1. Daniel .K
Frank.K
Manmeet .B
Nargis .A
Rosalie.F

2. Agenda
1. Introduction
2. Porter’s 5 Forces Model
3. Financial Analysis & The “Dinner Only” Decision
4. Lunch & Dinner House
5. Menu Engineering
6. Conclusion

8. 1. Number and strength of competitors
2. Potential entrants into the market
3. Availability of equivalent products
4. Bargaining Power of customers
5. Bargaining power of suppliers

9.  Number and strength of competitors

 looks at the number and strength of competitors in the market
 Landmark’s competition can include any chain restaurant that has similar menu items and similar prices
 Landmark has one competitor in the industry (short term and long term impact)
 Potential entrants into the market

 Medium to high potential
 High cost but inhibit new entrants
 Few have similar financial backing, brand power and equity, and banner diversification that Landmark
has
 Financial barriers include franchise and continuing royalty fees, start up and maintenance fees
 The key to Landmark’s success is speed to market and establish their reputation as the upper casual
restaurant.
 Availability of equivalent products

 One competitor
 Availability of equivalent products is low
 Short-term and long-term impact

10.  Bargaining Power of customers
 The bargaining powers of customers are very high in the restaurant industry.
 Price is an important factor for customers when determining which restaurant to go to for their short
lunch hour.
 Short term and long-term impact
 Bargaining power of suppliers
 Bargaining power of suppliers looks at the costs of purchasing supplies, such as food within the
restaurant industry as well as employee and labour costs.

11.  “Dinner House” has a higher contribution margin but reduced overall profitability due to lower projected customer volumes.
 Lunch profitability is difficult to determine without an ABC analysis. Nevertheless it appears to be generating sufficient
contribution margin to offset a large portion of fixed costs.
 Break-even analysis indicates that a substantial margin of safety exists to cushion the expected drop in clientele in the less
populated Newmarket region.
 The payback period on Shane House’s initial investment is longer, and the return on investment is lower under the “Dinner
House” model versus the “Lunch & Dinner” model.
 Cannibalization of higher-margin dinner business by lower-margin lunch business is an open question. However, if only 37% of
lost lunch customers made the switch to dinner, the restaurant’s profitability could be maintained.
 Conclusion: The “Lunch & Dinner” model should be retained.
• More stable and profitable base from which to grow the business.

12.  In order to grow their business, Landmark must make every effort to minimize this under-utilization
of capacity.
 Promotions similar to Milestones “Birthday Special” (bring 3 or more friends on your birthday and
get a free entrée) will ensure that additional margin is being generated during otherwise slow
business periods.

13.  Fifteen Minutes after Ordering or it’s FREE!!
Culturally this had been exactly what some of the time-pressed business
lunch crowd in Ontario had been looking for.
 Lunch Menu & Catering Menu
3 out of 4 employees eating a lunch prepared away from home at least
once a week, numerous opportunities to meet and exceed consumers'
desire for something special
 Healthier Alternatives
Offer gluten free and healthier options as people are beginning to
become more health conscious of themselves.
More than 14 percent of respondents living in a metropolitan area
reported salad as their typical lunch

14.  Distribute fliers in neighborhood office buildings advertising our quick
and tasty lunch service. Consider faxing a daily or weekly menu to office
managers.
 Break out of the box and offer a unique lunch experience.
 Offer special discounts (15% off food related items & non-alcoholic
beverages) off to frequent diners.
 Teach wait staff how to read their lunch customers and to be ready to
recommend items that can be prepared quickly.
 No matter how quickly customers are served, make sure the service is
top-notch.
 Have the check ready for guests promptly.
 Develop regular clientele by keeping track of guests' histories, including
menu preferences and birthdays.
 Consider offering high-tech service options, such as fax or online
ordering.
 Offer a gift certificate to customers who spend over $100 on their
dinner menu, to come in for lunch and get their lunch bill at 25% off.

15. Menu engineering - is the process
by which you find your most
profitable restaurant items and
maximize there sales.
 Psychology (perception, attention,
emotion/effect)
 Managerial Accounting
(contribution margin and unit cost
analysis)
 Marketing & Strategy (pricing,
promotion)

16. 4 Categories
1. Stars: Popular and
Highly Profitable
2. Workhorses:
Popular but yield a
low contribution
Margin
3. Puzzles: Not
popular but have a
high profit Margin
4. Dogs: Not popular
and have a very low
profit Margin.