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Arnie's Case Study

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Arnie’s Neighborhood Bar and Grill needs to make an important decision. Along with thirty-seven declared bankruptcies, Arnie’s experienced a 2.4% drop in same-store sales in 2016, its worst year since the recession. Arnie’s lost many young customers, and were described as “cool” by only 20% of respondents in a recent poll. There are two paths Arnie’s can take. The first, to offer discounts and acquire new partnerships with food delivery companies. The second, to rebrand Arnie’s as a Gastropub/fast-casual hybrid. Through this decision, Arnie’s wants to address two major concerns: its financial issues, and distinguishing Arnie’s from its competitors. With these criteria in mind, the correct decision is to rebrand Arnie’s. Adding discounts and limited-time items will not solve Arnie’s financial problems. While in the short run, these promotional actions may bring an inflow of customers, it is difficult for restaurants to sustain long-term profits off of solely discounted items. A more impactful change such as partnering with Grub Dash and Ultra Eats, could attract customers as none of Arnie’s…show more content…
Profits may increase initially from new customers, but in the long run, maintaining those profits as well as getting new loyal customers, will be hard. The partnerships can be expected to behave similarly, as companies will be able to steal this idea quickly. There is a chance that by making such a large change and rebranding, Arnie’s may lose a few of its existing customers. The casual dining market is dying, however, while Gastropubs have become popular in urban areas and these effects are likely to roll over to the suburban setting. The potential risks of rebranding are surpassed by the notion of solving both of Arnie’s financial and distinguishing problems. The smarter and right choice for Arnie’s to pursue is to rebrand as a Gastropub/fast-casual
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