generation of consumers and provide them with a friendly and better service experience in order for a return visit. 0 Environment: Despite the frequent long queue at Stations Specialties/Prime, consumers are willing to wait because they like the lively and vibrant atmosphere of the restaurant compared to the other alternatives. Location: It’s easy for consumers to find an Stations outlet in various parts of Singapore.

Purchase:purchase confluences by situational factors, time, physical and social. Examples:0 The desired food must be available at the time of purchase, the arrive of staff have to be prompt, friendly and anticipative to consumer’s needs. 0 The restaurant’s ambiance must be pleasant and acceptable by consumers. The food quality must be maintained; the “doyennes” of steaks has to meet consumers’ needs and expectations. Stations has constantly been able to meet or exceed consumers’ expectation of its food, price and ambiance to be able successfully grow its business. These factors are the key drivers of purchase and re-purchases leading to revenue growth.

Post-purchase Behavior:consumers will either be satisfied or dissatisfied after sitting and having their meals at a restaurant. With a satisfaction outcome, consumers will usually share their good experience with their friends and family and this will trigger a return visit. On the other hand if the consumers are dissatisfied with their food and services, they would start complaining to their peers and the bad word of mouth would prevent other consumers a chance to visit the restaurant. The fact that Stations’ has managed to grow from its humble beginnings to what it is today is testament to its ability to provide complete customer satisfaction in all areas of the dining experience. Age & Stages in Life Cycle:People buy different goods and services over a lifetime.

They eat baby food when they are young, eat most food in the growing and maturity stage and on special diets when they get older. Taste in clothes, accessories, food and other things is also age related. Most people from this stage of life cycle (age 15-35) have the buying power and money to spend on tasty and quality food in Stations, therefore it’s a good market to target. Occupation& Income:A person’s occupation and income has significant impact on his/ her buying behavior/power. In the society today, people are very concerned about heir image/look and the status, which is a direct outcome of their material prosperity. The status of a person is projected through various symbols like the clothes, accessories and possessions.

For example, Members (Professionals, Managers, Executives and Businessmen) will dine at an market restaurant like Stations Prime/ Specialties,whereas the lower income worker will eat at hawker centers or coffeepots and this will form the target market for Stations Express. Lifestyle:let refers to the way an individual lives in a society and is expressed by the things in the surroundings. Acquisitiveness’s, interests and opinions will determine his/her lifestyle and shape whole pattern of acting and interacting in the world. Then based on the combinations of these dimensions, consumers are classified accordingly. It is proven valuable in segmenting and targeting consumers according to their lifestyle classification.

The lifestyle in Singapore is largely cosmopolitan and the younger generation especially are more geared toward urban IL vying and used to dining at fast food outlets and restaurants rather than hawker centers and coffee shops. Stations is positioned well to cater to the target market with its western-influenced ideology and affordability. . Social Influences on Buying Behavior Social Class: Social class fuels certain consumer behaviors, especially the popularity of designer items and the desire to purchase them. Certain items are perceived to belong to members of certain classes. Consumers are likely to purchase items they view as a part of their social standing, or that they believe will elevate them to a higher social standing. Hanging out at Stations gives the young generation a hip and trendy feeling and it also enhances their social standing and status.

Culture: The most fundamental external influence on an individual and their buying behaviors. Ethnic backgrounds and geographical locations play a large part in culture and establishing culturally acceptable and unacceptable consumer behavior. With more young generation exposed to western culture, Stations has the market. Reference Groups:let consists of all the groups that have a direct or indirect influence on the person’s attitudes or behavior. Groups having direct influences on a person are called membership groups. Some membership groups are primary such as family, friends, neighbors, colleagues and others, whom the person interacts fairly, mutinously and informally.

Family members such as a spouse, children and parents can exert strong influence on the consumer’s vaingloriously. When the word gets around from a family member or friend about their good experience at Stations, the person who hears it will tend to believe them and give it a try. As for colleagues, they are usually influenced by the recommendations of their follow co-workers. 6. Psychological Influences on Buying Behavior Motivation:The driving force within individuals that impels them to action and that leads consumer towards buying a product or service. For example, a person is hungry (has a need), this will translate into a drive to obtain food to eat and the goal is to satisfy the need.

This factor is directly related to “Mason’s Hierarchy of Needs” which indicates that every individual will actively seek to satisfy physiological needs first, followed by safety, social, esteem and lastly, self-actualization needs. Dining at Stations potentially fulfills the individual’s social and self-esteem needs. Perception: The process that a person selects, organizes and interprets information inputs to create a meaningful picture of the world. For example, two sweaters on sales in the same store, one mass produced in China and the other marked as hand- made in USA, the hand-made sweater is likely to have a higher price and be perceived as more valuable and desirable by consumers, even though both sweaters would keep the consumer warm equally well. N comparison with Jacks Place, Cotton’s is perceived as more hip and trendy restaurant at the same price point. Learning:People remember each good or bad experience for later use when a similar situation arises. These experiences influence the consumer’s buying behavior by hanging the way they react to products similar to those they already have experience with. Many consumers choose to dine at Stations Prime because they had good previous dining experiences. Companies that focus on the consumer experience often gain repeat business because the consumer does not feel the need to look anywhere else to fulfill that particular need. Beliefs and Attitudes: Beliefs are the way people think about a particular product or subject.

An attitude is the individual’s consistently favorable or unfavorable evaluation, tendency or feeling about a particular subject. Consumers who are constantly satisfied with their dining experience at Stations would tend to be very loyal 7. Marketing Strategy, Recommendations & Conclusion Stations Brand Identity:To serve quality food at affordable prices with a friendly service and atmosphere for dining. Positioning:position as the mid-class steakhouse, which have 3 different levels of restaurants targeting different types of consumers with different atmospheres. Stations Prime is for the upper class, Stations Specialties for the mid-class and Stations Express for the average class (located in heartland within coffeepots). Andrew, 2010, p. 7) Product Strategy:Try to introduce new products to attract more new consumers to Stations or improve on the existing dishes Stations have on menu. Price Strategy:Adopt a different pricing compared to other competitors, in order to make it affordable for the good quality steak at Stations. Place Strategy: Location must be convenient to a consumer, that’s why Stations have many outlets island wide. Promotion Strategy: In order to minimize costs and facilitate brand building, local media advertising and carnival type of promotion tactics will be emphasized. Stations an invite local food magazine editors and food critic to taste and comment positively on its products or to create loyalty program (membership card) to retain customers.

With all these in place, Stations should be able to increase its growth sales by 2% each year and achieving a total of 10% for the next 5 years. 1) To provide better in-house dining service by giving intensive training to its frontline staff to ensure its customers are happy and will return for more. 2) With the expected growth in Singapore, Stations has to ensure that it meets the market demand for western food. ) To observe the market trend and its competition so that Stations will be able to enhance its product quality and services at a competitive price together with on going promotions to attract more customers over from other steakhouse patronizes. 4) To create a strong brand awareness through marketing communication activities such as to introduce the Reward Stamp card.

For example, with every $30 spend, customers will receive one stamp on the card and upon collecting 10 stamps, they will be able to redeem a free main course. 5) To create Stations very own Smartened App to attract more customers via games and lucky rows to gain more brand awareness and on-going promotions. 6) Participate in the Smartened Rewards Program APS like Peer(Peer, 2012)and Squirmy. (Squirmy, 2012) 7) To open another 3 Stations Express, 2 Stations Specialties and 1 Stations Prime in 12 In conclusion, Stations has the potential to bring its brand identity to the next level (high-end market) because: 1. Singapore is potentially a good market for the expansion of Stations’ western food business. 2.

There is a large segment of population who is Stations’ target market including the youths and teenagers and young working adults. 3. The Stations brand is well established in Singapore and is recognized for its quality food and affordable prices. Stations has gotten good reviews from Her World Magazine, The New Paper, Weekend Today and popular food critic KEF Seethe. (Stations, 2009) 4. Singapore, especially the teenagers are influenced by western cultures and their taste buds have also gone that direction. This results Stations’ ability to take advantage of the current situation to sell more western food items. However it is important to observe the recommendations made above, in order to improve and maximize its growth.

Student’s reflections

The XYZ Coffee House have always placed great emphasis on providing customer needs. Some of us go to work at the Coffee House everyday without realising that each action directly or indirectly affects customers level of satisfaction. Customer’s needs include giving prompt service, having a good meal, the right ambience, friendly as well as knowledgeable waiters and the list goes on. During my one month training in this department, I have gathered some factors that contribute to satisfying customer needs. Ambience

This is an important aspect in contributing to customer’s needs. Most customer choose a place to dine based on the environment of the restaurant. The di cor must not be too intimidating or too plain, air-conditioning must be just at the right temperature (at CG it is 25 – 27 degrees Celsius), suitable background music and furniture arrangement that provide comfortable space for guest movement. These are only some of the examples that provide the best ambience for the customer. At one time during the pre-service briefing, the issue of air conditioning came up.

It seems that the day before a customer complaint that the air con in the Coffee House was not strong causing him to sweat while eating his Asam Laksa. As a result he did not have an enjoyable meal and stormed off angrily from the place refusing to pay the bill. Obviously one needs to feel at ease when dining and if the restaurant fails to see to this, they will lose many customers in the future. Knowledge “Knowledge, without practice, makes but half an artist”. While doing my training in this outlet, I have learnt the importance of gathering information.

You might never know when a guest would come to you and ask “What time does the gym close? ” or “How far is Kuala Lumpur from here? ” and general questions such as “Where is the best place to shop in KL? “. As a guest in a foreign country they would definitely want to find out more about the place they are visiting and what better way to do so by asking the locals. The waiting staff should be able to answer to any of the guest queries promptly and without any difficulties at all. I believe that one factor in providing to customer needs also includes being the “walking directory/info guide” to them as well.

Language – one of the basic tool to satisfy customer needs is to be in the same wavelength as your guest. Language barriers are among the common disability a waiter can have in order to fulfill guest satisfaction. From my experience and observation in XYZ Coffee House, I have found that it is essential to be fluent in the language that the customer understands most. For instance, if it were a Japanese patron, the waiter’s ability to converse in Japanese makes order taking much more easier and less stressful.

As for the guest, speaking in his own language will make him feel more comfortable as he will be able to tell what exactly that he needs to the waiter. This also creates a more friendly atmosphere for the guest and make their dining experience more enjoyable. It is also widely known that the Japanese prefer conversing in their own mother tongue than other language. Likewise, I noticed that the waiters here took the initiative to learn up Dutch language as the hotel do receive many Dutch guest from KLM. Most of these guest have praised the waiters at XYZ Coffee House for their ability to speak in their language.

As a result they enjoy the company of the employees in this hotel and always look forward to return as a regular guest. Social skills My own definition of an effective social skill is the ability to put a smile on the guest’s face as they leave the restaurant. This is declaration that they had a satisfying experience dining with us. In order to achieve this I gathered that we must be familiar with their personality, know their likes or dislikes and anticipate their needs. There was a time during my training in this department, when Rachel, my Station Captain noticed an elderly lady preparing to take her medication after having her meal.

She offered the elderly lady a glass of plain warm water as she was about to take her pills. Rachel was able to anticipate her need even before she asked for the glass of water to swallow the pills. This is a fine example of going the ‘extra mile’ for the guest. Social skills also include having a small chat with the guests. This gives opportunity for the guest to point out what they liked or disliked about their meal. I once asked a guest whether the food that he ordered was satisfactory as I always practice this during my practical in the training restaurant at Sunway College.

By asking “Are you enjoying your sirloin steak so far, sir? “, the guest took the chance to say that the steak was cooked too raw. With that, I offered to send it back to the kitchen to have it cooked to the guest’s satisfaction. I believe this has prevented the restaurant from receiving a compliant and perhaps encourage the guest to return in the near future. SOPs All service personnel must familiarise with the SOPs in order to deliver consistency to the guests. SOPs provide guidelines for its staff to serve guests according to the standards of the hotel. With that only can the employees provide satisfaction to the customer.

Serving iced water

1. Iced water is served when guest request for it.
2. The water goblet must always be refilled form time to time (Extracted from XYZ Coffee House Operations Manual) At the terrace area of the XYZ Coffee House, there is a constant request for iced water from the guest especially the westerners. Due to the humid weather of our country, they are always alerting the waiting staff here to refill their glasses. Without waiting for their signal, the waiter should be able to observe whether the guest needs their glass to be refilled or not as it is part of the SOP. DUTIES DURING SERVICE 1.

Change ashtray whenever there are two or more cigarette buds. (Extracted from XYZ Coffee House Operations Manual) This procedure satisfies the need of smoking guests dining at the restaurant. I observed that too many cigarette buds on the ashtray result in the ashes flying to the guest’s plate. This is not good for the guest as they might swallow the unwanted particles that fell on the food. Furthermore, an ashtray with many cigarette buds project an unattractive table display in the eyes of the guest. Therefore, to provide a satisfying meal for the smoking guests, the restaurant has implemented this procedure.

Clearing

1.  Always excuse yourself before clearing.
2. Ask the guest if they have finished their meal. (Extracted from XYZ Coffee House Operations Manual) The purpose of establishing the procedure above is to ensure that the guest is aware that the waiter is going to clear his plate. On several occasions I noticed that the staff here forget to practice this and it ended making the guest irritated as they have not finish what they had on the plate yet. In the end, they will not be satisfied with the service of the staff. Speed It is a well known fact that most guest do not like to wait too long to be served.

An efficient waiter should be able to deliver the order promptly and prepare themselves for the next course to be served to avoid complaints of slow service and such. I believe that a hungry guest or a patron rushing for an appointment will definitely appreciate the fast service that was delivered. However, I realised that sometimes it is not the service staff’s fault that the food is served slow but the kitchen’s inefficiency in preparing the meal. Therefore, the service staff should inform the guest before hand on how long to expect their meals to arrive.

That way the guest would not be too disappointed or blame the restaurant for its slow service. Guest Comment Card The Guest Comment Card is one way to measure satisfaction level as it provides feedback from the customer. It provides information to the staff on how to improve their service better and provide greater satisfaction to the guest the next time. On a different note, the card also makes the customer feel appreciated. By writing down their comments, it allows them to perceive that the hotel does value their opinion. Furthermore, if it was a good comment, the hotel will sure be recommended by the guest through word of mouth.

This eventually generates more customers for the hotel in the future. TIPS I once read somewhere that the full term for TIPS is To Insure Prompt Service. The western culture practice in giving tips personally to the waiting staff and always feel obligated to do this every time they dine out. (“Tips on tipping”, Daniel Rogov; http://www. stratsplace. com/rogov/tips_on_tipping. html) I noticed some of the staff here were greatly motivated by tips that it brought about an obvious difference between serving a Caucasian and a local guest.

This should not be the situation as all guest regardless of where they are from should be treated equally. However, I believe that receiving tips from the guest is not a crime if it does motivate them to provide the highest level of satisfaction to customer needs. After going through my training in this outlet, I have found how essential it is to provide customer’s needs. I would say that it is a chain reaction as one satisfied guest generates future potential customers to the hotel. Therefore, satisfying every patron’s needs should be a top priority.

“Pets and Me” will offer a unique dining experience for pet owners in the west Los Angeles area who do not want to leave their pets at home when they go out. “Pets and Me” will offer a full menu of organic food for pet owners and their pets. This one of a kind restaurant also provides a sound investment opportunity in the restaurant/hospitality industry. Strengths The strength of “Pets and Me” lies in its unique market position. No other restaurant allows pet owners to take their dogs and cats out to dinner with them. Weaknesses

While pet owners may be enthusiastic about dining with their pets, people who do not own a pet may not appreciate a restaurant that serves animals alongside humans. The inability to overcome prejudiced ideas about animals in restaurants may present a challenge. Opportunities According to the American Pet Products Association (APPA), 63% of U. S. households own at least one pet (APPA, 2009). Pet owners are expected to spend $45. 4 billion on their pets in 2009 (APPA). There are currently no restaurants that serve pets and pet owners.

“Pets and Me” will be uniquely positioned to serve this untapped market without any competition. Threats For many people, dining out at a restaurant for meals other than lunch is a luxury that can be eliminated during tough economic times. This may be more true of specialty restaurants which already have a limited customer base. Analysis By focusing on pet owners, “Pets and Me” has the potential to reach an untapped market in the restaurant industry. At the same time, this approach may alienate people who do not own a pet and my limit the overall market.

Pet owners, however, represent a large group of people and tend to be very devoted to their animal companions. As with any business, there is the possibility that the economy could have a significant impact on the number of customers and on how much those customers are willing to spend on unnecessary items. References American Pet Products Association (2009). “Industry Statistics and Trends”. Online. Retrieved March 10, 2009, from http://americanpetproducts. org/press_industrytrends. asp

Marketing Research:

Marketing research is aimed to help organisations make effective decisions by providing by providing information that can inform the decision making process

Source: BTEC National Business, 2nd Edition, Book 1 (c) David Dooley et al 2007

Different Types of Marketing Research:

There are two types of marketing research, they are:

• Primary Research- Carried out to find new information required for a marketing research project, which has never previously been collected.
• Secondary Research- Makes use of work already carried out by someone else for some other marketing project or other purpose.

Source: BTEC National Business, 2nd Edition, Book 1 (c) David Dooley et al 2007

Observations:

McDonalds release new types of meals and aim to figure out if the product is selling, if so then they will consider putting it on their menu.

Experimentation:

McDonalds have experimented on their “fillet ‘O’ fish” burgers which usually sell for around i?? 2. 30p for one. Since they have released the three burgers for i?? 3. 00 it has been selling more. Surveys: In some McDonalds they put a questionnaire in the food tray to fill out after you have eaten the meal. This questionnaire asks about the customer service, cleanliness and food hygiene in the restaurant. This can be used for future improvements of the restaurants.

Marketing Information Gained From Marketing Research:

The information that’s gained from marketing research will inform them about their competitors. Information gained such as planning strategies, pricing strategies and economy. The customers The information from McDonalds when marketing research carried out shows: Competitors: Carrying this type of research McDonalds the financial state of their customers. New Products: McDonalds can trial out new products on their customers considering if they are happy with these new products.

Pricing Strategies:

McDonalds can survey their customers regarding their pricing if they are too high or just right. Promotions: McDonalds can consider whether their happy meals have the suitable and fun toys or are they lacking in child enjoyment. How Marketing Information is used in McDonalds: In this global economy crisis they must avoid expanding their businesses, shut down stores lacking in making profit and avoid spending excess funds.

Marketing information obtained through research is used by McDonald to help them identify how to move businesses forward with better planning and strategies that suits their business, it helps them to come up with a fast solution if products need to be improved, redesigned and quality checked. As a fast food retailer McDonald produce most of it’s food unhealthy which leads young generation to obesity so therefore they will be thinking of producing healthy food, for example ‘Pasta Hut’ which generally known as ‘Pizza Hut’. This promotes healthy eating as pasta is a healthy dish.

On of the most important thing that marketing will help is by identifying anything that is lacking in McDonald’s, for most people it is customer conveniences because McDonald don’t do home delivery, as some customers prefer home delivery so therefore they will be thinking of home delivery. Marketing research will help them decide what sort of price suits their customers which will help them to decide the suitable price and also competitors could be used by to revise their pricing strategies which will give them clear idea of taking next step forward.

Through marketing research they will decide if there is any necessary product that needs to be launched if their competitors have launched new product. This will give them information if the competitors’ products have been successful or not if they have then they must launch new products. Marketing research will help them analyse consumer’s lifestyle for example if consumers are moving towards healthy life style, then obviously they would not prefer fast food which leads to obesity, instead they would prefer place like ‘Pasta Hut’ which will cause loss to their income.

Marketing research will inform them about the current dark economic forecast for example ‘Recession’ and ‘credit crunch’ which is the cause of bankrupting Business like ‘Woolworth’ and many other stores so therefore marketing research can be used to decide if some restaurant needs to be closed if satisfactory profit is not gained and to avoid unnecessary Business expansion that will cause long term financial difficulties.

Conclusion:

From this assignment I have learned about the marketing research and how organisations use this as a means develop their strategies and products. I have done this to the best of my ability and knowledge.

The following day, bright and early, he drove sixty miles towards the Mojave Desert. His destination was a small, octagonal building, located on a corner in a small town. The stranger wasn’t impressed by the humble structure. It didn’t seem to fit with what he had heard.

Shortly before eleven o’clock, employees began to file in – men dressed in spiffy white shirts, smart trousers and paper hats. The stranger liked that. The men began to trundle trolleys laden with food and drinks into the building, their tempo picking up so much that they reminded the stranger of ants bustling around a picnic. Cars began to arrive, the parking lot soon filled up, and lines began to form as customers stepped up to the windows.

The investigator was impressed by the activity, but still dubious. He joined the line and said to the man in front of him — swarthy but well dressed, in a seersucker suit — “Say, what’s the attraction here?”

• “Never eaten here before?”
• “Nope.”
• “Well, you’ll see. You’ll get the best hamburger you ever ate for just fifteen cents. And you don’t have to mess around with tipping waitresses.”
• The stranger left the line to walk around the corner, where he found several workers sitting in the shade, gnawing on hamburgers. He approached a man in a carpenter’s apron and asked him how often he came there for lunch.
• “Every damn day,” he said without a pause in his munching. “Sure beats the old lady’s cold meatloaf sandwiches.”

The stranger was Ray Kroc, a dogged drink-machine salesman. After the lunchtime rush, he introduced himself to the drive-in restaurant’s bosses, Mac and Dick McDonald, and arranged to take them out to dinner.

As the brothers outlined their system that evening, Kroc became hooked by its simplicity and efficiency. The menu was strictly limited to just nine items, including drinks. The food comprised either hamburgers or cheeseburgers and fries. The burgers were all identical – a tenth of a pound of beef, all cooked the same way. Whereas a coffee shop sold a hamburger for 30 cents, it was only 15 at McDonald’s, or four cents more for a cheeseburger. The star attraction was the French fries, though – another bargain at 10 cents for a three-ounce bag. The menu was completed by coffee at a nickel a cup, soft drinks at a dime, or a large milkshake for 20 cents. That was it.

The brothers had started their business back in 1948, when they turned their barbecue restaurant into a slick assembly-line operation they called a “speedee service line.” At the time, the typical mass-market restaurant was a mom-and-pop coffee shop offering hundreds of items. The brothers’ nine-item menu never changed. Food was always cooked and served in the same automated way, so customers always got their meals immediately, when they were hot. They paid when they ordered, and cleared away their own debris after eating.

All of the food was good, especially the fries, yet Kroc stressed that the main attraction was the price. A meal at McDonald’s cost about half the equivalent at a coffee shop. How had Dick and Mac McDonald managed to do this?

They added value by subtraction. By removing menu variety, they made it much simpler to procure ingredients, operate the restaurant and cook and serve the food. By simplifying and automating the whole process, persuading customers to do some of the work, and producing assembly-line food, their labor costs per serving were reduced to a fraction of those of a typical coffee shop. The levels of throughput were astounding, too. The little shop that Ray Kroc visited had sales exceeding $400,000 a year (around $4 million in today’s money) — more than that of an average (much bigger) McDonald’s today.

By sourcing beef and other ingredients in large quantities, a virtuous circle was created — lower prices for hamburgers, leading to higher demand, further increasing purchasing muscle and overhead cost coverage, resulting in yet lower prices but also higher margins. Even when it was a tiny operation with just a handful of restaurants, McDonald’s had great purchasing power, which allowed it to cut costs. The restaurants needed to buy fewer than forty items in total to make their nine products, unlike a coffee shop which needed to purchase hundreds of items for its far more extensive menu.

They had essentially reinvented the restaurant and proved the economics of fast-food simplicity. In addition, there were subsidiary benefits:

1. Usefulness

• High-quality food. As Ray Kroc said, “The simplicity of the procedure allowed the McDonald’s to concentrate on quality in every step, and that was the trick.”
• Consistency and reliability — an identical product time after time

2. Art

• Spiffy uniforms for sharp employees
• The Golden Arches
• Cleanliness and visible hygiene in the store
• The McDonald’s name and “M” branding

3. Ease of use

• Fast service
• No tipping

Kroc negotiated a deal with the brothers whereby he would franchise the new outlets, and in 1961, he bought the whole company for $2.7 million (about $21 million in today’s money).

Then he set about turning McDonald’s into a big chain. He created a universal product of high quality, and produced a uniform system that allowed no variation, making it sufficiently simple to be franchised to thousands of entrepreneurs while still retaining absolute control and consistency. He developed a proprietary system that would deliver consistency for both customers and franchisees:

• Consistent menu — no variants allowed — and the same methods to attain the same food quality
• Sparkling clean toilets, restaurants and parking lots. Cleanliness was one of the four principles that Kroc stressed, along with quality, service and value.
• No pay telephones, jukeboxes or vending machines of any kind
• Founding the “Hamburger University” for franchisee and staff training
• Offering franchisees a simple product by providing them with a suitable ready site and financing
• Keeping the economics favorable, with a narrow product line, and helping the best suppliers to serve a large number of McDonald’s outlets and lower their costs, for example through bulk packaging and allowing them to deliver more items per stop

It’s clear that Kroc realized that the main purpose of his systems was to deliver a good product at an exceptionally low price. The bigger the scale of the operation, while allowing no variation in product and procedure, the lower the price. And the lower the price, the greater the customer satisfaction, sales, profits and value of the company. Kroc kept the price of McDonald’s hamburgers at 15 cents for nineteen years — until 1967, when inflation brought about by President Johnson’s Great Society and the Vietnam War forced an increase. He authorized the increase to 18 cents reluctantly: “If you look at it from the customer’s point of view – which is how I do it, because this guy is our real boss – you see the importance of every penny.” This is the credo of every price-simplifier.

Who created the greater value — the McDonald brothers or Ray Kroc? It depends on your perspective. Financially, Kroc added far more. Yet, we could argue that the brothers created the product, the proposition, the brand, the pricing and indeed the system. The changes to their template since 1961 have been relatively minor. However, imitation is usually more vital than creation. Certainly, in this case, imitation created an extraordinarily valuable business with a global footprint. Ray Kroc added a simple, uniform, high-quality franchise system that cloned the McDonald’s formula to a degree that was truly mind-boggling.

Key Points

1.  McDonald’s is excellent example of price-simplifying – where subtraction and an assembly-line operation have slashed complexity and enabled costs to be halved. Could you automate an industry or service that has not yet experienced anything comparable?
2. If you work in a service business, take heart that price-simplifying works as well in a service or retail setting as it does in manufacturing.
3. With prices cut in half and the appropriate economic exploitation, world demand for fast-food hamburger meals has expanded to a degree that was unimaginable in 1948. Can you think of a pedestrian market today that could conceivably explode in a similar fashion if prices were at least halved through automation and co-opting customers and/or franchisees?
4. Once again, the simplifying firm created a new, proprietary business system, with economics quite different from those of more complex restaurants. If you’re considering price-simplifying, how might you create a dramatically better economic system than whatever exists today in your market?
5. The firm combined an exceptionally low price with greater usefulness (consistently high-quality food; play areas for children), art (especially the Golden Arches and instantly recognizable branding) and ease of use (speed). What might be the equivalent extra benefits in your industry?

Iterance Gaiter Professor James Day Intro to Business July 21, 2013 The Cheesecake factory founded in 1972 by Evelyn and Oscar Overtone has been one of the most famous family eatery in America. Just the name along sets it apart as an iconic and delectable place, you can tell that cheese cakes are Just one of many of the restaurants specialties that it has to offer. Back in Detroit within the sass Evelyn created her own original recipe for cheese cake where Evelyn and Oscar open there own cheese cake shop together. That’s until Evelyn gave birth to their kids David and

Renee where they closed up shop to focus on their family. Though never giving up on her passion of baking Evelyn supplied the local restaurants with her original take on cheesecake which was in high demand. Into the couples ass they moved to Los angels and with their last savings opened up a restaurant and dubbed it the cheese cake factory. The years weren’t favorable and hard but they persevered, and in 1975 that led to expansions and opening of newer locations left and right, Evelyn recipes of cheese cakes grew to over 20 varieties and other desserts.

The company grew so such that Oscar had to hire truck drivers to accommodate the out of state customers. Than in 1978 David Overtone (son of Oscar and Evelyn) open up the first cheese cake factory restaurant in Beverly hills with little knowledge but a strive and intuition of making a great restaurant expertise perfect with generous portions and unlimited inventive menu selection the cheese cake factory was a success and within arrears later and over 100+ restaurants the cheese cake factory grew to the momentum house hold name it is today; Growing from a small kitchen in Oscar and

Evelyn basement to stand as a place that is a must to dine in didn’t come without its trials and tribulations. Though without much sorrow and having Evelyn famous cheesecake grew in clientele that stretch from Detroit throughout California spear heading the restaurant, and with David Overtone taking the intuitive to help his family dream into house hold name. As it stood the test of time with many highs and lows the cheese cake factory is a well known establishment in the states, as place with great food at excitable prices but still must all ways strive to meet the growing public needs and beat out the competition.

To ensure the business is at an up keep companies utilize SOOT; SOOT refers to strengths, weaknesses, opportunities and threats. SOOT is a process where the management or financial team identifies the internal and external factors that will affect the company’s future performance. The company’s strengths and weaknesses are the internal factors. Opportunities and threats deal with factors external to the company-environmental factors.

SOOT is done as part of the overall corporation planning process in which financial and operational goals are set for the upcoming years and strategies are created to accomplish these goals. My beliefs on the cheese cake factory SOOT analyst would Soot: Cheesecake Factory By balletomane stands strong at 164 strong in over 36 states, 13 being fine dining restaurant as grand Luke cafe two full scale bakeries and 1 Pan Asian restaurant named rock sugar.

An American style restaurant with a humble beginning of making cheesecakes from an oven in their basement selling them to local restaurants to being a household family name, Prides themselves on their world famous cheese cakes that has help make it the ninth largest restaurant company in the United States measured by market capitalization. The restaurant established the future chain’s pattern of offering an eclectic menu, big portions, and signature dessert dishes. The cheesecake factory continues to set mile stones for itself and distances from its competitors.

As a leader for how franchise restaurants should be monopolize, strength in numbers backed with history and wholesome food, iconic name and signature dish. With any giants strengths there’s always there weaknesses. Though the cheese cake factory has accomplish a lot in their time though the multitude of stores lack their own look it’s the same ball and chain aside from their grand Luke restaurants modeled after Italian, French, and Austrian styles. The Cafe offers, in addition to American and European-style food, Thai, Malaysian, Caribbean cuisine, and others.

With that being said if there isn’t change in the stores the menu though has grown with the times well over 200+ options to choose from isn’t user friendly and can have a longer wait time getting the guest in and out in a timely matter. Speaking more on the menu is the overall weakness that have been criticize by Robert Bishop Cot 26, 2010 in men’s health magazine “That the average sandwich at the restaurant contains 1,400 lories and their heavy promotion of large servings of high calorie and high fat foods, and a corresponding lack of healthy menu options”. For these reasons, the chain was dubbed the “worst family restaurant in America” .

Also a recent study shows that The United States Department of Agriculture’s Center for Nutrition Policy and Promotion states in its dietary guidelines that a typical adult should consume about 2,000 calories and no more than 20 grams of saturated fat per day Cheesecake Factory’s “Bistro Shrimp Pasta” dish had more calories than any other enter©e from a sectional chain restaurant at 3,120 calories, with 89 grams of saturated fat. The 2013 report from the Center for Science in the Public Interest also noted that The Cheesecake Factory’s “Crispy Chicken Costliest” has more calories (2,610) than a 12- piece bucket of fried chicken from KEF.

Though the cheese cake factory is doing well for now their weakness of having such an unhealthy menu will bring about problems of health to the general public. From what I have gathered from Cheesecake factories SOOT analysis I can say that their strength is that the company is a wholesome American family corp… With over 160 restaurants under its belt has expanded into fine dining and is breaching culture cuisine boundaries in its expansions.

As well the cheese cake factory is best known for their signature dishes the “cheese cake” an original recipe is still unmatched but always sought after. Their main weakness is that most items on the menu aren’t healthy one meal is taking in the total intake in calories for an adult for an entire day. Which more and of the public is getting wind of from the media. Once one company broadcast that they are adding a healthier menu than consumers will start looking costly the big contributors in most family orientated restaurants.

So I propose that with their name and surplus of restaurants they could practice cooking healthier items and substituting the materials they use in the meals with alternative products. By experimenting in the many restaurants to see if the consumers can see the difference in the meals taste, the restaurant would be under scrutiny into the transition before making it public. There’s nothing worse than a change, taking place that can result loss for the company. By doing so believe will give the cheesecake factory a leading edge.