As a sales manager, you will use statistical methods to support actionable business decisions for Pastas R Us, Inc., a fast-casual restaurant chain specializing in noodle-based dishes, soups, and salads. In simpler terms, you are reviewing available information to determine if what your company is doing works. In this assessment, you use predictive and qualitative analysis skills to create a report for the executive team from available Pastas R Us, Inc. data about the effectiveness of the current expansion criteria, loyalty card program, and marketing position.
Scenario
Since its inception, the Pastas R Us business development team has favored opening new restaurants in areas that satisfy the following demographic conditions within a 3-mile radius:
Median age is between 25–45 years old.
Household median income is above the national average.
At least 15% of the adult population is college educated.
Last year, the marketing department rolled out a loyalty card strategy to increase sales. Under this program, customers present their loyalty card when paying for their orders and receive some free food after making 10 purchases.
The company has collected data from its 74 restaurants to track important variables such as average sales per customer, year-on-year sales growth, sales per sq. ft., loyalty card usage as a percentage of sales, and others. A key metric of financial performance in the restaurant industry is annual sales per sq. ft. For example, if a 1,200 sq. ft. restaurant recorded $2 million in sales last year, then it sold $1,667 per sq. ft.
Preparation
Analyze the Pastas R Us charts file for your report, including the scatter plots and regression equations for the following pairs of variables:
“Sales/Sq.Ft. ($)” versus “Bach. Degrees (%)”
“Median Income ($)” versus “Sales/Sq.Ft. ($)”
“Median Age (Years)” versus “Sales/Sq.Ft. ($)”
“Loyalty Card (%)” versus “Sales Growth (%)”
Assessment Deliverable
Write a 700- to 1,050-word predictive and qualitative analysis report of Pastas R Us, Inc. that includes the following sections: scope and descriptive statistics, analysis, and recommendations and implementation.
Section 1: Scope and descriptive statistics
State the report’s objective.
Discuss the nature of the current data. What variables were analyzed?
Summarize your descriptive statistical findings from Week 1.
Section 2: Analysis
Interpret the scatter plots and designate the type of relationship (increasing/positive, decreasing/negative, or no relationship) observed in each one.
Determine what you can conclude from these relationships. You may include a copy of each chart in your report, but it is not required.
Section 3: Recommendations and implementation
Based on the findings, assess which expansion criteria seem to be more effective. Could any expansion criterion be changed or eliminated? If so, which one(s) and why?
Based on the findings, does it appear as if the loyalty card is positively correlated with sales growth? Would you recommend any changes to this marketing strategy?
Based on the findings, recommend market positioning that targets a specific demographic. (Hint: Are younger people patronizing the restaurants more than older people?)
Include how the local culture and communities are represented in your market position in your recommendations.
Indicate what information should be collected to track and evaluate the effectiveness of your recommendations. How can this data be collected? (Hint: Would you use surveys/samples or census?)
Format your references according to APA guidelines.