Prestige Institute of Management &

Research

Presentation
of
Strategic Management

Submitted to: Submitted By:

Prof Ranjana Patel Anushree Bakliwal
Ruchi Katare
Shikha Rawat
Shivani Patel
Tapish Chandwaskar
MBA Core Sec IV
FAST FOOD
 Fast Food Industry
• Fast food is the term given to food that can be prepared
and served very quickly.
• While any meal with low preparation time can be
considered to be fast food, typically the term refers to
food sold in a restaurant or store with preheated or
precooked ingredients, and served to the customer in a
packaged form for take-out/take-away.
• Outlets may be stands or kiosks, which may provide no
shelter or seating, or fast food restaurants.
• Franchise operations which are part of restaurant chains
have standardized foodstuffs shipped to each restaurant
from central locations.
 Start of Fast Food Culture
• The concept of fast food pops up during 1920s.
• The term "fast food" was recognized in a
dictionary by Merriam–Webster in 1951.
• The concept of ready-cooked food for sale is
closely connected with urban development.
• In Ancient Rome, cities had street stands that
sold bread and wine.
• A fixture of East Asian cities is the noodle
shop.
• Several factors that contributed to this explosive
growth in 1950’s were:
(1) America’s love affair with the automobiles.
(2) The construction of a major new highway system.
(3) The development of sub-urban communities.
(4) The baby boom subsequent to world war second.
“Fast-food chains initially catered to automobile
owners in suburbia
 FAST FOOD-THE INDIAN WAY
Mr. Dhirubhai Ambani is said to have
started the first Fast Food venture by
selling "pakora (Indian fast food snack)" to
pilgrims in Mount Girnar over the
weekends in 1932.
The fast-food giant McDonalds opened
its first restaurant in India at Vasant Vihar
in south Delhi on October 13, 1996
The Pizza Hut franchise also stepped into
the Indian fast food market by opening a
dine-in restaurant at Bangalore.
Fast food is one of the world’s fastest
growing food types. The fast food industry
in India is growing by 41% a year.
The Indian fast food market is growing at the rate of 30-35% per
annum.
It’s reached to nearly USD 6 billion in 2007.
Foreign Investment holds about one-fourth of the total investments
made in this sector.
Reasons:
– Growth in nuclear families.
– Exposure to global media.
– An increasing number of working
women.
– Customer sophistication &
confidence.
– Double Income Group.
– Large Population.
– Relaxation in rules & regulations.
 SWOT Analysis
Strengths Weaknesses
• Quick Service
• Affordable • Different Preferences
• Attraction • Lack of customization
• Perceived quality for price • Unhygienic and unhealthy
• Long market history and • Limited menu
fanatic followers
• Employee satisfaction high
• 24 hours service
 Opportunities Threats

• Expansion via franchising or • Oppositions from various

direct expansion. organizations.
• Growing nuclear families. • Location.
• Growing urban lifestyle. • Ready- to-eat products
• Health Concerns.
 INTRODUCTION
• 1967 - First Domino’s outlet in USA
• 1996 - First Domino’s in India at New Delhi
• It is one of the chains under Jubilant Food Works
Limited.
• 300 outlets in India in 22 cities with 9000
employees.
• The USP of Domino’s is the “30 minute Delivery”
agenda.
• Domino's is the second-largest pizza chain in the
United States and has nearly 9,000 corporate
and franchised stores in 60 international markets & all
50 U.S. states.
• The menu features pizza, pasta, oven-baked
sandwiches, wings, boneless chicken, salads,
breadsticks, cheese sticks, and a variety of dessert
items.
• Domino’s has introduced a new menu including Mexican
wrap & Italian pasta.
 Profit Margins
• Income for the year is about Rs420crores which
around 50% more that the previous year.
• During inflation the price of the most items was
increased by Rs 100/- to Rs 200/- on an average.
 SWOT Analysis
Strengths:
• Leading pizza delivery company in the US with more
than 5,000 stores in the US
• Global franchise operations - more than 3,500 in over
50 countries
• Strong brand equity supported by heavy advertising &
marketing campaigns
• Supply chain & distribution network
• Leader in online & mobile ordering
• Well projected campaigns
 Weaknesses
• Slow growing and declining same-store sales
• Weakening bottom line
• High staff turnover due to lack of training and
development
• Same and industrial flavor
• Same effin sauce
 Opportunities
• Growing presence in emerging markets, particularly in
India, China
• Leverage supply chain & distribution system to
introduce new products.

Threats
• Changing consumer habits towards healthier food
choices
• Franchise operations affected by currency exchange
fluctuations
• Intensive competition from a fragmented number of
small competitors
 ETOP ANALYSIS
Impact Importance Opportunities Threats

Political 8 6 48

Economical 8 5 40

Socio-cultural 6 5 30

Technological 4 5 20

Legal 7 6
 Pizza Hut: History
• Pizza Hut (corporately known as Pizza Hut, Inc.) is an
American restaurant chain and international franchise
that offers different styles of pizza along with side
dishes including pasta, buffalo wings, breadsticks, and
garlic bread.
• Pizza Hut is a subsidiary of Yum! Brands, Inc. (the
world's largest restaurant company)
• It has approximately 34,000 restaurants, delivery/carry-
out locations, and kiosks in 100 countries
• The chain was founded as a pizzeria in 1958 by
the Carney brothers - Dan and Frank.
Locations LOCATIONS
 SWOT Analysis

Strengths
• Part of the largest restaurant chain in the world
• Over 20,000 franchises around the world
• Brand leader in the UK
• Innovative range of pizzas under one roof
• Famous television advertising
• Food attracts people of various ranges from young to old.
• Sound financial situation and international turnover.
• 100% owned by yum!
• Pizza Hut sits on top of global full-service restaurant tree
Weaknesses
• Loyal customers are feeling that the satisfaction of the pizzas is
declining.
• While Novak said Pizza Hut’s expansion into China is going
exceedingly well, there is battling problems in New Zealand and
Australia.
• There are complex computer systems and internal conflicts from
franchisees.
• There is a lack of an organic pizzas, which will limit the target market

Threat
• Rising competition undermines Pizza Hut as consumers go for greater
convenience
• Rising cheese costs threaten margins
• Threat from Dominos pizza, also from Mc Donald’s who have tried to
introduce a new meal that is a Pizza called: McPizza.
 Opportunities

• New Pizzas with different crust sizes and flavours.

• Pizza Hut expands Indian market menu and looks to
old favourite to bolster sales in the US
• Pizza Hut targets upscale products and a downscale
consumer base
 ETOP ANALYSIS
Impact Importance Opportunities Threats

Political 7 8 56

Economical 8 5 40

Socio-cultural 9 9 81

Technological 5 8 40

Legal 7 6 42

Competitors 7 7 49
 Kentucky Fried Chicken
History
• Founder
– Colonel Harland Sanders

• Beginning Developments
• Change of Ownership
– Harland Sanders
– Jack Massey
• John Young Brown Jr.
 Major Fast-Food Segments

• Six Major business segments

– Sandwich Chains
– Dinner Houses
– Grilled Buffet Chains
– Family Restaurants
– Pizza Chains
– Chicken Chains
 SWOT Analysis

Strengths
KFC’s secret recipe
Name recognition and reputation
International expansion and expansion through franchising
Co-Branding
Neighbourhood Program
Weaknesses
• Many sales of KFC
• Limited menu offerings
• Inability to quickly bring new products to market
• PepsiCo’s poor relationship with franchises
• Failure to penetrate in some foreign markets
Opportunities
• The Mexican market
• Peso devaluation
• “Dual branding”
• New franchise laws in Mexico
• Australian opportunity
• New distribution channels

Threats
• Saturation of the U.S. market
• Increasing competition and rising sales of substitute products
• Changing preferences of consumers
• Obstacles associated with expansion in Mexico
 ETOP ANALYSIS
Impact Importance Opportunities Threats

Political 7 8 56

Economical 8 5 40

Socio-cultural 9 5 45

Technological 5 7 40

Legal 7 6 42
MC DONALD’S
INTRODUCTION..
Restaurants
Industry

May 15, 1940 in San Bernardino,

California;
Founded McDonald's Corporation, April
15, 1955 in Des Plaines, Illinois

Richard and Maurice McDonald

McDonald's restaurant concept;
Founder(s) Ray Kroc, McDonald's
Corporation founder.

Headquarters Oak Brook, Illinois, U.S.

Number of locations 32,000+ worldwide

Key people James A. Skinner
(Chairman & CEO)

Area served Worldwide

Fast food
(hamburgers • chicken • french
Products fries • soft drinks • coffee •
milkshakes • salads • desserts •
breakfast)

Employees 400,000 (2010)

Website McDonalds.com
HISTORY..
The business began in 1940, with a restaurant opened by
brothers Richard and Maurice McDonald in San
Bernardino, California. Their introduction of the
"Speedee Service System" in 1948 established the
principles of the modern fast-food restaurant.

McDonald's Corporation is the world's largest

chain of hamburger fast food restaurants,
serving more than 58 million customers daily.
A McDonald's restaurant is operated by either a
franchisee, an affiliate, or the corporation itself.

McDonald's has opened its door in India in October 1996.

McDonald's primarily sells hamburgers, cheeseburgers,

chicken products, french fries, breakfast items, soft drinks,
shakes, and desserts.
In response to obesity trends in Western nations and in the
face of criticism over the healthiness of its products, the
company has modified its menu to include alternatives
considered healthier such as salads, wraps and fruit.
ABOUT..
 Approximately 85% of McDonald's restaurant
businesses world-wide are owned and operated by franchisees.
All franchisees are independent, full-time operators.

 They have an efficient, assembly line style of food

preparation.

 McDonald's foods are purchased from only certified and

inspected suppliers. McDonalds works closely with ranchers,
growers and suppliers to ensure food quality and freshness.
 McDonald's takes food safety very seriously. More than
2000 inspections checks are performed at every stage of the
food process. McDonalds are required to run through 72
safety protocols every day to ensure the food is maintained in
a clean contaminate free environment.

 McDonald's was the first restaurant of its type to provide

consumers with nutrition information. Nutrition
information is printed on all packaging and more recently
added to the McDonald's Internet site.
Target Market
• Low to Mid income

• Busy people – anyone on the go!

– Families (Happy Meal)
– Teenagers
– College students
 SWOT Analysis

STRENGTHS
• Very strong brand name

• They are a global company operating more than 32000 restaurants in 109
countries.

• Large target group

• Cost Advantages

• New stores almost 100% guaranteed to succeed

• Ability to adapt when faced with criticism

• Play Area for children

 WEAKNESSES
• High employee turnover in their restaurants
leads to more money being spent on training.

• They have yet to capitalize on the trend

towards organic foods
 OPPORTUNITIES
• Low interest rates provide cheap capital for growth.

• Expand into Tier1 and Tier 2 cities

• Entry into breakfast category

 THREATS
• Changing customer lifestyle

• Increase in competition

• Criticism – contribute to
obesity, and other health
problems
 ETOP ANALYSIS
Impact Importance Opportunities Threats

Political 8 8 64

Economical 9 7 63

Socio-cultural 9 9 81

Technological 6 9 54

Legal 7 6 42

Competitors 7 7 49
 Burger King
• A global chain of hamburger fast food restaurants
headquartered in unincorporated Miami-Dade
County, Florida, United States.
• Started in 1953 as Insta-Burger King.
• 7,800 restaurants (domestic)
• 21.9% of fast-food market share
• Added a multi-tiered value menu in 1993 with items
priced at 99¢, $1.99 and $2.99 (USD) to better
compete with its competitors.
• Burger King was first to introduce the dine-
in concept, and drive-through food service.
• Strategy:
– New color scheme (blue instead of tan & brick)
– Different style interior
– Open kitchen to show off flame-broiled cooking
– “Virtual fun centers” to play areas that provides
electronic interactive games.
– Same menu but new cooking units.
 SWOT Analysis
Strengths:
– Second largest fast food hamburger restaurant (FFHR)
in the world
– Strong brand equity
– Growth model not capital intensive: 90% of its
restaurants are owned by franchisees
– Strong financial performance.
Weaknesses:
– Heavily concentrated in the US: about 65% of operations
– Not enough corporately owned stores means it relies
heavily on franchisees to execute its brand promise.
Opportunities:
– New product development, particularly around breakfast
– Keep building its brand through ad campaign, such as the
Whopper Virgin's
– Expansion into emerging markets
Threats:
– Changing consumer habits towards healthier food
choices.
– Away-from home consumption declines in the US due to
tougher consumer environment
– Intense competition from McDonald's, other restaurants
and even retailers
– Increasing labor costs putting pressure on bottom line
 ETOP ANALYSIS

Impact Importance Opportunities Threats

Political 6 8 48

Economical 6 7 42

Socio-cultural 6 5 30

Technological 5 5 25

Legal 7 5 35