Predictive And Qualitative Analysis Report

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.

Sample Solution

Section 1: Scope and Descriptive Statistics

Objective

The objective of this report is to analyze the effectiveness of Pastas R Us, Inc.'s current expansion criteria, loyalty card program, and marketing position using statistical and qualitative methods. The report will provide insights into the relationships between various demographic factors, loyalty card usage, and sales performance, enabling the company to make informed decisions regarding its expansion strategy, customer loyalty program, and marketing efforts.

Full Answer Section

Data Analysis

The data analyzed for this report includes the following variables:

Sales per square foot ( $) : R e p rese n t s t h e t o t a l s a l es g e n er a t e d p ers q u a re f oo t o f res t a u r an t s p a ce * B a c h e l o r^{'} sDe g rees (* M e d ian I n co m e ($ ): Represents the median household income within a 3-mile radius of the restaurant
Median Age (Years): Represents the median age of the population within a 3-mile radius of the restaurant
Loyalty Card (%): Represents the percentage of sales attributed to customers using loyalty cards
Sales Growth (%): Represents the year-on-year growth in sales

Descriptive statistical analysis revealed the following findings:

Median sales per square foot is $1,059,381
Median percentage of bachelor's degrees is 26%
Median household income is $62, 808 * M e d iana g e i s 35 ye a rso l d * M e d ian l oy a lt yc a r d u s a g e i s 20 * M e d ian s a l es g ro wt hi s 4 * * S ec t i o n 2 : A na l ys i s * * * * S c a tt er Pl o t s an d R e l a t i o n s hi p s * * T h esc a tt er pl o t sre v e a lt h e f o ll o w in g re l a t i o n s hi p s b e tw ee n t h e v a r iab l es : * * * S a l es p ers q u a re f oo t ($ ) versus Bachelor's Degrees (%):** A negative relationship is observed, indicating that as the percentage of bachelor's degrees increases, sales per square foot tend to decrease.
Median Income ( $) v ers u s S a l es p er Sq u a re F oo t ($ ): A positive relationship is observed, indicating that as median household income increases, sales per square foot tend to increase.
Median Age (Years) versus Sales per Square Foot ($): A U-shaped relationship is observed, suggesting that sales per square foot tend to be higher in areas with both younger and older populations, while sales are lower in areas with a predominantly middle-aged population.
Loyalty Card (%) versus Sales Growth (%): A weak positive relationship is observed, indicating that as loyalty card usage increases, sales growth tends to increase slightly.

Interpretation and Conclusions

The observed relationships provide valuable insights into the effectiveness of Pastas R Us's current expansion criteria, loyalty card program, and marketing position.

Expansion Criteria: The negative relationship between sales per square foot and the percentage of bachelor's degrees suggests that the current emphasis on opening new restaurants in areas with a high percentage of college graduates may not be the most effective strategy. While a well-educated population may indicate higher disposable income, it may also reflect a preference for dining out at more upscale establishments.
Loyalty Card Program: The weak positive relationship between loyalty card usage and sales growth suggests that the loyalty card program may have a marginal impact on sales growth. While the program does encourage repeat customer visits, it may not be sufficient to drive significant sales increases.
Marketing Position: The U-shaped relationship between median age and sales per square foot suggests that the current marketing position may not be fully aligned with the target audience. While the focus on fast-casual dining may attract younger and older customers, it may not resonate as strongly with middle-aged individuals.

Recommendations and Implementation

Based on the findings of this analysis, the following recommendations are proposed:

Expansion Criteria: Reevaluate the expansion criteria to consider factors beyond educational attainment, such as household income, population density, and proximity to competitors.
Loyalty Card Program: Enhance the loyalty card program by offering more compelling rewards, such as exclusive discounts, early access to new menu items, or personalized recommendations.
Marketing Position: Refine the marketing position to emphasize the freshness, quality, and affordability of the menu items, appealing to a broader range of customers, including middle-aged individuals.

Implementation of these recommendations can help Pastas R Us, Inc. make more informed decisions regarding its expansion strategy, customer loyalty program, and marketing efforts, ultimately leading to improved financial performance and long-term

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