Murano Restaurant Expansion: A Business Decision-Making Analysis

This report investigates the feasibility of London-based restaurant Murano expanding its operations by opening a new branch. It presents findings developed through secondary and primary data analysis, including graphical representations of revenue, profit trends, and consumer preferences. The analysis reveals that while the expansion is viable from marketing, legal, and operational perspectives, financial projections indicate negative worth in the initial four years. However, long-term profitability and growth are expected. The report concludes that if Murano can sustain the initial financial burden, the expansion is justified, recommending that the restaurant unit consider the long-term growth potential when making its decision. It also considers consumer awareness and satisfaction, indicating a positive reception for a new outlet.

Business Decision making
TASK 3 (3.3)

Overview
An investigation is conducted for
London-based restaurant unit,
Murano that is planning to
expand operations by opening up
a novel branch. The presentation
entails findings that are
developed as a part of analysis.

Secondary information-
Graphical presentation
2009 2010 2011 2012 2013 2014 2015 2016
0
500
1000
1500
2000
2500
1250
1520
1680
1830
1980 2070 2150
2260
250
380
470.4 512.4 594 662.4
817 904
Bar Chart- Revenue & Profit (in £'s)
Sales (in £) Profit (in £)

Continued
2009 2010 2011 2012 2013 2014 2015 2016
0
500
1000
1500
2000
2500
f(x) = 137.380952380952 x + 1224.28571428571
R² = 0.965338970027517
f(x) = 88.3404761904762 x + 176.242857142857
R² = 0.983399454593408
Trend line- Revenue & Profit (in £'s)
Sales (in £) Linear (Sales (in £)) Profit (in £) Linear (Profit (in £))

Analysis
 The bar chart sketched above shows growth in revenue and
profits of the restaurant unit in duration of last ten years. It is
seen that the revenue and profits are initially increasing at
constant rate; and thereafter, at increasing rate. This shows that
the Murano has witnessed adequate level of growth in terms of
revenue and profits earned.
 As per the trend line, it is expected that sales and profit would
continuously grow in upcoming five years of time. Further, as per
the value of r-square, it can be said that the value of revenue and
profits adequately depends on respective values of previous year.

Primary Information – Graphical
Presentation
47%
33%
7%
7%
7%
Do you prefer having Italian food products?
Strongly prefer Prefer Neutral Somewhat prefer Not preferred at all

Continued
47%
33%
7%
7%
7%
Do you prefer having Italian food products?
Strongly prefer Prefer Neutral Somewhat prefer Not preferred at all

Continued
50%
33%
3% 7%
7%
Do you agree that the Murano has its own
taste of Italian food products?
Strongly agree
Agree
Neutral
Disagree
Strongly agree

Continued
47%
33%
7%
7%
7%
Do you agree that the restaurant unit has
pleasant and soothing ambience?
Strongly agree Agree Neutral Disagree Strongly disagree

Analysis
As per the evaluation of primary
information, it can be said that
consumers have adequate level of
awareness. Further, they are pleased
to welcome new outlet of Murano
due to sufficient degree of
satisfaction among them.

Conclusion and
Recommendation
It is seen that the plan to open up an outlet in Central London is feasible
on grounds of marketing, legal and operational grounds. There is a
sufficient level of demand and curiosity among customers in the market
place. Further, the organization experience can be materialised to plan
up operations for the novel store. However, on financial grounds, it is
found that the new outlet is not going to positive worth in duration of 4
years. However, it is expected the business unit is going to generate
high level of profitability and achieve adequate growth in long run.
Henceforth, if the restaurant unit is stable enough to bear burden of
initial years, then expansion is justified. The business unit can decide
upon opening up a new outlet considering growth in long run.

References
 Bedeian, A.G., 2014. “More Than Meets the Eye”: A Guide to
Interpreting the Descriptive Statistics and Correlation Matrices
Reported in Management Research. Academy of Management
Learning & Education.13(1). pp.121-135.
 Jaggia, S. and et.al., 2016. Essentials of business statistics:
communicating with numbers. McGraw-Hill Education.
 Siegel, A., 2016. Practical business statistics. Academic Press.
 Taylor, W.B., 2013. Introduction to Management Science. 11th
ed. Pearson.