Wai-Ling is considering two big changes to his restaurant business. One is the possibility of adding a delivery service or to open a new unit a few blocks away from the current restaurant (Rao, 2004). Wai-Ling has a variety of challenges with both of these options; marketing, operational issues, inventory, and financial concerns. I recommended that Wai-Ling starts a delivery service because he would have quicker return on his investment without much capital needed for start-up. Also Mongol BBQ can increase business without significantly increasing regular operation costs or require expansion of their facilities.
Mongols BBQ was an ...view middle of the document...
To help keep the start cost of the new restaurant low Wai-Ling does not want to install walk-in refrigerator. The plan is to store all the meat and vegetables at the current restaurant and get someone to take them to the new location (Rao, 2004). This may present a problem in how Mongol should handle their inventory and still keep foods fresh. Many restaurant owners underestimate the start-up capital needed to open and run a new restaurant. Staffing also an issue since the new place is not near a college, Wai-Ling believes it can be difficult to find part time employees (Jenkins, 2014). Competition is also another challenge for Mongol BBQ since the location is a in a food court with other restaurants.
I would recommend that Wai-Ling start the delivery service instead of the opening a new unit down in the financial district. The reason for this recommendation is a full-service restaurant such as Mongol BBQ, delivery service can probably add about 10% to the restaurants revenues. Adding a delivery service can be especially profitable because it can increase the business without significantly increasing regular operation costs or requiring Mongol to expand their facilities (Frisch, 2011).
For this delivery service to be a profitable Wai-Ling has to use good marketing techniques to inform customers about their delivery service options. Before Wai-ling begins marketing their delivery service, he needs to make sure the delivery service operations are in order. The restaurant will need special space, materials, trained employees, and maybe a delivery automobile. Wai-Ling also needs to decide on the best method and time to take orders for the delivery service. I would recommend only provide delivery service at lunch since deliveries would be to nearby businesses. Most of these nearby business will probably be closed after the normal work hours so offering a delivery service in the evening would not be profitable.
Once the operations are in order, Wai-Ling can market their delivery service through the following means:
• Takeout and delivery menus
• Flyers and personal selling
• Phonebook or newspaper
Whatever methods the restaurant uses to take orders it can reserve all of the customer information in their marketing database, so the restaurant can use this information later in their marketing campaign (Frisch, 2011).
The main reason why I am against Wai-Ling opening up another restaurant is the financial aspect of this business venture. I believe Wai-Ling is...