Strategic Plan Part II – SWOTT Analysis

Week Three- Strategic Plan Part II: SWOTT Analysis

BUS/475

A business owner needs to realize that while there is great potential to succeed there is equal potential to fail. One of the greatest factors of success or failure is external factors and how they will play a role in the operations of a business. In this paper there will be a definition of some external factors for the Windy City Deli and how well the deli adapts to these factors. Analysis of the supply chain of operations will also be taken into consideration along with the identification of other issues and opportunities that may occur.

Economic, Legal and Regulatory Forces and Trends

In regardto external social forces/trends, there are several forces that create animpact on my business. For one, the grip of obesity on America has forced several individuals, especially youngsters, to eat healthy and reduce their waistlines. Indeed, one of the most successful fast food chains has not been McDonald’sor Burger King, but has been Subway (Subway, 2011).With their attractive pricing and healthy options, Subway has been far more profitable where other restaurants and chains have faltered. The Coachella Valley has two distinct colleges within a 5 mile radius of deli, there becan expectations to find college aged individualsdominating a large percentage of the customers at restaurant later in the afternoons. Because these health trends are extremely popular among the youth, it makes sense that these social factors of health conformity are a huge positive trend towardthe deli. College kids are more likely to be health conscious because it is the norm to be in shape and fit at that age. Therefore, by eating healthy sandwiches provided by the deli, they are a positive external force.

Competitive analysis as an external force/trend is quite interesting. Since the deli is in Southern Californiathere is a high population of Hispanics. Mexican cuisine is quite prevalent in the area and a Chicago themed restaurant would be an outlier among the usual fast food chains and the family-owned restaurants. This provides an advantage as the deli has something new, and different to offer. In addition, the restaurant is locatedin a downtown area gives advantages over restaurants not downtown. Downtown areas are usually home to many offices and small business employing workers. These businesses employ white-collared professionals who would most probably leave for lunch around the same time. Perhaps some sort of discount to employees who come in large groups could give the deli a loyal following. The installation of flat screen TVS displaying news items and economic information is material that is, generally, attractive to white-collared professionals. Because the deli will be in a location wherethese workers work, I have to cater to them this way and offer an attractive environment in which they can relax and unwind for lunch. Downtown areas are also hot spots for tourist exploringattractions of the city. As Southern California is a state with warms temperatures all year round, I expect people to at least stop for food or for something to drink. Given that families that usually do not come downtown do not see my restaurant as often, it may be an attractive choice to those who want to try something new.

External technological forces/trendscould go either way depending on how the business is opened. First impressions do matter – as much asbusinesses don’twant them to; with websites like yelp.com, there are several reviews of businesses available online. Yelp.com could tend to easily influence a potential customer even though it’s written by an amateur blogger– be it positive or negative. In this situation, it is very important that the restaurant makes a strong first impression. Older reviews on websites are usually at the top and have the most views so it is important that the first review is written well and is in favor of the deli. Alsocollege newspapers are a popular source of information to students and perhaps some sort of coupon or deal in the school newspaper would be a good way to lure students to the restaurant. Becausethe written part of paper has its counterpart on the web, online advertising would probably be a more attractive option because college students are more likely to read information online than in physical print; this is just more sensible of a thing to do.

Supply Chains Organizations Impacts

Considering the obtainment of resources for any business, a strong force that can negatively/positively affect the deli is the cost of transportation of materials. Originally, the plan was to transport fresh material daily through air from Chicago itself. However, this would be inefficient and extremely expensive. It makes more sense that these material are obtained from a truck transporting material on a weekly basis. These materials should be itemsthat would definitely have to be imported from Chicago because they have to be authentic Chicago foods. For example, the processed meat and the hot dogs that will be usedin the food should be imported from Chicago. On the other hand, ingredients such as vegetables, flour, and other raw materials can be obtainedlocally. This would also prove to be cheaper because it lessen the amount of materials imported from a long distance.

Identification of Issues or Opportunities

Culture

Culture is another internal force, which can make the deli a great and popular place. Having a family-owned business with a small group of friendly employees makes a huge difference in how a restaurant is perceived. Hiring employees whonot affiliated with the business owners generally results in employees who do their job but may not necessarily enjoy or take part in the enjoyment that the owners may have in operating the business; in other words, these employees will do their job but they will nothave the passion that family members would have if they ran the business. Generally, the friendly service that customers will receivefrom the deli will likely be an incentive for them to return again. The TV panels that will be providedfor viewing in the deli will be in several corners are important because they cater to different types of people; for example, the white-collared professional would enjoy watching TV programming relevant to what they enjoy whereas the sports fan would enjoy watching television relevant to theirliking. The feeling should be relaxing enough that customers will want to continue to hang out after their meal. Over time, places like these become a sort of “favorite” hang out for people; this is very similar to how bars become places where people can hangout and relax while watching TV and sipping on drinks and eating. With technology being so prevalent and because this is a college area, it is expectedthat people will have laptops and other portable electronic devices. Offering free Wi-Fi is essential in getting customers to stay longer.

Leadership

Leadership is an essential part of any business and can lead to better efficiency. It’s very important for my business to have a good leader. In a small business situation the leader should be the owner, there is a sense of warmth and gratitude when being greeted and served by the owner. Sometimes, a customer may ask a certain question that requires a bit of prerequisite knowledge about a certain type of food or product and to answer the question. When the owner is the leader, and a part of the general operations, that knowledge is passed on the other employees when the owner is serving the guests. Good leadership also is integral to making a business run smoothly. There usually has to be someone “in charge” that can direct people around in case they are lost. In this case, if an employee is making a certain product and is confused on how to finish it or continue with it, the “leader” can usually step in and aid in the completion of the product. Therefore, a good leader will run the business in a smooth manner while the lack of a leader can result in the business losing money because of customer dissatisfaction (due to problems such as excessive wait for food, bad service, bad food, etc.)

Strategy

The internal strategy will be to keep consumers pleased and to keep their visit to the deli memorable so they would want to come there again. Keeping the place a sit-in allows customers to enjoy the atmosphere and savor the taste of their food in a Chicago type atmosphere. With the added flat-panel displays, they have something to keep them occupied and enjoy their stay. To keep the menu a bit unique, there would be a diversified menu by serving specific “specials” on different days of the week. There would also be incentives provided in the form of discounts for a large group of people, such as office parties.

Economic

Economic forces and trends that can benefit or work against the deli are most definitely include the price of oil and prices of raw materials. Becausetransportation is a must in any business to bring materials to the deli, rising gas prices will hurt business and cost more. Similarly, a drought in the area will also exacerbate the situation and raise prices of raw materials to be used in the deli. Of the two local colleges, one offers undergraduate and graduate level programs so in a worsening economy, we can see that many people would enroll in a graduate program. This would increase the number of potential customers increasing business.

Regulatory

In regards to regulatory forces/trends that would affect this business would be the health inspection and how they regulate length of time a certain product is fresh. As an example, if health regulations do notallow beef to stay out for a certain amount of time or travel for a certain amount of time from one place to another, theremay have to be an adoption of faster ways that the beef can be transportedfaster. This may require the use of shipping through air and that would cost more. By not following these procedures, laws would be broken and there would be the risk of the business closing.

Becausethis is a small deli, it would not be too difficult to make changes unless the changes are extreme – like the change corresponding to the faster transportation of meat. Making changes to the menu or making different items is usually just a change in how a certain product is prepared. Becausedelis usually provide food made through the same ingredients mixed in different ways, this will not be very difficult changes to apply. However, if people were to ask for coffee in the deli, coffee-related products would have to be purchased and that could take some time for delivery. The deli is a small scalebusiness; it is easier toapply changes than it is for bigger businesses that may be spread out in several locations.

Global

The most recent global issue for most business right now is the price of oil. Gas keeps the trucks moving whether they will be carrying the meat, vegetables or cheese products;it will be an unavoidable cost. With rising gas prices, posses a real threat to the sustainability of the deli. All forms of delivery will be examined to ensure that the best price is acquired alongside the best quality.

Processes and Systems

Providing great service seems almost nonsensical as every business strives to do so. Small businesses have to make greater strides in this department. Consistency is the key in order to be consistent a system or process is needed for every detail. When there are definite procedures for the everyday tasks the employees and the customers know what to expect. For instance the opening and closing procedures will have specific tasks and duties every day. This type of consistency will keep a positive momentum.

Conclusion

In the world of business today careful consideration has to be taken in regards to several internal and external forces. Both internal and external forces can have a positive or negative effect an organization. After examining several internal and external factors, the Windy City Deli will face some challenges ahead. However armed with a strategic plan for the possibilities that lie ahead will arm the deli with the possibility to succeed.

References

Pearce, John A. ,& Robinson, Richard B. . (2009). Strategic management.formulation, implementation, and control. United States: McGraw-Hill.

Thompson, Arthur A. , Gamble, John E. , & Strickland, A. J. (2006). Strategy: winning in the marketplace: core concepts, analytical tools, cases. United States: McGraw-Hill Companies.