Forecasting at Hard Rock Cafe

For the following fictional character View the picture show Case for Chapter 3 for OMMyLab Bulletize the following (so that the gaffe can be understood full from your bullets and not have to read the case) clearly articulate the question(s) you are dressing in the beginning providing you answer Quantitative Issue The carriage is trying to guess how a new-fangled advertising campaign affects guest casts. findment data for the past 10 months (see the table) develop a least squares regression race and thus betoken the expected guest count when advertising is $65,000. Provide the answer to your boss and consequently provide the manikin as backup) Qualitative Issues 1. Describe trio different thinking applications at rocky arguing. trope three other areas in which you think leaden fluctuate could social occasion forecasting models. (Justify your choices) 2. What is the role of the POS system of rules in forecasting at grievous contention? 3. Justify the use of the weighting system used for evaluating managers for annual indemnityes. 4. Name several variables besides those menti iodind in the case that could be used as full(a) predictors of effortless gross r stillue in each(prenominal) coffeehouse.Provide backup using appropriate engineering (Provide the spreadsheets as spreadsheets). Forecasting at sturdy Rock coffeehouse With the growth of Hard Rock Cafefrom one public house in London in 1971 to more(prenominal) than 129 restaurants in more than 40 countries directlycame a corporate wide need for better forecasting. Hard Rock uses long forecasting in setting a capacity plan and intermediate-term forecasting for fasten in contracts for leather goods (used in jackets) and for such food stops as beef, yellow(a), and pork.Its short-term sales forecasts are conducted each month, by cafe, and then aggregated for a headquarters view. The centre of attention of the sales forecasting system is the point-of-sale system (FOS), w hich, in effect, captures transaction data on nearly every person who walks by means of a cafes door. The sale of each debut represents one customer the entree sales data are transmitted periodical to the Orlando corporate headquarters database. There, the financial team, headed by Todd Lindsey, begins the forecast process.Lindsey forecasts monthly guest counts, sell sales, banquet sales, and concert sales (if applicable) at each cafe. The general omnibuss of individual cafes knock into the same database to prepare a daily forecast for their sites. A cafe manager pulls up prior years sales for that day, adding info from the local Chamber of Commerce or Tourist Board on approaching events such as a major(ip) convention, sporting event, or concert in the city where the cafe is located. The daily forecast is further broken into periodic sales, which drives employee scheduling.An hourly forecast of $5,500 in sales translates into 19 workstations, which are further broken shoot into a specific number of clasp staff, hosts, bartenders, and kitchen staff. Computerized scheduling software plugs in volume based on their availability. Variances between forecast and actual sales are then examined to see why errors occurred. Hard Rock doesnt limit its use of forecasting tools to sales. To evaluate managers and set bonuses, a 3-year weighted contemptible average is applied to cafe sales. If cafe general managers exceed their targets, a bonus is computed.Todd Lindsey, at corporate headquarters, applies weights of 40% to the closely recent years sales, 40% to the year before, and 20% to sales 2 years agone in reaching his moving average. An even more sophisticated application of statistics is embed in Hard Rocks carte planning. exploitation multiple regression, managers can compute the squeeze on demand of other menu items if the monetary value of one item is changed. For example, if the price of a cheeseburger increases from $7. 99 to $8. 99, Hard Rock can predict the effect this lead have on sales of chicken sandwiches, pork sandwiches, and salads.Managers do the same compend on menu placement, with the center naval division driving higher sales volumes. When an item such as a hamburger is moved off the center to one of the side flaps, the corresponding effect on related items, say french fries, is determined. Hard Rocks Moscow Cafe Data Month 12345678910 Guest count 21 24 27 32 29 37 43 43 54 66 (in thousands) Advertising 14 17 25 25 35 35 45 50 60 60 (in $ thousand)