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The data analysis and interpretation for Fast-Food (Pizza) Restaurants, one of the five
services selected for the research, is presented in this Chapter. The legacy of Fast-Food
started with Pizza Hut in 1958, when two college students from Wichita, Kansas, United
States of America (U.S.A.) were approached by a family friend with the idea of opening a
pizza parlour. Although the concept was relatively new to many Americans at that time,
the brothers quickly saw the potential of this new enterprise. After five four decades, the
concept hit the Indian market. The traditional Indian cuisine and family dining started
giving way to consumption of fast-food outdoors. The criteria for selecting this service is
mentioned in Chapter 1.
The result of entrepreneurial efforts was the first Pizza Hut restaurant and the foundation
for what became the largest and most successful pizza restaurant chain in the world.
Building the leading pizza company required innovation, a commitment to quality, and a
dedication to service and value. But perhaps as much as anything, it has taken the
business through more than four decades of success. Pizza Hut franchisees, for example,
exemplify the entrepreneurial spirit which launched the system back in 1958. Through
their interest and initiative, the Pizza Hut system was able to develop new territories both
in the United States and overseas. Today, franchisees and joint venture partnerships
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As part of the PepsiCo corporate family, Pizza Hut shared its leadership position with
such fine products as Pepsi-Cola brand soft drinks and Frito-Lay brand snack foods. In
October 1997, PepsiCo spun off the restaurant businesses (Pizza Hut, KFC and Taco
Bell) and Tricon was founded. Tricon is also the parent company to two other segment
leaders, Taco Bell and KFC. When combined with Pizza Hut, these organisations make
In 2001, Pizza Hut became the first company to deliver pizza to the pioneers living in
outer space on the International Space Station. Pizza Hut uses more than 700 million
pounds of flour each year, representing the annual yield from nearly 500,000 acres of
wheat. Pizza Hut uses more than the equivalent of 525 million pounds of tomatoes each
year.
Service Quality in Fast-Food: Customers, who are central to the fast-food restaurant
service, are not a homogeneous class. They come from varying socio-economic and
provided will differ from customer to customer and even for the same customer at
different points of time, depending on the mood and mind-set of the same user at a
particular point of time. A customer who needs pizza and comes to an outlet in the
afternoon to find that it is not working is likely to be much more dissatisfied. Some other
factors that may influence perceptions of fast-food restaurant service quality are: Overall
ambience at the fast-food restaurant, Past experiences with the fast-food restaurant,
Familiarity with the services offered by the fast-food restaurant, Procedures followed etc.,
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restaurant with a particular menu which may be regarded as a status symbol. Interaction
Where there is direct interface with the fast-food restaurant's employees, it must be
ensured that all customers go back with a sense of satisfaction. Many fast-food
restaurants have set standards - for example, not more than five people should be waiting
in a queue at any outlet, all in a queue should be attended to within 20 minutes, A fast-
Quantitative determinates could be, for example, time taken to: (1) Accept an order,
(2) Accept a bill amount, (3) Complete an order, (4) Complete a further order, (5) Issue a
menu card, (6) Issue a bill, (7) Issue ordered items, (8) Give promotioi' material,
(9) Update the order, (10) Clear a Table, (11) Answer customer queries, (12) Attend to
complaints, (13) Complete serving process, (14) Sanction offers, (15) Process personal
details.
Pizza Restaurant Chains in India: There were three main players in the pizza market
during 2002, namely, Domino's, Pizza Hut and Pizza Corner. While the first two are
global chain restaurants, Pizza Corner is based at Chennai. The market profile of pizza
restaurants in India at the end of the first quarter of 2002 is depicted in Table 7-1.
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Table 7-1
Number of Pizzas I I
l2,00015,000*
Sold Per Day I
15,00
i_ 2,500
i ^ I
(*Estimated that Pizza Hut sells only higher value 8" and plus unlike others)
Source: "Pizza and Pizzazz" Business Tod April 14, 2002, p 18.
It can be seen from Table 7-1 that the profile indicates that though Pizza Hut has only
one-third the outlets as compared with Domino's, it equals pizza sales of Domino's.
However the business model of these restaurants differ in terms of service offering
apropos dine-in, delivery and take-away. There are also other independent fast-food
Pizza Restaurant Chains at Chennai: In the first quarter of 2003, Pizza Hut had S dine-
which also offer delivery and take-away options. Pizza Corner had 3 dine-in outlets -
Adyar, Nungambakkam and Anna Nagar while Domino's had 4 outlets - R.K. Salai,
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Current Research: A structured questionnaire was administered to 315 respondents
(customers of pizza restaurants) at the city of Chennai, capital of the, in South India. The
questionnaire comprised 8 questions besides the respondent profile section. The format of
Fast-Food Restaurants Surveyed: The players in the pizza restaurant market comprised
Pizza Hut, Domino's and Pizza Corner. The first two chains were covered under the
study while the remaining chain, Pizza Corner, did not permit research to be undertaken
at their restaurants. Consumers at Pizza Hut outlets accounted for a little more than three-
fourths of the respondents (76.19%) while nearly a quarter of the respondents (23.81%)
utilise such data for statistical analysis in order to accept or reject the hypotheses framed
for the study. The respondents were requested to indicate certain demographic
characteristics like gender, average monthly personal income and average monthly
household income. The class intervals for average monthly personal income and average
Gender: It was found that three-fifths of the respondents were male (60.63%) while two-
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Average Monthly Personal Income: About one-third of the respondents were in the
average monthly personal income groups of up to Rs. 10,000 and above Rs. 20,000 each.
the average monthly household income groups between Rs. 10,001 and Rs. 20,000 while
one-fifth of the respondents were in the average monthly household income group
exposure to imported products and aping of western culture, thereby facilitating the
mushrooming of the fast-food industry. Interestingly, quick snacks have been named as
"junk food" with contempt. There is a heated debate about the nutritional content of such
food besides that fact that such food are turning the population into "couch potatoes",
people who sit for hours in front of their television sets or those who browse the Internet
for hours, feasting on such food. Table 7-2 depicts the fast-food consumption pattern of
the respondents.
Table 7-2
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It can be seen from Table 7-2 that nearly one-third of the respondents (29.21%) did not
have any fixed fast-food consumption pattern. The remaining respondents were more less
equally divided among four groups, namely, once a week (21.90%), twice or thrice a
week (16.51%), once in a fortnight (15.87%) and few times in a month (16.51%). The
respondents seem to make about two visits to the pizza restaurants on an average per
month.
who either do not have the time to venture out due to family chores or those who prefer to
enjoy the food in the comfort of their homes. Table 7-3 depicts the respondents' fast-food
Table 7-3
It can be seen from Table 7-3 that half the respondents either did not order for home-
delivery or did not have any fixed pattern of ordering. One-fifth of the respondents
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ordered for home-delivery once a month. This indicates that there is more preference for
Preferred Time for Visiting Pizza Outlet: The preferred time for visiting a pizza outlet
varies from person to person depending upon work commitments, eating habits or group
dynamics. Table 7-4 depicts the respondents' preferred time for visiting pizza outlet.
Table 7-4
9.01pm_11.00pm
6(1.91) I
H 1
It can be seen from Table 7-4 that half the respondents prefer to visit the pizza outlet
between 7.00 pm and 9.00 pm. One-third of the respondents prefer to visit between
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Preferred Time for Home Delivery of Pizza: The preferred time for home-delivery
from pizza outlet varies from family to family depending upon number and age group of
family members, occasion or availability of members for cooking at home. Table 7-5
depicts the respondents' preferred time for home delivery from pizza outlet.
Table 7-5
[_ 2 H 1.01 pm-3.00pm 1L 1
[ II 3 3.01 pm - 5.00 pm VOMMMfgO (6.35)
1 5.01
4 pm-7.00pm 1F 5)(IX.73) -
7.01
5 11 pm-9.00pm -- 10(31.75) I
PI19.01 pm— 11.00 pm ft- 225) I
LI_7 JJ Unable to specify time II S326.35)
(Figures in parentheses indicate percentage out of 315 respondents)
I
Source: Primary.
It can be seen from Table 7-5 that nearly one-third of the respondents (31.75%) prefer
home delivery of pizza between 7.01 pm and 9.00 pm. Nearly one-fifth of the
respondents (18.73%) prefer home delivery of pizza between 5.01 pm and 7.00 pm.
However a little more than a quarter of the respondents (26.35%) were unable to specify
a preferred time.
Additional Offerings Desired at Pizza Restaurant: The pizza outlets essentially serve
pizzas comprising a menu from different cuisines. However, pizzas are not eaten in
isolation. Outlets serve soft drinks, juices, salads and desserts among other items in
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addition to their main product. Table 7-6 depicts the additional items that the respondents
desire.
Table 7-6
6 I Snacks 80(25.40)
I P -
P 7 1 Chocolates 77 (24.44)
I 8 IlCakes 72(22.86)
L 9
10
I Beverages
liFruits
I 69 (21.90)
38(12.06)
I
I
(Figures in parentheses indicate percentage out of 31 respondents)
Source: Primary.
It can be seen from Table 7-6 that half the respondents preferred fruit juices to be offered
on the menu. Soft drinks came a close second followed by desserts. Pizza outlets should
keep in mind the variety fare that they need to offer in addition to pizzas to keep the
consumers delighted.
Promotional Offers Desired from Pizza Restaurant: Any product or service requires
some promotional efforts to either create awareness or to aid in brand recall. Table 7-7
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Table 7-7
Standard
Promotional Offers Mean Sum Rank
Deviation
Additional free pizza 2.7846 2.8998 724 I
(equivalent or smaller size)
Complimentary soft drinks / 3.7869 3.1577 924 II
2
beverages
Discount coupons (limited period 3.2431 1109 III
3 4.6992
offer)
Discounts for repeat orders 3.0457 1147 IV
4 5.0978
(especially home delivery) _______ ________
1[ G i ft vouchers II5.46821I 3.0556 I 1203 II V I
6 ] Gifts / Discounts for bulk ordering 11 5.76501 3.0361
1251 IL VI I
Surprise gifts (on birthdays, 5.2397 3.3879 1268 VII
7
[anniversaries)
Food festivals (for different pizza VIII
8 1I cuisines
from around the world)
6.5818 3.8780 1448
It can be seen from Table 7-7 that additional free pizza is the most preferred promotional
offer. This concept was well popularised by Pizza Hut. Complimentary soft drinks and
beverages come second. This reiterates the need to serve such drinks as was seen in the
response for the previous question. Discount coupons and gift vouchers are the next most
preferred offers. The pricing of pizzas are not standard. Extra charges are levied
depending upon type of pan crust desired, stuffing of crust and toppings, among others.
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Service Attribute Rating Scale: A Likert-scale was employed to facilitate the
determine the level of service quality. The five points on the scale and the interpretation
Table 7-8
It can be seen from Table 7-8 that the scale involves ratings ranging from very poor
repetition of the attributes for Perception and Expectation scores. The number of items
have been increased from the original 22 besides the fact that the instrument has been
modified to suit the fast-food industry under study which makes it more realistic and
relevant. Table 7-9 depicts the ratings for 28 attributes of the pizza outlet's services. The
Figures in parentheses indicate percentage for each rating level. Table 7-10 presents the
mean, standard deviation and sum of the service attribute ratings, computed using SPSS
package.
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Table 7-9
3
Physical representation of the service
(menu cards, displays, furniture, etc.)
4 28 111 125 47I
(1.3) (8.9) (3s.2j (39.7) (14.9)
11
37 63 132 55
(11.7)11(20) 1 41.9) (17.5) I (8.9)
Recreational / Special facilities (play area 54 108 90 52 11
5] l'or children, indoor games, etc.) (RSF)
1
(17.1) (34.3) (28.6) (16.5) (3.5)
F
6 1
Staff's acknowledgement on entering the 14 fli 114 102 F 47
(4.4) (12.1) (36.2) (32.4) (14.9)
outlet (SAE)
5 24 138 106 42
Service provision in time (SPT) (1.6)1 (7.6) (43.8) (33.7) (13.3)
- Ethical practices (using vegetarian 4 7 133 122 49
8 ingredients only for vegetarian orders, (1.3) (2.2) (42.2) (38.7) (15.6)
fresh ingredients, etc.) (ETP) _ __
- 8 37 112 113 45
Assistance for seating (AFS) (2.5) (11.7) (35.6) (35.9) (14.3)
1-91 1
537 153 95 25
10 More outlets (MOU) (1.6) (11.7) (48.6) (30.2) (7.9)
629 158 95 27
HAccommodation of requests (AOR) (1.9) (9.2) (50.2) (30.2) 1 (8.6)
Individual attention paid to you (when in
FI 2]a group) (lAP)
7 1 29 1 50 93 36
(2.2) (9.2) 1(47.6) (29.5) (11.4)
T
Providing reliable information (menu 6 41 130 H08 30
13 ingredients, nutritional value, offers, etc.) (1.9) (13) (41.3) (34.3) (9.5)
r
(PRI)_______
15 rTh31 126 40
15 Staffs knowledge in answering (SKA) (0.3) (4.8) (43.2)j - (40) (12.7)
I aute uiLuuu
202
UI1LIiIU1LIUIi ILUIJI P1 VVIUU
21 75 149 52 18
17 Pricing of pizzas (POP) (6.7) (23.8) (47.3) (16.5) (5.7)
2 19 117 125 52
HImage of the pizza chain (IPC) (37.1) (39.7) (16.5)
(0.6) (6)
4 14 111 123 63
HAccuracy in billing (AIB) 39) (20)
(1.3) (4.4) (35.2)
21 51 169 65 9
HPromotional offers (POF) (6.7) (16.2) (53.7) (20.6) (2.9)
5 10 103 148 49
27 Correct provision of ordered items (CPO) (1.6) (3.2) (32.7) (47) (15.6)
203
Table 7-10
Mean, Standard Deviation and Sum for Pizza Outlet's Service Attributes
204
It can be seen from Table 7-10 that the attributes in terms of highest sums (sum
(MHC), Courtesy shown by staff (CSS), Location of outlet (LOO), Accuracy in billing
(AIB), Correct provision of ordered items (CPO), Appearance of staff (AOS), Items used
to provide the service (IPS), Image of pizza chain (IPC) and Ethical practices (ETP).
The three attributes which obtained the highest sums thereby indicating good service
shown by staff.
The attributes which obtained the least sums (sum of 1060 and below) are Recreational
Special facilities (RSF), Pricing of pizza (POP), Parking facilities (PKF), Promotional
The three attributes which obtained the least sums thereby indicating poor service quality
Reliability Analysis: The Cronbach alpha (reliability coefficient) values for the rating
scale, obtained using SPSS package, are presented in Table 7-11 along with the values for
number of respondents and number of attribute items. The literature about this coefficient
is mentioned in Chapter 1 under the section titled "Cronbach Alpha Reliability Test".
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Table 7-11
the alpha values were found to be very good for both pilot study as well as survey.
Factor Analysis: Factor analysis denotes a class of procedures primarily used for data
reduction and summarisation. There may be a large number of variables, most of which
are correlated and which must be reduced to a manageable level. In Principal Component
Analysis, the total variance in the data is considered. The diagonal of the correlation
matrix consists of unities, and full variance is brought into the factor matrix. The primary
concern is to determine the minimum number of factors that will account for maximum
variance. The factors are called principal components. Although the initial or unrotated
factor matrix indicates the relationship between the factors and individual variables, it
(axes are maintained at right angles) rotation method that minimises the number of
variables with high loadings on a factor, thereby enhancing the interpretability of the
factors. This results in factors that are uncorrelated. The rotated factor matrix using SPSS
,,,
Table 7-12
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It can be seen from Table 7-12 that Principal Components Methods with Varimax
rotation resulting in 3 iterations produced two factors. Values above 0.50 were taken for
each factor grouping and the attributes under each factor along with their corresponding
Table 7-13
I Attribute
Pizza Restaurant's Service Attributes Value ] Factor Name
Number If
J
I Individual attention paid to you (when in
I a group) J L^]
I Staff's acknowledgement on entering t 0.655
I outlet
Providing reliable information (menu II
'3 0.638 1
1 ingredients, nutritional value, offers, etc.)
It can be seen from Table 7-13 that the attributes under factor number I comprised
the outlet, Providing reliable information (menu ingredients, nutritional value, offers,
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Accommodation of requests, Assistance for seating, Service provision in time, Effective
utilisation of personal details (for mailers, feedback, offers, etc.), and Recreational /
Special facilities (play area for children, indoor games, etc.). The ten attributes have been
grouped together and named "Personalised service and customer delight", as this name
Table 7-14
Attribute
Number Pizza Restaurant's Service Attributes Value Factor Name
26 Maintenance of Hygiene/Cleanliness [ 0.715 I
27 I[Correct provision of ordered items I 0.688 I
19 I [Accuracy in billing 0.665 I
Provision of items mentioned in menu
25 0 Service design and
card I delivery
I 28 J [Quality of preparation (ordered items) [ 0.63 5 ]
20 Convenience of outlet hours 0.631
18 Image of the pizza chain II 0.571
1 22 I_Courtesy shown by staff I 0.555
It can be seen from Table 7-14 that the attributes under factor number I comprised
items), Convenience of outlet hours, Image of the pizza chain and Courtesy shown by
staff. The eight attributes have been grouped together and named "Service design and
KOVE
Overall Points Tally for Pizza Restaurant's Service Attributes: : The respondents
were asked to award a maximum of 100 points for each of the five categories depicting
different facets of the Pizza restaurant's services, depending on their encounters with the
Pizza restaurant thus far. The mean, standard deviation and sum for the seven categories
Table 7-15
S. Standard
Pizza Restaurant 's Overall attribute Mean . . Sum Rank
Deviation
The Pizza outlet's commitment to 14.5778 25418 I
1 80.6921
quality, hygiene and ethics
The knowledge and courtesy of the
2 Pizza outlet's staff and their ability to 77.9429 15.0181 24552 II
convey trust and confidence
The willingness of the Pizza outlet to 75.3016 15.9146 23720 III
help its customers
The appearance of the Pizza outlet's
4 physical facilities, personnel and 74.4476 13.7787 23451 IV
communication materials
The ability of the Pizza outlet to
5 perform the promised service 74.219014.7244 23379 V
dependably and accurately
Source: Primary.
It can be seen from Table 7-15 that maximum points were awarded to the Pizza outlet's
commitment to quality, hygiene and ethics. The knowledge and courtesy of the Pizza
outlet's staff and their ability to convey trust and confidence were voted second while the
willingness of the Pizza outlet to help its customers was rated third. However, the areas
where the pizza outlets are lacking comprise the appearance of the Pizza outlet's physical
210
facilities, personnel and communication materials and the ability of the Pizza outlet to
perform the promised service dependably and accurately. Thus, though the services of the
pizza outlets have been rated as good with respect to quality of food, hygiene and staff,
the areas lacking are communication and service delivery. There are no standards for
delivery inside the restaurants sometimes resulting in delays in serving the ordered items
or availability of the items on the menu card itself. On the other hand, home delivery is
executed within thirty minutes, albeit with the application of certain conditions.
dependent variable using SPSS package. The analysis gave rise to I model with the
corresponding R square values as shown in Table XI-A in Annexure Xl. The beta and
significance values were also noted for the variable under the model.
It can be seen from Table XI-A that the variable influencing gender is courtesy shown by
staff
monthly personal income as the dependent variable using SPSS package. The analysis
gave rise to 2 models with their corresponding R square values as shown in Table XI-B in
Annexure XI. The model with the highest R square value was chosen as the best model
and this was found to be model 2. The beta and significance values were also noted for
monthly household income as the dependent variable using SPSS package. The analysis
gave rise to 4 models with their corresponding R square values as shown in Table XI-C in
Annexure XI. The model with the highest R square value was chosen as the best model
and this was found to be model 4. The beta and significance values were also noted for
It can be seen from Table XI-C that the variables influencing household income groups,
Mann-Whitney U-Test on Gender: This test was administered to see if the data from
two groups, namely, male and female respondents, were identical in terms of rankings for
promotional offers by pizza chain. The statistical analysis is presented in Table XI-D in
It can be seen from Table 7-16 that all the null hypotheses are accepted except the null
excepting food festivals, there is no significant difference in the rankings by male and
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Table 7-16
Null Hypothesis
Result
Number Statement
213
Kendall's Coefficient Of Concordance W Test: This test is administered to ascertain
whether the respondents (k' judges) are applying the same standard in ranking the factor
under study ('n" objects). The statistical analysis is presented in Table XI-E in
Annexure XI.
The null hypothesis (H 013) framed was: The respondents are not applying es
same standard in ranking the promotional offers of pizza outlets. It can be seen from
Table XI-E that the value for Kendall's coefficient of concordance was 0.186 while the
value for Chi-square for II degrees of freedom was 399.863. The Significance value was
0.000 and hence the resulting value is significant at I % level of significance and hence
the null hypothesis is rejected. Therefore, the respondents are applying ess. the
Marketing Mix Mean Ratings: A check-list of the marketing mix was compiled based
restaurants. The marketing mix elements have been depicted in the form of fish-bone
The following attributes were found to obtain mean ratings of 3.5 and above thereby
qualifying for the status of 'Good Service Quality": Ambience (APO), Appearance of
Staff (AOS), Physical representation of the service (PHY), Ethical practices (ETP),
Staffs knowledge in answering (SKA), Image of the Pizza chain (IPC), Accuracy in
billing (AIB), Convenience of outlet hours (COH), Items used to provide the service
214
(IPS), Courtesy shown by the staff (CSS), Location of outlet (LOO), Maintenance of
Hygiene / Cleanliness (MHC), Correct provision of ordered items (CPO) and Quality of
preparation (QOP). All other attributes need to be monitored and quality improvement
measures undertaken.
In the case of Environment, all the three attributes have been rated as having good service
quality whereas in the case of Management, two out of four attributes have been billed as
possessing good service quality. This indicates a hundred and fifty percent rate
respectively. The People category is not far behind with three out of five attributes being
In the case of Process, six out of fifteen attributes in this category have been rated as
Service Quality Dimensions Mean Scores: The mean scores for the five service quality
presented in Table 7-17 and Figure 7-2. It can be seen from Table 7-17 that the two out
of five dimensions, namely, Responsiveness and Empathy, have obtained a mean score
below 3.5 indicating satisfactory service quality. The percentage of service attributes
having been billed as possessing good service quality (mean score above 3.5) within the
215
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216
Table 7-17
3.6
MOU
-3.3111
PKF - 2.9175
-
F - I - POP - 2.9079
-_I 1 -
-
- -
[_POF-2.9683
- Ir RSF - 2.5492
Tangibles
-
Reliability
1 -
-
Responsiveness Assurance
SAE-3.4127
Empathy
Mean = Mean = Mean = Mean = Mean
3.6661 3.6235 3.3809 3.6406 3.1788
Attribute Scores in bold indicate mean rating above 3.5 out of 5.
Note: For Abbreviations Refer Tables 7-9 and 7-10.
Summary of Service Quality Gaps in Fast-Food: The significant service quality gaps
identified from the current study which require immediate and focused attention are
217
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218
Table 7-18
Identified in Fast-Food
The fast-food restaurants need to concentrate on the attributes mentioned in Table 7-18 in
SCOT Analysis for Fast-Food: The SCOT analysis for the fast-food industry is
presented in Table 7-19 on the basis of personal interviews with employees of fast-food
219
Table 7-19
STRENGTHS CHALLENGES
OPPORTUNITIES THREATS
220