Making Decisions Based on Demand and Forecasting

In: Business and Management

Submitted By nbkgqoc
Words 694
Pages 3
Assignment 1: Making Decisions Based on Demand and Forecasting

Assignment 1: Making Decisions Based on Demand and Forecasting ECO 550 January 24, 2013

Assignment 1: Making Decisions Based on Demand and Forecasting Page 1

I have been considering opening a Domino’s Pizza in my community within the Virginia Beach area. In this paper I will present to you, a data analysis and a forecast of Domino Pizza’s sales revenue that consist of the demographics within my community. These demographics consist of the population size, the average income per household and the independent variables which include the price in pizza and soda. This demand analysis will be used to give an estimated forecast that will assist in my business making decision technique, which will determine if it will be beneficial for me to open a Domino’s Pizza in my area. To determine if I will enter into the market place in Virginia Beach, I will research the reported demographic and independent variables that are relevant to complete a demand analysis that has been provided to me from different resources within my community. By using Excel to calculate, I will input the data that I have collected to create an estimated regression analysis. Once the calculation has been provided, I will be able to interpret the coefficient of determination, and how it has provided an influence on my decision to open the pizza business in my area. Variables. The significant dependent variable (Y) that was used to create this research was the pizza and soda sales revenue. This data was taken from the last four years, which include 2008 through 2011. The total sales revenue in the Virginia Beach area, for Domino’s Pizza, in 2008 was $100,425, in 2009 the sales was $100,404, in 2010 the sales increased to $100,571 and 2011 there was a slight increase of…...

Similar Documents

Demand Forecasting

...DEMAND FORECASTING: EVIDENCE-BASED METHODS Forthcoming in the Oxford Handbook in Managerial Economics Christopher R. Thomas and William F. Shughart II (Eds.) Subject to further revisions File: Demandforecasting-17-August-2011-clean.docx 17 August 2011 J. Scott Armstrong The Wharton School, University of Pennsylvania 747 Huntsman, Philadelphia, PA 19104, U.S.A. T: +1 610 622 6480 F: +1 215 898 2534 armstrong@wharton.upenn.edu Kesten C. Green International Graduate School of Business, University of South Australia City West Campus, North Terrace, Adelaide, SA 5000, Australia T: +61 8 8302 9097 F: +61 8 8302 0709 kesten.green@unisa.edu.au # words in body 10,053 (requested range was 6,000 to 9,000) ABSTRACT We reviewed the evidence-based literature related to the relative accuracy of alternative methods for forecasting demand. The findings yield conclusions that differ substantially from current practice. For problems where there are insufficient data, where one must rely on judgment. The key with judgment is to impose structure with methods such as surveys of intentions or expectations, judgmental bootstrapping, structured analogies, and simulated interaction. Avoid methods that lack evidence on efficacy such as intuition, unstructured meetings, and focus groups. Given ample data, use quantitative methods including extrapolation, quantitative analogies, rule-based forecasting, and causal methods. Among causal methods, econometric methods are useful given good theory, and few key...

Words: 12973 - Pages: 52

Making Decisions Based on Demand and Forecasting

...Tool 3. Demand Analysis Economic Analysis of Tobacco Demand Nick Wilkins, Ayda Yurekli, and Teh-wei Hu DRAFT USERS : PLEASE PROVIDE FEEDBACK AND COMMENTS TO Joy de Beyer ( jdebeyer@worldbank.org) and Ayda Yurekli (ayurekli@worldbank.org) World Bank, MSN G7-702 1818 H Street NW Washington DC, 20433 USA Fax : (202) 522-3234 Contents I. Introduction 1 Purpose of this Tool 1 Who Should Use this Tool 2 How to Use this Tool 2 II. Define the Objectives of the Analysis 4 The Reason for Analysis of Demand 4 The Economic Case for Demand Intervention 4 Analysis of Demand for the Policy Maker 5 Design an Analysis of Demand Study 6 Components of a Study 6 The Nature of Econometric Analysis 7 Resources Required 7 Summary 8 References and Additional Information 8 III. Conduct Background Research 9 IV. Build the Data Set 11 Choose the Variables 11 Data Availability 11 Data Types 12 Prepare the Data 13 Data Cleaning and Preliminary Examination 14 Preparing the Data Variables 14 References and......

Words: 36281 - Pages: 146

Making Decisions Based on Demand and Forecasting

...Making Decisions Based on Demand and Forecasting Robyn Wilson Strayer University Econ 550 Assignment One January 31, 2013 Report the demographic and independent variables that are relevant to complete a demand analysis providing a rationale for the selection of the variables. Demographics are an important variable when choosing target marketing strategies. The variables are relevant to complete a demand analysis by providing a rationale for the selection of the variables. Whithin my area, Cross, SC, I am looking at local demographics and paying special attention to the following: • Age: Persons under 18 years percent 27.4% • Income levels: Average 39,779 per household • Persons below poverty level: 17.2% • Education: Bachelor degree age 25+ percent 13.1% • Housing: ownership rate 57.9% Making an informed analysis will inform you about the spending and eating habits of the people who live in the servicing area. Demogrphics give you a clear understanding of the areas behavior, values, cultures, interests and lifestyles of the community. Data research was consider because of the amount of time given for the assignment. The success of Domino’s opening a location in Cross, SC will depend on the factors listed above. Having a customer loyalty program that will have frequent customers that will come buy the products will help the company save on selling......

Words: 868 - Pages: 4

Decision Based on Demand

...Making Decisions Based on Demand and Forecasting There are several demographic and independent variables which are relevant in completing a demand analysis for pizza in Loudoun County, Virginia. The first variable that I used in completing my demand analysis is the average cost per pizza in the Loudoun County, Virginia area. The average cost of pizza is imperative in completing a demand analysis, because consumers in Loudoun County, Virginia have several choices in pizza companies vying for their attention. The second variable that I used was the sales revenue for Domino’s Pizza domestic stores for the quarters ranging from the first quarter of 2010 to the first quarter of 2013. Once I obtained the sales figures for the quarters ranging from the first quarter of 2010 to the first quarter of 2013, I then divided the sales revenue in order to obtain the average sales revenue for each domestic store. In order to complete a demand analysis, and forecasting income for future periods one must be able to know the relationship between the average sales per store, and the consumers who are demanding the product. The third variable that I used in completing my demand analysis is median income for Loudoun County, Virginia. Median income is significant for two reasons; first one can tell if the median income can afford to purchase pizza if a new restaurant is established, and secondly one can review the trend in median income. Reviewing the median income trend provides significant......

Words: 302 - Pages: 2

Making Decision Based on Demmand and for Forcasting

...Making Decision Based on Demand and For Casting Presented By: Earnest Lee Sims Presented By: Dr. Domino’s pizza is conducting data to decide to whether to open a store in Lake Providence, Louisiana. Domino’s pizza will complete an indept evaluation and research of this city to determine should they open up a store and the potential demand for the area. Domino will collect data and information on the following areas males, females, children, population, unemployment, and income and food environment. Upon collecting conduct a regression analysis. According to McCvigar. Moyer, and Harris stated that “given any particular value of (mana gerial economics, doll). We can therefore, assess demand for Domino pizza in Lake Providence, Louisiana on various factors such as population, education and food environment. Demographic and Independent Variables The new location of a new Domino’s pizza will be in Lake Providence, Louisiana 71254 which is located in East Carroll Parish, we will be conducting a demand analysis on Lake Providence being the only major city has a population of 3,848 in 2012 in East Carroll Parish in 2012 (city-data). The population also consists 1,728 or 44.9% males, 2,120 or 55.1% females, median resident age 31.0 years, income $19,650, number of grocery stores 3, and number of full services restaurants. Population and income will play a crucial role in Domino’s pizza decision to open up a chain in Lake Providence, Louisiana. According to McGigan, Moyer and......

Words: 549 - Pages: 3

Making Decisions Based on Demands

...Making Decisions Based on Demand and Forecasting Latonya Woodrow Instructor Name: Dr.Samuel F. Onipede ECO 550 –Managerial Economics and Globalization July 21, 2013 College Students buy pizza in large quantities for a cheap price, but if the prices were to increase, then these same students may look for similar alternatives that will not empty their wallets.   These are possible alternatives that offer a large quantity of food at a reasonable price that can affect the demand of pizza.   However, monitoring the costs of the competing fast food restaurants in the Charlotte, North Carolina, area will allow Domino’s Pizza to offer certain specials and pizza deals to the community that can keep their demand at a high rate. A market demand analysis is used to help understand how much consumer demand there is for a given product or service.   This type of analysis will help determine if a business can successfully enter a market and generate enough revenue and profit to maintain the business.   One must identify the market and the growth potential. Domino’s Pizza was incorporated in 1963 and has been franchising since 1967.   A traditional Domino’s store is located in shopping centers and/or strip malls with appropriate parking for delivery vehicles and walk-in customers for carry-out services...

Words: 1234 - Pages: 5

Assignment 1: Making Decisions Based on Demand and Forecasting

...Assignment 1: Making Decisions Based on Demand and Forecasting An Assignment Submitted by Name of Student Name of Establishment Class XXXX, Section XXXX, Fall 2013 Assignment 1: Making Decisions Based on Demand and Forecasting Regression analysis is the description about the relationship between two variables where one is dependent and the other is independent. Regression analysis (in statistics), generally, is about any techniques that facilitate modeling and analysis of several variables. It focuses on the relationship between a dependent variable and one or more independent variables (Sykes, 2000). To be specific, regression analysis allows understanding of the typicality of value of the dependent variable changes, while any one of the independent variables is varied. At the same time, the other independent variables must be fixed. Usually, regression analysis estimates the expectation of conditions connected to the dependent variable given the independent variables (Sykes, 2000). Thus, the average value of the dependent variable is calculated using condition that the independent variables are held fixed. Not that often, regression analysis focuses on a quantile, or other location parameter of the conditional distribution of the dependent variable given the independent variables. Nevertheless, the regression function is the estimation target, which is a function of the independent variables. In regression analysis, it is also......

Words: 608 - Pages: 3

Making Decisions Based on Demand and Forecasting

...Running Head: DEMAND AND FORECASTING Making Decisions Based on Demand and Forecasting [bami] strayer University] Making Decisions Based on Demand and Forecasting The demographics used for the demand analysis are the average yearly income of the house hold in Georgia, the total yearly population, and average kids per house. The rationale behind choosing these demographics is that the demand is highly associated with the average income, and can have a great impact on the demand of the economy, for higher the income, the higher the spending ability of an average house hold. Therefore, it can also be said that the average income is directly proportional to the spending ability of an average house hold, whereas as far as total yearly population is concerned, demand is also associated with the total population, as for demand arises with rise in population. Average kids per house hold also have a strong link with demand. Considering the fact that pizza is highly popular among kids, and is the cause of its major demand. The other independent variables used for conducting a demand analysis are price of the pizza, and price of the soda. The rationale behind choosing these demographics is that the demand is also highly associated with price, as per the demand and supply law, the lower the price the higher the demand, and the higher the price, the lower the demand. Pizza and soda are two main products of a pizza restaurant...

Words: 1269 - Pages: 6

Eco 550 Wk 3 Assignment 1 - Making Decisions Based on Demand and Forecasting

...ECO 550 WK 3 Assignment 1 - Making Decisions Based on Demand and Forecasting Click Link Below To Download: http://strtutorials.com/ECO-550-WK-3-Assignment-1-Making-Decisions-Based-on-Demand-and-ECO5501.htm Assignment 1: Making Decisions Based on Demand and Forecasting Domino’s Pizza is considering entering the marketplace in your community. Conduct research about the demographics of your community, for example the population size and average incomeper household and other independent variables, such as price of pizza and price of soda, for this assignment. By conducting a demand analysis and forecast for pizza, you will be able to make a decision whether Domino’s should establish a presence in your community. 1. Report the demographic and independent variables that are relevant to complete a demand analysis providing a rationale for the selection of the variables. 2. Using Excel or other calculation software, input the data you collected in criterion one to calculate an estimated regression. Then, from the calculation provided, interpret the coefficient of determination, indicating how it will influence your decision to open the pizza business. Explain any additional variables that may improve the coefficient of determination. 3. Test the statistical significance of the variables and the regression equation, indicating how it will impact your decision to open the pizza business. 4. Forecast the demand for pizza in your community for the next four (4)......

Words: 291 - Pages: 2

Information Based Decision Making

...| Information based decision making | Unit 5002V1 | | | 4/1/2015 | Task 1 (600-700 words): A.C.1.1 – Examine the nature of data and information Data comprises of factual information. Data are the facts from which information is derived. Data is not necessarily informative on its own but needs to be structured, interpreted, analysed and contextualised. Once data undergoes this process, it transforms in to information. Information should be accessible and understood by the reader without needing to be interpreted or manipulated in any way. Knowledge is the framework for understanding information and using it to inform judgements, opinions, predictions and decisions – a pyramidal relationship (See diagram 1) Diagram 1: There are 2 types of knowledge: 1) Explicit knowledge (“know that”) – derived from facts, easily communicated via hard data and facts and 2) Tacit knowledge (“know how”) – more of a personal framework informed by beliefs, schemata, mental frameworks, difficult to verbalise or write down, more based on process rather than factual content. In the field of knowledge management, tacit knowledge is individual specific and can be acquired without language through observation and practice. This type of knowledge is acquired through experience, and therefore from a knowledge management perspective, shared experiences are a key platform to share tacit knowledge. A clinical example: The Trust has a standard assessment proforma for new patients...

Words: 2953 - Pages: 12

Standard Based Decision Making

...Standard-Based Decision Making Courteney Alderman ETH/376 March 23, 2015 Juanita Davis Audit Opinions When performing an audit there are four different types of audit opinions that Green and Associates can provide when the audit has been finished. They can provide an unqualified, unqualified with explanatory paragraph, qualified, and an adverse opinion. * Unqualified opinion- An auditor can give an unqualified opinion when it comes to a company’s financial statements when the financials show their financial position, shows the results of their operations, and shows the company’s cash flows. This type of opinion can also be known as a clean opinion which means that the financials show to be presented fairly. * Unqualified with explanatory paragraph opinion- This type of opinion only happens when one of five situations are reported. When a justified departure from GAAP happens, when there is an inconsistent application of GAAP, when there is a growing concern, when there is an emphasis of a matter, and when there is a need to reference other auditors. * Qualified opinion- This type of opinion means that the auditor has taken an exception to certain current-period accounting applications or is unable to establish the potential outcome of a material uncertainty. Also meaning that the auditors’ reservations or has an uncertainty about how fairly the material is presented in some different areas of the financial statements. This opinion is stated qualified......

Words: 777 - Pages: 4

Demand Forecasting

...Accuracy of Demand Forecasting Between Point of Sale and Order History Supply Chain Management TBS908 Table of Contents 1. Executive Summary 4 2. Company Profile 4 3. Demand 5 3.1 Demand Forecasting 6 3.2 Demand Forecasting Methods 6 3.2.1 Opinion Polling / Qualitative Method (subjective): 6 3.2.2 Statistical Methods/Quantitative Approach (objective): 6 4. Order History Vs. Point-of-sale 8 5. Planning Promotions 8 5.1 Promotion Planning and Supply Chain Contracting in a High-Low Pricing Environment 9 5.1.1 Basic Household Inventory Model: 9 6. Types of demand forecast in GCC and UAE 10 7. Objective 10 8. Methodology 11 Table 3 13 Figure 1 13 9. Result 14 10. Recommendations 14 11. Conclusion: 15 11. References 16 12. Appendixes 17 Appendix I 17 Appendix II 19 1. Executive Summary Demand forecasting is essentially anticipating future prospects by reviewing historical data in the most calculated way in an uncontrollable environment. Foreseeing what and when buyers will purchase has never been a simple procedure for producers or retailers. Troubled by the overwhelming undertaking of correctly coordinating supply with interest, makers are always enhancing procedures to accomplish the most noteworthy estimate exactness that will guarantee when the customer enters a store, the item they are searching for is on the rack. This is getting significantly tricky as the uncertainty level increase. In the below report the demand......

Words: 5698 - Pages: 23

Evidence Based and Decision Making and Discovery

...Evidence Based Decision Making and Discovery | |Compare |Contrast | |Quantitative Research |-Requires the collection, analysis, and |-Research is deductive, logical or | | |reporting of data. |reasonable. | | |-Reporting data consist of supplying |-A hypothesis is needed to begin research. | | |readers with participant information, data |- The researcher is ideally an objective | | |patterns, recognition of biases, and |observer that neither participates in nor | | |further research to be conducted |did influence what is being study (Barnes, | | |surrounding the topic. |2005). ...

Words: 653 - Pages: 3

Demand and Supply Is Useful Tool in Business Decision Making

...In business decision making most useful tool is demand and supply. Demand and supply are very broad area in economics. It will talk about very thing in the business. If do not know about the demand and supply, then cannot make a decision on the business. In this easy will discus about the demand and supply and other tools of business decision making. A market is a set of arrangement by which buyers and seller exchange goods and services. Let us look about demand. Demand can be described as the relationship between quantity demanded for a particular good or service in specific circumstance. Also demand is define as the quantity of a good or service that consumers are willing and able to buy at a given price in a given time period. Each of us has an individual demand for particular goods and services and the level of demand at each market price reflects the value that consumers place on a product and their expected satisfaction gained from purchase and consumption. The following example gives a demand curve. Price | | | | | | | | 30 | | | | | | | | | | | | | | | | 20 | | | | | | | | | | | | | | | | 10 | | | | | | | | | | | | | | | | 0 | 2 | 4 | 6 | 8 | 10 | 12 | Quantity | The demand curve shows an estimate about the relationship between the price of any particular product or service and the quantity of that product that will be demanded by consumers. It is usually assumed to slope downward, in the general...

Words: 486 - Pages: 2

Information Based Decision Making

...the criteria a manager will use for selection of data and information An explanation of how managers filter/evaluate which data/information is useful and what is not useful. 1.4 List and discuss local legislation/UK. Legislation that protect against the collection of data and information 2.1 state a few models Evaluate at least 2 of the models Examples - Adair model SWOT SPELT Rational model Pros & cons 2.2 Name/list of persons Examples of how they would analyze information to make a decision 2.3 list the methods of presenting decision made and valuated as least 2 methods – how a senior manager will present decision to - Board - Other Manager - Stake holder 3.1 evaluate how a middle manager will communicate the decision to the staff 3.2 discuss the process of implementing a communication method How would you put in place a communication method to share decision with others? Example - Meeting – what is the best time to have the meeting - E-mail – do everyone have and e-mail account / how often do they check the e-mail 3.3 evaluate on 3.2 How effective is the communication method to the organization Is it effective will it work...

Words: 250 - Pages: 1