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At present, the owner (Mr Chohan) has a pizza outlet in West Bromwich. He is considering opening a second shop in Handsworth. I will now investigate: - "Should Mr Chohan open a second shop in Handsworth?"

Extracts from this document...

Introduction

> Introduction The business I am basing my research assignment on is Pizza Chef in West Bromwich. Pizza Chef is a pizza take-away and delivery firm that has been established for 5 years. The management is a partnership of two friends, who share the duties around the firm. Between themselves, the managers have got more then 30 years of experience in the pizza trade. There are five staff members including one supervisor. The shop is open 7 days a week, Monday's to Saturday from 4pm-12am and Sundays 4pm-10am. All the workers work under a rota and have two or three shifts a week. Workers have to go through an induction programme before they start working in the organisation and Pizza Chef also send employees on a food hygiene course to ensure extra safety whilst working. The method of payment in Pizza Chef is an hourly rate of �4.20. The employee's are paid every week by cash with senior members earning significantly more. Pizza Chef has a good reputation around the West Bromwich area. The customers are always pleased with the service they provide and Pizza Chef executives promise a 30-minute service or they give you discounts on your pizza. Where Pizza Chef is based, there is a lot of competition in the area. There is a McDonalds opposite, a Chinese take-away next door and a chips shop on the other side. The shop is situated near a residential area and has many regular customers. In this research assignment, I will investigate whether it is feasible for Mr Chohan and Pizza Chef to open a second Pizza base in the Handsworth area. This outlet will be situated on the Soho Road opposite the Barclays Bank towards Rookery Road end, which is shown on the map on the next page. I will look at all the possible solutions for the problems that may arise. The main problem for Pizza Chef at this present moment is deciding whether they should open the new branch in Handsworth? ...read more.

Middle

This is a positive factor because when I had conducted my foot-count, I had realised that more females had actually walked passed and into the shop. In Handsworth, the foot-count for the gender balance had varied with more females between 6'o'clock and 7'o'clock, and more males between 9'o'clock and 10'o'clock. According to past experience of working in Pizza Chef, I had also realised that females are more reluctant to purchase pizzas, which is a positive thing. The major difference between Handsworth and West Bromwich is the ethnic groups within the areas. Although my figures state that there are more Asians in the West Bromwich area, my primary research had shown that more people from the white ethnic group were in West Bromwich than in Handsworth. I cannot thoroughly explain why this is the case but I feel it is because people from the white ethnic group tend to prefer fast food over people from the Asian ethnic group who also have there traditional evening meal (e.g. chapatti's) to consume which may decrease the number of Asians buying pizzas. If I am correct in thinking this, then setting up the new business in Handsworth will not be a success because people from the Asian ethnic origin will not purchase pizzas and therefore Pizza Chef Handsworth Branch will not make enough sales to break even and therefore could go into a massive decline. Other interesting facts I had found whilst reviewing the secondary data was the unemployment levels in the 2 areas. This piece of information is crucial because if there is a high unemployment rate then people will tend to save more of there money which therefore means that they will not spend on luxury items (Pizza) as much as anticipated. When analysing the figures, I had observed that a total of 18.5% of Handsworth's population was unemployed compared to West Bromwich whose unemployment rate was 9.8% (unemployment sheet). ...read more.

Conclusion

My second objective was to investigate whether the customer bases were similar and whilst achieving the answer to this, I had realised that the customer bases had differed in both the areas. Therefore my second objective does not support whether to open the proposed shop. Whilst completing the questionnaire, I had learnt a lot about the market of Handsworth. I had noticed that the people in my sample mainly bought pizzas between 0 to 10 times a month. This is a positive factor for Mr Chohan but the questionnaire had also told me that the main competition was from Pizza Point, which is also based on the Soho Road. Whilst analysing Pizza Point's menu, I had calculated that their average price for a pizza was �4. Whilst studying Pizza Chef's menu, their average cost for a pizza was �8. This is a crucial factor because I do not think that the residents of Handsworth are prepared to pay �8 for a pizza especially when 18.5% of people in Handsworth are unemployed and would rather save there money then spend it on a luxury item. This once again this information is not in favour of Mr Chohan's proposed outlet. I also feel that the new business will cost too much money to set up and will not make enough monthly profit. This had been shown in my last objective, where I had approximately calculated the total revenue and profit that Mr Chohan is likely to make. This profit is not enough to keep Mr Chohan satisfied and make the Handsworth Branch a success like the first one. The peak time on the Soho Road were most people are out is on the lunch hour. Because Mr Chohan opens his outlet at 4pm, he will miss the lunch hour. If Mr Chohan would have opened his shop during the lunch hour, then I my views may have been changed in favour of the new outlet. > Appendix Graph 2.1 Graph 2.2 Graph 2.3 Graph 2.4 Graph 2.5 Graph 2.6 1 Sandeep Madahar Business Assignment 2681 ...read more.

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