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MN5070 The Practice of Consultancy

Task 1: Fast Food Restaurant [25 marks]

The client is Beef Shake, a ‘Better Burger’ fast casual restaurant chain with 12 restaurants, located in London. The restaurants have a 1960s American diner décor and the menu can be broken down into 4 categories.

Beef Shake’s Menu
  1. Burgers and warm and cold sandwiches, including plant-based options, with a combination of 20 free toppings, served with fries.
  2. Soft drinks: Unlimited refills from the ‘Freestyle’ fountain with 300 flavour combinations, some proprietary, from regular branded soft drinks or sparkling water, with or without extra flavourings, to exotic carbonated fruity drinks.
  3. Fresh milkshakes, made with fruit and milkshake mix-ins to provide over 1,000 varieties, some of which are proprietary and exclusive to Beef Shake.

The first Beef Shake restaurant opened its doors in May 2000 and, during the first 14 years of operations, the business grew rapidly. Between 2014 and 2019, Beef Shake still grew steadily but its growth rate did not match that of the previous years. The last restaurant opened in 2014.

The past two years have been difficult for Beef Shake. Successive Covid-19 lockdowns hit the business hard but profitability had already started to decline in 2019 and, according to the client, the restaurant is steadily losing money. You have been contracted by the CEO of Beef Shake to discover the root of the problem.

Additional Information:
  • Beef Shake currently has a 6% market share of the London fast casual ‘Better Burger’ market.
  • Beef Shake’s main competitors are: Shake Shack, Five Guys, Smashburger and, to a lesser extent, Nando’s and Gourmet Burger Kitchen.
  • Compared to the sector average of 80 to 125 seats, Beef Shake restaurants are more intimate and comfortably seat 60 to 80 people. Typical Beef Shake restaurant layout: 2 tables seating 6; 12 tables seating 4 and 6 tables seating 2 i.e. an average of 72 seats and 20 tables per restaurant.
Dinner service (5pm-10pm) average table turnover time is 60 minutes, with a table turnover rate of 5, serving an average of 100 parties (based on 20 tables), whereas the average seat turnover rate is 4.5, serving an average of 288 covers (based on an average of 64 occupied seats out of an average of 72 available seats). Table turnover time, table turnover rate and seat turnover rate are below sector benchmarks of 45 minutes, 6.7 and 6 respectively.
  • Beef Shake has stated its main strengths and capabilities are related to its strong brand, high food quality, menu and customer choice, excellent customer service and the strong team dynamics among its employees.
  • Employee turnover is 12%, which is below the hospitality sector average of 30%.
Required for Task 1 (Comments for task 1 should not exceed 500 words in total.)
Define the problem facing the client and summarise the key information in a problem definition worksheet. The words contained in the problem definition worksheet are not part of the word limit.
Create an issue tree to identify the potential key issues underlying the client’s problem. Ensure your tree is MECE. The words contained in the issue tree are not part of the word limit.
Prepare a short report, with deliverables (problem definition worksheet and issue tree), to update the client on your progress. Specifically, your report should discuss the possible causes of the problem and make tentative recommendations on how potential issues may be resolved.
Task 2: New Magazine Publication [25 marks]

The client is Gerimi, a publisher that produces a line of women’s, men’s health and pre-teen (ages 9 to 12) magazines. The segments are still profitable but the market is saturated and readership has been declining year-on-year, with the circulation of its women’s and men’s health magazines down by 14% and 20% respectively on November 2020. By comparison, UK magazine circulation figures fell by an average of 6% over the same period. With a circulation growth of 12% compared to November 2020, its pre-teen magazine fared better and the most recent circulation figures show 49,500 magazines were distributed in October 2021.

Gerimi is now considering launching a new monthly popular music magazine aimed at teenage girls (aged 13 to 17), tentatively titled ‘PopTops’ magazine. The magazine will come with a ‘free’ gift and feature chart roundups, interviews, gossip and photos of chart-topping artists and other celebrities popular with the target audience and is intended to be published as a traditional, print magazine.

The client’s goal is to generate UK circulation revenues of £2 million in the first year. You have been hired to evaluate whether this goal is attainable.

The client is also considering whether it would be a good idea to (re-)introduce fold-out posters to a new generation. Posters were once a popular feature of a pop magazine published by the client between the 1970s and early 1990s and you have been asked to look into the possible interest in this feature.

Circulation refers to the number of distributed copies of a publication, whereas readership is an estimate of the number of readers a publication has. Readership typically exceeds circulation.
With newsstand sales falling across the UK magazine sector, the client noted that single issue sales were hit by the Covid-19 lockdowns but the number of magazine subscriptions has increased since mid 2020.
Teenage bedroom decorating trends in the last 10 years have moved to more calm and grown-up décors, with teenage girls more likely to look to popular vloggers’ interiors for decorating and style inspiration, rather than adorning their bedroom walls with posters of famous vloggers, singers and other celebrities. In fact, a 2017 survey of 4,000 respondents revealed that just 7% of teenagers admitted to putting up posters of their heroes compared to 79% in the 1990s. Today, teenage girls are more likely to opt for white-painted bedroom walls with fairy lights.
Task 2
  1. Estimate the total market size and estimate potential market share to estimate UK circulation revenues in the first year.

This activity requires you to conduct desk research. You need to clearly define your approach and assumptions. Outline the main steps of your analysis, state your data source(s) and describe and justify your reasoning and estimates. You will be marked on your ability to make reasonable assumptions about the total market size, potential market share (taking into account competing magazines), cover price, subscription rates and estimated circulation revenues. Comments, assumptions and descriptions are part of the word limit. Sources need to be referenced using the Harvard method. Sources and references to not count towards the word limit.

  1. The client is considering making fold-out posters a key feature of the magazine. What kind of research could you conduct to evaluate demand for this feature? Based on your findings under 1 above, would you go ahead with this research? Justify your decision.
  2. Based on your answers to questions 1 and 2 above, prepare a short statement for the client to summarise your findings and recommendations.
Task 3: Meat Replacement [25 marks]

The client, Zonder, which translates as ‘Without’, is a Dutch food company producing plant-based meat replacements since 1997. Their ‘Meat Without Meat’ range is made from soya, fungi or wheat protein. They hold a significant share (34%) of the plant-based meat replacement market in their home market but year-on-year market growth has been slowing down. They are now seeking new opportunities for growth outside of the Netherlands. The UK has been identified as the first potential foreign market for entry because of the rapidly rising interest in vegetarian and vegan lifestyle choices and the growing popularity of meat-free ‘meat’ options. If the market and environment prove favourable, the client intends to open a subsidiary in the South East of England.

In the meantime, the client will start negotiations with major retailers to introduce its most popular vegetarian and vegan products to the UK market, before considering partnerships and investing in more extensive distribution systems.

You have already had the first meeting with the client. A number of tasks and analyses now need to be performed before your next meeting.

  • The Zonder brand is trademarked in the EU and the UK.
  • You may assume Zonder has sufficient capital, meets all legal requirements and has the capabilities to open a subsidiary in the UK.
  • In its home market, Zonder has a highly competitive cost structure, with a gross profit margin of 36%. It can be assumed that this capability can be extended to the subsidiary.
  • In addition to large players, small companies are entering the plant-based ‘meat’ industry in the UK.

Required for Task 3 (Comments for task 3 should not exceed 500 words in total.)

  1. Conduct a relevant market entry analysis for Zonder. You may use one of the frameworks covered on MN5070 or another framework of your choice.
  2. Conduct a PESTLE analysis for Zonder. You need to focus on the UK market.
  3. Identify the opportunities and threats facing Zonder.
  4. Synthesise your findings (for your desk research and analyses under 1 to 3 above) and create a set of deliverables (visuals for 1 to 3 above) for the client. Prepare a set of notes summarising your findings and preliminary recommendations in preparation for your next meeting with the client.

You need to insert your visuals, together with the corresponding notes and preliminary recommendations, into your coursework. Text presented in deliverables (tables or other visuals) are not part of the word limit.

The client is Zap, an ultra-rapid grocery delivery company, operating out of several dark stores in central London since 2021. It offers local grocery deliveries in under 15 minutes. Customers order their groceries via an app on their mobile device.

As a consultant to this start-up, you have been asked to conduct a study to examine the level of take- up for ultra-rapid grocery delivery services. Specifically, you have been asked to evaluate whether there is a difference in the take up rate between consumers who are comfortable using mobile technology and those who are not.

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