Question

Every day during lunch, customers of the Tran Asian restaurant flock to the restaurant. Tran cannot afford to build a larger facility. To spread out demand, Tran should consider:
a. serving food in lesser quantities to encourage customers to eat more quickly.
b. charging a higher price for its cuisine to cut down the number of the customers.
c. prohibiting more customers from entering the restaurant once the seating capacity is full.
d. offering customers an incentive to come to the restaurant during off-peak hours.

Answer 1

Answer:

Correct option is (d)

Explanation:

It is observed that Tran Asian restaurant is flooded with customers during lunch and rest of the time it is not that crowded. So, adding more space is not a viable option since restaurant is crowded only during lunch hours. Cost would be more than revenue in this case. Serving less food will not increase customer satisfaction. It might lose existing customers in this case.

Charging higher price is not an appropriate strategy as it will again lose customers this way. The only appropriate strategy is offering incentive to the customers to visit restaurant at off-peak hours in the form of reduced prices or special offers. This will increase revenue as well as fully utilize existing capacity.