RESTAURANT BUSINESS IN A NEW LOCATION:
1. Type of study
Feasibility study
2. Purpose and problem statement
Purpose:
To determine the feasibility of either a) transferring the restaurant in another location, or b) adding a new branch for the existing restaurant.
Problem Statement:
The company is facing a situation of impending decrease in number of buyers resulting from changes in location of some local businesses. Employees in these local businesses have formed a large percentage of the total number of buyers. Their absence in the area would adversely affect the company’s revenues and profitability positions. This is an immediate concern that needs to be addressed in order to survive in business. It is then important to know whether a new business will be put up and in what location or to totally transfer the business to a more feasible location.
3. How the purpose and problem statement would fill the information void for the decision maker
The results of the study would help the decision maker in determining the market and financial feasibility of either putting up a new branch or transferring to another location for the restaurant.
4. The elements of the dummy table(s) and why these variables appropriate
a) the population in the proposed area
• This is a basic information to determine the possible size of the business in the proposed location
• Basic information on potential buyers
b) number of households in the area
• To determine number of potential buyers
c) occupation of families and corresponding monthly income
• This will provide data on purchasing power a basis of pricing and product decisions
d) lifestyle of people and families in the area
• To determine whether families hold important family events outside
• To determine whether dining out is a practice of people in the area
e) local businesses, size (as to number of employees), and location
• Local businesses are sources of potential buyers
• Provide data on accessibility to target market
• Basis of determining the most feasible location for the business
e) competitors in the area, as to size, specialties, and target buyers
• This will give idea on market share
• Information on entry points will be provided
• Basis of deciding on marketing strategies ( product, price, place , and promotion)
f) existence of school, churches, and other public entities and their locations
• These are sources of possible market or buyers
• To determine where to locate the business
g) local infrastructures, transportation, utilities (e.g. electricity, water facilities, etc.)
• these are important for basic operations of the business
• transportation facilities would answer the question of accessibility of the restaurant to target buyers
h) local ordinances in the area
• these are important legal issues to consider
Questions:
Identify primary and secondary data sources that would you use. (For this discussion, a survey is not an option). Justify why these data sources are appropriate for the study’s purpose.
Identify the variables from the data sources that you would use for analysis.
Distinguish between the levels of data for the variables you would collect.
Consider the validity, reliability, and practically of these variables. Explain why the data you would collect would meet the standards for quality data.
Identify primary and secondary data sources that would you use. (For this discussion, a survey is not an option). Justify why these data sources are appropriate for the study's purpose. Identify the variables from the data sources that you would use for analysis. Distinguish between the levels of data for the variables you would collect.
Primary data sources would include county records for building permits and demographic information. These sources can provide information about the local economy and local populations. Demographic information such as the nominal levels of gender, race, and company names and types would be the first level. Not only does one want to know what the people in the area are, but we need to know the types of companies that are located in both the proposed new area and the current location.
Ordinal information from the demographics would include household income, level of education, and other resource information to help determine things like disposable income. Some ordinal information may be gained if wages information is available as well. Ranking information lets individuals target specific groups according to their ranking when needed.
Interval and interval ratio will come from secondary sources for information such as what types of things are bought and their costs. For example, are there car dealerships and the type is a nominal level. However, and how much the cars cost and how many people are purchasing them and at what prices people are buying is interval. For these figures, secondary sources like industry or local industry figures can be accessed. The local government will also have information about the type of cars bought and registered in the county. This would be primary source, like other government agency information.
Another primary way to collect data would be to visit and record prices and menus for the most likely competitors for the restaurant. For example, one might not visit the full service luxury restaurant open for dinner only most days, but local sandwich shops, diners, chain restaurants would need to be surveyed for their competitive offerings and prices.
Consider the validity, reliability, and practically of these variables. Explain why the data you would collect would meet the standards for quality data.
Most of the information collected from county tax rolls, vehicle and building permit agencies, and demographic information for the county overall and location specific are going to be reliable. These are accurate because they must meet standards for state and federal funding as well as local funding budgets. Industry records are usually very reliable because again, there are issues of taxing and government oversight, but they also help the organizations that work within their respective industries (in this case I would use restaurant industry, but would also access industry information for areas such as retail, automobile, oil and gas, and any other that might help locate and better identify the population, their living conditions, their geographical location and movement).
QUESTIONS:
Discuss which one of the three qualitative tools (i.e., focus group, in-depth interview, or projective techniques) is the best one for collecting the appropriate data for the research problem.
What are the advantages and disadvantages of your plan?
For the focus group or interview, what topics/questions would you explore (going from general to specific)? If you use the projective technique, how would you do it?