Question: 1 . Twiggy is formulating plans to extend its services to new Tier - II cities as part of its expansion strategy. The company predicts

1. Twiggy is formulating plans to extend its services to new Tier-II cities as part of its expansion strategy. The company predicts that the demand for orders in this new city will adhere to a normal distribution, with a mean of 1000 and a standard deviation of 200. Several restaurants can be highlighted on the Twiggy app. The estimated average cost for restaurants to prepare a meal is Rs.50 per order. Twiggy aims to charge customers an average value of Rs.200 per order via its app. Each restaurant is expected to manage approximately 70 orders per day. Twiggy has committed to compensating any shortage in orders falling below this threshold at a rate of Rs.30 per order. This approach will enable Twiggy to guarantee restaurants a minimum number of orders and foster trust. Moreover, Twiggy has decided to remunerate restaurants Rs.100 per order, in addition to 25% of the revenue it accumulates from each order.
a. Based on the data provided, how many restaurants should Twiggy aim to enlist on its app? Please round up the number of restaurants to the nearest whole number.
b. What is the expected profit for Twiggy based on the answer of (a)?
c. If a restaurant spends Rs.50 on preparing each order, any unused material at the end of the day will have to be discarded. Each restaurant is prepared to deliver 70 orders. If the expected sales from the Swiggy app are evenly distributed across all participating restaurants, what would be the expected profit for an individual restaurant?

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