ABC Restaurant Business Analysis

This assignment analyzes the performance of ABC restaurant through a mix of primary and secondary research. It examines customer satisfaction, explores the relationship between sales and profits, recommends a focus on social media marketing for revenue growth, and evaluates the financial viability of two proposed projects (A & B) highlighting Project A's higher return potential.

BDM

Table of Contents
INTRODUCTION......................................................................................................................3
TASK 1......................................................................................................................................3
1.1 Planning for the collection of primary and secondary data..............................................3
1.2 Presenting survey methodology and sampling frame used..............................................3
1.3 Preparation of questionnaire............................................................................................4
2.1 Creating and summarizing information for decision making..........................................6
2.2 Analyzing results to draw valid conclusion.....................................................................7
2.3 Using measures of dispersion for decision making..........................................................9
2.4 Quartile, percentile and correlation coefficient................................................................9
TASK 2....................................................................................................................................10
3.1 Producing graphs by using spread sheet........................................................................10
3.2 Creating trend line for assessing future trends...............................................................11
3.3 Dissemination of information through software............................................................12
3.4 Preparation of formal business report............................................................................12
4.1 Using appropriate information processing tools for decision making...........................12
4.2 Preparing a project plan for determining critical path...................................................13
4.3 Using financial tools for decision making.....................................................................14
CONCLUSION........................................................................................................................15
REFERENCES.........................................................................................................................16

INTRODUCTION
In the business organization, owner or manager has to take several decisions
regarding effective administration, fund raising, expansion etc. Moreover, any inappropriate
decision has high or negative impact on the productivity and profitability of firm. This project
report is based on the case scenario which entails that large restaurant chain is planning to
open another unit in London. Moreover, now tourism in London is increasing with the very
high pace. Further, now having parties in restaurant become the part of individuals life style.
In this, the present report will provide deeper understanding about the ways in which
statistical and financial tools helps in developing suitable framework for near future. Besides
this, it will also shed light on the project management tools such as network diagram, Gantt
chart which in turn helps in framing highly competent framework for the near future.
TASK 1
1.1 Planning for the collection of primary and secondary data
 Primary data collection: Data which is gathered by scholar through the means of
survey, observation, focus group etc. is known as primary data. As the name suggests,
primary data is gathered by scholar for the first time in accordance with the research
aims and objectives. Such data is highly raw in nature and assists in presenting the fair
solution of research issue or problem. In this, to analyze the taste and preferences of
customers regarding the existing and another one research will conduct survey.
Moreover, by asking questions in relation to price, location etc. researcher would
become able to extract suitable information (Rajasekaran and et.al., 2016). Thus, for
the collection of primary data researcher will prepare questionnaire by including both
types of questions into it such as close and open ended. Thereafter, research will send
questionnaire to 20 customers of ABC restaurant which are selected from purposive
sampling technique. Hence, by following such plan primary data will be gathered by
scholar.
 Secondary data collection: Books, journals and scholarly articles are the main
sources that contain valuable findings presented by other scholars through in-depth
research. Hence, to gain information about customer preferences, attitude and their

purchasing behavior researcher will make evaluation of journals, scholarly articles
and government reports to gather secondary data.
1.2 Presenting survey methodology and sampling frame used
 Survey methodology: It entails methodology or process which will be employed by
the researcher for conducting survey and thereby collecting data. Hence, for the
collection of primary data researcher will conduct online survey. Such survey process
is highly effectual which enables researcher to gather data within the less time frame
at low cost (Biersack, Herrnson and Wilcox, 2016). Now, restaurant owner maintains
data about the customers such as mail-id, contact number etc. Hence, researcher will
acquire information about mail-id from restaurant owner. Thereafter, researcher will
send questionnaire to the respondents by taking prior permission from them. Thus,
by following such process survey will be conducted by researcher.
 Sampling frame: Selection of suitable sample is the prior requirement when
researcher is planning to organize or conduct survey. Moreover, time and fund are the
main constraints due to which it is possible for the scholar to conduct investigation on
whole population. In this, probabilistic and non-probabilistic are the main two
sampling types which can be undertaken by scholar foe sample selection (Baltzan and
Phillips, 2016). Hence, by using purposive sampling technique researcher will select
20 customers. Such technique is the part of non-probabilistic technique in which
researcher selects sample according to the purpose of research. Moreover, by existing
customers have better idea regarding the area of restaurant which requires restaurant.
1.3 Preparation of questionnaire
Questionnaire
Demographic information
Name …………
Age ……………..
Gender …………..
Income ………….
Q.1 How often do you dine with us?

 Often ()
 Very often ()
 Never ()
Q.2 Do you like reservation system?
 Yes ()
 No ()
Q.3 How do you rate the food which is offered by restaurant?
 Excellent ()
 Better ()
 Very good ()
 Good ()
 Average ()
 Poor ()
Q.4 Kindly indicates the extent to which do you agree or disagree with the below mentioned
aspects:
Particulars Agree Strongly
agree
Neutral Disagree Strongly
disagree
Food served
by restaurant
is hot and
fresh
Food is tasty
and flavorful
Personnel are
highly skilled
and efficient
Interior and
exterior is
highly
attractive

Proper
hygiene is
maintained
by restaurant
Waiting time
affects your
satisfaction
level
Q.5 From the following factors which promotional medium have high level of impact on your
decision making?
 Television ()
 Newspaper ()
 Social media ()
Q.6 Is location factor affect your decision making in relation to dine?
 Yes ()
 No ()
Q.7 How much do you ready to pay for the meal of two people?
 £50-60
 £65-80
 £80-90
Q.8 Which kind of food do you like most?
……………………………………………….
Q.9 Giving recommendations for improvement ………..(Kindly clarify)
2.1 Creating and summarizing information for decision making
Sales and profit figures of large chain restaurant are enumerated below:
Years Sales Profit
2008 1100 220

2009 1200 240
2010 1380 276
2011 1450 284
2012 1320 250
2013 1380 264
2014 1580 275
2015 1750 290
Calculation of mean, mode and median
Particulars
Sales (in
£)
Profit
(in £)
Mean 1437.14 268.43
Standard Error
68.1285
3 6.858631
Median 1380 275
Mode 1380 #N/A
Range 550 50
Minimum 1200 240
Maximum 1750 290
Sum 10060 1879
Statistical evaluation of data set presents that mean sales and profit of firm was £1437
& £268 respectively. On the other side, 50% amount of sales and profit is related to £1380 &
£275. Hence, by considering the overall trend it can be stated that median sales are higher

than the average amount. Hence, by undertaking significant measure or action restaurant unit
can increase its sales and profit level.
2.2 Analyzing results to draw valid conclusion
Outcome of primary of data investigation
Theme 1: Excellent services are offered by Large chain restaurant
Particul
ars
Views of
responde
nts
% of
responde
nts
Excellen
t
5 25%
Better 4 20%
Very
good
4 20%
Good 3 15%
Average 4 20%
Poor - -
Excellent Better Very good Good Average
0%
5%
10%
15%
20%
25%
30%
% of respondents
% of respondents
The above mentioned graph presents that 25% respondents rated the services of
restaurant as excellent. On the contrary to it, 40% customers said that service quality of large
chain restaurant is better and very good. It shows that customers are highly satisfied from the
dinning services offered by firm. Hence, such satisfaction will turn into loyalty in the near
future and thereby helps firm in increasing profit level.
Theme 2: Social media has high level of impact on customer’s decision making

Particulars Views of respondents % of respondents
Newspaper 6 30%
Television 4 20%
Social media 10 50%
Total 20 100%
Results of survey show that decision making of 50% customers is highly influenced
from social media. From secondary data investigation, it has been assessed that now people
make use of social media with the very high rate and share their views as well as suggestions
with others. On the other side, 20% respondents consider television, whereas remaining
customers undertake newspaper while take dinning decision. On the basis of this aspect, by
developing suitable promotional mix company can entice the decision making of others.
2.3 Using measures of dispersion for decision making
Calculation of standard deviation and variances
Particulars
Sales (in
£)
Profit
(in £)
Standard
Deviation 180.25 18.15
Sample
Variance
32490.4
8 329.29
Kurtosis 0.51 -0.88
Skewness 0.73 -0.58
From evaluation, it has been determined that standard deviation of sales and profit
measure is £180.25 & £18.15. Hence, in the near future revenue and margin of the firm will
deviate from such amount. Thus, manager needs to undertake such aspect while framing
strategies and policies regarding another restaurant unit (Abadi, 2017).
2.4 Quartile, percentile and correlation coefficient
Quartile measure helps company in assessing its performance eve in the respect of
each quarter. Percentile also presents the same but it shows output in the form of percentage
(Quartile, 2017). Hence, by evaluating such performance firm can make suitable decisions
and thereby makes contribution in the attainment of organizational goals and objectives.
Computation of quartile and percentile
Quartiles Percentiles Sales (Amount in £) Profit (Amount

in £)
Quartile 1 25th Percentile 1290 247.5
Quartile 2 50th Percentile 1380 269.5
Quartile 3 75th Percentile 1482.5 278
Tabular presentation shows that sales revenue and profit margin of large restaurant
unit was £1290 & £247.5 respectively. On the other side, in the second and third quarter,
sales of firm were £1380 and £1482.5. Further, profit margin of business unit also increased
from £269.5 to £278. Hence, by considering all such aspects it can be stated that both sales
revenue and profit margin were increased from one quarter to another. This aspect clearly
shows that business unit had attained success in attracting the large number of customers.
Calculation of correlation coefficient
Particulars Sales Profit
Sales 1 .90
Profit .90 1
The above depicted table entails that high level of positive relationship takes place
between the sales and profit margin of restaurant. According to the statistical aspects if sales
revenue will increase then profit aspect moves in upward direction and vice versa. On the
basis of this aspect, business entity needs to frame highly competent framework which place
positive impact on both sales revenue and margin (Link and et.al., 2017).
TASK 2
3.1 Producing graphs by using spread sheet
Graphical presentation of sales and profit from 2005 to 2015:

1 2 3 4 5 6 7 8
0
200
400
600
800
1000
1200
1400
1600
1800
2000
Sales
Profit
Graph which is presented above clearly entails that sales revenue of large chain
restaurant increased from £1100 to £1750 at the end of 2015. It shows that large number of
people prefers to take services of restaurant more frequently (Abid, Abbas and Nazir, 2016).
Along with this, the above depicted graph also presents that profit margin of restaurant also
increased from £220 to £290 in the last 11 years. Thus, by considering all such aspects it can
be said that financial position and performance of restaurant is sound.
3.2 Creating trend line for assessing future trends
Trend line may be served as a statistical tool which in turn helps in analyzing the
future trend and pattern in monetary terms (Ezeonwumelu, Kalu and Johnson, 2016). With
the aim to make optimum use of resources large restaurant chain has conducted trend
analysis. Thus, from investigation, it has been identified that in the upcoming time period
both sales and profit margin will increase. It is the positive indicator for the firm. Hence, by
offering high quality food, maintaining proper hygiene, making interior and exterior highly
attractive business entity can attract large number of customers. Thus, by keeping all such
aspects in mind firm can achieve success in the highly strategic business environment.
Trend analysis of sales and profit

1 2 3 4 5 6 7 8
0
200
400
600
800
1000
1200
1400
1600
1800
2000
f(x) = 75.2380952380952 x + 1056.42857142857
f(x) = 7.08333333333333 x + 230.5
Sales
Linear (Sales)
Profit
Linear (Profit)
3.3 Dissemination of information through software
Enclosed in power point presentation.
3.4 Preparation of formal business report
To,
Board of Directors,
Large chain restaurant,
Date: 26th February, 2017
From evaluation, it has been assessed that sales and profit margin of firm is continuously
increasing. From 2005 to 2015, sales revenue of restaurant group increased significantly.
Along with this, due to the existence of positive and high relationship profit aspect of the
restaurant was increased in the past 11 years. Further, trend line shows that in the near future
sales revenue and margin of the restaurant will incline. Output of data investigation also
shows that customers are highly satisfied from the services offered by restaurant. Moreover,
now high level of increase takes place in the living standard and lifestyle of people. Thus, by
considering all such aspects it can be stated that business entity of large chain restaurant will
attain success by opening another unit in London. Thus, owner of restaurant chain should go
with expansion plan which will help them in getting the desired level of outcome or success.
Sincerely
Research analyst
4.1 Using appropriate information processing tools for decision making

There are several information processing tools that can be undertaken by the business
entity for the purpose of decision making are enumerated below:
 Management information system (MIS): It is the computer based software or system
that helps manager in taking profitable decision by organizing and evaluating data in
the best possible way (Barton and et.al., 2016).
 Decision support system (DSS): Such software arranges data of all departments in the
best possible way and thereby supports strategic decision making of firm.
 Transaction processing system (TPS): Large chain restaurant can assess the area of
control by recording and analyzing the business transactions (Özdemir, 2016).
Hence, by analyzing and interpreting all such information systems business unit can take
suitable decision that directly aid in the profit margin of firm.
4.2 Preparing a project plan for determining critical path
Project plan and activities for starting restaurant is enumerated below:
S. No. Activities Immediate
predecessors
Duration (in days)
1. Research outline - 6
2. Doing literature 1 12
3. Primary data collection 2 16
4. Arranging and analysis of data
as well as drawing conclusion
2 & 3 18
5. Preparation of budget 3 & 4 9
6. Executing plan 5 25
7. Finding deviations and making
changes
6 7
8. Final execution 7 9

According to the above mentioned network diagram large restaurant unit would
become able to complete project within the short time frame such as 84 days by following
below mentioned path.
Path: 1 + 2 + 3 + 5 + 6 + 7 + 8
4.3 Using financial tools for decision making
Investment appraisal techniques are the one which helps manager in evaluating the
attractiveness and profitability aspect of different projects. Such techniques includes payback
period, NPV and IRR which in turn helps in assessing the viability of investment proposal
(Kołacz and Grzegorzewski, 2016). For instance: owner of ABC restaurant owner has two
projects such as A and B for investment. Thus, to select best proposal capital budgeting tools
have been applied by the manager of large chain restaurant is enumerated below:
Calculation of payback period, NPV and IRR
Year
Pr
oje
ct
A
Cumulative
cash inflow
PV
factor
@
10%
Discoun
ted
cash
inflow
Pr
oje
ct
B
Cumulative
cash inflow
Discoun
ted
cash
inflow
1
12
00
00 120000 0.909 109080
11
50
00 115000 104535
2
13
50
00 255000 0.826 111510
12
20
00 237000 100772
3
12
80
00 383000 0.751 96128
11
80
00 355000 88618
4
14
00
00 523000 0.683 95620
13
00
00 485000 88790
5
15
50
00 678000 0.621 96255
14
40
00 629000 89424
Payback
period
2 + (350000 –
255000) /
128000 = 2.7
2 + (350000 –
237000) /
118000 = 2.10

years years
Total
discounte
d cash
inflow 508593 472139
Initial
investmen
t 350000 350000
NPV 158593 122139
IRR 26% 22%
The above mentioned table presents that payback period of project A and B is 2.7 and
2.10 years. It shows that in the case of project B business entity has to wait 3 months more
for recoup the initial investment as compared to proposal A. Further, IRR of proposal A is
26% which is higher than proposal B. Along with this, NPV of proposal A and B is £158593
& £122139 respectively. By considering such aspect and selection criteria, it can be stated
that high returns are associated with project A. Thus, by investing money in proposal A large
chain restaurant would become able to get high profit margin.
CONCLUSION
From the above report, it has been concluded that researcher will gather data from
both primary and secondary sources. Beside this, it can be inferred from primary
investigation that customers have positive attitude towards the dinning services provided by
the restaurant. It can be stated from the report that statistical tools helps in summarizing the
large amount of data in the best possible way. Hence, by considering the outcome of mean,
median and measures of dispersion owner of ABC restaurant can take suitable business
decisions. Further, it can be revealed from the report that both the variables such as sales and
profit are highly associated with each other. Hence, by focusing on social media campaign
restaurant can maximize both sales revenue and profit margin. It also has been articulated
from financial analysis that project A will offer higher return to the restaurant as compared to
others.

REFERENCES
Books and Journals
Abadi, D. H., 2017. The Implementation of Islamic Education Management Information
System in Religious Ministry Regional Office West Java Province. International Journal
of Nusantara Islam. 4(2).
Abid, M., Abbas, N. and Nazir, H. Z., 2016. Improved ratio estimators for the population
mean using non-conventional measures of dispersion. Pakistan Journal of Statistics and
Operation Research. 12(2). pp.353-367.
Baltzan, P. and Phillips, A., 2016. Business driven information systems. McGraw Hill
Education.
Barton, K.A. and et.al., 2016. Information system security commitment: A study of external
influences on senior management. Computers & Security. 59. pp.9-25.
Biersack, R., Herrnson, P. S. and Wilcox, C., 2016. Risky Business: PAC Decision Making
and Strategy: PAC Decision Making and Strategy. Routledge.
Ezeonwumelu, A. N., Kalu, C. and Johnson, E. H., 2016. Development of swim lane
workflow process map for sales and inventory workflow management information system:
A case study of petrospan integrated services, Eket, Akwa Ibom State, Nigeria.
Mathematical and Software Engineering. 2(2). pp.57-65.
Kołacz, A. and Grzegorzewski, P., 2016. Measures of dispersion for multidimensional data.
European Journal of Operational Research. 251(3). pp.930-937.
Link, D. F. and et.al., 2017. Management techniques for non-traditional network and
information system topologies. 9. pp.537,731.
Özdemir, D., 2016. Measures of Dispersion. In Applied Statistics for Economics and Business
(pp. 51-72). Springer International Publishing.
Rajasekaran, K. G. and et.al., 2016. A Review on Employing Multi Criteria Decision Making
Methods for Supplier Selection. Asian Journal of Research in Social Sciences and
Humanities. 6(6). pp.802-810.