Analyzing Sales Decline at Curries R US: A Restaurant Case Study

This report investigates the decline in sales at Curries R US, an Indian cuisine restaurant in Southport, Australia. The research explores the probable causes, including increased competition, changing consumer preferences, and the impact of online food ordering platforms. It reviews foodservice industry trends, emphasizing the importance of total quality management, customer lifetime value, and adapting to evolving consumer expectations. The report discusses the need for competitive strategies, quality assurance, and innovative approaches to attract customers and increase sales. Recommendations are provided to address the identified issues and enhance the restaurant's market position. The limitations of the research are also acknowledged, providing a comprehensive analysis of the challenges and opportunities facing Curries R US.

Final research report Curries R US

Table of Contents
INTRODUCTION AND RESEARCH PROBLEM...............................................................1
LITERATURE REVIEW.....................................................................................................4
METHODOLOGY............................................................................................................11
FINDINGS........................................................................................................................13
DISCUSSION...................................................................................................................24
RECOMMENDATIONS...................................................................................................28
LIMITATIONS AND CONCLUSION................................................................................30
REFERENCES................................................................................................................33
APPENDIX.......................................................................................................................38
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INTRODUCTION AND RESEARCH PROBLEM
The topic for research is the decline in the sales in restaurants- a case study of
Curries R US. The topic of research is selected for investigating upon all the relevant
aspects regarding the decline in sales in the restaurant.
Overview of industry partner- Curries R US
The restaurant is an Indian cuisine restaurant for fine dining located in Southport- Gold
Coast, Australia. The restaurant proudly serves the authentic and traditional Indian
dishes. It provides the dining and takeaway services (Curries R US, 2018). The
restaurant is registered on the website of Australian Business register where the starting
year is given 2014 and the other business details are given showing that the holder of
the business is the Trustee for Guru Ramdasji investment trust operating as a
discretionary trading trust. The representative of the organization is Paramjit Kaur (ABN
Lookup, 2017).
Rationale
The research here is intended towards solving the issue of scrutinizing on the reasons
behind the fall in sales of the restaurant, Curries R US. It will investigate upon the
rationale behind the fall in the sales and also identify certain other unaddressed issues
which are impacting the sales like the lack of promotional activities or the location of the
restaurant (Avlonitis and Panagopoulos, 2010).
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The problem of the depletion in sales is a major problem for the industry partner,
Curries R US as due to the sales decline the company is facing the reduction in net
profits generated which ultimately is reducing the market share and therefore
weakening the brand image (Walker and Walker, 2016). The problem needs more
attention as there are many nearby restaurants serving the Indian cuisine who are
offering a tough competition to the firm. The competitors of the restaurant are earning
good profits by their augmenting sales with time. The competitors pose a great threat to
the restaurant as their rise in the market will put the operations of Curries R US at the
danger which may also ultimately lead to shutting down of the restaurant in extreme
case (Lee and Yoo, 2012). Also, there are also many other dining places present near
Curries R US which serve the Chinese, Italian and Seafood Chinese restaurants which
give a tough competition to Curries R US in terms of serving great food at reasonable
expenses and also have good ratings on the online websites that display the nearby
restaurants (Lee, et al. 2016).
The project is of great importance as the research will provide assistance in finding of
the probable causes that cause the decline in sales of the restaurant along with the
methods and strategies that can be applied for coping up with this issue (Saunders and
Lewis, 2012). The research will help the industry partner to address the problems that
have caused the firm to lag behind in sales than its competitors. This will also provide
an opportunity to Curries R US to plan and implement new strategies to be applied for
the increase in the sales profits and therefore major benefits to the business that
increase its popularity and also enhance the brand image. For these reasons, it
becomes crucial to conduct the research (Bell, 2014).
Research aim
On the basis of research problem stated in the above section, the aim of the research is
formed. The aim of conducting this research is to explore and investigate upon the issue
of the depletion in sales of Curries R US along with investigating upon the probable
causes of the issue and suggesting methods for improvement in sales. Based on the
aim of the research, the following research questions have been formed-
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 What are the probable reasons for depletion in sales of Curries R US?
 How do the sales drop impact on the business of Curries R US?
 What measures can Curries R Us undertake for grabbing the attention of
customers and ultimately augment sales?
Report structure
The report has been structured in the following sections-
 Introduction and research problem
 A literature review describing the theoretical background of the research topic
 Research methodology
 Findings from research
 Discussion
 Recommendation
 Limitations of research and conclusion
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LITERATURE REVIEW
Foodservice industry trends
According to Burns, et al. (2013) the roles and functions of a restaurant are regulated by
effective restaurant management. The successful and most popular restaurants work
as well-oiled machines which include the execution of a wide range of the functions
performed in order to provide a high quality of services to the customers. The
restaurants providing the best in class services adopt Total Quality management (TQM)
for quality assurance and establish an environment where the business is able to
provide the best services and products to its customers (Hoang, et al. 2010). This
involves great efforts for quality control. The restaurants are a part of the hospitality and
the food service industry which involves the services to be provided for the comfort and
satisfaction of the customers. Ryu and Han (2010) state that table services are offered
in the restaurants which become one of the operating factors of the restaurants.
Figure 1: café, catering and restaurant industry Australia
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Source: [Shead, 2017]
In the figure above, it is depicted that the sector of catering, cafes and the restaurant
industry currently contributes $24.3 billion towards the growth of national economy
employing around 554,200 individuals where their number is expected to rise up to
647,900 by the year 2019. Till 2017, there were around 35,911 food service outlets
including the restaurants, cafes and catering in Australia out of which 93% were the
small businesses (Shead, 2017).
Figure 2: the statistics of the popularity of cuisines in Australia
Source: [Shead, 2017]
The figure shows that the popularity of healthy eating in Australia is increasing and has
reached 78.5 % and the growth rate of which is 14.7% maximum of all the food
concepts. Therefore, it can be seen that people are moving towards healthy food more
in Australia (Shead, 2017).
According to Euromonitor International (2018), the food services for the consumers at
the global level are becoming the daily consumption trend which necessitates the need
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of a good variety of food with quality assurance and also a shift from the traditional
indulgence. The meal services for the individual has begun to become value centred
which has blurred the difference between the retail and food services and the
component of service has become a major element of the business models (Lin and
Mattila, 2010). In the foodservice industry, the advent of online platforms for food
ordering and doorstep delivery has led to the creation of new opportunities for the new
operators to enter in the food service industry (Chou, et al. 2012).
It has been found that in Australia, the food industry has gained growth by 4% in the
year 2016 as compared to the previous years. This has resulted from the increase in
the expectations and interest of consumers in the food services (Booth and Whelan,
2014). The efficient working of the food service industry requires the business to be
well equipped with the latest technology, have an efficient workforce that meets the
interest and needs of the consumers, a good infrastructure and sufficient financial aid to
support the functioning of the business (Duverger, 2012). The operations of the
foodservice industry may include the types such as bistro, brasserie, coffee shops,
restaurants, cafeteria and other catering and food outlets. According to Park, et al.
(2010), the operations of the food service industry have been simplified and modernized
with the help of adoption of the attest technological changes. Also, the operators in the
food service industry are shifting from the focus on their primary products to more
diversified menus which comply with the dietary needs of the consumers (van der Rest
and Roper, 2013). It has been observed that besides the fact that the although the food
services operators at the global level have continued to develop and grow, in the year
2016, the independent operators have been successful in retaining a share of 69% in
the consumer food service industry. Also, it has been estimated that till the year 2021,
the growth in the food services will be increased as a result of the innovation in the
customer experiences, improved menus and formats (Bigliardi and Galati, 2013).
Therefore, for the smooth operations of the food service industry, it is expected that the
food service providers adopt the latest trends and implement them in order to sustain in
the growing and highly competitive market.
Factors to be considered for an increase in sales in business
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Yasin and Yavas (1992) state that for ensuring the growth of sales for the business
there are a number of aspects that must be kept mind. The author states that to ensure
the restaurant business must be able to maintain a competitive edge over others along
with planning the strategies for an increase in the market share of the business.
According to Luca and Zervas (2016), the competing environment offers great
encouragement and motivation to the businesses for innovating more and introducing
new dishes in their food service settings. The author says that new entrants in the
market tend to replicate the existing dishes offered by the famous dining food service
offering restaurants which lead to increased competition (Kim and Jogaratnam, 2010).
The extremely competitive environment needs to be paid attention towards otherwise
the implications of this can be drastic in nature. The businesses suffer hugely loses in
their sales due to the competitors offering the same services at comparatively lower
rates and more in amount.
According to Dale (2015), the aspect of total quality management is a significant factor
to be considered that assures that each and every staff member must perform their
duties with great responsibilities in order to maintain and meet the quality standards at
the workplace in each and every aspect of the operations of the business. This provides
an assurance of the sales department of the business working with full dedication in
order to cross-check the sales needs are fulfilled as per the decided and set objectives
of the business (Sadikoglu and Zehir, 2010). The notion of total quality management or
TQM works on the principles such as the focus on the customer, the employee
involvement, integrated systems, process centred, continual improvement, decision
making on the fact basis and communications (Wang, et al. 2012). The total quality
management ensures that the sales of the business are regulated and there is the
activity of decline of the same due to some negative implications.
Ha and Jang (2010) have shared the views that for the rise in sales of the business,
quality assurance is a necessary aspect to be considered which makes sure that the
quality of the services and products offered by the business will be well maintained.
There are a number of aspects that are checked for quality assurance. Similar views are
shared by Ryu and Han (2010) stating that the aspects include the use of best practice
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strategies comprising of the performance agreements, the continual improvement
processes and benchmarking of the consumers and centers for food services. One
more parameter of quality assurance of the food products that are freshly prepared is
their hygiene test, preparation tests and many more. The aspect of service quality also
needs to be considered for assuring the good quality of overall services offered by the
restaurants to their consumers.
According to Kasemsap (2018), the customer lifetime value is a crucial aspect that must
be considered. The customer lifetime value calculates the value a particular business
will derive from their all-inclusive relationship with the consumer. The measurement of
Customer Lifetime Value provides benefit in the form of providing aid in the planning of
marketing campaigns and therefore enhances the interaction with customers for
augmenting sales. It aids in calculation regarding which customers should the sales
representatives focus on most for maximum acquisition. It predicts the health of the
business in the food service industry for a long term.
What are the factors that cause a decline in sales?
According to Jargon (2010), the restaurants in the recent times, in general, have
observed the decline in sales which may be caused as a result of several reasons. One
of the most common and general aspects is poor marketing techniques applied by the
food service industry. The lack of marketing and sales alignment leads to the lack of
attention paid by the customers towards a particular business. The poor selling
techniques adopted by the businesses cause the sales of the services and products to
lessen down. Despite the fact that consumer spending has increased in the recent
years, due to the increase in the competition the restaurant’s which have adopted the
traditional selling methods and approaches lag behind and face loss in their business
profits (Osterwalder and Pigneur, 2010). Another aspect that has been found in the
change in the requirements and preferences of the customers which have been caused
due to the emergence of various food outlets serving foods of different countries. One
more reason that has been found is that sometimes the sales representative’s ignore
the sales statistics and therefore due to not taking any follow up the graph of the sales
keeps on declining at a steady rate. The ignorance by the management of the rising
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competitors in the food service industry leads to the depletion in sales due to the
customers of the existing firm migrating to the others. The competitors of the business
pose a great threat by pulling down of the consumers towards them which drastically
leads to decrease in the sales of the company (Liu and Zhang, 2013).
Another major aspect that may lead to the decline in sales is the problem of ineffective
management. This involves lack of hiring the right employees and rewards systems,
sudden changes in the process of sales and poor metrics. All these factors become the
root cause for the decline in the encouragement in the sales team and therefore they
show ineffectiveness in their work (Obiechina, 2016). Another factor that has been
newly discovered is the location of the food service place. Due to the complicated
structuring of the restaurants, the customers may find it uneasy for next time to come.
This also involves the area in which the place is located. Due to the fewer footfalls of
people in that area, the restaurant may be less visited and therefore it will ultimately
lead to the decrease in the sales. Another reason that has been identified for the
declining sales is the lack of proper service delivery systems in the restaurants. The
service delivery systems must be effective enough that the services and products are
able to reach the targeted audience (Ponsignon, et al. 2011). It involves effective
service management which comprises elements such as the quality of service, the
culture, engagement of employees and the customer experience. The lack of focus on
the service delivery systems by the restaurant business causes them to lag behind their
competitors in terms of sales.
Strategies to be implemented for augmenting sales
Teece (2010) state that it is essential to implement a certain set of strategies in the
businesses in order to observe progression in sales and thus generate more profits. The
author has shared the views that the strategies of increasing penetration in the existing
markets is a good approach for the augmentation in sales and thus gain growth in the
market share. It is a good and quick method for exploiting the foundational portion of the
food serving business and thus gets the most feasible and fastest sales. According to
Friedman (2012), the strategy of introducing of a new product line in the market is
another widespread strategy for gaining growth in the sales in a market where the
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customers are easily attracted to try the new dishes of the restaurants. In Australia,
according to Assaf, et al. (2011), the restaurants are moving towards innovation and
therefore introducing the new line of innovative dishes that are healthy as well as tasty.
This will also help in generation of potential customers who are on diet and earlier
avoided dining outside due to fat contained in the food. This falls under the strategy of
identifying a new segment of clients (Nagle and Müller, 2017). According to a survey, it
has been found that around 95% of the world’ population is overseas. Therefore, it is a
smart approach to find new channels for distribution of services and products that will
aid in augmentation of sales.
Another strategy that can be incorporated as stated by Namkung and Jang (2010) is
offering new services to the customers like addressing the preferences of the customers
by observing their buying behavior, managing the costs of labor through implementation
of new technology, developing new checks for food safety and the IT security,
introducing new promotional activities etc. that attract the customers more and thus
there is some increment in the sales. The unique services offered at the food service
outlets will drive more consumers and this will enhance the cash flow thus observing
sales raise and solidified relationships with the consumers. The strategy of aggressive
pricing has not gained must popularity but is an option for the sales rise (Jin, et al.
2016). This causes the increase in the number of sales but sometimes leads to
significant loss of the businesses thus removing their chances to gain some amount of
profits.
The food service industry is continuing to grow with the evolution new ideas and
technological changes which lead to more businesses to enter. Also, there are certain
crucial aspects to be considered for the smooth functioning of the food service outlets
particularly restaurants like the total quality management thus ensuring that the sales of
the business are not impacted largely (Akkerman, et al. 2010). It causes the existing
businesses to observe some loss is their sales and thus gain less profit but urges them
to deploy some strategies for balancing their sales.
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