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Demand Forecasting

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DEMAND AND FORECASTING FOR Forestville, MD
As one of the premier fast food establishments, Domino’s Pizza has had a long history of satisfying the hunger pains of millions of consistently faithful customers with its mouth watering pizza and other food selections in its product offerings such as pizza bread, sandwiches and party chicken wings. A fan favorite amongst pizza connoisseurs worldwide and internationally, its management and executive team are considering other potential locations to call Domino’s Pizza home. With thousands of highly successful domestic franchises already situated throughout the United States, Domino’s Pizza is interested in entering into the fast food marketplace in Maryland. One of the commercial retail territories that Domino’s Pizza is considering establishing dominance is in the Forestville suburb of Prince George’s County, Maryland.
In order to make analyze whether or not Forestville, Maryland will prove to further establish Domino’s Pizza as the global giant in pizza satisfaction, Domino’s Pizza has enlisted our company to provide a thorough recommendation on whether or not it will be beneficial for their company to plan to build a Domino’s Pizza franchise in the vicinity of Forestville, Maryland. Based on information contained within the body of the company’s 2011 Annual Report, Domino’s Pizza accounted for “4,513 franchise stores and 394 company-owned stores domestically,” (Domino’s Pizza, 2011). These impressive numbers highlight the importance of ensuring that the newest Domino’s Pizza franchise store will be a financially successful venture for both the executives at Domino’s, the franchisee and customers who live within the geographic and delivery proximity of their newest location.
By looking at several demographic and independent variables such as population and income, fellow fast food restaurants already in neighborhood proximity, our company will be able to complete a demand analysis to Domino’s Pizza with a rationale for our recommendation.

The City of Forestville
Forestville is a city that is located in the Prince George’s County section of Maryland. Touted by many Prince George’s County residents and major publications, Forestville is considered to be a growing, bustling area of the prosperous and ever growing part of the suburbs of Prince George’s County Maryland. As highlighted in Figure A based upon information attained from the United States Census Bureau website with help from the Census Bureau's Population Estimates Program, the city of Forestville has a populace of 10,913 residents (U.S. Census Bureau, 2007-2011). Although the number of residents may not be as large as other nearby counties within Prince George’s County such as Landover which has over 23,000 residents and Bowie which has an overwhelming populace of 55,000, Forestville is still a desirable location for a Domino’s Pizza franchise.
Fans of both pizza and the global franchise fast food chain would generously benefit from a Domino’s Pizza franchise in the immediate vicinity. It must be noted, however, that in the city of Forestville, it is also home to many other quick service food franchises that serve thousands of hungry consumers on a daily basis. These franchises, also known as competitors to Domino’s Pizza also have a very strong presence in the city of Forestville. This recommendation should also state that there is currently a Domino’s Pizza franchise in Forestville, Maryland. Because of the uniqueness of the situation, the question is whether or not another Domino’s Pizza location is best for the company.
Domino’s Place in the Pizza Delivery Market Highlighted within the body of the company’s 2011 Annual Report, it is noted that Domino’s Pizza is the “number one pizza delivery company in the U.S. based on reported consumer spending and the second largest pizza company in the world based on number of units and sales,” (Domino’s Pizza, 2011). Though serving pizza is a unique niche in the pizza delivery component, it is clear that despite other mainstream competition such as Pizza Hut, Papa John’s and Little Cesar’s Pizza and other pizza startup companies, Domino’s Pizza remains the leader in the pizza delivery market. The report continues to note that Domino’s Pizza is “the number one pizza delivery company in the United States with a 22.6% share based on reported consumer spending,” (Domino’s Pizza, 2011). Because of this, it is even more imperative the franchises Domino’s Pizza seeks to newly establish within a specific county is able to continually meet and exceed the quality and customer service that the Domino’s Pizza brand is known for both domestically and abroad.
Other Neighborly Dining Options
Presently, there are several restaurants located in the city of Forestville that are potential competitors to Domino’s Pizza and that are vying for the hearts, customer loyalty, revenue and stomachs of everyday or recurring customers. The restaurants included in this bunch are: Kentucky Fried Chicken, Subway, Chick-Fil-A, Qdoba Mexican Grill, Cluck-U Chicken, Taco Bell and McDonald’s. It should also be noted that presently there are already three McDonald’s locations situated within the surrounding borders of Forestville, Maryland. This recommendation should also note that each of these seven restaurants each has their own loyal following of daily and repeat customers.
Interestingly enough, the seven restaurants have their own unique product offerings, just as Domino’s Pizza has a distinct product offering of its own – pizza. For those who enjoy chicken as their official product offering, Kentucky Fried Chicken and Chick-Fil-A suits this particular taste. If one not only loves chicken but prefers the option of having it personally delivered, Cluck-U Chicken meets this demand. For those who have hearts loyal to burgers, McDonalds’ meets this need. For those who love fast food but prefer a healthier version of the product, Subway fits this niche, which is dominated by Subway. And rounding out the fast food love affair, for customers with an affinity for Mexican have Taco Bell, Chipotle or the Qdoba Mexican Grill as strong options.
Existing Market Presence in Forestville
After further review and research, this recommendation also wants to point out that Domino’s Pizza currently has an established franchise in Forestville. Known as Store #4657 on the company website, the location on 796 Harry S. Truman Drive offers both store pick-up and delivery within specified mileage parameters. With the possibility of opening another store franchise in Forestville, executives of Domino’s Pizza must ask themselves what this new location will possess in terms of service offerings that the present location does not in order to still fulfill the needs of the customer. Can it guarantee that both locations can meet the supply and demand in a timely fashion? Will the new franchise cater only to delivery orders or will it concentrate exclusively on fulfilling customers orders for pick-up? The response to this question will help guide Domino’s Pizza in the best direction of both the franchise and the customer.
Independent Variables Affecting a Forestville Franchise
The question for this consultant group now becomes whether or not it is in the best interest of the Domino’s Pizza franchise to open another franchise in the same city. This consultant management group is looking at two independent variables which play a integral role in whether it is both profitable and reasonable for Domino’s Pizza to open another franchise in the Forestville area.
One independent variable to factor in is the population of the county. With a population of nearly 11,000 in the Forestville area, it is apparent that even with other fellow fast food competitors located in the county of Forestville, the present location of Domino’s Pizza is one that is centrally located. The present Domino’s Pizza location is located on Harry S. Truman Drive is a prime real estate location with a commuter rail system only minutes away, bus stops for public transportation and residential housing that are within walking distance to the pizza delivery franchise.
This benefits Domino’s Pizza greatly as other fast food locations in the area such as Cluck U Chicken and Chipotle are farther away from commuter bus lines and not as commuter friendly. These factors are vitally important considering the fact that a person who lives on the other side of Domino’s Pizza in the Forestville area may not have a suitable mode of transportation to get a slice of pizza. Although all 11,000 residents may not be fans of pizza, having bus lines and accessible methods of transportation to reach the public is crucial in the ongoing success of the franchise. Additionally, with residents moving out of the area and new residents calling the Forestville community their home, there is no shortage in possible new customers to the franchise.
Another independent variable in the equation is the average income for residents living in the Forestville area. According to the US Census Bureau’s State and County Quick Facts data sheet, the median household income for Forestville residents between 2007 and 2011 is $81,875 (U.S. Census Bureau, 2007-2011). If a resident chooses to purchase a medium two topping handmade pan pizza which will costs $12.00, purchasing the pizza will not significantly impact the bank account of the resident. With coupons featured both online and in circulars, the price of Domino’s Pizza is reduced to $7.99. Both pricing options are pleasing to consumers who are looking to keep their costs low even with a generous median income.

Final Recommendations for Domino’s Pizza Upon review of local competitors, independent variables and other data subsets, the consultant group has determined that establishing another Domino’s Pizza location in the Forestville is not in the best interest of the franchise. It is evident to the consultant group that the current Domino’s Pizza location in Forestville is already fitting the needs of its nearly 11,000 residents. Keeping in mind that pizza delivery is a niche market, Domino’s Pizza already has a built-in following of pizza lovers. Over the years, customers of the pizza franchise have grown to look to this location as their only destination for pizza, and their other product offerings.
It is the consensus of the consultant group that due to the fact the Forestville area itself covers a less than five mile radius, bringing another franchise to the area will do more harm than good. With multiple bus stops and residential housing units all within mere walking distance, Domino’s Pizza has clearly already established its dominance in the Forestville area. Adding another location even if a few miles away, will prove to be more of a hindrance rather than profitable.

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