Clarence Otis, chairman and chief executive of Darden Restaurants Inc., sees better days ahead for an...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Clarence Otis, chairman and chief executive of Darden Restaurants Inc., sees better days ahead for an industry that took a beating during the Great Recession of the recent past. Otis, whose company owns Olive Garden, Red Lobster, Long Horn Steakhouse, and other casual dining chains, expected the job losses that cut consumer spending to abate in the first quarter of 2010. "Restaurants, historically, are one of the first industries to benefit coming out of a recession. People have deferred big- ticket items like cars, appliances and vacations, and a meal out is a low-ticket treat," said Otis. Darden planned to capitalize on the recovery by doing the things it had been planning to do prior to the recession, such as investing in menu development and employee training, remodeling restaurants, and preserving cash. Unlike many restaurant chains that turned to heavy discounting to lure customers, Darden avoided that. Buy-one-get-one-free or half-off promotions "run the risk of communicating to consumers that price is the primary attribute of your brand and it overwhelms all the other things that go into developing a strong brand," Otis said. Instead, Darden introduced new menu items at lower prices; that helped restaurants keep the same profit. At its upscale Capital Grille chain the company offered, for $40 per person, new seafood entrées paired with appetizers and wine from regions of the world where prices are lower or from newer vineyards that charge less than more established ones. Darden also reduced the pace at which it opened new restaurants. The biggest lesson that was reinforced for him during the downturn, Otis said, was to spend conservatively and to keep debt low even when times are good. Discussion Questions 1. What managerial roles is Clarence Otis emphasizing in the case just presented? 2. What challenges would restaurant managers face in implementing Otis's approach to keeping the restaurants performing well during a slow period in the economy? 3. If you have visited a Darden restaurant lately, what suggestions can you offer top level management for attracting even more customers? 4. Based on media reports, how successful do you think Clarence Otis has been in helping the Darden chain becomes a continuing success? 5. What financial management practices of the Darden chain might be useful to you in managing your personal finances? Clarence Otis, chairman and chief executive of Darden Restaurants Inc., sees better days ahead for an industry that took a beating during the Great Recession of the recent past. Otis, whose company owns Olive Garden, Red Lobster, Long Horn Steakhouse, and other casual dining chains, expected the job losses that cut consumer spending to abate in the first quarter of 2010. "Restaurants, historically, are one of the first industries to benefit coming out of a recession. People have deferred big- ticket items like cars, appliances and vacations, and a meal out is a low-ticket treat," said Otis. Darden planned to capitalize on the recovery by doing the things it had been planning to do prior to the recession, such as investing in menu development and employee training, remodeling restaurants, and preserving cash. Unlike many restaurant chains that turned to heavy discounting to lure customers, Darden avoided that. Buy-one-get-one-free or half-off promotions "run the risk of communicating to consumers that price is the primary attribute of your brand and it overwhelms all the other things that go into developing a strong brand," Otis said. Instead, Darden introduced new menu items at lower prices; that helped restaurants keep the same profit. At its upscale Capital Grille chain the company offered, for $40 per person, new seafood entrées paired with appetizers and wine from regions of the world where prices are lower or from newer vineyards that charge less than more established ones. Darden also reduced the pace at which it opened new restaurants. The biggest lesson that was reinforced for him during the downturn, Otis said, was to spend conservatively and to keep debt low even when times are good. Discussion Questions 1. What managerial roles is Clarence Otis emphasizing in the case just presented? 2. What challenges would restaurant managers face in implementing Otis's approach to keeping the restaurants performing well during a slow period in the economy? 3. If you have visited a Darden restaurant lately, what suggestions can you offer top level management for attracting even more customers? 4. Based on media reports, how successful do you think Clarence Otis has been in helping the Darden chain becomes a continuing success? 5. What financial management practices of the Darden chain might be useful to you in managing your personal finances?
Expert Answer:
Answer rating: 100% (QA)
1 2 During the slow period of economy the restaurant manager faced the following challenges in the implementation of Otiss approach for maintaining th... View the full answer
Related Book For
Fundamentals of Physics
ISBN: 978-0471758013
8th Extended edition
Authors: Jearl Walker, Halliday Resnick
Posted Date:
Students also viewed these general management questions
-
Clarence Otis, chairman and chief executive of Darden Restaurants Inc., sees better days ahead for an industry that took a beating during the Great Recession of the recent past. Otis, whose company...
-
(b) The block diagram of a control system is shown in Figure 3. Derive the closed-loop transfer function Y(s)/ R(s). R(s) 115 S a-b Figure 3 (9-b)-6 s+2 Y(s) (13 Marks) k
-
Will the taxpayer revolt that began during the Great Recession of 2008 affect labor relations in the public sector in future years? If so, how? If not, why not?
-
In an attempt to identify ecologically friendly methods for controlling mosquito populations, researchers conducted eld experiments in India where aquatic nymphs of the dragony Brachytron pretense...
-
Husband and Wife have lived together as husband and wife for the past 20 years. They have never been formally married. Can Wife testify against Husband concerning the conversation? Why or why not?
-
Falco Co. began operations on July 1. It uses a perpetual inventory system. During July the company had the following purchases and sales. Instructions (a) Determine the ending inventory under a...
-
How can a judgment creditor obtain funds in a judgment debtors bank account?
-
Bills Wrecker Service has just completed a minor repair on a tow truck. The repair cost was $1,550, and the book value prior to the repair was $6,500. In addition, the company spent $12,000 to...
-
Explain at least two state and federal acts on patient events reportable under the law
-
There is a database that contains a website's traffic data over a period of 30 days. The first table contains users' information including the user type (user, crawler, admin). The second table...
-
using the table in appendix 14A, Calculate the present value of a 9%, $400,000 bond with a three-year term issued when the market rate of interest was 8%, interest is paid quarterly. TABLE 14A.2...
-
Prove that at the azeotropic point, the composition of the vapour and liquid phases are the same.
-
Discuss the significance of liquid-liquid equilibrium in extraction process.
-
What do you mean by depression of freezing point? Discuss van't Hoff's law of freezing point depression of a solution.
-
Define the term critical solution temperature.
-
Discuss the solid-vapour equilibrium for sublimation process.
-
Coursework One (LO1 and LO2) The Assignment Template You should; depending on your own skills and experience, identify a suitable graduate position, or a placement with a chosen company. You then...
-
Use the T account for Cash below to record the portion of each of the following transactions, if any that affect cash. How do these transactions affect the companys liquidity? Jan. 2 Provided...
-
Calculate the number of coulombs of positive charge in 250 cm3 of (neutral) water.
-
At 20oC, a rod is exactly 20.05 cm long on a steel ruler. Both the rod and the ruler are placed in an oven at 270C, where the rod now measures 20.11 cm on the same ruler. What is the coefficient of...
-
A certain particle is sent into a uniform magnetic field, with the particle's velocity vector perpendicular to the direction of the field. Figure gives the period T of the particle's motion versus...
-
A computer input control is designed to ensure that a. Machine processing is accurate. b. Only authorized personnel have access to the computer area. c. Computer processing has been performed as...
-
In its computer processing system a company might use check digits to detect which of the following errors? a. Recording an invalid customers identification charge account number. b. Assigning a...
-
In a credit sales and cash receipts system flowchart symbol X could represent a. Auditors test data. b. Remittance advices from customers. c. Error reports. d. Credit authorization forms.
Study smarter with the SolutionInn App