Could you estimate for me, the number of burgers a McDonald’s outlet sells in a day

Question

To simplify this problem, I would like to estimate the sales in (1) the restaurant and (2) takeaways, separately.

(1) Restaurant Strategy

I would like to approach this problem from a supply point of view. I want to add that supply in this context means not the burgers that can be manufactured but the maximum customers that can be seated in McDonald’s on a given day. I will further try to understand their consumption patterns to arrive at total burgers sold.
I’m assuming that an average McDonalds has about 50 seats and is open from 10 am to 10 pm. The consumption patterns of burgers are different throughout the day

The total number of burgers = (# hours) x (# people per hour) x (# burgers per person)
We have used mathematics here to ensure MECE segmentation.
The total number of burgers = (# hours) x (# of seats occupied) x (# people per seat per hour) x (# burgers per person)
The total number of burgers = (# hours) x (Total # of seats) x (average % occupancy) x (# people per seat per hour) x (# burgers per person)

Let’s say every person eats at McDonald’s for 20 minutes. There are 3 (60min/20min) people occupying a seat every hour. Also, in my experience, since burgers in India are slightly smaller, I will assume 20% of the people eat 2 burgers and 80% of eating 1 burger.

That is an average of

0.2*2 + 0.8*1 = 1.2 burgers per person per sitting.
The total number of burgers = (# hours) x (50) x (average % occupancy) x (3) x (1.2)
= (# hours) x (% occupancy) x (180 or approx. 200)

Since the occupancy varies according to time of day, I would like to do the math separately for each hour.

For simplicity’s sake, let’s take 3 scenarios:

100% occupancy (high traffic),

50% occupancy (medium traffic),

and 25% occupancy (low traffic).

High traffic: Lunch and dinner hours
Medium traffic: Post lunch and early evening hours
Low traffic: Morning hours
The kind of insight demonstrated by the candidate above is what you want to aim for in guesstimates. Not only should it be important but something that can easily be incorporated in your solution.

Calculation: (Following from the last mathematical equation)
High traffic: 5 hours * 100% occupancy * 200 burgers = 1000 burgers
Medium traffic: 5 hours * 50% occupancy * 200 burgers = 500 burgers
Low traffic: 2 hours * 25% occupancy * 200 burgers = 100 burgers

The total number of burgers sold in a day in a restaurant is 1600 (or ~1500 burgers).

(2) Takeaways

The takeaway counter has a queue during high traffic hours and it will be useful to bring in my own experience at these counters to estimate the time that each exchange takes.
In my view,
Time taken for every person = 75 s = 1.25 min
# of burgers in an hour = (# of people in an hour) * (# burgers per person)
I have assumed that the takeaway orders are slightly more than the restaurant orders.
# of burgers in an hour = (60/1.25) * (2) = ~100 burgers
Assuming that the traffic of people is similar for takeaways as well,
High traffic: 5 hours * 100% traffic * 70 burgers = 350 burgers
Medium traffic: 5 hours * 50% traffic * 70 burgers = 175 burgers
Low traffic: 2 hours * 25% traffic * 70 burgers = 35 burgers
A total number of burgers sold in a day in a restaurant is 560 (or ~600 burgers).
Case Interviews Cracked
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Hence, the total number of burgers sold every day at an average McDonald’s is about 2200 burgers
Impressive. Is there anything else you would like to add?
Yes. I would like to do a quick sanity check.
A sanity check is a method to check if the answer from the guestimate is in the bounds of reasonableness
I think the bottleneck during high traffic hours is the supply i.e. the manufacturing rate of the burgers themselves. The kitchen would be running at nearly full capacity during these hours.
Supply = Demand during peak hours.
Demand (as per our calculation)
The demand for burgers during high traffic time = 270 (restaurant: 200; takeaways: 70) burgers per hour = ~4-5 burgers per minute.
Supply
Keeping in mind that the McDonald’s model is a made-to-assemble* one,
Time required to make a burger = (1) Sourcing components + (2) Heating + (3) Assembly + (4) Delivery
*A made-to-assemble model is one where the individual components are ready or ‘made’ and require only assembling to make the finished product
Time required to make a burger = 5s + *5s + 10s + 10s = ~30s
*Assuming 2 crate of patties (each having 30) take about 5 minutes to cook.
Hence, every kitchen employee makes 2 burgers per minute.
Assuming 3 people working in the kitchen during high traffic hours, the outlet produces ~6 burgers per minute or which is in the same ballpark as the demand. I concede that due to incomplete knowledge about the industry, I may have made some errors in assumption.

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Sudhanshu Singh 4 years 0 Answers 10232 views Member 9

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