Coop Case Analysis

Decision Problem:

The sales at Chicken Coop have been growing at the rate of 10% per annum for the last 20 years exceeding the growth rate of the Quick Service restaurant industry which has been only 5% per year. In 1995, 20 stores of the 76 total stores which account for 32% of retail sales have shown a decline of 6%. Analyzing internal sales data and descriptive data of the struggling stores has not yielded any conclusion on why the sales are declining. Performing external secondary research like analyzing competitors and the local economy also does not show any pattern which could lead to declining sales. The management at Chicken Coop is faced with the following decision problem:

We need to diagnose what went wrong in the 20 stores with declining sales and take corrective actions to boost sales again

Research Questions:

The following are the questions which market research needs to address:

Why are sales declining in the 20 stores?

Is the root cause confined to those just 20 stores or is it a brand or corporate issue?

Proposed Research: Since the secondary research conducted could not uncover the root cause of the issue in discussion, we propose to do a primary research. We need to diagnose if there is an operational issue like quality or customer services or a more wide-spread problem with branding. We will attempt to explore options like menu selections, performance standards, quality of food, home delivery options, breakfast options, branding, co-branding and promotions. The research will try to uncover if there are any external factors like local economy or competition which are affecting the sales. It will also try to discover the level of customer satisfaction from dining at Chicken Coop stores. We propose conducting focus groups to perform our market research. Conducting 2 focus group sessions, gathering information and analyzing findings will take about 6weeks. This includes recruiting the members for the focus groups based on some...