Amrest company business plan - 2750 Words

Amrest company business plan (Essay Sample) Content: AmRest Restaurant Company Student's Number Date AmRest Restaurant Company Introduction AmRest is an international company headquartered in Wroclaw, Poland that deals majorly with the operations in the hospitality industry, especially in the fast food and dining restaurants. Thus, some of its products include French fries, hamburgers, the Burger King Whopper (a brand it is associated with too) and Animal Fries CITATION Amr15 \l 1033 (Amrest, 2015). The company went public in 2005 thus placing it in the list of Warsaw Stock Exchange, and has since expanded in the hospitality industry in Europe (currently operating restaurants in 12 countries) and even the United States CITATION Amr15 \l 1033 (Amrest, 2015). The company was initiated as a joint venture between American Restaurants and Yum! Inc. and was referred to as the AmRest Holdings. Since then, acquired other operator companies such as IFFP (International Fast Food Polska), Restauravia and, recently, Starbucks restaurants in Germany. As a result of its acquisition and expansion ventures, this operator has been associated, majorly, with six brands. These include: Burger King, Starbucks (especially in Germany), Pizza Hut, KFC, Applebee's and La Tagliatella. The current company CEO (Chief Executive Officer) and chairman is McGovern Henry. The Marketing Environment * External Environment: PESTLE AmRest's Marketing environment comprises versatile and dynamic characteristics that shift across its international market. For instance, social, political, ethical, legal and economic conditions vary across the 12 countries it operates its restaurants and this, more often, have a direct influence of the preferences on their products. The characteristics of these market environment conditions are as described in the PESTLE Analysis below: Political Since AmRest is an international company, it is greatly influenced by changing political issues across the countries it operates in. For instance, the recent invasion of Russia in Ukraine, in Eastern Europe, led to sanctions that greatly affected the AmRest's business operations. This is because this sanctions led directly to the devaluation of the ruble and volatile exchange rates that impaired normal movement of AmRest's goods and services across to Russia. Thus, AmRest was forced to change it long term plans as a result of unpredictable stances by Putin's government CITATION Mar14 \l 1033 (Marketinsider, 2014). Economic The economies, especially of the Eurozone, have experiences the most turmoil during this decade. From the Greece crisis to the recent Brexit, the value of the Euro and its rate fluctuations has become unpredictable. As a result of this, there is a risk of huge debt deficits in individual countries such as the Greece debt. Furthermore, there is the cause of a weakening Russian ruble has seen investments into this emerging market become less costly but politically uncertain. Despite this negative characteristics, Amrest has received high growth rates in countries in Europe such as Spain because of her stable and growing economy CITATION Mar14 \l 1033 (Marketinsider, 2014). Social-cultural The Eurozone, and in particular, the countries that AmRest operates span across the European continent. From Spain to Russia, AmRest is affected by differing cultural and language orientations that often influences the preferences of its products. Despite this, the AmRest Brand and its other brands are recognized internationally and are popular especially in Europe. This aspect as had a direct positive influence on preference of its products. For instance, in Spain, the company has experienced an increase in the buying patterns of its products in relation to particular brands offered by the company CITATION Mar14 \l 1033 (Marketinsider, 2014). This is also the case in Germany especially after the recent acquisition of restaurants formerly operated by Starbucks. Technological When it comes to the technological aspect, AmRest has been able to increase and grow substantially since the introduction of the internet and the portable smartphones. By implementing new invention and applications of the smartphone and the internet, AmRest has been able to reach a wider customer portfolio. For instance, in the use of the internet, AmRest has set up its own website where clients can be able to order its products online for delivery. This can also be done conveniently using smartphones that can call and even access the internet at the same time. Moreover, AmRest has been able to use its website to advertise its current product portfolio and even measure the levels of customer satisfaction through flow up surveys and similar strategies. Legal In the current global economy, international trade is affected by legislature that regulates and determines custom duties and import restrictions. Furthermore, the most recent influence of legislature to AmRest is the interest of countries and their governments to control global warming and protect the environment. When it comes to the latter, AmRest is obligated by law, especially in countries such as the USA to reduce and monitor and regulate its waste. As a result, the carbon footprint and global warming impact of AmRest is monitored and the company is obligated by the US government to do so. This has affected budget allocations in as far as AmRest's financial expenditure is concerned. For instance, AmRest has diverted a substantial amount of its annual expenditure to the recycling of plastic and intends to do so in countries where it has to implement this environmental protection strategy. * Internal Environment: AmRest's SWOT Strengths The company has a strong distribution and sales networks that keeps on growing as the company continuously acquires other competitor companies such as in the Starbucks scenario in Germany. This networks have increased the competitive aspect of AmRest. In addition to this, high profitability in stable economies such as in Spain have contributed to the growth of the company and the overall reduction in the costs of its products and services CITATION Tre12 \l 1033 (Tremblay Tremblay, 2012). This aspect as completely led to the high competitive nature of this restaurant operator in Europe and thus a further increase in its profits. Weaknesses The first profound weakness to AmRest is its financial constraints caused by high interest rates that have impaired the ability of the company to secure loans for development in emerging markets such as Russia and China. This has thus reduced the ability of the company to expand into other emerging markets such those in Africa. Furthermore, the fact that it is a restaurant operator makes the company lose direct control of it restaurants because it uses the franchise system of operation CITATION Ols08 \l 1033 (Olson Bever, 2008). This indirect control may pose a challenge to management and has been known to be the major cause of failure in restaurants especially when an operator seeks to venture into a new market. AmRest's Strategic Marketing Plan From the above environmental analyses, the best Ansoff's Matrix option for AmRest lies in its ability to improve its market penetration strategies CITATION Lut11 \l 1033 (Luther, 2011). This strategy is feasible because AmRest's international brand is recognized and penetration can be facilitated by its already vast, measurable and recognizable market network in Europe and USA. Under this option, AmRest will solely focus on increasing its market share and thus will not be affected by the financial restraints that come with the need to borrow large sums of capital in order to, for instance, expand in other emerging markets in Africa or any other market development needs. Furthermore, under this option, AmRest has the necessary infrastructure to implement particular strategies such as promotions by, for instance, using its current website and initiating proper customer segmentation strategies to target clients using preferences in purchases over the internet and even using smartphones CITATION Lut11 \l 1033 (Luther, 2011). Since the infrastructure is already laid out, this promotions may lead to better competition and thus the ability of AmRest to decrease the price of its products even further. Practically, AmRest has been able to phase out its competition in Germany through the use of price reductions strategies that facilitated its acquisition of all of Starbucks restaurants in April this year. Acquisitions, in the long run, have the potential to phase out competition and thus reduce competition CITATION Lut11 \l 1033 \m Smi01 (Luther, 2011; Smith, 2001). Finally, because the brand the already internationally recognized and respected, more product refinements such as those done by McDonald's would see the company even improve its competitive ability over this rival CITATION Lut11 \l 1033 (Luther, 2011). Modest product refinements such as in the improvement of taste, ease and fastness of production and presentation results in improving customer preference towards the same product as has been seen in McDonald's. Refinements also include the ability of the client to easily recognize a specific AmRest product, memorize it and thus be able to specify exactly what he or she needs in a fast and easy way to increase the effectiveness of timely delivery. Segmentation, Targeting and Positioning Analysis for AmRest Segmentation Using the above option, AmRest can then undertake market segmentation, targeting and positioning in order to penetrate the market as required. Under this, the company shall design and implement a strategy that shall determine the demography of its clients. This shall include a demarcation of young, youth and old population based on sexes, religion, race and nationality. Segmentation shall also aim to effectively demarcate resta...