Analyzing Cost Volume Profit Relationship On Small Fast Food Shop(A Study On Bangladeshi Fast Food Industry)

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Analyzing Cost Volume Profit Relationship On Small Fast Food Shop(A Study On Bangladeshi Fast Food Industry)

Journal Title: International Journal of Business and Management Invention - Year 2018, Vol 7, Issue 11

Abstract

The paper presents the stage of knowledge the cost-volume-profit analysis (CVP analysis), namely the principles, objectives and its usefulness for the cost management of small fast food business. The main objective of the paper is to establish the relationship between cost and profitability. To achieve the main goal of the research, we approached concepts such as costs, sales, production volume, profit, decision making, what if analysis needed by the management to develop different scenarios on production volume, cost, sales price that lead to conclusive decisions in the near future. The research methodology corresponds to the research objective and is circumscribed to an archival research regarding literature review. The basis of the research is the small fast food business, in which we studied the impact of CVP analysis on their activity. To reach the aim of the research, we have developed a questionnaire to conduct the research. Two types of questionnaires have been developed for identifying the financial factors and non-financial factors. Most of the businesses are not interested to disclose their information which is a barrier to conduct a survey. When I circulate the questionnaire to fifteen different types of small fast food business, among them twelve shops agreed to participate in the survey. For determining the relationship strength among the variable I choose correlation and coefficient analysis. I also analyzed the upper limit and lower limit for correlation and coefficient. I conduct one sample T-Test with multiple regression to test the hypothesis considering H0= No Relationship between (cost, volume) and profitability. As we know the fast food industry is very large, so it’s very difficult to cover the whole industry. For this reason I focused on only the small fast food business. There is also limited numbers of journal publications available in online that hinder to construct most informative literature review. So, in near future before conducting a research we can take permission from business authority that will add value to further research and we should collect financial information for determining the relationship among cost, volume and profitability. We have to focus on developing relationship based on categorical variables that limit the outcome of the research where as actual relationship can only be determined on the basis of real life financial information. For conducting a more accurate research number of variables could be more for both financial and non financial side of a business.

Authors and Affiliations

Arif Ahsan

Keywords

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EP ID EP416085
DOI -
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