Restaurant Business at Central Park Market Analysis Report

 

 

 

 

 

 

 

Pastas R Us, Inc. Report

Sarah E. Long

DAT/565

Ranjit Rebello

November 15, 2021

 

 

 

 

 

 

Pastas R Us, Inc Report

Scope and descriptive statistics

Objective

Pastas R US Inc. is determined to continue its expansion criteria and make more profits. Because of this, the business requires an in-depth analysis of the new strategies such as the Loyalty Card marketing strategy. This report aims at studying the data collected from the customers, conducting statistical analysis, and gaining insights on the available expansion opportunities for the business. The company database consists of data from 74 restaurants. Of the eight variables in the database, only six variables are analyzed in this report. These are sales growth over the previous year, sales for loyalty cards as a percent of net sales, annual sales per square feet, median housing income, the median age of customers, and the percent of customers who hold bachelors’ degrees.

Descriptive statistics

SalesGrowth%	LoyaltyCard%	Sales/SqFt	MedIncome	MedAge	BachDeg%
Mean	7.4141	2.0265	420.3054	62807.7027	35.2014	26.3108
Standard Error	0.7701	0.0642	15.9538	2081.3295	0.4248	0.8143
Median	7.03	2.075	396.01	62757	35	26.5
Mode	4.05	2.04	#N/A	#N/A	34.8	29
Standard Deviation	6.6247	0.5524	137.2395	17904.2730	3.6546	7.0047
Sample Variance	43.8871	0.3051	18834.6868	320562990.0200	13.3558	49.0665
Kurtosis	1.1462	1.4536	2.8805	-0.5116	0.1639	-0.9373
Skewness	0.4937	-0.7569	1.2359	0.2978	-0.1670	0.1405
Range	37.12	3.09	808.56	81424	18.8	26
Minimum	-8.31	0.29	178.56	32929	24.7	14
Maximum	28.81	3.38	987.12	114353	43.5	40
Sum	548.64	149.96	31102.6	4647770	2604.9	1947
Count	74	74	74	74	74	74

 

Analysis

Scatter plots of the pairs of variables with regression equations and a trendline are as below.

 

Scatter plot of BachDeg% versus Sales/SqFt

The scatter plot of “BachDeg%” versus “Sales/SqFt” has a negative linear relationship. This shows that as the percent of customers with bachelors’ degrees increases, the amount of sales per square foot is predicted to decrease. Restaurant Business at Central Park Market Analysis Report

Scatter plot of MedIncome versus Sales/SqFt

There appears to be a weak negative linear relationship between median income and the sales per square foot. An increase in the median income is predicted to lead to a decrease in sales per square foot.

Scatter plot of MedAge versus Sales/SqFt

The scatter plot shows a weak positive linear relationship between median age and sales per square foot. As the median age of customers increases, the amount of sales per square foot is predicted to increase linearly.

Scatter plot of LoyaltyCard(%) against SalesGrowth(%)

The percent loyalty cardholders and the percent in sales growth appear to have a medium negative linear relationship. From the graph, as the percent of loyalty cardholders increase, the percent sales growth is predicted to decrease.

Recommendations and implementation

Based on the analysis results, the strategy of median income appears to be the most effective one. This strategy shows that the business thrives more in areas with low median income than those with high median income indicated by the negative linear relationship. If the company continues to focus on expanding to areas with low median income, it will continue to generate more profits. In addition, the expansion criteria focusing on the median age within 3 miles also appears to be effective. It’s the only strategy with a positive linear relationship with sales per square foot. It means that as the median age increases, sales per square foot are predicted to increase. The observation indicates that the products and services offered are more appealing to the elder members of the community than to the young members. The other expansion criteria focusing on the percent of customers with bachelors’ degrees also appears to be effective. The services offered by the company appear to be more appealing to the less literate members of society. However, since the number of degree holders is bound to rise, the business will continue to have a decrease in sales per square foot if it focuses on expansion based on this strategy.

Surprisingly enough, the analysis of the Loyalty Card strategy produces a negative correlation between Loyalty Card and percent sales growth. It is expected that the Loyalty Card strategy should have a positive correlation with sales growth so that as the percent of customers with loyalty cards increase, the percent sales growth should increase. Since the correlation between the two is negative. An increase in the number of customers with loyalty cards leads to a decrease in sales growth hence hurting the company financially. I would recommend that the Loyalty Card strategy be abolished because of the negative impact on sales growth.

In addition, I would recommend a more targeted marketing strategy for the business. From the analysis of median age strategy, the data suggests that the products are more appealing to the older generation. I would propose the implementation of a new marketing strategy that targets the old. Sample data is to be collected to assess the effectiveness of the proposed strategy. The data is for the average sales per square foot and the median age of customers for the restaurant within a period through surveys. Further analysis should then be done to compare the median age before and after the advertisement is implemented and then compare the resulting sales growth between the two periods.

 

 

References

Doane, D., & Seward, L. (2016). Applied Statistics in Business and Economics (5th ed.). New York: McGraw-Hill Education.