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MBA 512 Tips

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MBA 512 Tips

  1. 1. Topic: Restaurant Tipping Presented by: Miranda Lazar & Kristyn Kelly
  2. 2. <ul><li>2003 sales at restaurants totaled $151 Billion </li></ul><ul><li>Assuming 15% tipping, waiters and waitresses earned $22.7 billion in tip income </li></ul>
  3. 3. <ul><li>Research shows that tip percentages are weakly related to customers’ rating of service quality </li></ul><ul><li>Tips may be influence by many factors </li></ul><ul><ul><li>Size of the party </li></ul></ul><ul><ul><li>Table location in the restaurant </li></ul></ul><ul><ul><li>Gender </li></ul></ul><ul><ul><li>Smokers vs. non smokers </li></ul></ul><ul><ul><li>Time of the day (Lunch vs. Dinner) </li></ul></ul>
  4. 4. <ul><li>Restaurant located in a suburban shopping mall </li></ul><ul><li>Server collected data during an interval of two & a half months </li></ul><ul><ul><li>Gender (0=male, 1=female) </li></ul></ul><ul><ul><li>Smoker (0=no, 1=yes) </li></ul></ul><ul><ul><li>Day of the week (3=Thursday, 4=Friday, 5=Saturday, 6=Sunday) </li></ul></ul><ul><ul><li>Time of day (0=day, 1=night) </li></ul></ul><ul><ul><li>Size of the party </li></ul></ul><ul><li>Manager believed that the data would provide a means of assessing what sorts of things affect tips and whether they were seen as objective </li></ul>
  5. 5. <ul><li>Total bills range from $3.07 to $50.81 </li></ul><ul><li>Mean of Total bills = $19.79 </li></ul>$50.81 $3.07
  6. 6. Men
  7. 7. <ul><li>May be skewed do to more men were apart of the research than women </li></ul><ul><li>157 men vs. 87 women </li></ul>
  8. 8. SAMPLE HYPOTHESIS TESTS hyp value sample mean stdev sample size for the mean REF =average() =stdev() =(n) NULL :  Null statement   ALTERNATIVE:  Alternative statement test statistic (obs) =standardize(sample mean, ref value, std error(stdev/sqrt(n)) critical measure =normsinv(1-signif level/#tails) one-tailed or two-tailed? 1 |OBS| > CRIT? p-value =(#tails)*(normsidst(abs(obs)))  -level 0.050 p-value <  -level?
  9. 9. HYPOTHESIS TESTS hypothesized value sample mean stdev sample size for the mean 3.00 3.09 1.49 157 NULL :  Men are better tippers than women   ALTERNATIVE:  Men are not better tippers than women test statistic (obs) .7540843 critical measure 1.6448535 one-tailed or two-tailed? 1 |OBS| > CRIT? no p-value 0.225  -level 0.050 p-value <  -level? no ACCEPT THE NULL
  10. 10. <ul><li>Men are better tippers than women! </li></ul>
  11. 12. HYPOTHESIS TESTS hypothesized value sample mean stdev sample size for the mean 3.00 3.10 1.44 176 NULL :  people tip more than the average tip at dinner time ALTERNATIVE:  people tip less than the average tip at dinner time   test statistic (obs) 0.94836 critical measure 1.64485 one-tailed or two-tailed? 1 |OBS| > CRIT? no p-value 0.171  -level 0.050 p-value <  -level? no ACCEPT THE NULL
  12. 13. <ul><li>People tip more than average at dinner time! </li></ul>
  13. 18. <ul><li>Gender of patron has an influence over the amount of tip </li></ul><ul><ul><li>Men tip an average of $3.09 </li></ul></ul><ul><ul><li>Women tip an average of $2.83 </li></ul></ul><ul><li>Time of day has an influence over the amount of tip </li></ul><ul><ul><li>Lunch tip average $2.72 </li></ul></ul><ul><ul><li>Dinner tip average $3.10 </li></ul></ul>
  14. 19. <ul><li>Little or no influence over tip amount </li></ul><ul><ul><li>Day of Week </li></ul></ul><ul><ul><ul><li>Sat & Sun tend to have larger total bill=larger tips </li></ul></ul></ul><ul><ul><li>Average Total Bill </li></ul></ul><ul><ul><ul><li>Sat & Sun larger total bill </li></ul></ul></ul><ul><ul><li>Smoker vs. Non-Smoker </li></ul></ul><ul><ul><ul><li>Very little difference </li></ul></ul></ul><ul><ul><ul><li>$2.99 avg. vs. $3.00 avg. </li></ul></ul></ul><ul><ul><li>Size of Party </li></ul></ul>
  15. 20. <ul><li>Have servers alternate from lunch and dinner shifts so there is more opportunity for equal tip earnings. </li></ul><ul><li>Because average total bills tend to be larger on weekends equaling larger tips, also alternate days of week that servers work for opportunity to earn equal tips. </li></ul><ul><li>Add gratuity to the bottom line or explain that gratuity is not included. </li></ul>

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