Issues/Additional Data Points/Questions: 1. Your recent sales performance has been soft. What tactics might you employ to improve them by 10% this year? In answering, please specify the drivers you’ll try to impact and the tactics matched to each change in the drivers that you’re targeting. 2. There is a new Summer Menu in a nearby test market for the company and reports suggest that it has the ability to generate incremental sales while simultaneously reducing weighted food cost by 1.2 percentage points (1.2%) 3. You have been experimenting with a new Off Premise program in unit B which seems to have had a good impact on year-over-year sales and which carries a higher gross margin than your in-restaurant operation due – in part – to a higher check average. 4. Unit C seems to have a number of problems despite having the highest sales of your three restaurants. What is your initial assessment of what those problems might entail? 5. How might you specifically drive Unit C’s EBITDA for 2019 to 17.0% – assuming you are able to achieve the 10% top-line increase mentioned in #1 above? 5. The Minimum Wage in your market is going to go up to $11.82 per hour effective January 1, 2019. This represents at least a 3% increase over the current Minimum Wage and will probably add at least .6% to your labor cost in 2019. (This creates even greater need for your efforts to improve performance.)

MARGIN COMPRESSION MINI-CASE
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