qwertyuiopasdfghjklzxcvbnmqw ertyuiopasdfghjklzxcvbnmqwert yuiopasdfghjklzxcvbnmqwertyui opasdfghjklzxcvbnmqwertyuiopa [Type the document title] sdfghjklzxcvbnmqwertyuiopasdf ghjklzxcvbnmqwertyuiopasdfghj klzxcvbnmqwertyuiopasdfghjklz Feasibility study of a home delivery

service xcvbnmqwertyuiopasdfghjklzxcv bnmqwertyuiopasdfghjklzxcvbn mqwertyuiopasdfghjklzxcvbnmq wertyuiopasdfghjklzxcvbnmqwe rtyuiopasdfghjklzxcvbnmqwerty uiopasdfghjklzxcvbnmqwertyuio pasdfghjklzxcvbnmqwertyuiopas dfghjklzxcvbnmqwertyuiopasdfg

9/29/2011

Group Members: Ammar Hameed Natasha Hassan Zain Malik Zohaib H. Shah Muqtadir S. Kazi

Table of Contents
Company Overview ...................................................................................................................... 1 Product Offerings.......................................................................................................................... 2 Research Problem ......................................................................................................................... 3 Research Objectives ...................................................................................................................... 3 Exploratory Research Design ...................................................................................................... 4 Focus Groups............................................................................................................................... 4 Experience Surveys ..................................................................................................................... 7 Exploratory Research Findings ................................................................................................. 10 Focus Groups............................................................................................................................. 10 Experience Surveys ................................................................................................................... 14 Questionnaire Design .................................................................................................................. 18 Quantitative Data Findings ........................................................................................................ 19 Objective 1: ............................................................................................................................... 20 Objective 2: ............................................................................................................................... 21 Objective 3: ............................................................................................................................... 22 Objective 4 ................................................................................................................................ 22 Objective 5: ............................................................................................................................... 23 Objective 6: ............................................................................................................................... 24 Objective 7: ............................................................................................................................... 25 i

Hypothesis Testing: ................................................................................................................... 26 References .................................................................................................................................... 28 Appendix ...................................................................................................................................... 29 Screener questionnaire .............................................................................................................. 29 Interview Questionnaire (Hardees Manager) ........................................................................... 31 Interview Questionnaire (McDonalds Manager) ..................................................................... 31 Survey Questionnaire ................................................................................................................ 33

Company Overview
Hardees is a multinational fast-food chain with over 3,100 restaurants in 14 different countries and is famous for its charbroiled, thick burgers. The founder, Wilburt Hardee opened his first store in 1960 and on the strength of its manly menu items, soon grew rapidly through franchising. It is said that Hardee lost his controlling share of the company to James Gardner and Leonard Hawls and upon this realization, sold them the hold company. In 1997, the chain was acquired by CKE Restaurants, the parent company of the Carl's Jr. fastfood restaurant chain. Over time, some Hardee's restaurants were converted to serve higherquality hamburgers and other products available from Carl's Jr., and also took on the Carl's Jr. star logo in the process. Hardees opened its first outlet in Lahore in 2009 and has enjoyed great success since. It has expanded the number of outlets in the city to three with another twelve planned throughout the country. The company describes itself as follows: The core strengths of the Hardees brand are our premium quality, best-in-class menu, premium service and delivery systems, premium facilities, innovative menu offerings, youthful brand image and edgy, cut-through advertising. Our value proposition for consumers is based on offering authentic, premium quality American Style burgers at a price that consumers are willing to pay for better quality, better service and better hospitality in a premium Quick-Service Restaurant (QSR) environment. We offer made fresh to order products, partial table service, all you can drink beverage bar with free, unlimited refills and the best quality products in our segment. At Hardee's, we concentrate on being the best versus being the biggest, delivering premium products and the ultimate dining experience to guests.

Product Offerings
Hardees in Pakistan offers four different menu option categories, each with various items. These are listed below:

1. Charbroiled Burgers (Beef):

Cheeseburger Original Thick burger Big Burger Famous Star Superstar Mushroom & Swiss Jalapeno Burger

2. Chicken & Other:

Chicken Fillet Buffalo Chicken Santa Fe Jalapeno Chicken Grilled Chicken Chicken Stars

3. Side Orders:
Crispy Curls Onion Rings French Fries

4. Beverages & Shakes

Tea Coffee Nestea Peach Iced Tea Nestle Lemonade Soft drinks: Coke, Diet Coke, Sprite, Sprite Zero, Fanta Hand-Scooped Shakes: Chocolate, Vanilla, Strawberry

Research Problem
Although Hardees in Lahore has been very successful in catering to the fast food market; the company is interested in knowing whether it can further increase its market share by providing a home delivery service to cater to the stay at home segment of the market. Almost every local and international fast food chain provides a delivery service in Lahore and as such Hardees would try to increase its sales through such a service, pending viability. The purpose of this research would be to conduct a feasibility study to check whether demand exists among Hardees customers for this service, the extent of that demand, the overall number of fast food customers that get food delivered in a day, the costs and requirements associated with starting this service (including purchase of capital such as motorbikes as well as an increase in the number of employees) and the potential loss of customers to competition due to a lack of home delivery service.

Research Problem Statement: To evaluate the viability of starting a home delivery service
for Hardees by analyzing demand and the associated costs of service

Research Objectives
The number of people that order fast food via a home delivery service The number of Hardees customers that demand a home delivery service The number of customers that shift to a competitors brand because of a lack of delivery service Factors that influence preference of one delivery service over another The amount that people are willing to pay for such a service The most frequent hours of delivery service.

Exploratory Research Design

Exploratory research is conducted to obtain greater understanding of a concept or to help crystallize the definition of a problem. It is also used to identify important variables to be studied. Exploratory research is preliminary research used to determine a course of action. Exploratory research can take several forms: Literature research, experience surveys, secondary data analysis, case analysis and focus groups. Exploratory research is used to clarify a perceived problem. It is necessary to ensure that if there is a problem it is clearly understood before a company uses its resources to address it.

Focus Groups
Research Population: Fast-food consumers within the Lahore area Sampling Frame: Three different sets of participants would be taken for three different focus groups conducted. The first set would consist of fast food consumers aged 18-25 (both males and females) with a household income of Rs.25,000 or higher. The reason for such a sampling frame is that this age bracket is one of the major segments that Hardees targets and as such their opinions would be useful. The income level is chosen to ensure that the selected sample can afford Hardees on a regular basis. The second set for the second focus group would consist of office personnel aged 18-30 (both males and females) with an income of 25,000 or higher and have fast-food delivered to their offices. This would help to gather opinions from Hardees consumers that may wish to have it delivered during lunch hour where traditionally most delivery services observe a spike in demand. The third set would be of the same income group as the one above, belonging to the same social class but would belong to the 10-18 age bracket. This would ensure a varied base for conducting focus groups and as such would help to gain further insight into the psyche of those that eat fastfood regularly. Sampling Technique: Convenience Sampling will be used due to time and cost restraints. A screener questionnaire would be used to obtain candidates that seem better suited to our needs. Sample Size: Eight respondents would be selected for each focus group.

Tools and Procedures: The moderator will be selected from within the research group based on whoever is deemed to have the best communication skills. A round table setup will be used and a casual environment will be created with a clear discussion guideline being followed. The conversation will be observed by the rest of the members of the group and will be recorded for further analysis. Focus Group Guidelines INTRODUCTION/ WARM UP (5 Minutes) Introduce yourself Highlight the purpose of focus group Introduction of respondents Ask about their hobbies Try to be friendly and build rapport Rules of Focus Group

LIST OF PREFERENCES (5 Minutes) Ask respondents regarding different fast food delivery chains When do they prefer to eat fast food Ask them to list them as per preferences Basis of choosing one fast food chain over another Ask them to tell about first word comes to their mind when they hear about different fast food delivery chains

PRICE SENSITIVITY (10 Minutes) What do they think about prices of major fast food outlets? How will an increased price affect consumption patterns? Their perception of the relationship between price and quality? Any suggestions

Delivery (10 Minutes) Ask them about frequency of delivery from different fast food chains What would be the appropriate time taken for delivery What would be the appropriate charges for delivery Ask about situations where delivery is preferable to take away or dine in Ask about frequency of delivery to dine in Ask about frequency of delivery to take away

PERCEPTION OF HARDEES (10 Minutes) Perception about Hardees Taste of Hardees Ask them about their consumption patterns from Hardees Preference of Hardees in different types of burgers How they would react if Hardees offer delivery service

CLOSING (5 Minutes) Summarize Feedback Closing remarks Gifts

Experience Surveys
An experience survey is an exploratory research technique in which individuals who are knowledgeable about particular research problem are surveyed. We shall conduct this research for the purpose of thoroughly understanding the matter at hand and to gather insight into the process of fast-food operations. Two experience surveys would be conducted to gather different types of information; the first involves interviewing the head of operations for Hardees in Lahore and the other involves interviewing the operations manager of McDonalds for the Y-Block DHA branch, in Lahore. Method of Obtaining Information: The method for obtaining information will be interviews, where one of the researchers of the group would ask questions while the others would be silent observers. A series of predetermined questions will be asked from the interviewee that will ensure that same areas of information are collected in depth. To obtain detail, in-depth and formal information, interview is the best tool and thus we selected it. All the information available with the operations manager will be gathered and analyzed, thorough understanding of the problem is very vital. Hardees Head of Operations Interview: The reason the head of operations for Hardees has been chosen is because he will have significant knowledge regarding the company and general operations and as such would be better suited to answer queries. The information that we will be collecting from Hardees operations manager will include the current sales level of its product with respect to industry. We will analyze the demand trend for Hardees products. This information will help us in analyzing the current position of Hardees in the industry. We will then further need to divide the sales into dine-in and take away. This will give us the idea of the various consumption patterns and preferences of Hardees customers. To completely understand customer base of Hardees, we will require the operations manager to share with us the information regarding the target market of Hardees and their demographics.

This information will be quite useful in knowing the Hardees customers. By using this information, we can specify the customer of Hardees into various categories such as age groups, gender, income brackets, student and professionals etc. Further we will need information about the psychographics of the customers which will help in learning about the lifestyles of the segment which is key to the concept of delivery service. It will help in determining whether the consumers will appreciate the delivery service and react positively to it. This information will also help us understand the people who shift to other brand due to ease of delivery service. To compare Hardees customers we will need to obtain information regarding competition. We require the manager to inform us about the major competitors and the edge they have over Hardees. One piece of information that would be required from the manager is the reason behind not launching a delivery service in the first place as every major competitor has this service. Some other information that would be needed is about the capability of the management to handle this new service. Do they have the right structure to handle this stuff? Information regarding the targeted geographical areas would also be required. [The interview with the Hardees operations management would be conducted on 13th October, 2011 at 12:00 pm, Hardees Y block] McDonalds Operational Manager (Y-Block DHA, Lahore): The reason for selecting the McDonalds operations manager is to gain information in terms of delivery sales, peak times, frequency etc. As McDonald is the closest competition, it will help to gather vital information about delivery service demand. The operational manager is the most suitable person to interview in order to get in-depth information of the delivery service that will help us to evaluate the viability of starting a delivery service for Hardees. He can provide us with information and trends of the delivery service at McDonalds, through experience gained on the job. The idea is to gather information that would help deduce whether a delivery service is a viable growth option for Hardees. Information like trends of the delivery service, frequency of orders, sales ratio in terms of dine in, take away and delivery along with their demands are very important to make a feasibility report for Hardees. Customer information regarding number of

customers preferring McDonalds just because of delivery service etc. are also important to obtain. [The interview will be with McDonalds operations manager and it will be conducted on 14th October, 2011 at 2.30 pm at McDonalds Y block branch]

Exploratory Research Findings

Exploratory research was conducted to gather qualitative data for better understanding of our subject matter; this was conducted through focus groups and experience surveys (two each) and the findings of each are listed below:

Focus Groups
Two focus groups were conducted; each consisting of eight people. These focus groups were recorded and the video recordings were used to extract a number of common themes that emerged from the two focus groups.
[Focus groups were conducted in Urdu, with quotes being transliterated into English for this report]

Fast Food Fast-food is considered as staple food for almost all the university students. Fast food chains are the hangout place for most college friends and they consume it 4-5 times a week. Although they know that it is high in calories and is fattening, it is still highly popular and this knowledge does not seem to deter them from consumption.

Fast Food Chain Preference The general theme to emerge was that people preferred fast food when they went out for a casual lunch / dinner or when they wanted quick service, with Hardees the overwhelming favorite in terms of fast food outlets, McDonalds second and KFC a distant third. As one respondent put it, Ever since Ive tried Hardees, McDonalds burgers seem like a cheap knockoff and KFC doesnt even come into contention. Generally people think that KFCs quality has been deteriorating for the past couple of years. Many think it is a strategy followed to appeal to the lower segments that moved from KFC to AFC, EFC, JFC etc. On the other hand McDonalds is known for maintaining its quality, however service time is considered to be slower than before. It is also not considered cool due to general ambience as well as the fact that it seems to be associated with children. I like McDonalds and I get a lot of food delivered from it but I never want to go to a McDonalds outlet, sit down and have a meal

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because the of overall ambience and crowd. McDonald's is considered appropriate for a 'quick bite' or snacks, but not a proper meal by adults. Hardee's is perceived to have a cool and a hip personality catering specifically to urban youngsters.

Pricing In terms of absolute pricing, fast-food prices were generally considered to be appropriate for their respective menus with small changes in prices not affecting demand for product. However in terms of price to quantity ratio, there was a polarization of views with some arguing that McDonalds had the worst price to quantity ratio while others arguing exactly the opposite. These views were best illustrated by the following two quotes: Although all three have appropriate servings in accordance with price, McDonalds is by far the best in terms of price to quantity! McDonalds has the smallest burger sizes and seem like a joke for the price one pays! For Hardees people seemed to think that the quantity served was appropriate for what they were paying, although no one seemed to think that the servings were over-generous; as one student said, With Hardees, you get what you pay for, nothing more, nothing less.

Delivery Focus groups results showed that people preferred a delivery service that was free, quick and there was some sort of quality assurance. However most seemed not to mind a small surcharge for delivery as is the case with McDonalds and KFC. Quick was seen as a service that delivered food in 30 minutes or less with anything upto the 40 minute mark considered as adequate. Delivery was seen as most preferable when one wants to eat alone or during lunch hour at work while dining in was considered the best option when with friends. Take away was the least preferred option; seen as a last resort. Overall the general trend was that the delivery to dine in ratio was 3:1 while delivery to take away ratio was 5:1. It was seen that McDonalds received the highest delivery orders among fast food chains with KFC lagging behind considerably, although people indicated that a Hardees delivery service would provide strong competition to McDonalds, especially for those who have food delivered during lunch hour at the office; as one female participant put it, There are lots of days when Im

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literally craving for Hardees but cannot leave the office even during lunch hour because of the amount of work and thus I have to make do with a McDonalds burger! Hardees Hardees is seen as the fast-food chain for urban young adults and is associated with words like cool, hip and tasty. The quality is considered the best among its competitors and the disparity in quality between Hardees and the competition is greatest within beef burgers, with other beef burgers seen as no match for Hardees thick burgers. Hardees is also the most consumed fast-food chain as per the results of our focus groups with the Famous Star being the burger of choice for most. The only major complaint that emerged was the fact that they do not have a delivery service and as such people who do not want to leave their homes or offices have no option but to consider an alternate. A female participant was quoted as saying, They may want us to go to their outlets and sit and have their meal but they must be stupid to not realize that some of us do not want to leave their homes at 11 P.M just to eat Hardees! Unexpected Emerging Trends There were a few surprises that came to light through these focus groups which are listed in point form below: KFC was considered much worse by females than males Hardees was seen as more expensive than McDonalds even though both have similar prices Hardees beef burgers were considered far superior to McDonalds even though both use the same type of beef and of similar quality Hardees fries were seen as having lowered in quality slightly ever since they reduced the thickness of their fries The 10-18 segment preferred McDonalds to Hardees

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Conclusion Most people seem highly satisfied with Hardees in terms of product and atmosphere however they would prefer a delivery service be added. The younger crowd (10-18) seem to prefer McDonalds mainly due to the appeal of the happy meal and the play place; however the overall results show that Hardees is the most liked and as such the only thing lacking is a delivery service which is seen as a must for all fast-food chains as people prefer on quite a few occasions to have food delivered to their homes or place of business / work.

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Experience Surveys
Two experience surveys were conducted; one was an interview with the Hardees head of operations while the other was an interview with the operational manager of McDonalds (YBlock branch). A number of key findings were extracted with regards to different topics from each interview, these are described below:

Hardees Head of Operations Interview

High dine-in Sales Sales at Hardees are consistently high, the primary reason being the quality and consistency of the service provided. The restaurant provides value of money to all its customers. The dine-in experience at Hardees is better than its competitors as they provide clean and comfortable environment with friendly staff always at service. The sales percentage of dine-in and takeaway/drive through also reflects the impact. Hardees have a high percentage of dine-in customers which is probably the highest among its competitors. They are able to attract people from all walks of life to dine at their restaurant. Their market is youth oriented and that particular segment prefers home delivery. Beside it Hardees has managed such high dine-in numbers speaks about the demand and likeability of its products. Reason for not offering delivery service Since the Hardees brand arrived later than its competitors, it initially wanted to focus on capturing the dine-in market and with the extreme hype surrounding its launch and initial opening; it was thought that a delivery service might cannibalize the initial surge in demand that would arise, resulting in potential loss of customers in the dine-in area. Another aspect was that they did not want to waste any of their resources on delivery; rather they wanted to focus all their attention to those that came to their outlets with friends and family to dine in. The strategy was to emphasize on reviving the dine-in trend and make customers come to their outlets which they now consider a success. Another reason for having no delivery service is to prevent cannibalization of sales. It was also thought that with only one outlet, the company would not be able to fully cater to their customers and it might affect their image; hence the idea was to expand and then think about having delivery service system in place.

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Availability of resources Hardees currently have enough resources to start a delivery system. The management structure is also flexible and can handle the demands of putting in place a delivery system. They now have three branches in the city which are ideally located to divide the city into segments. This segmentation can prove useful in providing an efficient delivery system. With the demand for this service increasing day by day, this is seen as an ideal time to think about launching such a service. Competitive Position The closet competition Hardees have is McDonalds. They also have the highest sales volume in the industry and also dominate geographically as they have the most number of outlets. McDonalds also have a competitive advantage over Hardees due to its delivery system. It guarantees home delivery of its food almost anywhere in the city with precision and speed. There is a certain segment that Hardees is not yet catering and that is the home delivery segment. All the major and minor competitor of Hardees offers this service. The demand for this service is ever increasing. One reason for this thriving fast food industry is the home delivery service which provides convenience to the customer. Strengths and Limitations of Information The information we acquired through our experience survey provided helpful knowledge to study the costs and benefits of launching a delivery system. The strength of the collected information is that it has enabled us to fully understand the reasoning behind not launching a delivery service earlier and why have they decided to launch one now, their objectives, their competitive position and the resources that they have. However there are some limitations to this information. We do not have exact sales figures, the percentages of dine-in and take-away are not absolute and few other pieces of information that are confidential to the company could not be shared.

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Conclusion and recommendation After analyzing the results of the experience survey we came to a conclusion that Hardees is one of the leading companies in the industry with high demand and sales. The demand for a delivery system also exists and company has sufficient resources to set up this new service. It is perhaps early to say but at this point in time it seems profitable and viable for Hardees to launch a home delivery system. Further research would be done on this matter to fully comprehend its feasibility.

McDonalds Operational Manager (Y-Block DHA, Lahore):

Demand for McDonalds McDonalds is a giant of the fast food industry and is rated as the best in the business in Pakistan in terms of sales and demand. McDonalds with its wide variety of menu and speedy service is the number one choice for its desired target market as it offers dine in, take away, home delivery service and drive through (at selected outlets) which makes it very convenient, accessible for customers. Trends in delivery service Delivery service of McDonalds accounts for higher sales as compared to any other fast food chain and the major reason for this is that their delivery service is fast and efficient. People avail the option of a delivery service as it saves time and energy and recent trends indicate that sales resulting from the delivery service have increased 15% last year and 7% the year before that. Delivery Timings The demand for food through delivery is highest during the office lunch hour and late night (10 P.M - 4.A.M.). These two timings are when the delivery service demand is at its peak and it becomes difficult to meet demand. Generally demand is adequate throughout the day and high at regular hours of lunch and dinner. There is a lull in demand between 4 A.M and 10 A.M but enough demand exists to justify keeping the delivery service open. Strengths and Limitation of Information The information acquired from McDonalds operations manager through the use of experience surveys was helpful in understanding the importance and impact of delivery service for any fast food chain operating in Pakistan. It enabled us to understand the timings of the demand for a delivery service, increase in sales by the delivery service and overall impact of delivery service on restaurants.

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However the limitation of this information is that it does not give us quantitative data and thus we cannot estimate our results in absolute terms. Conclusion and Recommendations McDonalds is the largest fast food chain in Pakistan and one of the factors in their mega success is their home delivery service. Delivery service has become the most important part of their portfolio and they have very efficient and effective delivery service which is cherished by its customers and as Such for Hardees to break McDonalds stronghold over the fast-food sector, it must start a delivery service which is better or at the very least comparable to McDonalds.

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Questionnaire Design
The purpose of this questionnaire is to further the findings of the exploratory study, particularly to quantify the tentative findings that were taken from the focus group study and the experience surveys. Research Population: Fast-food consumers within the Lahore area Sampling Frame: The sampling frame consists of the accessible portion of the research population and hence would consist of people that visit the McDonalds, Hardees and KFC outlets (in DHA) along with students of Lahore School of Economics; as such the questionnaire would be administered in these locales. Choosing participants from the first three locales would ensure a greater chance that a large portion of the participants would be those that eat fast food regularly. The fourth location (Lahore School of Economics) would ensure that the type of consumer Hardees most caters (urban young adults) to is included. Sampling Technique: Convenience sampling will be used due to time and cost restraints. Sample Size: A total of 150 questionnaires will be filled

Tools and Procedures: The survey team would personally distribute the questionnaire survey at the three locales mentioned in the sampling frame. Before the questionnaire is administered, each potential participant would be asked whether they consume fast food at least occasionally. This would ensure that only those that eat fast food provide insights.

Hypothesis: H0 = Hardees as the first choice preference for fast food consumers does not have a significant relationship with its brand image, ambience in outlets , food quality , cost , service and time taken to provide order. H1 = H0 = Hardees as the first choice preference within fast food restaurants has a significant relationship with its brand image, ambience in outlets , food quality , cost , service and time taken to provide order.

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Quantitative Data Findings

Questionnaire surveys was conducted to gather quantitative data for better understanding of our subject matter and to satisfy our listed objectives, along with the developed hypothesis. The data has been analyzed using a statistical tool known as SPSS and the findings with relation to our objectives along with the hypothesis are listed on the next page.

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Objective 1:

40% of the people consume fast food once a week by ordering via a home delivery service and the remaining 33% order via delivery twice a week. 12% out of all get food delivered once a month and same percentage is for people ordering via delivery every alternate day. This shows that majority of the people order via delivery either once or twice a week thus there is a high potential for Hardees to start its delivery service.

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Objective 2:

Out of our total sample, a high percentage (around 90) wanted Hardees to start a delivery service. This analysis helped us with our research objective to find the number of people who demand a home delivery service of Hardees and we have come to the conclusion that there is high demand for a delivery service for Hardees.

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Objective 3:

Out of the 85% who chose Hardees as their first choice in question 4, a majority of 40% people once a week substituted another restaurant for Hardees because Hardees doesnt have a delivery service. 21% substituted Hardees once a month because of the same reason as stated above. This shows that due to lack of delivery service, Hardees is losing a significant portion of customer to other restaurants. Thus there is a high demand for a delivery service of Hardees.

Objective 4

Out of 85% who chose Hardees as their first choice in question 4; 33% of the people consider freshness as the most important factor while deciding which fast food restaurant to deliver from followed by delivery time (24%) and then delivery charges (19%).

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Objective 5:

According to 37% of our sample, the appropriate delivery time for fast food is considered to be 30-35 minutes whereas 33% demand a delivery time of less than 30 minutes. This shows that people want their delivery in the minimum time possible.

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Objective 6:

According to 50% of the people there should be no delivery charges whereas 35% people thought that delivery charges under 11 rupees would be acceptable. This helped us with our research objective to find if people are willing to pay for delivery service. It is quite clear that people want the delivery service to be either free of cost or be at a minimum price i.e under 11 rupees.

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Objective 7:

Out of 85% of the people who prefer Hardees, a majority of 38% get food delivered between 9:01 P.M to 12 A.M whereas 24% of the people get food delivered between 11:01 A.M to 2 P.M. Thus dinner and lunch time have high potential in terms of delivery.

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Hypothesis Testing:
To test the hypothesis that was developed, a multiple regression analysis was conducted, the regression model and its corresponding equation is shown below, along with a thorough analysis: Regression Model
Parameter

Coefficient
0.0461095 0.353232 0.351173 0.453202 -0.0495677 0.21128 0.133718

Std error
0.364626 0.184073 0.139209 0.128754 0.0781075 0.0851191 0.189385

T- statistics
0.126457 1.91898 2.52264 3.5199 -0.634609 2.48217 0.706061

P value
0.9005 0.0075 0.0490 0.0017 0.0619 0.0208 0.0872

constant
Hardees as a brand Ambience in outlets Food quality Cost Service Time taken to provide order

R-squared = 88.3599 percent R-squared (adjusted for d.f.) = 85.8294 percent Standard Error of Est. = 0.213829 Mean absolute error = 0.125416 Durbin-Watson statistic = 2.21831 (P=0.7123) Lag 1 residual autocorrelation = -0.114421 Analysis of Variance Source Model Residual Total (Corr.) Sum of Squares 7.98286 1.05163 9.03448

Df 5 23 28

Mean Square

F-Ratio

P-Value

1.59657 0.0457229

34.92

0.0000

Hardees as the first choice for fast-food consumers = 0.0461095 + 0.0075* Hardees as a brand + 0.049* Ambience in outlets + 0.0017* Food quality - 0.0619* Cost + 0.0208* Service 0.0872*Time taken to provide order The model tested has a coefficient of determination (R squared) of 88.3599 percent. This measures the goodness of fit or the quality of fit and since R2 in this case is close to 1, it shows a good overall fit for the model. Adjusted R2 is a better measure for goodness of fit, as it is adjusted for the degree of freedom, comes out to be 85.8294 percent; we can conclude that 85.8% of the variation in purchase intention around its mean is explained by our model.

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The second thing to look at in terms of our regression model is the overall P-value for the model upon which it would be determined whether the null hypothesis is rejected or not. For our model, the associated P-value comes out to be 0.000035 and since the P- value of 0.000035 < 0.05 (LOS), we are 95% confident that a statically significant relationship exists between the independent variables listed and the dependent variable (consumer preference of Hardees as the first choice for fast food consumers). Looking at each independent variable in isolation, we come to understand that although the overall model has a significant relationship and that this model does explain 85.8% of the variability in the dependent variable; some independent variables individually do not have a significant relationship with the dependent variables. This is checked by comparing the P-values of each variable with the level of significance (0.05). As is seen, the P-values of Cost and Time taken to provide order are higher, hence these do not have a significant relationship with Hardees as the first choice within fast-food restaurants. It is also seen that the other four variables have a statistically significant relationship.

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Conclusions & Recommendation

The purpose of the study was to conduct a feasibility study for Hardees and recommend on the basis of the results of the study as to whether a home delivery service would be a viable option. In terms of qualitative findings, the focus groups results showed a favorable response towards Hardees starting a delivery service and Hardees in general; while the experience survey helped us to understand that Hardees possesses the resources necessary to start a delivery service and McDonalds, its key competitor, lists it as one of its core strengths. In terms of the quantitative data findings, we found out that a lot of people have foot delivered and would love for Hardees to start a service and the fact that this service is not provided results in a loss of consumers. In addition it was learned that these consumers have food delivered typical during lunch and dinner hours and place high importance on freshness, cost of service & speed of delivery. Based on these results, we recommend that Hardees start a delivery service as soon as possible, pending an analysis of overall costs that will occur as a result of starting this service.

Limitations
Cost of service has not been analyzed Convenience sampling may not have been representative of the population Lack of a proper budget did not allow for greater statistical tools to be implemented Sample size too small to make definitive claims Lack of time may have resulted in lack of depth in terms of statistical analysis

References
http://www.hardees.com/

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http://www.hardees.com/menu http://mytownmyhardees.com/ http://www.facebook.com/HardeesPakistan#!/HardeesPakistan?sk=info http://eatntravel.pk/2010/02/03/hardees-at-m-m-alam-road/

Appendix

Screener questionnaire to select focus group participants:

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Name_______________________ Age________________________

1. What is your household income level? a) Below 25,000 b) 25,000-35,000 c) 35,000-50,000 d) Above 50,000

2. Are you a fast food consumer? a) Yes b) No

3. How often do you eat fast food? a) More than twice a week b) Twice a week c) Once a week d) Never 4. How often do you consume Hardees? a) More than twice a week b) Twice a week c) Once a week d) Never

5. Do you prefer dining in, take away home delivery? a) Dining in b) Home delivery c) Take away

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6. Which is your favorite fast-food place? a) McDonalds b) KFC c) Hardees

7. How often have you been chosen for a focus group? a) Never b) Once c) Twice d) More than twice Interview Questionnaire (Hardees Manager) 1. What is the current level of sales compared to the industry? 2. Is the demand for Hardees product rising, declining or stagnant? 3. What percentage of total sales is take away orders? 4. What customer segment is Hardees currently targeting? 5. Who are its major customers? 6. What are the Demographics of the customers? 7. Who are its main competitors? 8. What competitive edge do they have? 9. Why Hardees has not yet offered delivery service? 10. Is there any demand for delivery service? 11. What impact will delivery service have on dine-in customers? 12. Will introduction of delivery service increase sales? 13. Is the management capable of handling the delivery service? 14. If delivery service introduced, what will be the geographical areas targeted by the service? 15. Does lack of outlets affect the quality and speed of delivery service? Interview Questionnaire (McDonalds Manager) 1) What is the ratio of delivery service sales in total sales of a day? 2) What are the peak timings of delivery service of McDonalds?

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3) What is the frequency of order in terms of delivery, dine in and take away? 4) What is the trend in delivery service? 5) Is demand for delivery service increasing or decreasing? 6) Does delivery service provide McDonalds a competitive edge? 7) What is the impact of delivery on dine in and take away service? 8) Does delivery service at McDonalds helps them in higher sales? 9) Is the speed of delivery service is fast or slow? 10) Is delivery service accounts a considerable percentage in overall sales? 11) The demand of McDonalds is rising or declining? 12) What are the demographics of the customers? 13) Who are its major competitors? Short summary of interview from Hardees head of operations Hardees is among the leading brands in fast food industry. Our sales compared to the industry are high. The products offered by Hardees have a healthy demand, due to some new additions to the menu, the demand has increased. The sales are dominated by dine in customers as they account for about 70% of the total sales. 30% of the sales are made through take-away and drive through orders. Hardees target market consists of people from SEC A and SEC B. The target audience includes kids, families, office employees and youngsters falling in the age bracket of 15-30. The biggest competition that Hardees has is McDonalds followed by KFC. The possible competitive edge that our competitors have is diversity in their menu, delivery service, number of outlets and 24 hour branches. Hardees at first did not offer any delivery service because we wanted to capture the dine-in market and also to prevent cannibalization of sales. The effect of launching delivery service on dine-in sales would be negligible, because people who prefer or want to have food delivered to their homes mostly go for alternatives. We expect an increase in sales because of the delivery service as we would be targeting a new segment and making it more convenient for our customers.

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Our management is also fully capable of handling this new venture as we have all the resources and skills required to perform the task. Hardees has limited number of branches but that wont have a big effect on the quality of delivery as we would strategically divide the city into smaller areas and would use latest logistics to back it up.

Short summary of interview from McDonalds Operational Manager (Y-Block DHA, Lhr) McDonalds is one of the largest fast food chains in Pakistan not only in terms of outlets but also in sales as well. It has the biggest market share in fast food industry and lies at the top with much higher than industry average. McDonalds has a very diverse menu which not only includes burgers but also appetizers, hot drinks and desserts which makes it the best fast food chain enjoyed by masses. McDonalds majority of the sales come from dine in that accounts for 48% whereas delivery and takeaway both accounts for 52%. McDonalds target market consists of both SEC A and SEC B, though Sec A goes for delivery and takeaway more and Sec B enjoys dine in service. Target audience of McDonalds includes kids, youngsters, office employees and families within the age bracket of 8 to 30. The biggest competitors of McDonalds are KFC and Hardees. Hardees being new in the market is gaining market share rapidly which is one of the major concerns for McDonalds. The competitive edge of McDonalds is delivery service and branches all over the town which makes it very convenient fast food restaurant for people. McDonalds delivery is enjoyed by many people and trends have shown that the delivery service is increasing day by day and the peak timings for the delivery service are evening and night. The delivery service of McDonalds is very fast and efficient and most of the orders are delivered much early than the mentioned time.

Survey Questionnaire [This survey relates to a Marketing Research Project for LSE MBA students]

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1. How often do you consume fast food? a) Once a month b) Once a week c) Twice a week d) Every alternate day e) Other: [Please Specify]______________________

2. How often do you consume fast food by ordering via a home delivery service? a) Once a month b) Once a week c) Twice a week d) Every alternate day e) Other: [Please Specify]______________________

3. Rank the following in terms of importance when choosing a fast food restaurant:
Factor Price Taste Popularity Variety of Menu Atmosphere Not important at all Little Importance Neutral Moderately Important Very important

4. Score the following restaurants (out of 100) in terms of preference: Outlet Score

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Hardees KFC McDonalds Others

5. Rate the following according to value for money [1= value for money extremely low, 2 = low, 3 appropriate, 4= high, 5= very high] Outlet Hardees McDonalds KFC 1 2 3 4 5

6. Rank the following times in order of frequency of consuming fast-food through delivery service: [1 for the most frequent timeslot and 5 for the least] 4 A.M - 11 A.M 11:01 A.M 2 P.M 2:01 P.M 6 P.M 6:01 P.M 9 P.M 9:01 P.M 12 A.M 12:01 A.M 3:59 A.M

7. Rate the importance of the following factors when deciding upon which fast-food restaurant to have food delivered from:

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Factor Delivery time Delivery charges Freshness Accuracy of order Availability in area

Not important at all

Little Importance

Neutral

Moderately Important

Very important

8. In your opinion, what is considered an appropriate delivery time for fast-food? a) Less than 30 minutes b) 30-35 minutes c) 36-40 minutes d) 41-45 minutes e) 46-60 minutes

9. What do you consider to be acceptable charges for a delivery service (in Rupees)? a) Free b) Under 11 c) 11-20 d) 21-30 e) 31-50

10. Rank the following reasons for choosing delivery over dine in / take away:

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Factor When eating alone When feeling tired In order to save time When busy with work No restaurant in close proximity Unexpected Guests

Not important at all

Little Importance

Neutral

Moderately Important

Very important

Please specify if there are other reasons for choosing delivery over dine in / take away: ______________________________________________________________________

11. State your opinion on the following factors for Hardees: Factors Hardees as a brand Ambience in outlets Food quality Cost Service Time taken to provide order Poor Sub-par Average Good Excellent

12. Do you want Hardees to start a home delivery service? a) Definitely Yes

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b) Yes c) Indifferent d) No e) Definitely No [If your answer to the previous question was No, please complete the next question and skip the rest of the questions Otherwise please skip q19 and move on to q20] 13. If no, please specify a reason as to why you wouldnt want Hardees to start a delivery service: _____________________________________________________________________ 14. How many times have you substituted another restaurant for Hardees simply because Hardees does not have a delivery service: a) Never b) Once a month c) Once a week d) Twice a week e) Other [Please specify]: ________________________ 15. If Hardees starts a delivery service, how often would you skip going to the restaurant and have food delivered instead? a) Everytime Im in the mood for Hardees b) Half the time Im in the mood for Hardees c) One in three times d) One in four times e) Never f) Other [Please specify]:_____________________________

Please provide the following details:

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16. Age (in years): a) Under 10 b) 10-18 c)19-30 d)30-40 e) Older than 40

17. Gender: a) Male b) Female

18. Education Level: a) Primary School b) Middle School c) High School d) Undergraduate e) Post Graduate f) PhD

19. Monthly Income (in Rupees): a) Less than 10,000 b) 10,000-30,000 c)30,001-50,000 d) 50,001-70,000 e) Greater than 70,000

20. Please state your profession: _______________________

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