Making Decisions Based on Demand and Forecasting Tiara Jones Strayer University Dr. Mumeka ECON 550 July 25, 2013 Introduction In this assignment I will be discussing the consideration of Domino’s Pizza entering the market place in the Washington DC’s Georgetown community. I selected this area because it is highly populated with tourists that may want to grab a quick bite to eat while shopping and touring the area and the local upper class working singles that often don’t have time to cook after a long day at work.
I have conducted research and gathered information forecasting the demand for this business based n population, household income and other pizza establishments in this area along with the average cost for pizza. Based on the research and demand analysis we should be able to determine if it would be in the best interest of the Domino’s Pizza Company to establish an operation in this community. Mission Domino’s Pizza cares about its customers and the quality of its products (Domincfs Pizza, LLC). Therefore, our mission is to feel the void by establishing a Domino’s Pizza Company in an atmosphere where the supply is low and the demand is high.
To serve delicious pizza in an outstanding atmosphere and to ensure that the ommunity’s demand for pizza is not only met by providing day delivery and dine in services but to provide late night delivery and dine in services as well. It’s the company’s mission to sustain a competitive advantage over other pizza companies in the area and to expand the communitys population. In addition, Domino’s Pizza Company will strive to make a positive impact on the community by ensuring all services are prompt, friendly and professional and its employees by providing and maintaining a respectful, positive and professional work environment.
Community Georgetown is currently one of the oldest neighborhoods in Washington, DC and served as a major port and commercial center during the colonial times because of its prime location on the Potomac River. Today, Georgetown is a vibrant community with upscale shops, bars and restaurants along its cobblestone streets (Cooper, R). In addition, there are several hotels located within walking distance to the shopping, dining, entertainment and nightlife. The main streets of Georgetown are Wisconsin Ave and M Street which can be accessible by car or for metro rail riders via the DC
Circulator bus from the Foggy Bottom, Rosslyn and DuPont Circle metro stations. The Foggy Bottom-GWU metro station, located on the blue and orange metro lines, is a short 1 5-minute walk from Georgetown. The Rosslyn and Virginia station, located on the blue and orange lines, is a short walk across the Key Bridge to Georgetown (Georgetown Business Improvement District, 2011). In Georgetown you can also find the main campus of Georgetown University where many students that attend the University choose to live or commute from other surrounding areas because of the expensive cost of living in the Georgetown area off campus.
Due to the many shops, fine dining and other entertainment in the area, the income and cost of living is much higher more than your average neighborhood. Income and Population The latest data gathered for the Georgetown area reports a population of 13,880 in which the majority are single upper class and high income individuals. According to the Zillow Real Estate Network, there are three main types of people that reside in this area. The first type is the Power Single which is considered high income urban singles. These singles are known to be highly educated professionals, many with advanced degrees.
They draw a handsome salary and have reasonable living expense while living a hip, upscale life in an urban center. The Zillow Real Estate Network considers the second type of people Making It Single. Making It Singles are known to be upper scale urban singles. These singles are pre-middle-age to middle- age singles with upper-scale incomes and may or may not own their own home. Most have college educations and are employed in mid-management professions. Lastly, there are the Multi-lingual Urbanities. Multi-lingual Urbanities Urban are classified as dwellers who speak more than one language.
Some have a high school or college education, and they work in a variety of occupations and they are considered to have moderate to upper-scale earning potential (Zillow Real Estate Network, 2013). In addition, the median household income is reported at $88,665 with an average household size of 1. 9. Households with children are reportedly averaging 10. 3% and 89. 7% without children. The majority are single males averaging 27% followed by single females reportedly averaging 25. 3% with a median age of 39 for both male and female. According to the Zillow Real Estate Network, the average for singles alone is 48%.
Following behind singles are married couples with a 39. 85% average, divorced individuals with a 7. 69% average and lastly, widowed individuals coming in at a 4. 75% average (Zillow Real Estate Network, 2013). Given the calculations for singles in this area there are more likely less home cooked meals and a high demand for takeout like Domino’s Pizza. Supply and Demand Within the Georgetown area there are currently 13 ditterent restaurants that serve pizza, 3 of which are higher priced, 5 with moderate prices and 5 which sale pizza at a cheaper price usually under $10 (Urbanspoon, 2013).
The cost for higher and oderate priced pizza range from $8. 95 for a small plain pizza to $19. 00 for the maximum cost of a large specialty prepared pizza for dinning in or takeout. Cheaper priced pizza range between $3. 86 to $18 in which $3. 86 is for one slice and $18 is the maximum cost for a large specialty prepared pizza dinning in or takeout as well (Urbanspoon, 2013). Although individuals in the community have many options to choose from when it comes to pizza, there is only one Domino’s Pizza in the area.
Therefore, demand to establish another Domino’s Pizza would be determined by the communitys preferences. Among those 13 establishments mentioned above there are 6 restaurants that deliver in which 5 of them offer late night deliver service after 12am. There are 8 restaurants that provide dine in services with only 2 of them offering late night dine in after 12am and 11 restaurants that offer takeout services (Yelp Inc. , 2013). Domino’s pizza is among those establishments that provide late nights deliver services up to 2am.
However, the Domino’s takeout services are not provided after 10pm. With that said there is a demand to establish another Domino’s pizza that will provide takeout services beyond the hours of IOpm. This will not only enefit the residents in the area but it will also be beneficial to the nonresidents and party goers that would like to grab a bite to eat after taking part in the area’s late night entertainment. Short Term Goals As mentioned above, statistics show that Georgetown is an area that attracts a lot of tourists due to the shops, fine dining and entertainment.
Not to mention that a large part of the population is single professionals. Therefore, the company’s short term goal would be to open a new establishment in the intersection of M Street and Wisconsin Ave NW two blocks from the current operation and to attract late night orking singles residing in the area and tourists by expanding the hours of operation until 3am for dine-in and takeout and 4am for delivery. Other short term goals would be to expand the menu for our single residents and tourists by offering more selections.
Currently Domino’s pizza is known for their freshly prepared pizzas, wings, oven-roasted sandwiches and newly added pastas. The new establishment’s menu will be expanded to add personal pan pizzas and pizza served by the slice. That way those who are dining alone will not be limited to purchasing a whole pizza. Also aking in to consideration of our health conscious customers, other variables the company will be considering are salads and sub sandwiches. I chose salads and sub sandwiches because pizza can be heavy and fattening and when eating late at night customers may prefer something lighter.
This new menu selection will help the company in the long run because “change can help a business stay current with industry trends, which can make it more attractive to potential customers as well as help maintain current customers” Ooseph, C). Long Term Goals The company’s long term goal is to receive 100% customer satisfaction by providing rompt, friendly and professional services during every encounter. Other long term goals of the company are to double revenue, become more profitable and grow the business brand by becoming and remaining number one amongst competitors.
Domino’s Pizza Company would forever challenge competitors by embarking on an innovative concept that targets new customers as well as grow the current population. We expect the market to respond to the changes within the new establishment and for the business to grow rapidly in the next year. Overall the company’s goal is to create and maintain a reputation of excellence, consistency and ecure the company’s ability to provide delicious and freshly prepared foods while becoming the leader in the pizza industry.
Marketing As mentioned above our goal is to become more profitable and sustain a competitive advantage over other pizza companies in the area. The company’s strategy to market the new establishment would be to create coupon books and send them by mail to all residents in the area and hand then out to individuals walking past the store. This book will feature our products at a discounted price and by one get one free deals. Coupons will also be offered online through the company’s web ite and given to customers with their purchases.
In addition, the establishment will offer daily deals for delivery and takeout such a free drinks with the purchase of a personal pan pizza or sub sandwich, unlimited toppings on any size pizza, free wings with any purchase over $20 or 50 cent wings with a minimum purchase of 10. The company will also give customers the option to price match pizzas with any of our competitors. This will impact the company in the short run by increasing cash flow and profitability. Conclusion In conclusion, the overall concept of this paper was to determine why Domino’s
Pizza Company should exercise the opportunity of opening a new establishment in my area. As mentioned, there are many places for the community to choose from when it comes to pizza. However, there is only one Domino’s. Information has been provided regarding the current Domino’s Pizza Company and other pizza places in the area such as their hours of operation and options for dining in or delivery. It has been determined that Domino’s Pizza Company will bring something to the community by offering some of the things that the current pizza companies in the area do not such as later hours for takeout, delivery and dine in.