BUSINESS CASE C - Thematic Restaurant

"The dream-come-true channel of restaurant is a reality nowadays": This is the favour phrase of the owners of a thematic restaurant franchise based on a legendary galactic saga.

The business gathers the next features: (1) 23 restaurants in the 5 continents. 12 are own. (2) Restaurant open-up investment of $2 millions.(3) ROI after 4 years with demonstrate profitability around 8%. (4) Manpower:800 people in the company. (5) The main attractive point for customers and employees is focus in combine good cuisine with a non-age movie universe.

The challenges for investors in new restaurants are, among other, strict procedures track, a considerable initial investment, some quality clauses in the contracts about customers' satisfaction, and hard-to-keep business sustainability during the first 2 years.

The only drawback of the business is the risk that some restaurants can change the original spirit of the own business, developing their own ideas.

As result of several rumours and sales drop, the company has decided after 20 years to have a new component in its services. That is an interactive game where the customers can participate from home and earn deals and visits to the movie scenarios. That new service will include: (1) Games that the customer can play from home or in the restaurant. It is interactive with other players around the world. A community and blogs will be created. (2) It is an accumulated game where the client can earn or loss points, depending on the results and consume. (3) This game system involves a game development and an investment in an expensive hardware tables in the restaurants. (4) Once a month, and looking for big sales peaks, one actor of the movie will be dining in one restaurant. That will be expensive but globally profitable. (5) Once a year, the winners will be able to visit the saga studios with an exclusive tour. (6) Due the dynamic game and the new movies, this program will need a dedicated team that will update and maintenance such the game systems, the look, and the IT resources.

From the business point of view, this project will suppose:

Benefits

- A new level of partnership with the film company who owns the rights over the saga. That will include that the name of the Restaurant Saga can appear in the next movie, reporting an uncalculated publicity for the business.

- This new challenge has a projected 5 years of ROI, depending on the number of new restaurants open.

- As result of all those measures, the Board forecasts till 20 new restaurants, consolidating the business for the next 10 years.

- This new version of the company will allow to get more information about the customer satisfaction in all aspects, hourly operations planning, and enhance the direct costs.

Risks

- Too dependency of the filmmaker, who will buy part of the shares of the company.

- A too long development project in the worst financial situation of the company.

- Negative reactions of the restaurant owner to the royalty increment before starting with the program and excess of control of their business.

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Business case questions, about the bases of the service developing:

1. What is the main challenge that the company has to face from the legal point of view? Option:

A. Domestic regulations, e.g. labour standards, business regulations, finance and banking regulations

B. Export requirements or a schedule of commitment limitations, e.g. ownership and entry restrictions

2. How can you balance the Intellectual Property Protection when you are using the product of another company? Describe the main roadblocks to success.

Option:

A. Patents: Provide protection for a process or product and give the patent owner exclusive rights to use the product or process;

B. Copyright: Provides the creator of an original work with the right to exclusively use, or authorize the use of that work. Like patents, copyright applies only within the jurisdiction of the body granting the copyright;

C. Service marks: Similar to trademarks but identify a service rather than a product;

D. Trade secrets: Protect any confidential business information that gives an enterprise a competitive edge.