Corporate strategy: steakhouse case Essay

Gener all(prenominal)y the efficiency of the production is neglected only when as unaccessible embarks on a assortediation and niche strategy that doesnt profess its competitiveness. All other building blocks of competitive advantages ar addressed, its products atomic itemise 18 of resplendent smell, its products as well as the management remains and the organisational anatomical organise argon innovative and its customer responsiveness is outstanding.Opportunities and ThreatsThe strategic position of remote is primarily determined through companies that argon in the aforesaid(prenominal) strategic convocation moderate price and senior high fibre dinners. The opportunities and threats atomic number 18 mainly the same for that strategic group, the insertion into another group might be desired and would result in a diversification strategy.Indus attack Structure gibe to Porters Five Forces Model, the restaurant industry is highly competitive. The aspiration among established companies is rattling high as inaccessible operates on the matchless hand in the highly fragmented restaurant industry and on the other hand has to compete promptly with a few larger-than-life doctor ups. The demand conditions depend to a high tip on the universal economic situation, but the US market in general advise tho accommodate a limited number of restaurants. The exit barriers argon actually offset. The risk of portal of potential competitors is high as the barriers of entry are very low.The talk terms power of buyers is moderate, all customers account for only a marginal part of the revenues but as the demand is very elastic they tend to switch to the competitors if they are not fully content. The bargaining power of suppliers is moderate to high, the company doesnt depend on angiotensin-converting enzyme single supplier, but on high quality. The threat through shift products is quite high, steaks could be replaced through poultry or completely contrary meals.MacroenvironmentThe macroeconomic environment influences the restaurant industry to a high degree as a decline or growth of the economy influences directly the demand for restaurant food. Further, the US market will be stark(a) with around 550-600 outback(prenominal) restaurants, this offers the fortune of further growth in the succeeding(prenominal) few years but simultaneously imposes the threat of chroma of the guinea pig market and induces the need for an planetary option. In the social environment, the greater health consciousness leads to a lower consumption of red mall.Normally this would be a threat, but as it croup be assumed that volume just switch to going out to eat red meat this could be an opportunity for even greater extension of the business. Further more(prenominal)(prenominal) remote could include healthier options into its menu and diversify into other segments of the restaurant industry. A good opportunity is the expansion into the int ernational market to overcome US-market saturation. Aproblem could be the lack of international experience.Question 2 are Outbacks various strategy components sustainable in the home(prenominal) help market ? throw out they be imitated ? Are they transferable to the international markets ? wherefore ? wherefore not ?1 Strategy components sustainable in the domestic marketThe basic strategy of Outback, a famous US chophouse kitchen stove, was a success, because the image was simple earmark a high quality service for an affordable price.The average price is between 15 and 20 $, so, we washstand deduce that the target of the chain is spunk and upper middle classes. However, most of restaurants share this idea, particularly for this highly competitive domestic market. Outback found enough distinctive competencies to reach its actual level. Outback has different key strategies, which explain the success of the company. The experience accumulated by the deuce-ace creators pe rmits to develop an entrepreneurial spirit and to increase the ack at presentledge on the steackhouse chain market. These abilities take aim given to the top coachs the capacity to create relevant strategies. put of the companyOutback is a steakhouses chain, which decided prototypical to respond at the demand of middle and upper classes basic Ameri nates consumers. So, they absorb to afford good report price-quality, which depends first of all of the quality of the meal and the services provided by the personal. Meals are simple but cope with completely to the wishes of the Ameri nookie consumers. The quality of Outback is insured because of the concomitant they are only open during the night and not twice pro day, which corresponds to the judge target by Outback and the needs of the last one. Organisation structureIn five years, the electronic profit of franchises growth by 400 %. This fact pushed the company to develop a strong logistic network and as well as privilege the relationship with a few suppliers, which became real partners of the company. This gave us the opportunity to gain a high quality product and trustworthiness can be established. For the suppliers, the advantages are valuables because they know that they will continue their products if they nevertheless provide the same level of quality expected. For Outback, it gives the opportunity to obtain low prices and surety of the food. The high number of restaurants asked for a relevant logistic structure in commit to provide the best product on time for all franchises.In order to gain economies of scale, Outback allowed a franchise system. This gives the opportunity to reduce costs and to be implemented in various areas without high investment departures. Following the growth of the company, Outback neuterd the organisational structure to be more efficient and have more control on the brand image. They are developing better relationship between the headquarter and the partners. Thes e latter have now stock options. This salary plan gives them motivation and accuracy in their job, because it guarantees a real engagement from the employees. Human resources strategyA real consideration of the human resource is done by Outback. The unified estimate that better working conditions and working schedule give more motivation to the employees. They feel comfortable within the company and are readier to pack at the injection of the headquarter. Location strategyAfter study of the view and demographics particularities of a county, it seems that all the restaurant are established in detail distribution area. They set up the restaurant near dynamic region and easy to go, which remains middle class population. Communication polityAt the beginning, Outback privileged local target population. Then, they extend their communication network by sponsoring specific events, as sport or charity events. A lot of support as television, billboard and radio are use because it is the best way to touch an importationant number of potential consumers.2- Can they be imitated ?On the domestic market, Outback has many steakhouse chain competitors. Each brand is trying to find a niche. scarcely some strategies can be easily imitated such as the geographic carrying into action and the target. The thematic of the restaurant was existing before the creation of Outback and the system of franchise is not adopt only by the restaurant bondage. But Outback is able to put some entries barriers. The experience of the top manager is very helpful and contribute to create a trustworthiness from the employees. The synergism between the suppliers and the franchises gives at Outback more confidence on the prospective and more competitive.3 Are they transferable to the international markets ? Why ? Why not ?The excogitation of steakhouse chain, as Outback, seems to be adaptable in foreign countries. The company has two choices. First of all, it can keep its concept of Ame rican steakhouse chain within foreigner culture. Or it can also adapt to the country culture and has the ability to modify its concept and integrate it completely in the country chosen. Outback has the opportunity to internationalize its strategy, but the company has to take care about the way to do it.-The food habits is a first problem because a lot of Moslem countries cannot consume beef. Outback has to do a geographic selection-According to the policy of a country, the American restaurant can or cannot be set up as in Irak or northwards Korea. The American corporate culture can be a barrier of establishment too. Outback has to think about the suppliers network. Some solutions appear as food export or licensing. But these strategies have a mean disadvantage the local population may expect to eat local product-Outback has to spay the organisational structure in order to integrate an international division. The structure can add a foreign operations department to their existin g structure and contribute to use the same control system.3.- The countries, which Outback should enter, are in hierarchic descending order as follows1.- SOUTH KOREAAdvantages1)Good economic development.2)Politically stable.3)Easy to import American style to South Korean.4)Infrastructures improvements.Disadvantages Obstacles for US firms (regulation for labeling, sanitary standards)Modifications needed occupy to be financially sound company, because South Korea is an emergent market with good-looking opportunities of growing and so that big investments will be needed. The firm will have to adapt to the sanitary standards, they will have to cope with perfunctory problems relate with quarantine of some products.2.- UKAdvantages 1) Common language, business practices facilitates US entry 2) No restriction on foreign ownership and movement capital, boil flexibility. Free enterprise and open competition in UK. 3) UK find US goods and services very attractive.4) Abolition of internal trade barriers (UK as a gateway to the rest of EU).5) Very good communication networkDisadvantages As UK is a gateway to the rest of European countries is of vital importance the role-play in UK, depending whether is successful or not the European adventure will be better or worst.Modifications needed Very low rate of modifications are needed to enter in the UK market, as we have said antecedently US and UK have common language and have very next culture.3.- CANADAAdvantages1)Business practices alike to US and US goods are well received in Canada. 2) Very good economic development.3) Very good communication network and very close to North America, which will reduce communications and tape drive costs.Disadvantages The linguistic and cultural problems that are taking place in Canada make a tense situation.Modifications needed As a result of the disadvantages related before it would be necessary to have employees with knowledge of French and/or English.4.- MEXICOAdvantages 1) They have improved infrastructures 2) Despite the economics problems at that place are opportunities for North American firms but they will provide low cost products, because of the low buying power of Mexican throng. 3) Duty free to exports.4) It is geographically very close to North America, so that transportation as communications are easier.Disadvantages 1) Political reforms, which make of Mexico not a very stable country.2) No good economic development.Modifications needed1)As we have written is necessary to change the prices in order to adapt to the low buying power of the Mexican people.2)Related with the previous point it would be interesting to create a pond in order toavoid the possible devaluations in the national currency.Germany and japan are more difficult markets to enter into by the company. See auxiliary for advantages, disadvantages and changes needed.4.- As result of the previous SWOT analysis we can maintain that Outback has the opportunity, the intention and th e necessity to expand the company into the international market.OPPORTUNITIESIncomes have risen globally, so that there is more money to expend on, when master(a) needs are fed another kind of needs appear. Outback has to take advantage of this and enter into new markets. Related with that the increasing number of women entering the work force which means that if traditionally women have to cook, straight off they dont have too much time for it, and so that restaurants with good quality food and family oriented are highly cherished by working women. In other side demographic concentrations of people in urban areas, which make necessary to have different offers of restaurants. A good opportunity is the willingness of younger generation to try new products, we have as an example the Japanese young people.Although in Japan still remain some conservative customers, new generations are willing to try new kind of products coming for another countries. Also is very definitive to point out the improved international transportation, this is very important because can reduce the costs of export restaurants assets into another international country, as we have already said. Although there are very similar firms operating at the moment in the market, US food themes are very popular abroad. In order to reduce market saturation Outback has used joint ventures with an Italian chain (Canabbas Italian Grills)INTENTIONWe see the will to expand when for example, in 1994 the firm didnt pay dividends despite the good profit, the reason was to invest the money to be able to expand to international markets.NECESSITYThe saturation of the US fast-food chains make that Outback looks for new countries where it can operate and grow there are very similar firms operating at the moment but US food themes are very popular abroad. Although in order to reduce this market saturation Outback has used joint ventures with an Italian chain (Canabbas Italian Grills)