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Riverside Motor Inn Situation Analysis

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Riverside Motor Inn Situation Analysis
Situational Analysis Overview: Riverside Motor Inn in Bridgewater, Nova Scotia is a building built in 1975. There are 34 rooms, the Sou’ Wester restaurant, and Chapters Lounge within the building. Guests of the Riverside Inn and residents of the community come to Chapters Lounge for a drink and quiet conversation. The atmosphere is unique because it is relaxing compare to the typical “bar scene.” The sales from Chapters Lounge from 1994 to 1996 have been $63,300, $75,700, and $66,700 with 95% of the sales from drinks. From 1995 to 1996, revenues decrease and this needs to change to prevent revenues from going down next year. In order to reach $100, 000 by 2000, the full contribution minus labour costs from October 1997 to June 1998 can help Chapters Lounge. …show more content…
The contribution of $35, 867 can help attract more customers by advertising the lounge in Bridgewater, Lunenburg County, or Bridgewater trading area. The decrease in revenue in 1996 can be because of the departure of a long-time bartender named DJ or the new manager named Ronald. In exchange for DJ, Chapters Lounge gains Heidi who had six years of experiences at a different Lounge. Overall, to reach the goal of $100, 000 in the year 2000, the company knows 49% of households spend an average of $191 on alcoholic beverages served on licensed premises.
Problem Analysis: There are three other competitors within the same area and during Happy Hours, Chapters Lounge has the most expensive drinks at an average of $3.23 per drink compared to the other three bars. Chapters Lounge’s environment is not the typical bar and that can cause customers to go to ones with a dance floor and live entertainment. The reason for revenues to decrease can be because of renovations. During the peak season, the lounge closed for renovations and this can explain the decrease in revenue compared to other
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