Working Papers

Restaurant Analytics: Emerging Practice and Research Opportunities (joint work with Jelle de Vries and Debjit Roy)

Smart technologies and increased data availability enable restaurants to gather more information about customers and their behavior. These data can be utilized in combination with other data sources to inform a wide range of strategic and operational restaurant decisions, and therefore hold tremendous potential to generate value for restaurants and their customers. This study describes the available restaurant data, and the dominant data analytics methods through which these data can be used to inform relevant business decisions. We illustrate how added value can be generated through the effective utilization of data across various restaurant domains. More specifically, we elaborate on the potential application of business analytics in established restaurant decision areas such as location decision, reservation management, table management and labor decisions, menu design and engineering, and queue management. Furthermore, we discuss the potential value of analytics in relation to the emerging topics of sustainable restaurant supply chains and food waste, and food delivery and online platforms. As a result, this contribution aims to aid restaurant managers in capitalizing on analytics to inform strategic and operational business decisions, and inspire researchers with ideas of how to support these decisions through new cutting-edge research avenues.

Volume guarantees in global health and economies of scale: the effect on current and future prices (joint work with Alexander Rothkopf)

Recently global health procurement organizations grant volume guarantees to pharmaceutical companies for the procurement of donor funded medicines and medical devices (e.g. pentavalent vaccine, contraceptive implants) and have been successful in achieving, among other things, lower prices. One main driver for substantial price reductions associated with volume guarantees are economies of scale. However, awarding one or more manufacturers a longer-term contract may inhibit recurring competition and also disincentivize new manufacturers to enter the market. This paper focuses on how the design of a volume guarantee (its size and split among incumbent suppliers) may affect competition and prices, currently and in the future, when technology is mature and fixed production costs are high. We find that due to economies of scale a) second period bids, a proxy for future prices, do not monotonically increase in the guarantee, b) first round bids, a proxy for current prices, do not necessarily decrease in the guarantee, as one would intuitively expect, and c) there is benefit from splitting the current volume among suppliers. Total procurement cost over both periods, and hence the success of the guarantee, depends heavily on whether or not suppliers behave strategically.