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Marketing Application Problem #1

You run a large restaurant equipment distribution company that sells smokers to BBQ places all over the United States. There are three different types of BBQ restaurants:

1. Shacks (Seat, on average, 5 people at a time)

2. Dine-Ins (Seat, on average, 30 people at a time)

3. Chain franchises (Seat, on average, 50 people at a time)

Smokers are used to cook basically all of the meat in a BBQ restaurant, and each person consumes, on average, .5 pounds of meat when they visit any kind of BBQ restaurant. Your smokers can cook up to 50 pounds of meat at a time, and all BBQ restaurants cook their meat within 12 hours of when it is to be served. Most BBQ restaurants are open for lunch and dinner and often do take out, but, of course, have a lot of variability as to the number of orders based on the time of day in which we are discussing.

Based on the information I have given you, I want you to tell me the size of each customer segment and the size of the total market. In doing this, I want you to assume characteristics about each of these customer segments based on anything of your choosing that you believe makes sense. After conducting these calculations, tell me which market segment you believe is more attractive for your business, why you think it is most attractive and your plan to grow your market share within this segment. One more time: Feel free to assume anything you think makes sense about anything – but please list your assumptions.