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Making Decisions Based on Demands

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Making Decisions Based on Demand and Forecasting Latonya Woodrow Instructor Name: Dr.Samuel F. Onipede ECO 550 –Managerial Economics and Globalization July 21, 2013

College Students buy pizza in large quantities for a cheap price, but if the prices were to increase, then these same students may look for similar alternatives that will not empty their wallets. These are possible alternatives that offer a large quantity of food at a reasonable price that can affect the demand of pizza. However, monitoring the costs of the competing fast food restaurants in the Charlotte, North Carolina, area will allow Domino’s Pizza to offer certain specials and pizza deals to the community that can keep their demand at a high rate. A market demand analysis is used to help understand how much consumer demand there is for a given product or service. This type of analysis will help determine if a business can successfully enter a market and generate enough revenue and profit to maintain the business. One must identify the market and the growth potential. Domino’s Pizza was incorporated in 1963 and has been franchising since 1967. A traditional Domino’s store is located in shopping centers and/or strip malls with appropriate parking for delivery vehicles and walk-in customers for carry-out services. The initial investment of a traditional store is approximately $119,500 (low estimation).To determine if a Domino’s Pizza can be opened in Morehead City, North Carolina one must estimate consumer demand for this area. Some of the variables that can be considered are population, price of pizza, and income per household. The population of Morehead City is 8,780 people; let’s assume

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