Chapter 2 — Quiz

Twenty-five self-check questions. Answer from memory first; the key is collapsed at the bottom.

Multiple choice

1. A restaurant concept is best described as: - (a) the cuisine and the price point - (b) a chain of dependent operating decisions that constitutes a testable claim about a market - (c) the name, the logo, and the intended atmosphere - (d) the founder's vision, expressed on a menu

2. The chapter argues that guest personas should be built primarily from: - (a) age, income, and zip code - (b) psychographic categories and lifestyle segments - (c) occasions — the reason a guest is out, with party size, frequency, and alternatives - (d) the founder's own dining habits

3. A trade area is best measured by: - (a) a three-mile radius - (b) drive time and walk time, adjusted for physical barriers - (c) the municipal boundary the site sits in - (d) the mailing list of the previous tenant

4. Bellwether requires 36,140 covers a year. If the average guest visits four times a year, the required guest count as a share of the 118,000 people within a ten-minute drive is approximately: - (a) 2.4% - (b) 7.7% - (c) 15.3% - (d) 30.6%

5. A daypart is: - (a) any two-hour block of a service period - (b) the portion of the day a given employee is scheduled for - (c) a defined block of the operating day treated as a distinct business with its own guest, menu, labor model, and economics - (d) the interval between the first and last table seated

6. For a neighborhood full-service restaurant's weeknight occasion, the largest single competitor is usually: - (a) the nearest restaurant of the same cuisine - (b) the most expensive restaurant in the district - (c) the guest not going out at all — cooking at home, prepared foods, or delivery - (d) national chains within a fifteen-minute drive

7. Capture rate is computed as: - (a) covers ÷ seats - (b) (annual covers ÷ visits per guest per year) expressed against the trade-area population - (c) sales ÷ trade-area population - (d) reservations honored ÷ reservations made

8. A concept forecasts 60% of covers at a \$35 per-person average and 40% at \$50. Its blended check is: - (a) \$40.00 - (b) \$41.00 - (c) \$42.50 - (d) \$43.75

9. At Bellwether's \$46 dinner check and a 72% food / 28% beverage mix, the food portion of the check is: - (a) \$28.75 - (b) \$31.20 - (c) \$33.12 - (d) \$34.50

10. Bellwether adds 68 seats to a direct-occasion seat base of 172 seats in its district. That is an increase in supply of roughly: - (a) 18% - (b) 28% - (c) 40% - (d) 68%

11. Which of the following is most likely to pass all three parts of the differentiation test? - (a) a signature cocktail - (b) a wood-fired hearth - (c) a "locally sourced" claim on the menu - (d) a proprietary online-ordering interface

12. A concept statement built from adjectives ("elevated, approachable, seasonal") fails primarily because: - (a) the words are overused and sound unoriginal - (b) it cannot be falsified, and no one can act on it - (c) designers find it difficult to interpret - (d) lenders prefer numbers to language

13. Bellwether's plan rejects adding a sixth service. The primary financial reason given is: - (a) the additional food cost - (b) that it adds a full day of the fixed labor floor to the lowest-volume night of the week - (c) that the lease restricts operating days - (d) that guests would not come

14. The axes of a positioning map should be chosen to reflect: - (a) the categories used by industry data providers - (b) price and cuisine, always - (c) how the guest actually decides between the alternatives - (d) the dimensions on which the concept scores best

15. Scoring a concept at 3.30 out of 5 on the stress-test scorecard is described in the chapter as: - (a) a failing result requiring a new concept - (b) evidence the scorecard weights are wrong - (c) the correct and more useful result for a concept that has not yet met a guest - (d) grounds to proceed directly to a lease

16. Which of the following is not a barrier that reshapes a trade area? - (a) a rail corridor with two at-grade crossings - (b) a six-lane arterial with no pedestrian crossing for four-tenths of a mile - (c) a river with a single bridge that backs up at 5:30 p.m. - (d) a median household income of \$63,000

Short answer

17. Write the three-sentence test from §2.1, and state the property all three sentences must have.

18. A concept requires 30,000 covers a year. Its guests visit an average of five times a year, and its trade area holds 80,000 people. Compute the required guest count and the capture rate.

19. Explain in two sentences why a check average is a weighted output rather than a price decision.

20. Why is a competitive set defined per occasion rather than per restaurant? Give one example.

21. Using Bellwether's frozen figures — 68 seats, 1.4 turns, \$46 dinner check, five dinner services; 110 covers at a \$24 check for each of two brunch services — compute weekly covers and weekly revenue.

22. State the three parts of the differentiation test in §2.6.

23. The chapter calls a trade-area data sheet "a denominator, not an answer." Explain what it means and name the numerator.

24. A founder describes their concept as "elevated comfort food for the neighborhood." Rewrite it as four operating decisions somebody could execute and measure.

25. Distinguish claiming concept-market fit from demonstrating it. What actually demonstrates it, and what is the earliest evidence an operator can get?

Answer key — try all twenty-five first **1.** (b) — Not a cuisine, not a mood, not a name: a chain of dependent decisions that can be shown to be wrong. **2.** (c) — Occasions produce covers; demographics do not. The same person is four different customers on four different nights. **3.** (b) — Rings are what data vendors sell because rings are easy to compute. Guests experience drive time, walk time, and parking. **4.** (b) — $36{,}140 \div 4 = 9{,}035$ guests; $9{,}035 \div 118{,}000 = 7.7\%$. Expressed the other way, that is roughly a third of the \$100,000+ households in the drive time, as dining pairs. **5.** (c) — Breakfast, lunch, afternoon, happy hour, dinner, late night, weekend brunch. Bellwether operates two: dinner and weekend brunch. **6.** (c) — Not going out. Every marketing decision and every reason-to-return mechanism is ultimately competing with a refrigerator. **7.** (b) — Annual covers ÷ visits per guest per year gives the distinct guests required; expressing that against the trade-area population gives the capture rate. **8.** (b) — $(0.60 \times 35) + (0.40 \times 50) = 21.00 + 20.00 = \mathbf{\$41.00}$. **9.** (c) — $0.72 \times \$46.00 = \mathbf{\$33.12}$; beverage is \$12.88. **10.** (c) — $68 \div 172 = 39.5\%$, about 40%. Against the broader 380-seat district base it is 18%, which is the number a founder would rather quote. **11.** (b) — The hearth is perceptible with three senses, requires capital plus ventilation plus a scarce skill (so it cannot be copied by Tuesday), and its cost is real. Note that (b) passes tests one and two; test three is unresolved until Chapters 6 and 7 price it. **12.** (b) — "We serve people who appreciate quality" cannot be wrong, which means it says nothing and no cook, server, or manager can act on it. **13.** (b) — A sixth service adds the salaried manager, chef, opening prep, and closing dish to the lowest-volume night. The second reason given is concept discipline, which is not financial. **14.** (c) — Price against formality is the usual pair, but price against speed or against "who is it for" can be more revealing depending on the market. **15.** (c) — A 4.5 at concept stage would mean the founder had not looked hard enough. The two threes are the items the rest of the plan must answer. **16.** (d) — Income is a characteristic of the population inside the trade area, not a barrier reshaping its boundary. **17.** (1) Who and when: a specific guest, on a specific occasion, at a stated frequency. (2) What and what for: a specific experience at a specific price, taking a stated length of time. (3) Why us: chosen over a specific named alternative, for a reason the guest would recognize. **All three must be falsifiable** — capable of being shown wrong by evidence. **18.** $30{,}000 \div 5 = \mathbf{6{,}000}$ distinct guests; $6{,}000 \div 80{,}000 = \mathbf{7.5\%}$ capture rate. **19.** The check average is the sum of what each guest orders, weighted by how often they order it — and, at a higher level, the weighted average of the per-person spend of each occasion the restaurant serves. Because it is an output, it moves when the occasion mix moves even though no price changed, which is why a ten-point shift in mix can remove \$39,520 from Bellwether's year without appearing on any report. **20.** Because guests choose per occasion, not per category. In Figure 2.6 the wine bar is a direct competitor for the bar-first occasion and irrelevant for the celebration occasion; the downtown steakhouse is the reverse. A single "who are our competitors" list obscures both. **21.** Dinner: $68 \times 1.4 = 95$ covers × 5 = **475 covers**, at $95 \times \$46 = \$4{,}370$ per service × 5 = **\$21,850**. Brunch: $110 \times 2 = $ **220 covers**, at $110 \times \$24 = \$2{,}640$ × 2 = **\$5,280**. Weekly totals: **695 covers, \$27,130.** **22.** (1) Does the guest perceive it, and does it change their choice at the deciding moment? (2) How long would a competitor need to copy it? (3) Does it return more than it costs — in equipment, inventory, prep labor, training, and complexity? **23.** The sheet counts who is nearby; it never says whether they will come. It supplies the population against which a claim is measured. The numerator is the **capture rate** — the share of that population you are claiming, at an assumed visit frequency — and that is an argument you must make and test, not a figure any data set will give you. **24.** Answers will vary; a good one names decisions such as: à la carte only, no tasting menu; entrées \$24–\$32; dinner Tuesday–Saturday plus weekend brunch; menu changes quarterly with three items rotating monthly; bar seats held for walk-ins until 7:30; 60%+ of covers from within a ten-minute drive. The test is whether a cook, a server, and a manager who have never met the founder could each execute their part, and whether it could be shown at month-end to have failed. **25.** A plan *claims* concept-market fit by showing a defined guest, a defined trade area, a credible capture rate, and a defensible position. Only paying guests *demonstrate* it, repeatedly — which means the demonstration begins after opening, not before. The earliest real evidence is a repeat-visit signal: covers holding after the opening spike normalizes, party sizes and check by daypart matching the occasion mix, and the same faces returning. A cheap pre-opening approximation is a pop-up or residency where strangers pay the intended price twice.