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Palate review Lai, Oscar; Lau, Mauricio; Zhao, Yiling; Liang, Karen; Worthington, Michael Aug 11, 2017

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 UBC Social Ecological Economic Development Studies (SEEDS) Student ReportElaine Zhao, Karen Liang, Mauricio Lau, Michael Worthington, Oscar LaiPalate ReviewCOMM 486MAugust 11, 201716272431University of British Columbia Disclaimer: “UBC SEEDS Program provides students with the opportunity to share the findings of their studies, as well as their opinions, conclusions and recommendations with the UBC community. The reader should bear in mind that this is a student project/report and is not an official document of UBC. Furthermore readers should bear in mind that these reports may not reflect the current status of activities at UBC. We urge you to contact the research persons mentioned in a report or a SEEDS team representative about the current status of the subject matter of a project/report”.		 	P A L A T E Alma Mater Society Team 5 Consulting Oscar Lai Mauricio Lau Yiling Zhao Karen Liang Michael Worthington Executive	Summary	First	opened	in	2015,	the	AMS	Nest	is	a	student-focused	hub	with	a	dual	mandate	of	being	both	fiscally	responsible	while	meeting	the	needs	of	UBC	students.	The	Nest	currently	offers	a	variety	of	activities	and	services	for	students	to	eat,	study,	and	socialize.	In	this	report,	we	will	focus	on	a	relatively	new	entrant	within	its	food	offerings	–	the	Palate.	Situated	in	a	prime	location	that	intersects	both	students	in	the	Nest	and	those	walking	around	it,	the	specialty	sandwich	store	has	the	enormous	potential	to	become	the	go-to-place	for	UBC	students.			Our	analysis	started	with	us	interviewing	UBC	students	within	the	Nest,	and	we	found	that	student	decisions	on	where	to	eat	ultimately	came	down	to	three	main	considerations.	Firstly,	price	has	proven	to	be	a	key	factor	in	the	decision	making	of	students	–	the	primary	target	for	restaurants	in	the	AMS	Nest	–	which	has	driven	students	to	various	alternatives	around	the	Nest	which	deliver	food	at	a	seemingly	more	reasonable	price	point.	Secondly,	convenience	in	terms	of	location,	space,	and	seating,	has	proven	to	be	an	important	part	of	choosing	where	to	purchase	food	–	we’ve	found	that	areas	that	have	more	space	surrounding	it,	or	space	for	sit-down	meals,	have	encouraged	customer	visits.	Lastly,	variety	of	offered	products.	Currently,	Palate’s	offerings	are	less	varied	than	that	of	some	of	their	more	popular	competition,	leading	us	to	believe	that,	based	on	the	primary	research,	students	are	driven	by	variety	of	choice	as	well.		As	part	of	our	analysis,	we	recommend	Palate	to	undertake	several	operational	changes	starting	with	opening	up	a	door	along	its	curved	windows.	This	will	allow	us	to	expand	the	preparation	area	and	let	us	add	an	additional	employee	during	peak	hour	to	address	an	existing	bottleneck.	We	will	also	undertake	a	small	but	on-going	marketing	effort	to	spread	awareness	of	the	store	and	its	price	advantages.	Taking	into	account	these	considerations,	we	believe	that	the	proposal	will	generate	positive	income	as	early	as	2018.	The	main	limitation	of	this	report	is	forecasting	revenue	and	salary	expectations	with	incomplete	data,	as	well	as	relying	on	a	small	sample	size	for	our	analysis	which	may	be	incomplete	or	not	representative	of	the	overall	student	body.	1Our	first	step	when	tackling	this	case	was	to	assess	the	current	situation,	we	wanted	the	answer	to	the	big	question:	where	are	we	now?	This	led	to	an	information	gathering	process	which	included	an	online	&	in	person	survey,	the	timing	of	the	services,	 and	an	analysis	of	the	Palate’s	structural	design	and	its	effects	 on	the	customer	journey.Online/In	person	survey:In	order	to	get	to	know	more	about	our	audience	we	decided	to	do	two	surveys.	The	first	survey,	consisted	of	us	going	to	the	Palate	and	The	Delly (What	we	perceive	to	be	its	main	competitor)	and	asking	the	people	in	line	a	series	of	questions.	This	included	broad	questions	such	as	why	Palate	or	Delly,	consequently	why	not	the	Palate	or	Delly,	what	could	be	improved,	and	what	type	of	food	would	you	like	to	see	in	the	Nest.	Overall,	we	interviewed	a	total	of	40	people.	We	found,	through	this	survey	that	the	main	reason	people	we	interviewed	chose	the	Palate	over	Deli	was	due	to	lower	prices	(44%),	consequently,	the	main	reason	as	to	why	people	chose	the	Deli	over	the	Palate	was	due	to	the	variety	of	products	it	offers	(24%).		However,	we	understood	that	the	people	surveyed	are	already	customers	of	both	the	2Palate	and	the	Delly and	as	such	our	data	would	be	skewed.	As	such	we	also	decided	to	do	an	online	survey	in	order	to	reach	people	who	might	not	know	about	the	Palate,	or	who	might	not	go	the	Nest	as	well.	Through	this	survey	we	were	looking	at	whether	or	not	they	ate	at	the	Nest,	 how	frequent	do	they	go,	which	places	do	they	go	to,	and	why.	Out	of	the	56	people	who	answered	the	online	survey,	68%	said	they	did	go	to	eat	at	the	Nest,	 out	of	which	32%	eat	there	once	or	more	times	 a	week.	Out	of	the	68%,	32%	went	to	the	Deli,	with	the	majority	citing	the	atmosphere,	and	variety	of	options	as	the	reason	they	go	there.Timing	of	Services:As	a	team	we	also	wanted	to	get	an	idea	of	the	efficiency	 of	service	provided	by	the	Palate,	which	is	why	we	decided	to	gather	specific	data	relating	to	the	speed	of	service.	This	 included	customer	attendance	 turnover,	which	measure	the	amount	of	time	it	takes	for	the	employee	to	take	the	order	of	another	customer,	and	the	cycle	time	per	customer.	We	also	counted	the	number	of	people	per	10	minutes	which	was	multiplied	it	by	6	to	get	an	approximate	of	the	number	of	customers	during	peak	hour,	and	the	average	number	of	people	in	line	over	a	10	minute	period.	This	was	also	done	for	the	Delly’s sandwich	section	which	is	the	only	other	restaurant	in	the	Nest	that	provides	custom	made	sandwiches.	The	results	of	the	analysis	was	as	following:	The	Palate	takes	12.5%	more	time	 to	take	a	new	order,	and	the	whole	cycle	which	involves	ordering,	customizing,	and	paying	for	your	sandwich	takes	22.2%	more	time	in	the	Palate.Image:	https://static1.squarespace.com/static/50ee198ae4b029acc68b8379/5855eb093e00be1ae0bbf7d5/586bd535e58c624be9f5d9f8/1483827351494/Vancouver-Architectural-Photography-UBC-AMS-Nest-Dialog-Brett-Ryan-Studios-1001.jpg2Customer	Journey:	Finally,	we	decided	to	map	out	the	behaviour	of	the	customer	through	a	customer	journey	map.	What	we	observed	is	that	when	arriving	to	the	Nest,	people	tend	to	look	for	a	place	to	sit	before	grabbing	their	food.	This	often	lead	to	food	locales	with	a	closer	proximity	to	high	congestion	areas	benefiting	from	most	of	the	demand.	The	whole	process	of	ordering	food	in	the	Palate	is	divided	by	3	main	stages.	The	first	stage	involves	the	first	employee	 to	take	your	order,	place	the	initial	main	ingredients	depending	on	what	you	order	(meat,	 squash,	chicken)	and	placing	your	order	in	the	oven.	After	you’re	passed	on	to	the	second	stage	where	the	second	employee	waits	till	your	sandwich	is	toasted,	and	where	you	ask	for	general	ingredients	such	as	to	what	vegetables,	and	sauces	you	want.	The	final	stage	is	the	payout	process,	which	involves	the	same	employee	from	the	second	stage.Overall	using	the	data	gathered	from	all	of	the	three	sources	we	came	 to	the	conclusion	that	there	are	3	main	issues	surrounding	the	Palate.Waiting	times:	 Compared	to	the	Delly,	the	Palate	is	slower	when	servicing	its	customers,	with	a	slower	customer	turnover,	and	a	slow	cycle	time	per	customer.	This	3is	due	to	the	larger	amount	of	workers	available	in	the	Deli,	which	include	3	cashiers	to	finish	your	purchase,	and	due	to	the	bottlenecks	 the	design	of	the	Palate	suffers	from.	This	causes	the	people	waiting	in	line	to	accumulate,	 causing	the	perception	of	even	a	larger	waiting	time,	which	might	discourage	potential	customers.Product	Variety:	 The	key	reason	as	to	why	people	chose	the	Delly over	Palate	was	to	the	variety	of	products,	Deli	offers	its	customers,	even	though	the	Palate	is	the	cheaper	option.	Student	Exposure:	We	found	out	that	students	are	not	exposed	to	the	Palate.	Some	people	who	don’t	frequent	the	Nest	very	often	did	not	know	about	the	Palate,	and	those	who	do	tend	to	settle	 in	areas	where	the	Palate	is	not	in	eye	sight.	https://s3-media4.fl.yelpcdn.com/bphoto/oord1KWJ9lLSSwsf8SOu0A/o.jpg3Floor	Plan	of	Proposed	PalateFeature	1	– Space	Expansion	We	decided	to	knock	down	½	of	the	current	window	and	expand	the	seating	areas	to	outside	of	the	current	Palate	beyond	the	window.	Considering	Palate	as	an	attraction	to	go	in	AMS,	we	believe	having	the	Palate	door	open	facing	outside	would	better	attract	customers.	We	identify	our	main	customers	as	grab-and-go	type	of	customers.	This	type	of	customers	is	more	time	sensitive.	From	our	primary	research,	we	discovered	that	customers	of	this	type	on	average	are	willing	to	wait	 less	than	10	minutes	for	their	orders.	In	respond	to	this,	we	would	expand	the	operation	space,	making	stage	larger	than	before.	This	is	to	adapt	to	the	increase	in	traffic	by	opening	two	doors	both	from	inside	of	AMS	and	outside.	On	top	of	that,	 it	provides	employees	 with	larger	working	space,	which	prepares	Palate	of	hiring	one	more	staff	during	peak	hours	to	increase	service	speed.	However,	there	is	another	type	of	customers	in	AMS,	which	are	the	ones	that	would	4hang	around	with	friends	during	lunch	hours.	This	type	of	customers	looks	for	variety	in	the	menu	and	large	seating	area.	We	believe	Palate’s	competitor	– Delly would	have	a	competitive	 advantage	over	these	customers	since	Delly owns	a	better	geographic	location	to	satisfy	group	customers.	However,	we	would	still	try	to	attract	some	of	these	customers	by	increasing	seating	area.	These	tables	and	chairs	will	be	located	outside	of	the	current	window	during	spring	and	summer	time.	Feature	2	– Menu	VarietyWe	propose	Palate	more	variety	for	students	to	choose	from.	We	are	aware	f	of	the	extra	cost	that	would	associate	with	increase	in	food	variety,	so	instead	of	massively	increase	variety,	we	recommend	Palate	to	start	off	by	offering	“Sandwich	of	the	day”.	This	is	a	more	cost	saving	approach	to	take	on	for	the	current	Palate,	but	still	brings	in	some	changes	to	the	menu.	Feature	3	– Increase	Service	SpeedWe	believe	it	 is	good	to	add	in	one	more	staff	during	peak	hours	(11:30am-1:30pm)	Monday-Friday.	This	will	increase	Palate’s	service	speed	and	decrease	 turnover	time.	As	we	identify	Palate’s	 target	customers	are	grab-and-go	type	of	students,	 increase	in	service	speed	will	allow	Palate	to	have	significant	competitive	 advantage.	 	4Service	Journey	Step	1	–Walk-inCustomers	walk	inside	Palate,	trying	to	decide	on	what	to	order.	Customers	would	find	from	the	menu	that	there	are	a	lot	more	varieties	 in	the	menu	now.	Daily	special,	which	include	sandwich	of	the	day	and	a	soft	drink	or	a	soup	is	one	of	the	most	popular	order.	We	also	recommend	Palate	to	keep	vegetarian	option	in	order	to	serve	a	wider	range	of	students.	Step	2	–Wait	in	lineCustomers	will	discover	that	the	wait	time	has	significantly	decreased.	We	recommend	Palate	to	add	one	more	server	during	peak	hours	(11:30am	– 1:30pm)	for	faster	service.	Seeing	less	people	waiting	in	line,	students	who	want	a	quick	grab-and-go	lunch	will	be	more	likely	to	stop	by	Palate.	Step	3	– OrderAs	Palate	used	to	be,	the	new	Palate	would	also	process	order	in	the	same	way.	However,	customers	would	find	that	the	operation	space	has	become	 larger	than	before.	A	larger	operation	space	would	allow	more	room	for	staff	to	turnaround,	5which	we	believe	would	enhance	customer	experience	and	foster	positive	synergy	among	employees	 in	Palate.	Step	4	– Order	Pick-up	and	AfterCustomers	pick	up	their	orders	feeling	satisfied	that	the	service	is	much	faster	than	before.	Now	we	group	the	customers	into	two	categories	 – grab-and-go	type	of	customers	(often	come	to	Palate	alone)	and	Hanging	around	type	(often	come	with	friends	and	have	more	flexible	time).	We	identify	our	primary	customers	being	the	grab-and-go	type,	however,	we	also	want	to	capture	some	of	the	students	that	would	like	to	hang	around	with	friends	during	lunch	time,	 so	we	increase	some	seating	space	beyond	the	window.	During	summer	time,	 students	can	enjoy	the	sunshine	while	chatting	with	friends.	Step	5	– Customers	Leave	PalateNow	there	are	two	doors	for	entry/exit	– one	opens	inside	AMS	(the	one	current	Palate	has)	and	a	new	one	facing	outside	of	AMS	(by	knocking	down	½	of	window).	Students	will	find	entering	and	exiting	Palate	much	more	convenient	than	before.		5Propose	to:	Replace	½	of	the	glass	window	with	glass	doors,	increase	efficiency,	 add	options	in	the	menu.Comparing	with	Delly,	Palate	is	lack	of	the	spatial	advantage	for	customers	to	sit	in	nature.	We	proposed	two	ways	to	deal	with	this	issue.First,	we	suggest	replacing	1/2	of	the	glass	window	by	door	to	make	Palate	looks	more	welcoming.	 Currently,	it	is	not	convenient	for	customers	from	outside	to	access	Palate	because	they	have	to	pass	through	two	doors	from	the	building	entry.	After	the	change,	customers	can	enter	Palate	directly	from	the	outside,	making	the	palate	looks	more	welcoming	and	increasing	chances	 for	passersby	to	check	out	food	options	in	Palate,	eventually	 increasing	sales.	 In	addition,	having	an	extra	entry	will	enable	Palate	to	expend	operating	space	by	placing	seats	outside	during	summer	to	compensate	 the	disadvantage	in	lack	of	eating	areas.	Second,	we	position	Palate	mainly	as	grab-and-go	type	of	food	service	store.	Thus,	we	suggest	Plate	to	improve	efficiency	to	compensate	 the	limited	spatial	disadvantage.	Based	on	information	we	collected	 during	the	field	trip,	we	conducted	the	process	analysis	and	found	that	Stage	2,	adding	vegetables	and	packaging,	 is	the	bottleneck	6for	the	whole	process.	Thus,	we	suggested	to	hire	four	workers	in	total	during	peak	hours	which	is	from	11:30	am	to	1:30	pm,	allocating	2	staff	in	charge	of	stage	2	and	1	staff	for	each	other	activities	 instead	of	3	staff	in	charge	of	each	process	currently.	By	doing	so	we	can	increase	the	capacity	 rate	from	42	units/hr to	51	units/hr.		6Students	who	eat	 in	Nest	frequently	are	looking	for	food	varieties.	Comparing	with	Delly,	Palate	has	less	food	options.	Thus,	we	highly	suggest	Palate	to	increase	varieties	to	enhance	its	competitiveness.	 We	do	aware	that	 increasing	the	food	options	will	result	in	higher	cost.	Therefore,	we	suggested	Palate	to	offer	special	“sandwich	of	the	day”	rather	than	upgrade	food	varieties	for	the	whole	menu.	Except	saving	cost,	offering	“sandwich	of	the	day”	can	also	help	Palate	to	constantly	attract	and	maintain	customers’	 interests	and	encourage	purchases	as	the	sandwich	is	only	available	on	certain	special	days.	7Diff	 imageMarketing	is	going	to	be	important.It	was	noted	that	Palate	is	in	a	prime	location,	but	we	found	that	less	people	walked	through	the	entrance	next	to	Palate	than	most	of	the	other	entrances.People	do	know	what	palate	is,	but	we’ve	found	that	of	the	people	who	do	not	go	to	the	nest	often	seldom	know	what	palate	is,	making	the	position	it’s	 in	convenient	only	if	you’re	looking	for	it.	 It’s	not	in	plain	sight	to	people	who	aren’t	 looking	for	it.Sign	on	the	window	is	not	that	visible,	possibly	because	of	the	backdrop	and	lighting	behind	it	so	people	can	easily	walk	past	it	without	too	much	recognition.Nothing	drawing	a	person	to	the	place	except	for	the	appeal	of	‘vegan’	options.	Students	like	the	food	when	they	know	it’s	there.	 It	 just	needs	to	be	better	known	to	the	masses.	A	few	recommendations	for	marketing:	Easier	website	 to	navigate.Ø More	posters	or	signage	or	banners	to	direct	people	there	for	a	period	of	time	—e.g.	September	when	school	begins,	if	signs	are	up	directing	people					there,	there’s	high	traffic	among	new	students	and	you	can	capture	the	new	student	8turnover	as	others	may	have	their	routines	more	concreteØ Further	to	that,	putting	little	infographics	or	info	cards	on	study	desks	around	the	NEST	— maybe	even	5%	off	coupons	for	people	to	pick	up	with	indication	for	where	the	store	is	will	encourage	people	to	go	and	try	it	for	that	discounted	cost	— no	indication	of	the	retention	of	customers	unless	you	survey	them	at	a	later	date.	But	it	could	increase	awareness	and	traffic	in	long	term	solely	by	putting	palate	on	the	map.Ø Promotion	in	popular	locations	— not	about	cannibalization. People	go	to,	for	example,	Gallery	for	food	OR/AND	for	drinks.	You	can	place	little	 info	cards	or	stand	up	promo	cards	on	tables	that	are	less	for	eating	and	more	for	studying/drinking/relaxing	- e.g.	the	ones	with	couches	or	lounge	chairs8To	find	out	how	to	best	serve	the	student	body	at	UBC,	we	did	some	primary	research	at	the	Nest	and	online	to	find	out	what	students	care	most	about.	Combining	out	results	from	over	100	responses	in	person	and	from	an	online	survey,	we	found	that	the	three	key	value	that	students	look	for	are	price,	convenience,	 and	variety.	Price	– Palate	has	an	advantage	in	this	area	as	 it	is	common	known	that	Palate	has	cheaper	sandwiches.	A	lot	of	the	people	who	we	interviewed	spoke	of	value	when	we	asked	them	why	they	chose	the	store.	This	is	a	point	we	want	to	really	leverage	on.	If	we	can	successfully	 improve	the	other	two	factors,	convenience	and	variety,	we	are	confident	that	we	can	grab	a	larger	market	share	within	the	Nest.	Not	only	that,	of	the	2/3	of	the	people	who	reported	to	not	eat	at	the	Nest,	 about	half	of	them	say	that	 it’s	because	it’s	 too	expensive.	Part	of	our	marketing	efforts	will	be	to	communicate	 the	cost	savings	from	going	to	the	Palate,	which	will	 ideally	increase	overall	traffic	into	the	Nest.Convenience	– it’s	 hard	to	compete	with	the	Delly because	of	its	vast	seating	area.	It’s	 a	place	where	people	like	to	meet	after	class	and	that	makes	the	Delly a	very	clear	choice	when	they’re	looking	at	places	to	eat.	 Our	strategy	in	this	area	is	to	shift	our	focus	away	from	a	sit-down	sandwich	store	into	a	grab-and-go	location.	It’s	9conveniently	located	both	for	passerby	on	campus	and	for	those	in	the	Nest.	We	will	keep	the	number	of	cashier	the	same	 but	streamline	the	operation	by	adding	another	person	to	help	with	Stage	2	of	the	food	preparation	process.	Variety– Lastly,	we	want	to	address	the	issue	of	variety	but	we	don’t	want	to	go	overboard.	Delly has	a	huge	selection	 of	food	due	to	its	size,	and	we’re	not	going	to	imitate	that.	 Instead,	 let’s	 focus	on	what	we	do	well	– which	is	sandwiches	– and	build	on	that.	Let’s	 introduce	a	sandwich	of	the	week	or	do	more	to	promote	the	soup-sandwich	combo	so	we	can	market	ourselves	as	the	more	nutritious	sandwich	option	compared	to	the	Delly.	Based	on	what	people	like	every	week,	 that	can	be	the	basis	of	what	forms	our	menu	selection.	 By	doing	this,	we	can	also	shrink	the	menu	down	to	focus	on	a	few	things	and	do	them	well.	910111213

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