Edward’s Restaurant and Sir George’s Catering Case Analysis Essay

15361 Words Apr 2nd, 2013 62 Pages
03/13/2013

Edward’s Restaurant and Sir George’s Catering Case Analysis

General Environment
Demographic:
Industry: Demographic factors are favorable to the restaurant industry.
Approximately 52% of the 1993 population in the area was 60 years of age or over. This was considered the restaurant’s main target market. During the late 1980s and early 1990s, the number of people taking up permanent residence in the valley increased dramatically for various reasons. The climate was attractive for growing population of seniors. Land prices, housing, taxes, and utilities were affordable. With the average cost of an acre of industrial land in the Penticton area at $45000 in 1991, businesses were attracted to the area. Between 1984 and
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On the other hand the was more negative factors: Goods and Services Tax increase, while customer traffic remained more or less constant, the dollar amount of the average order declined to compensate for the GST. Thus, while increases in other costs contributed to the losses, the GST had the effect of decreasing the revenue and increasing the cost of the restaurant. With the average cost of an acre of industrial land in the Penticton area at $45,000 in 1991, businesses were attracted to the area. However, level of tourism was declining after 1991, campgrounds in the area were planning to close due to tax increases, and one waterslide had already shut down. Demand for accommodation and related services in Penticton had declined in 1994. Fast food was particularly popular with younger customers. Many of fast food restaurants were parts of large chains that provided the financial strength of giant corporations and relatively standard menus and layouts familiar to traveling customers.
The restaurant industry had an unusually high number of failures. The average lifetime of new restaurants in the Penticton region was about two years. The number of restaurants in the area remained high. The industry standard suggested that, on the average, about 1 restaurant for each population unit of 1,000 would leave well-managed restaurants viable. The 1993 Penticton population of about 27,000 seemed to

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