96/97 Profits went down and continued to until 200. During this time span, the following occured: Staff received pay rises
Mr. x's salary increased
98-99: head offices operational expenses increased
Inflation at 5%
Hotel occ. low (affects rest)
Mr x also took became less involved before retiring in the business

The Profits were low and they encountered trouoble becasue:

- lack of proper furnishings, decor and maintenance
- lack of skilled employees and no training
- high staff turnover
- kitchens not properly equiped
- No proper menu development or design
- Billing system not adeqûate
- Lack of quality control and standardization
All of the above in my view are symptoms and led to the problem

Alternatives:
1) External magmt company to turn rests. around
2)Internal restructuring/mgmt.
3) Niche marketing and diversification (take out, specility rests etc)

Reccomendations:
1) External mgmt. company too expensive and not neccessary as y has expericne and is properly qualified.
2) Internal restructuring and Managment: YES. Because y is properly qualifed. He should hire new qualified personeel as unit managers all report to him, and a quality control measure should be implmemented such as ISO 9000.* Menu should be redesigned by an ouside company, staff should go through training programs (this will reduce turnover), kitchens should be properly equipped with new equipment.. (all symptoms should be taken care off) redecorated etc. This will cost money but in the long run will save. Also financially they have cash reserves due to Mr x investment of money, and the basic framework for their restaurants is established. They need to improve what already exsists.
3) Niche marketing: is very risky, very expensive as they are creating a new product entirely

** ISO 9000. Very good for this case stuidy in my opinion. It is a quality control program used primarily in F & B outlets. Rest that are then awarded ISO 9000 certification means they have a standard of quality. It is internally operated but then an external company comes to see if it should be given the award. This programs trains all e,ployees properly, and its fundamental goals is to standardize everything. It is a little bit costly but in the long run is proven to save money. "The Perfect 10

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