Estimating sales figures. 2

“Estimate sales of a university cafeteria.”

There are 5 steps in the Fermi estimate.

１.Verify the precondition.

２.Determine how to approach.

３.Make an estimate model.

４.Calculate.

５.Compare with the actual numerical values.

Solve the problem along these steps.

１.Verify the precondition.

Read the sentences of the problem thoroughly, and verify the definition of the sentences. In this exercise:

University cafeteria defines that it is on a university campus where the author attended.
Sales defines that it is the average sales per day on weekdays.
Customers defines that they are all university students.

The preconditions have been put.

２.Determine how to approach.

In order to estimate, set the calculation formula that matches it. In this exercise, you are estimating the sales, therefore the calculation formula would be:

Sales=Average price per customer × Number of customers.

Number of customers=Capacity × Utilization rate × Turnover rate × Hours of operation.

These are the calculation formulas.

Here are the explanations about each element of the number of customers.

Capacity:

It defines that how many people can be accommodated in a certain space. For example, when there are 100 seats in the restaurant, the capacity is 100.

Utilization rate:

It is a ratio that defines the percentages of the utilization in the capacity in certain periods of time. For example, the capacity of the restaurant is 100, and when there are 50 customers in the restaurant, the utilization rate is 50%.

Turnover rate:

It is a ratio that defines the number of people who come and go in a certain period of time. For example, when a customer stays in a restaurant for 30 minutes on average, the turnover rate per hour is 2.

Hours of operation:

It defines the period that the store is open. For example, when the store is open from 11:00 to 23:00, the hours of operation is 12 hours.