Unit 6: Regent College Business Decision Making Sample Assignment Report - Essay Prowess
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Unit 6: Regent College Business Decision Making Sample Assignment Report

Unit 6: Regent College Business Decision Making Sample Assignment Report

  

Introduction

Business decision making involves analyzing the existing businesses to comprehend the operations of the intended market area. It includes feasibility study to determine factors that may facilitate or hinder the viability the proposed business. The intended market area should be studied comprehensively so that one can understand the strategies of the potential competitors. Our intended market area is London City which is a multicultural city. London restaurants serve over 70 cuisines from different countries. Restaurants mostly open from 6 A.M with the periods between 10 A.M and 12 P.M being the peak hours. Some restaurants operate on a 24 hour basis. Payments in these restaurants is mostly through major payment cards; MasterCard, Visa and Amex. 

Task 1: Report on Data Collection and Analysis for Study of Market preferences

1.1

Primary Datawill be collected through various ways which include: observations, experiments, interviews and questionnaires.  

  • Questionnaires: Questionnaires will be given to existing restaurants’ stakeholders. The questionnaires will fetch first-hand information mostly focusing on daily routine in the restaurants.
  • Interviews: Interviews will also give fast hand information. They will involve different stakeholders including management, staff and customers.
  • Observations: This will complement the questions asked in the interviews. Some observations will be done while interviewing people such as customers and the staff.
  • Experiments: This can be done by for instance ordering a meal and making recording data. The data includes: menu pricing, delivery time, service procedures and general customer experience.

Secondary Dataentails digging deep into secondary sources of data. The data is from factual figures and information from existing business and past studies (Sapsford and Jupp, pp.17). Secondary data collection includes:

  • The internet: The internet contains multiple sources of information about restaurants including legal requirements. It provides latest trends and experiences about restaurants including pictorial representations.
  • Databases: These include all the information about restaurants. They form a comprehensive source of information.
  • Books: There are many books that provide financial, legal and statistical information about restaurants and businesses. There are many print and electronic books that can provide essential information.
  • Historical Records: Historical records provide information about the trends in the catering industries. Business trends in London can be drawn from historical information which will give clear information about restaurants especially in the potential market area.
  • Newspapers and Magazines: These provide specific information about different experiences.   

 1.2

Survey Methodology for this research will seek to get both quantitative and qualitative data. The survey will collect information about existing businesses turnover and the major occurrences in the industry (Levy and Lemeshow, pp.21). The methodology is aimed to solve the following issues that pose difficulties to the process of gathering information:

  • The coverage of the intended population: Collecting data from all the intended sources of data is not always achievable but covering a significant population can be considered an achievement. Some information such as financial and strategic information might not be disclosed freely. This is because the sources of the information are the competitors.
  • Language Barriers and Miscommunication: Customers from different locations might be communicating in different languages. Even though English is the language expected to be used all over London, an interviewee speaking a different language is a possibility. Slangs and different names of different foods might cause miscommunication.
  • Geographic Restrictions: Different locations of the restaurants mean different trends and cultures of the restaurants in London. The survey should hence cover different locations of the city. The methods of data collection may involve using emails and making phone calls in case there are restrictions on physical contact.
  • Legal Issues: The survey involves acquiring sensitive information that might only be accessible through the use of legal procedures. The process of collecting data should therefore be conducted as per the legal requirements of the nation.

Sampling frame involves choosing the most appropriate area for data collection and selecting credible respondents. Details of the persons that will provide data vary depending on the location and all the data that should be collected. There are important issues that will be considered during the survey research. These include:

  • The data available: Information about the samples to be used for data collection is essential in choosing the relevant samples for the survey. Such information involves determining the type and content of the information. The availability of their contact information in order to prepare for data collection is a key issue that needs to be considered first.
  • The availability of respondents: Planning for data collection involves seeking the availability of the respondents. Most respondents for a restaurant business survey are available during working hours. Due to the management’s busy schedule, they may not have ample time to respond to many interview questions. Therefore, data collection should be done when the respondents are not very busy and when they are willing to be engaged.
  • The stakeholders that can be sampled: The sampling process should cover a significant number of different stakeholders in order to get first-hand information. The researcher should thus seek permission from the management who will assist in the sampling process in order to involve all the stakeholders.

1.3

Questionnaire for Restaurant Customers

  • Gender
  • Male 
  • Female
  • Select the category of your age
  • 18-25
  • 26-35
  • 36-45
  • 46-55
  • 56-65
  • 66-75
  • 76 and Above
  • Are you a United Kingdom resident?
  • Yes
  • No
  • Which seasons do you visit UK? (For Non- Citizens)
  • Jan- March
  • April-June
  • July-Sep
  • Oct- Dec
  • Do you use accommodation services provided by the restaurant?
  • Yes 
  • No
  • How many times do you take you meals at the restaurant?
  • Once Daily
  • Twice Daily
  • Thrice Daily
  • Once in a Week
  • Once in a Month
  • For how long do you stay in the restaurant?
  • 1-3 Days
  • 4-6 Days
  • 1 Week
  • 2 Weeks
  • 1 Month
  • Over 2 Months
  • How much (Sterling Pounds) do you pay for meals in a day?
  • Less than 500
  • 500-1000
  • 1000-3000
  • Over 3000
  • How much do you pay for accommodation services in a day (Sterling Pounds)?
  • Less than 500
  • 500-1000
  • 1000-3000
  • Over 3000
  • Which other services do you consider important in the restaurant?
  • Transport
  • Bar
  • Swimming Pools
  • Gambling
  • Other (Specify)
  • Which hours of the day do you like to spend in the restaurant?
  • 6 A.M – 11 A.M
  • 12 P.M- 5 P.M
  • 6 P.M- 8 P.M
  • 9 P.M – 6 A.M
  • Does the restaurant provide all your preferred food and drink choices? If not, please indicate the names of the foods and drinks.
  • Yes
  • No

Questionnaire for different Restaurant Management Staff

  • What is the average number of customers you receive in a day?
  • Less than 20
  • 20- 50
  • 50-100
  • 100-500
  • 500- 1000
  • Over 1000
  • How many employees do you have?
  • 10-20
  • 20-30
  • 30-50
  • 50-100
  • Over 100
  • How much do you spend on foods and services in a day? (Sterling Pounds)
  • Less than 2000
  • 2000- 5000
  • 5000-10000
  • 10000-20000
  • 20000-50000
  • Over 50000
  • How much do you spend on employee payments in a day? (Sterling Pounds)
  • Less than 2000
  • 2000- 5000
  • 5000-10000
  • 10000-20000
  • 20000-50000
  • Over 50000
  • How much do you pay for bills and licenses in a month? (Sterling Pounds)
  •  Less than 2000
  • 2000- 5000
  • 5000-10000
  • 10000-20000
  • 20000-50000
  • Over 50000
  • How much do you get as returns in a day? (Sterling Pounds)
  • Less than 2000
  • 2000- 5000
  • 5000-10000
  • 10000-20000
  • 20000-50000
  • Over 50000

The questionnaire is meant to collect data from all the customers both local and international. It also captures data about the age, visits, the kinds they prefer, the amount they spend in the restaurants, the seasons and hours they visit the restaurant and services they prefer. This is comprehensive information about the restaurants since it captures information from different stake holders of the existing restaurants in the city.

2.1

   Season Income Expenses
  Meals Income Accommodation Income Meals Expenses Accommodation Expenses Employee Salaries (100 Employees) Bills and Licenses
Jan-March 650000 510000 320000 200000 30000 50000
April-June 670000 530000 340000 220000 30000 50000
July- Sep 750000 550000 370000 250000 30000 50000
Oct- Dec 630000 500000 330000 200000 30000 50000
Total 2700000 2090000 1360000 870000 120000 250000

2.2

The table above gives different figures for different seasons of the year. The periods between October and December present lowest visits to the restaurants while the periods between July and September present the highest visits. Expenses on employees’ salaries, bills and licenses remain constant throughout the year.  The annual income, expenses and profit figures can be represented in a business context as follows:

Income Expenses Profit
4,790,000 2,600,000 2,190,000
     

The figures show that a restaurant with 100 employees receives a profit of 2,190,000 annually. This is 182,500 pounds monthly. The figures are drawn from different seasons.

2.3

The measures of dispersion in the accompanying spreadsheet show little variances in the seasons. For instance the expenses on meals, employee salaries, bills and licenses remain constant throughout the year.

2.4

The data derived from spreadsheet gives multiple dimensions of exploring the market space. Important information on the market status can be drawn to determine the feasibility of the restaurant business. From the spreadsheet data, salaries of employees can thus be estimated to be about 1000 pounds per month for. Bills and licenses information can be estimated to be about 12500 pounds per month. The expenses of the business are therefore less than the income of the business increasing the viability of the business. An annual profit of 2,190,000 pounds is expected from the business indicating that the venture is worth starting. 

The correlation coefficient between sales and net income is closer to +1. Normally, it ranges from -1 to + 1. It is closer to +1 means that there is a strong relationship between the income and expenses. The company can thus make simple adjustments to the company’s expenses that will have a direct impact on the income. Therefore, the correlation coefficient can be useful to the company while making decisions regarding expenses and income. The interquartile range can be used to predict the range within which its expenses and income will lie. They can also indicate the consistency results in terms of income. Therefore, the company should use information from the quartiles find contingency measures to stabilize its income and also increase the predictability of the income.

Task 2: Graphs, Flowcharts, Numerical Reports on Financial Viability, Project Implementation and necessary explanations

3.1

From the graph above generated from a spreadsheet, it is evident that different income sources generate more money than their corresponding expenses. Therefore, it creates the impression that the restaurant is highly profitable with income being higher than 400,000 Sterling Pounds every season. Expenses are below 400,000 Sterling Pounds, leading us to the conclusion that the business is profitable every season of the year. The business is thus viable since income exceeds expenses.

3.2

The exponential trend line added to the graph forecasts that increase in expenses result into more income and higher profits. This is very important in the growth of the restaurant business since increase in number of customers will result into increased income thus higher profits for the business. The business will still generate significant profits even during the lowest seasons, between the months of October and December. The trend also indicates that the business will grow exponentially if more services and facilities are introduced into the business. The introduction of new services and facilities occurs due to the growth of the business. Such a case usually occurs when the business has grown and demand for services becomes higher necessitating for more services and goods.   

3.3

Refer to the PowerPoint presentation included in this package. The presentation highlights major facts about the new restaurant. It gives an overview of what the new business entails.

3.4

The following is a report of a restaurant business. The report entails all the information about the viability of the business including estimated cash flows and profits. The restaurant will provide services to people in London as well as visitors from foreign countries. The choice of the product and services offered by the business are perfect for this city that has many residents and visitors. The idea was ignited by the success of another restaurant and this restaurant is expected to have the same success. The experience and skills gained from managing the first restaurant will very useful in the running of this restaurant. The management of the existing restaurant will provide all the information and skills needed to run the new restaurant in London. The management’s marketing skills will be vital in the promotion of the new restaurant (Kuiper, pp.63).

However, the business could face risks arising from the comparison of the new restaurant with the operational restaurant. It is because to the fact that the two are located in different places that have different trends and cultures. This report dives deeper into the hotel industry especially in London to eliminate such risks. Another risk is the competition from the existing restaurants in the city which have established a good customer base. Offering better and affordable services will increase the new restaurant’s competiveness. Statistical figures and graphs predict that the business will make huge profits because of the large customer base in the city. This makes the business more viable. Seasonal variances of customer numbers do not reflect a significant change in the profits gained annually. 

The restaurant will be run by a management team similar to that of the existing restaurant. The restaurant is headed by a manager who oversees all the activities of the business by coordinating all the business activities. The manager will work hand in hand with the head of the restaurants finances in order to maintain the profitability of the company. A sales and marketing representative of the restaurant will market the business globally. Three departments will ensure a smooth running of the restaurant. These departments are the kitchen department, customer service department and the accommodation services department.

The restaurant will provide all kinds of meals including cultural foods throughout the day and will operate on a twenty-four hour basis. Accommodation services will also be provided with considerations for different types and numbers of customers. The restaurant will also provide other services including entertainment and transport services. The restaurant will provide meals from different cultures all over the world. This is achievable by using the information collected from different customers all over the world. The prices of these meals and services have been drawn from researches on other restaurants providing the same services. They are however different from those of other restaurants in that they will be offered with added value of the uniqueness of the restaurant.

The restaurant aims to attract both local and international customers especially with the publicity gained form the existing restaurant. The restaurant will also provide different packages for different people in order to accommodate regional and cultural differences. The company’s website will market the restaurant online. The website will also provide restaurant and travelling information as well as booking services. Networking with the existing restaurant will also promote the restaurant. The restaurant startup funds will be funded by the accumulated profits of the existing restaurant. Cash flow of the business is represented in the graph below:

The success of the existing business under the same company brought about the idea of extending the services to other locations. The management team has vast experience in this business area and is expected to be vital in the success of the new restaurant and other restaurants that will be established in the chain. The difficulties encountered in the existing business have already been solved. Therefore, his business is expected to be more productive as it will kick off with less management difficulties. For instance, management and financial problems in the industry have been comprehensively explored by the business management. The management will therefore use the acquired skills to run the new business. For this reason, the business will continue and will compete with other businesses in London City with the ultimate goal of becoming the best service provider in the industry.   

4.1

4.2

 Major Milestone/Deliverable Planned Completion Date Immediate Predecessor
Data Collection and Analysis(DCA) 01/11/2014  
Business Decision Making(BDM) 30/11/2014 Data Collection and Analysis
Allocation of Responsibilities(AR) 15/12/2014 Business Decision Making
Budget Allocation(BA) 20/12/2014 Allocation of Responsibilities
Acquisition of Business Premises(ABP) 10/01/2015 Budget Allocation
Full Operation of the Business (FO) 01/02/2015 Acquisition of Business Premises

Critical Path= 30+15+5+10+20+30= 100 days

4.3

   Season Income Expenses
  Meals Income Accommodation Income Meals Expenses Accommodation Expenses Employee Salaries (100 Employees) Bills and Licenses
Jan-March 650000 510000 320000 200000 30000 50000
April-June 670000 530000 340000 220000 30000 50000
July- Sep 750000 550000 370000 250000 30000 50000
Oct- Dec 630000 500000 330000 200000 30000 50000
Total 2700000 2090000 1360000 870000 120000 200000
   
             

Decision: The business is viable since it is profitable and can be forecasted to grow.

work cited

Kimmel, Paul D., Jerry J. Weygandt, and Donald E. Kieso. Financial accounting: tools for business decision making. 4th ed. Hoboken, NJ: John Wiley, 2007. Print.

Kuiper, Shirley. Contemporary business report writing. 3rd ed. Mason, OH: Thomson South-Western, 2007. Print.

Levy, Paul S., and Stanley Lemeshow.Sampling of populations: methods and applications. 3rd ed. New York: Wiley, 1999. Print.

Sapsford, Roger, and Victor Jupp. Data collection and analysis. 2nd ed. London: SAGE Publications in association with the Open University, 2006. Print.