DEA Efficiency with Side Constraints Review Exercise 5.5. After looking at the analysis, your corporate client proposes a refinement. Since the corporation has emphasized market share in other divisions, the following constraint is suggested: the virtual Exercise :
Evaluating Restaurant Efficiency Celia's Tacqueria is a chain of five Mexican restaurants in Florida. A DEA evaluation is being conducted to make comparisons of the different locations. Input measures for the restaurants include weekly hours of operation, fulltime equivalent staff, and weekly supply expenses. Output measures of performance include average weekly contribution to profit, market share, and annual growth rate. Data for the input and output measures are shown in Table.
(a) Perform a DEA evaluation for this set of units, listing the efficiency and the virtual outputs for each of restaurants.
(b) For each of the inefficient units, find the reference set and calculate the inputs and outputs for a corresponding HCU.
Table . Inputs and Outputs for Five Restaurants
|
Restaurant
|
Input measures
|
|
Hours of operation
|
Fit
staff
|
Supplies
($)
|
|
Jacksonville
|
96
|
16
|
850
|
|
Daytona
|
110
|
22
|
1400
|
|
Gainesville
|
100
|
18
|
1200
|
|
Ocala
|
125
|
25
|
1500
|
|
Orlando
|
120
|
24
|
1600
|
|
|
Output measures
|
|
|
Weekly
|
% Market
|
% Growth
|
|
Restaurant
|
profit ($)
|
share
|
rate
|
|
Jacksonville
|
3800
|
25
|
8.0
|
|
Daytona
|
4600
|
32
|
8.5
|
|
Gainesville
|
4400
|
35
|
8.0
|
|
Ocala
|
6500
|
30
|
10.0
|
|
Orlando
|
6000
|
28
|
9.0
|
output for market share should be at least 150 percent of the virtual output from either profit or growth.
(a) With the side constraints added, calculate the efficiencies of the five restaurants.
(b) What are the advantages and disadvantages of using the side constraint?