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Product Implementation Forecasting
- 1. Chiboodle Inc Case Analysis
- 2. GRAPHICBULB 2 Project Crunch is anticipated to increase revenues by 12% by 2019 compared to business as usual… Project Crunch makes available two price points at an average of competitor prices ($8.44) and a higher priced option that is still at a competitive price ($10.28) At the average competitors salad price, Chiboodle sales are expected to increase 12% by 2019. While the higher priced option anticipated at a 17% increase in sales. *Price of $10.28 generated by the average of two highest priced competitor salads. *Additional analysis of competitor foot traffic is required for a more comprehensive analysis of price point. Recommendation The course of action recommended would be to implement Project Crunch at the price-point of $10.28.
- 3. GRAPHICBULB 3 Hypotheses 1 2 3 Assumptions and Logic Burrito Sales -8.9% From sales calculation (2015 vs 2014) Taco Sales -3.8% From sales calculation (2015 vs 2014) Kids Menu Sales -5.3% From sales calculation (2015 vs 2014) Drink Sales 1.2% Historical average provided by CRO. 2015 vs 2014 not used as a result of one-time introduction of alcohol.
- 4. GRAPHICBULB *Bar labels represent sales rankings by location Introduction of alcohol sales have been the primary driver of revenue and has helped Chiboodle sales increase 9.5%...
- 5. GRAPHICBULB 5 hough this is not indicative of product growth rates (2014 vs 2015)… Although overall revenues have increased, the location average has shown a decrease across all products with the exception of drinks. * 1.2% increase in drink sales provided by CRO from historical data. + 1 .2 % -3 .82% -5.30% -8 .91%
- 6. GRAPHICBULB 6 Planned/ExpectedLocations (2016-2019) This may be a result of rapid expansion after 2008, which raises concerns regarding new stores as a reliable revenue driver… NumberofLocationsBuilt 120% increase from 2008-2015
- 7. GRAPHICBULB 7 Per Location …While new stores (2015) only accounted for 8% of total sales despite over 200 locations being added… Sales from 2015 stores account for nearly 45% less revenue than stores built the previous year. This may be a related to location saturation due to rapid expansion post 2008. +200 Stores +222 Stores +260 Stores +201 Stores +160 Stores 2443 Total Stores
- 8. GRAPHICBULB 8 With the introduction of Project Crunch at a slightly higher price point than competitor average, sales are anticipated to reach $5.7B by 2019.