CHAPTER 1

INTRODUCTION
1.1. Introduction
A restaurant business is a lifetime business, since it provides primary needs of human
beings, which are food and beverages. Restaurant is one of the great industries and never
losing its attractiveness in customer’s persuasion, which is proven by Statistik UKM
2005 that the restaurant industry have inflation around 8,54 from 2003 until 2004 [1].
This industry is full of potential, prospect, fast growing industry, and a business that can
lead to success if the owner is capable to manage and operate it well [2].
Some people may have an idea that it will be easy to establish and manage a restaurant if
it has good quality of taste and cozy environment towards the customers; in fact, there are
several issues that can affect the success of the restaurant. The equipment utilized and the
business process flows of a restaurant are several examples that can construct the way to
be succeeded for a restaurant. It will be useless if the restaurant has a fine quality of taste,
but it has a terrible flow of process that can decrease the process efficiency.
Therefore, it should have a good knowledge towards designing an efficient business
process to increase the performance of the restaurant itself. The implementation of
existing restaurant POS software would be a good idea, but it is hardly affordable for
small and medium business. In order to fulfill the needs of knowledge, this project will
provide an analysis towards existing business process, and develop it to be more efficient
for a restaurant to establish their business. This new business process will be
implementing on compiere erp. compiere erp is an open source ERP system that
mostly used and also provides many customization possibilities from one study abou
comparison of existing open source ERP system [3]. That’s could be the reason why in
this thesis, we will implement the business process on compiere erp
. 1.2 BACKGROUND OF THE STUDY
In our ever-increasingly globalised world, the fast food industry represents billions of
dollars yearly and is still growing, specifically in Asia (Data Monitor, 2005). AC
Nielsen Online Consumer Survey (ACNielsen, 2005) reveals that Asians are the
world’s greatest fast food fans. A total of 30 percent of Asia Pacific consumers eat at
take-away restaurants at least once a week and 35 percent of the population of Asia
Pacific eats at take-away restaurants three times a week and some even more than once a day.
Along with the fast changing lifestyle, eating out habit is becoming a part of modern
lifestyle which has driven customers to try new things and experiences. These
changes have then led fast-food industry to grow rapidly and become one of the
fastest growing business sectors in recent years. The increase in the number of outlets,sals volum
e, recognition and popularity has witnessed the success of fast foodindustry
The growth of the fast food industry shows the dramatic increase of competitions and
challenges in the market. Competition among existing players is becoming much
stronger than before. According to Alonzo (1986), restaurant business is a very high
risk business because about 80% of new businesses including fast food restaurants
(FFRs) fail within the first year. Thus, it is significant to the fast food operators tocraft their
marketing strategies and tactics to generate profits and ensure the growth of
the company. To be specific, the marketing strategies aim at increasing repatronage
intentions and maximising market share in view of the positive impacts on the
financial performance of the organisation
CURRENTSTUATION
Restaurant industry sales continued their moderate
growth between 2009 and 2010. According to.National Restaurant
Associatioreports, restaurant industry revenues are projectednominal growth, such optimism, experts a
mid mixed economic signals, rising labor costs, and a complex
regulatory environment at both the federal andstate levels.Performance Index (RPI) continue to support
the cautious tone in the expectations of NRA experts. The RPIis a combination of the current situation index (de
rivedfrom recent period restaurant industry indicators such
as same-store sales traffic, and labor and capital expenditures) and the expectations index (derived froma
forward-looking or six-month outlook for restaurantindustry indicators) and is based on the NRA’s monthlysur
vey of U.S. restaurateurs. RPI values greater than100 indicate expansion, while values less than 100 sug-gest a
period of contractn for key restaurant industryindicators