Restaurant Industry :: essays research papers

Discussion of the problemSanjay Thomas, a second-year MBA student at M.I.T. Sloan educate of Management has three choices after he graduates. The first adept is an superior job offer that he received from a top-flight wariness consulting firm. The second option is to open an upscale restaurant that will set Indian gourmet cuisine. The third option is to open the restaurant with his aunt. each option has positive and negative aspects, but when Sanjay compargons them only the financial benefits are relevant.If Sanjay takes the job offered by the management consulting firm he would earn a wages of $80,000 a year. If he decides to open the restaurant, he would face a different scenario. To figure out Sanjays salary he would live to take into account three variables number of repasts sold, revenue per meal, and labor cost. If Sanjay opens the restaurant in partnership with his aunt, she would guarantee him a salary of at to the lowest degree $3,500 a month, and in return she wou ld get 90% of all periodic earnings in excess of $9,000.Data Analysis Sanjay estimated the following statistics for the variables that impress the expected salary at the restaurant. First, the number of meals obeys a normal dispersal with a mean of 3,000 and a standard deviation of 1,000. Second, the revenue per meals is $20.00 with a luck of 25%, $18.50 with a probability of 35%, $16.50 with a probability of 30%, and $15.00 with a probability of 10%. Third, the labor cost follows a continuous uniform distribution between $5,040 and $6,860. He also estimates that there are two inflexible costs. One is the fixed cost per meal of $11 and the other one is non labor cost of $3,995.All these variables and fixed costs were used in a semblance software incase to forecast the expected salary on the restaurant for the two situations one running the restaurant by alone, and the other one, running it with his aunt. Each simulation consisted of 10,000 trials.The result of Sanjay running the restaurant alone is represented in represent A. With a mean of $10,845 and standard deviation of $8,568 (Table 1), this option shows that the expected salary would be senior high schooler than the $6,666 monthly salary that he would earn in the consulting firm ($80,000/ 12). At the same time, the standard deviation projects a high variability on the expected salary, which means that there is the potential of earning more(prenominal) money than at the firm and of losing money running the business.