Question

32

1. Jen and Barry opened an ice cream shop in Eugene. It was a big success, so they decide to open ice cream shops in many cities including Portland. They hire Dante to manage the shop in Portland. Jen and Barry are considering two different sets of performance measures for Dante. The first set would grade Dante based on the cleanliness of the restaurant and customer service. The second set would use accounting numbers including the profit of the shop in Portland.
   What are the advantages and disadvantages of each set of performance measures?

Answer 1

Cleanliness of the restaurant and customer service :

In hospitality or food business cleanliness and customer service is very necessary part of the success.

Advantages:

* Increased Hygiene

* Increased footfall

* Better customer experience

* Increased comfort

* More business and repeat customers

Disadvantages:

* Increased expenditure

* Increased delivery time

* More training required for employees

Accounting numbers including the profit of the shop :

Accounting number are also very important to know whether the business is in profits or losses. Various ratios may give us the results that how our business is performing.

Advantages:

* Increased sales

* Cost cutting

* Increased efficiency

* Less advertising expenses as the business is already a success.

Disadvantages:

* Short term approach

* Focusing on numbers may not be viable in long run