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# Bob’s Café, a busy restaurant, has decided to stop serving steak, whic

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Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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Updated on: 05 Jan 2019, 02:17
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Bob’s Café, a busy restaurant, has decided to stop serving steak, which takes much longer to cook, and concentrate instead on poultry dishes. The management believes that this will allow servers to speed up customer turnover and therefore maximize profits by serving as many customers as possible at each meal.

The Bob’s Café management’s plan to speed up customer turnover would be most undermined by which of the following?

A. Chicken takes only half as long to cook as steak in most instances.

B. Chicken is less expensive than steak for Bob’s Café to purchase.

C. Chicken dishes can be sold for nearly as much as steak dishes.

D. The bistro next door to Bob’s Café will continue to serve steak.

E. Customers who order chicken tend to order dessert much more frequently than do customers who order steak.

I am not convinced with OA and OE, i will post the OA after some responses..

Originally posted by agdimple333 on 16 Jul 2012, 08:18.
Last edited by Bunuel on 05 Jan 2019, 02:17, edited 4 times in total.
Renamed the topic and edited the question.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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16 Jul 2012, 11:15
3
I go for E.
Stimulus=>Chicken lesser time to make hence customers will be served quickly and hence, more profits.

E=> Customers who order chicken also order Desserts. If desserts take a long time to make, the customers can't be served quickly and hence not much profit.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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16 Jun 2013, 21:17
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I was deciding between D and E. I ultimately chose E because if people order chicken and also order dessert, then turnover in customers would not increase. If anything, the cooking of the steak compared to cooking chicken and customers also ordering dessert results in...the same number of customers at the resturant. It weakens the turnover argument.

Then I thought if chicken costs \$15, and steak is \$45, even if I order dessert (which is \$10), my chicken + dessert = \$25, versus my steak of \$45. Using the same logic of same # customers above, then I wouldn't have increased profits either.

I feel that this answer best acknowledges both points of making less profits, and no change/decrease in customer turnover. But who knows! I'm not too sure about my answer!
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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17 Jun 2013, 01:47
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Hi umesh & Ankurgupta, I picked E and here is my 2 cents.

ANALYZE THE STIMULUS:

Bob's Cafe new strategy is that it wants the customer turnover ratio is high. The reasons behind that are:
(1) Chicken takes less time to cook
(2) Customers WILL NOT SPEND MORE TIME on eating chicken than on eating steak.

What happens if after customers have done with chicken, they will stay to have other food such as dessert
==> The total time = Time for having chicken + Time for having dessert
The total time spending on chicken MAY BE EQUAL or EVEN GREATER than total time spending on steak.
==> Bob's cafe new strategy based on the high customer turnover will fail.

A. Chicken takes only half as long to cook as steak in most instances.
Wrong. A strengthen ==> less time cooking, higher customer turnover.

B. Chicken is less expensive than steak for Bob’s Café to purchase.
Wrong. B strengthen ==> less Cost of good sold ==> higher profit.

C. Chicken dishes can be sold for nearly as much as steak dishes.
Wrong. Revenue = Quantity x Price. If price is the same, but quantity increases because of less time cooking ==> Profit may increase.

D. The bistro next door to Bob’s Café will continue to serve steak.
Wrong. Bob's Cafe is a regular restaurant, NOT STEAK ONLY RESTAURANT. Profit of Bob's cafe will decrease ONLY IF it is a steak restaurant. If Bob's cafe does not server steak anymore ==> it will lost customers to the next door bistro ==> Its profit decreases.

E. Customers who order chicken tend to order dessert much more frequently than do customers who order steak.
Correct. E focus directly on "time spending on food".

Hope that helps.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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17 Jun 2013, 04:01
D it is for me. because if the competition continues to serve something and our restaurant stops they might lose customers to that Bistro.

I dont think it is C because Selling Price doesn't mean the same as Profit Margin ? Chicken might have the same Retail Price but might have a much lower Margin.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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17 Jun 2013, 08:10
Hi Ivy League,

I think you should go re-read the question. It is all about 'customer turnover'. It is not about the general plan for the business to be successful.

If you only care about 'customer turnover' which we do - then it's clear that E is correct. This is the only one that gives evidence that just serving chicken will slow 'customer turnover'

Hope that makes sense.

James
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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18 Jun 2013, 05:01
plumber250 wrote:
Hi Ivy League,

I think you should go re-read the question. It is all about 'customer turnover'. It is not about the general plan for the business to be successful.

If you only care about 'customer turnover' which we do - then it's clear that E is correct. This is the only one that gives evidence that just serving chicken will slow 'customer turnover'

Hope that makes sense.

James

But doesnt it also mention "speed up customer turnover and therefore maximize profits by serving as many customers as possible at each meal."

If the margin is much lower he can double or triple is turnover but not "maximize profits"

Now even more confused
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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18 Jun 2013, 05:05
2
Hi Ivy, No - This is really important.

Look at the question you're being asked:

The Bob’s Café management’s plan to speed up customer turnover would be most undermined by which of the following?

Where there does it ask about profit or anything like that? It doesn't it just asks about 'customer turnover' - so that's what you've got to answer. What would affect the plan to speed up turnover.

The passage itself may talk about many things - this is why GMAT is not easy! You just have to answer the question being asked.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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07 Aug 2013, 22:22
1
agdimple333 wrote:
Bob’s Café, a busy restaurant, has decided to stop serving steak, which takes much longer to cook, and concentrate instead on poultry dishes. The management believes that this will allow servers to speed up customer turnover and therefore maximize profits by serving as many customers as possible at each meal.

The Bob’s Café management’s plan to speed up customer turnover would be most undermined by which of the following?
A. Chicken takes only half as long to cook as steak in most instances.
B. Chicken is less expensive than steak for Bob’s Café to purchase.
C. Chicken dishes can be sold for nearly as much as steak dishes.
D. The bistro next door to Bob’s Café will continue to serve steak.
E. Customers who order chicken tend to order dessert much more frequently than do customers who order steak.

I am not convinced with OA and OE, i will post the OA after some responses..

Responding to a pm:

The cafe has decided to stop serving steak since it takes too much time. So the assumption is that people who order steak right now will start ordering chicken and hence customer turnover will increase. More customers will mean more profits.

Now, many things can undermine this argument since we made many assumptions. Some of these things are:

1. Chicken sells at a much cheaper price than steak.
2. Customers who want steak will switch the cafe rather than the meat.
3. Customers who eat chicken take much longer to finish than customers who eat steak.
etc

Let's look at options (C), (D) and (E)

C. Chicken dishes can be sold for nearly as much as steak dishes.
This strengthens our argument. Chicken cooks faster so leads to higher customer turnover and sells at the same price so it does lead to higher profits.

D. The bistro next door to Bob’s Café will continue to serve steak.
This option kind of hints at "people may switch cafes" but it doesn't say so. We don't know whether people will switch cafes or meat so it doesn't undermine the argument. We need an option to specify that they will prefer to switch cafes.

E. Customers who order chicken tend to order dessert much more frequently than do customers who order steak.
This is no. 3 in our list above. If people who eat chicken order dessert too, they will take longer to finish and hence the customer turnover may not increase. It may actually decrease. We don't know the cost of dessert and hence cannot say anything about profits. But this option does undermine our "increase customer turnover" logic.

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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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08 Aug 2013, 14:44
agdimple333 wrote:
Bob’s Café, a busy restaurant, has decided to stop serving steak, which takes much longer to cook, and concentrate instead on poultry dishes. The management believes that this will allow servers to speed up customer turnover and therefore maximize profits by serving as many customers as possible at each meal.

The Bob’s Café management’s plan to speed up customer turnover would be most undermined by which of the following?
A. Chicken takes only half as long to cook as steak in most instances. speeds up customer turn over
B. Chicken is less expensive than steak for Bob’s Café to purchase.has nothing to do with customer turnover
C. Chicken dishes can be sold for nearly as much as steak dishes.has nothing to do with customer turnover
D. The bistro next door to Bob’s Café will continue to serve steak. irrelevant
E. Customers who order chicken tend to order dessert much more frequently than do customers who order steak.
. correct

correct, the cafe is getting rid of steak because it take too long to make. Chicken takes less time, but if more order dessert when ordering chicken, this will increase customer turnover. The benefit of offering only chicken will be canceled because of the increased turnover caused by additional dessert orders.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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24 Aug 2013, 07:31

e) Customers who order chicken tend to order dessert much more frequently than do customers who order steak.
» Less steak, more chicken = more costumers per hour.
» BUT, more chicken, more dessert = more time with a costumer, not necessarily more costumers per hour.

Imagine that:
1- steak generates \$5 as profit and the costumer takes 20 mins to finish and leave the restaurant.
2- chicken generates \$5 as profit and the costumer takes 15 mins to finish and leave the restaurant.
3- dessert generates \$1 as profit and the costumer takes +15 mins to finnish.

In one hour will have as profit \$15 from costumers eating just steaks and \$12 from costumers eating chicken + dessert.

Why not the other options:

a) Chicken takes only half as long to cook as steak in most instances
» Can't be used because there is no information about the time to get a dessert ready.

b) Chicken is less expensive than steak for Bob’s Café to purchase.
» Can't be used because there is no information about the selling price.

c) Chicken dishes can be sold for nearly as much as steak dishes.
» Can't be used because there is no information about the cost price.

d) The bistro next door to Bob’s Café will continue to serve steak.
» Not relevant because if the Bob's Café don't want people eating steaks in there, the steak eaters can go to somewhere else and give space to those who want chicken. Besides that we don't know if the next door bistro has good steak, if it is expensive, if it is clean enough, and other information that would really make the costumers to go to the bistro instead.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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26 Aug 2013, 03:42
I am not convinced with the OA. Though some people have reasoned that E will increase the turn around time. But the argument doesn't say much whether people take more time to eat steak or chicken. It only says it takes more time to cook. So E sounds unreasonable .
IMO it should be D. People come to eat steak hence the concern. So if the next door bistro is still serving steak chances are people will go there.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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26 Aug 2013, 22:23
summer101 wrote:
I am not convinced with the OA. Though some people have reasoned that E will increase the turn around time. But the argument doesn't say much whether people take more time to eat steak or chicken. It only says it takes more time to cook. So E sounds unreasonable .
IMO it should be D. People come to eat steak hence the concern. So if the next door bistro is still serving steak chances are people will go there.

In CR questions, you have to answer exactly what you are asked. The question clearly says "management’s plan to speed up customer turnover would be most undermined by which of the following". So you have to try to undermine the plan to speed up turnover i.e. whichever customers come, you have to try to serve them fast and get them out of the door as fast as possible.
So (D) is out of scope. What the other bistro is doing does not affect time management in Bob's Cafe.
(E) suggests that time management could be affected because people who eat chicken also order dessert. Hence the plan MAY not work. Note that you don't need to ruin the plan. You need to try to undermine it. You just need to bring in doubt.
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Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic  [#permalink]

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05 Jan 2019, 02:47
pqhai wrote:
Hi umesh & Ankurgupta, I picked E and here is my 2 cents.

ANALYZE THE STIMULUS:

Bob's Cafe new strategy is that it wants the customer turnover ratio is high. The reasons behind that are:
(1) Chicken takes less time to cook
(2) Customers WILL NOT SPEND MORE TIME on eating chicken than on eating steak.

What happens if after customers have done with chicken, they will stay to have other food such as dessert
==> The total time = Time for having chicken + Time for having dessert
The total time spending on chicken MAY BE EQUAL or EVEN GREATER than total time spending on steak.
==> Bob's cafe new strategy based on the high customer turnover will fail.

A. Chicken takes only half as long to cook as steak in most instances.
Wrong. A strengthen ==> less time cooking, higher customer turnover.

B. Chicken is less expensive than steak for Bob’s Café to purchase.
Wrong. B strengthen ==> less Cost of good sold ==> higher profit.

C. Chicken dishes can be sold for nearly as much as steak dishes.
Wrong. Revenue = Quantity x Price. If price is the same, but quantity increases because of less time cooking ==> Profit may increase.

D. The bistro next door to Bob’s Café will continue to serve steak.
Wrong. Bob's Cafe is a regular restaurant, NOT STEAK ONLY RESTAURANT. Profit of Bob's cafe will decrease ONLY IF it is a steak restaurant. If Bob's cafe does not server steak anymore ==> it will lost customers to the next door bistro ==> Its profit decreases.

E. Customers who order chicken tend to order dessert much more frequently than do customers who order steak.
Correct. E focus directly on "time spending on food".

Hope that helps.

I particularly don't understand how can we assume that the chicken and steak are priced the same? As per me, B is the right answer- because a chicken dish whose cost price is low cannot be priced same as a steak dish ( so, even though there might be high volumes generated because of faster turn-around time due to faster cooking of chicken dish, since it's price is low- Profit margins for dishes remain the same- You can never sell chicken dish at Steak's price! So, the net impact will remain the same and no huge boost in profits generated
Re: Bob’s Café, a busy restaurant, has decided to stop serving steak, whic   [#permalink] 05 Jan 2019, 02:47
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