SWOT and PESTEL Analysis of Seafood Restaurant

prepargon and PESTEL Analysis of Seafood RestaurantSUMMARY pitch Sprat is the possessor of seafood restaurant in a coastal t give birth. He is 60 category old and doctor has advised him to put in rest so he had ap flowed a Man progressr to carriage after the line of merchandise exploit and he use to come to wait the pipeline once in a week. But once he handed over the melody to the extradite it offr his billet is non doing well and in that respect is continuous declining in the crease.So in order to see to it remedy owner has been approached to the causation to analyse the incident and suggest as what should be through with(p) to append back the crinkle of the restaurant.Author has analysed the business with the tools of business (case) depth psychology-SWOT, and PESTLE and advertise pecuniary data has also been taken into consideration to recollect appear the declining trend and come to a conclusion as why business is going take in.In order to evaluate t he business operation and effect the findings in the cover author has done extensive research-secondary research and analysed the case with his rich suggestions.ACKNOWLEDGEMENTAuthor would the likes of to convey his gratitude to those entire slew who helped him to enhance his empathiseing of the case and analyzed the situation so that a valid conclusion of the case grass be drawn. Author has unblemished this case successfully and has been presenting his findings with suggestion in this report. So author would like to thanks to the Module tutor for kind support and guidance.INTRODUCTION asshole Sprat is 63 socio-economic class old owner of 60 nookie licensed seafood restaurant that is situated in a courtal town. out front starting this business cakehole was simply a Manager at a local Bluebeckers Restaurant. But an inheritance left this restaurant to him. Since the col of this restaurant business it has given real good return.The belief of Jack towards success f this bu siness is the Maintenance of high standards in fod merchandise and presentation. Other fact is lineup and beverage name has been fairly qualifying little since beginning of this restaurant. Jack did not change menu and beverage distinguish because business was giving modest return since beginning.But jack is not regular to the restaurant and he has appointed a Manager to manage the business operation and he use to come to the restaurant to see the business operation once in a week. This is because at this age (63) he has been suffering from health problem and his doctor has advised him to take rest. But business of this restaurant has at peace(p) mow as concisely as it was handed over to the manager. Absenteeism of the staff has been change magnitude.Keeping in creative thinker the remedy of the situation author has established aim and object glasss of this report, here atomic number 18 the aim and objectives written in expoundAim of this report is to find remedy of t he existing problem or discrepancies of the restaurant and give valu able suggestions to overcome from these problems so that business quarter be put on its old pattern- gatherable.Objectives be conclusion most principal(prenominal) problemsIdentification of nevertheless teaching that would be helpful in making realistic plans for the emerging of the businessTo list the prioritiesDrawing an action PlanThe structure of this report is as follows First of wholly main body has been presented wherein SWOT, PEST, and otherwise detailed analysis has been done. Then conclusion has been drawn and bibliography (list of references) has been given followed by extension section where additional informations has been provided.MAIN SECTIONAim and objective No.1 Finding important problems in advance providing solution of anything one has to find the problems first. So to find problem related to any business it is very first timber to conduct SWOT analysis and PEST or PESTLE analysis.Befor e going for the SWOT analysis of the business bear on it is important to understand SWOT first. SWOT ANALYSIS is the detailed search and listing of factors from situational analysis that might or lead impact the businesss strategy. Strategic merchandiseing is establish on the SWOT analysis. The process by which SWOT factors are derived is to conservatively review the internal analysis for strengths and weaknesses, and the surroundingsal analysis for opportunities and threats, and to then record. (Reich, Z.A, 1997) harmonise to (Morrison, J 2002) The SWOT analysis is a commonly used planning tool, which assesses the firms strategic profile in bounds of its strengths, weaknesses, opportunities and threats. Focusing on both internal and immaterial environments, it serves to highlight a firms distinctive competences, which exit alter it to gain competitive advantage.Based on the above information from the scholars it is real that business environment notify be divided into t wo part-internal and external environments. Internal environment consists of all told factors that is internal part of the business. These internal factors are within the control of the business. Strength and Weaknesses of the business can be base in the internal environment of the business. External factors are those factors which are not within the control of the business and to be into existence business houses has to change in their internal policy and adjust itself to cope with the external environment factors. Opportunities and Threats are the factors that are part of external environment of a business.SWOT Strength, Weakness, Opportunities and Threat Analysis of Seafood Restaurant Business of Jack SpratSTRENGTHSWEAKNESSES to begin with this business was increaseableIt is established systemMaintaining high standard in food and presentationStaffs are familiar with their workCustomers feel that restaurant is conveniently placed and commissions reasonable priceOwner is not able to give full time attention to the businessManager is less empowered-as he feels less scope has been given to him for the development of this business physical body of staff has been increased-which is extra weight down on payroll expenses of the business.No redevelopment done properly social classlyMaintenance and Hygiene problem shy(predicate) fund/ preferences for spending on maintenance and HygieneMenu extract is stale and boringImproper management of food due to omit of proper forecasting of guests.OPPORTUNITIESTHREATSRestaurant is old so having established securities industryMarket Image is good- reasonable price and consistent standardDilution of mart share due to inability to refurbishmentEnvironment Health policeman may not be informal in future and there will be time when formal notice will be issued.PEST ANALYSISBefore analyzing PEST or PESTLE factors from a business point of view it is important to understand these factors ( semipolitical, Economical, Socio cultural, Technological and Legal).A PEST analysis is an analysis of an external macro environment that affects all firms. Such external factors usually are beyond the firms control and sometimes present themselves as threats. For this reason, some say that pest is an appropriate term for these factors. However changes in the external environment also create red-hot opportunities and letters sometimes are rearranged to construct the more than optimistic harm of STEP ANALYSIS. Many macro environmental factors are country special and the pest analysis will need to be a performed for all countries of interest.Political FactorsTax policyEmployment lawsEnvironmental regulationsTrade restrictions and tariffsPolitical stabilityEconomic FactorsEconomic growthInterest rates substitution ratesInflation rateSocial FactorsHealth consciousness community growth rateAge distributionCareer attitudesEmphasis on safetyTechnological FactorsRD activityAutomationTechnology incentivesRate of expert changewww.netmba.com/strategy/pest/ Accessed on 2/01/2011Aim and objective No.2 Identification of advertize information that would be helpful in making realistic plans for the future of the businessInformation ask towards securities industry segmentation-target marketInformation to the case is very important to analyze any business health or problem. It is equally important like medical tests are important for human body for remedy of any kind of find fault of a patient.There are other tests or scanning is take for business analysis. Market segmentation is one of them. Market segmentation market consists of buyers disaccord in one or more ways. They may differ in their wants, resources, locations, buying attitudes and buying practices. Because buyers have unique ask and wants, severally buyer is potentially a separate market. Ideally, then a seller might design a separate market program for each buyer. For example a caterer can customize the menu, entertainment, and the s etting to meet the necessarily of specific clients. However, most companies are unable to offer complete segmentation. The be of complete segmentation is high and most customers cannot afford completely customized overlaps. Companies therefore, look for broad class of buyers who differ in their product needs or buying responses. The restaurant industry offers many examples of segmentation by a variety of variables. (kotler,p 2004)The reason behind knowledge of market segmentation is needed because until unless its not known that which segment is being targeted by the organization concerned (in this case Restaurant of Jack Sprat), it would be very difficult to comparability the strength of that segment for the business. In this case its not given in the case so its important to analyse this business from its segment point of view.Information Needed for competitor analysisTo get success of the business its needed to deal with customers, suppliers, employees, and others. In almost all cases there will also be other organizations offering similar products to similar customers. These other organizations are competitors. Objective of the other organizations is the same as yours to grow, make funds and succeed. Effectively, the businesses are at war fighting to gain the same resource and territory the customer. And like in war, it is necessary to understand the enemy How he thinks What his strengths are What his weaknesses are Where he can be flak catchered Where the risk of attack is too great.. And so on. And like in war, the competitor will have secrets that can be the difference between dinero and loss, blowup or bankruptcy for the business. Identifying these secrets is thus crucial for business survival. (http//dspace.dial.pipex.com) accessed on 2/01/2011Other information needed is about its competitors. Information of competitors is very important to know the business of competitors and farther business concerned can be compared with the competitors. So competitor analysis is very important.Aim and objective No.3 To list the prioritiesFirst of all instant action should be taken to sack up Hygiene problem.Proper forecasting of guests so that underproduction and overproduction both can be kept under controlExtra manpower has to be reduced so that there will be less burden on payroll costChoice of menu has to be increasedManager should be empowered or can be changed (as information is not given properly and in detailed so it is unimaginable to say to change)Somehow owner has to be in touch veritable(a) over the phone to monitor the business operation and if possible relative frequency to visit may be increased.Local bank should be approached for defraud term loan for the refurbishment activities.Aim and objective No.4 Drawing an work PlanAction plan is a process that includes assessments of own strengths, uncommitted resources and market opportunities. There must be idea about marketing objective of the organization concerned then a plan can be prepared and further implemented to achieve the determined objective. In other words these informations are basic and needed at very first step towards making action planMarket and transaction environment of the business concernedDecision about market business is targeting toKnowledge about differentiation or advantage of uniqueness of own product and servicesDeciding marketing mixEstimation of caudex etc.ACTION PLANPRODUCT Option in Menu list will be givenPRICING May charge little higher than what has been chargingPROMOTION There is need to promote the product and create awareness to remove the negative image of the organization. So it can be done through normal aids of advertisement-News papers or T.V Channels. Through T.V Channels it may little costly affair in that point of view daily is better.Other Actions to be takenIt could have opened even on Sunday to attract customers want to use their holidays. So it will be open all 7 days. blood line should be m anaged instantly- It can be done by approaching moneymaking(prenominal) Banks for short term loans.Refurbishment will have to be done as soon as loan is approved.Employees have to be re-motivated so that absenteeism of staff can be kept under control.REVENUE (SALES) pane OF VIEWFood sales has been increased in 2007-8 by 4.3% compared to 2006-7, and it bypast(a) down in the financial year 2008-9 by 3.95% compared to 2007-8 sales of food. booze Sales has been increased in 2007-8 by 5.97% compared to 2006-7 and further it increase by 15.59% in the year 2008-9 compared to 2007-8.Overall Total Sales has been increasing in the financial year by 4.67% in the financial year 2007-8 compared to 2006-7, and further increased by 6.57% in the financial year 2008-9 compared to 2007-8.DIRECT exist head up OF VIEWIn the financial year 2006-7 food cost was 42.05% of its sales and in 2007-8 it became little fortunate by going down to 41.16% of its sales figure and in the year 2008-9 in again deceased up to 43.63%Direct cost of Liquor is 59.72% of its sales in the financial year 2006-7, and 57.70% in 2007-8 and further 57.91% in 2008-9. So its favorable as its in declining trend.Total direct cost is 54.01%, 55.11% and 52.88% in the financial year 2006-7, 7-8, and 2008-9 respectively which also seems favorable because in 7-8 it gone little up but again it gone down by good margin-around 2 to 3%GROSS PROFIT POINT OF VIEWGross profit of food is 57.95%, 58.84% and 56.37% in the financial year 2006-7, 7-8, 8-9. This shows increase in 7-8 and further decline in 8-9.Gross profit of Liquor is 40.28%, 42.30% and 42.09% in the financial year 6-7, 7-8, and 2008-9 respectively. Overall it is in favorable trend.Gross profit in the financial year 2006-7 is 54.01%, 55.11% in 2007-8 and 52.88% in 2008-9 which seems declining trend. In the year 2007-8 it gone up but in 208-9 it came down. This is because there was declining of sales of food in the financial year 2008-9 by 3.95%, otherwis e sale of liquor in this financial year was good and direct costs were also behaving favorably. verifying EXPENSES POINT OF VIEWThere are three component of substantiating expenses-labour, smashs and operating expenses and maintenance expenses. Amount spent in labour is in increasing order i.e., 29.76%, 31.51% and 33.21% in the year 6-7, 7-8, and 2008-9 respectively. This shows restaurant is spending more % every year in its staffing.Overheads and Operating expenses seems within control as its 8.78%, 7.21% and 8.36% in the year 2006-7, 2007-8, and 2008-9 respectively.Maintenance expenses is 1.61% of sales in the financial year 2006-7, 1.40% in the financial year 2007-8 and 0.91% of sales of financial year 2008-9. This shows that organization is spending very less on maintenance expenses.Overall number substantiative expenses is 40.15% of its sales in the financial year 2006-7, 40.12% in 2007-08 and gone up in the financial year 2008-9 to 42.48%NET PROFIT POINT OF VIEW profits pr ofit is 13.86%, 14.99% and 10.40% in the financial years 2006-7, 7-8, and 8-9 respectively. This shows that bread profit has going down, and in the financial year its gone down with huge gap compared to previous years percentage.Overall its a consider of discussion and management should pay attention to the indirect costs as percentage of indirect cost is very high. As gross profit is in 50% so almost 40% of sales are being spent for indirect expenses. Although management is not spending much in maintenance component of indirect expenses but other components i.e., overhead and operating expense, and payroll expenses are very high that is the reason Net profit of the restaurant is not attractive.CONCLUSIONAuthor has analysed the case of Jack Sprats restaurant and found that major problem is its hygiene and maintenance and indirect expenses. These two of the factors has to be kept under control and converted into favorable mode only then this organization can earn profit like previo us time.There are other areas also that needs attention i.e., arrangement of fund, manpower management, empowering manager etc.BIBLIOGRAPHYBritton, C and Worthington. I (2003) The business environment, 4th Edition, UKPrentice hall.Hooley.G(2004) Marketing strategy and competitive positioning, tertiary edition UK Prentice HallKotler, P. (2004) marketing for hospitality and tourism, 3rd Edition, Delhi soulLuck.D and Rubin, S.R (1996) Marketing Research,7th Edition, USAPrentice hallMorrison, J (2002) the international business environment, 1st Edition, New York Pal grave.Reich, Z.A (1997) Marketing Management for the hospitality Industry,1st Edition, Wiley and sons Canada.Wearne.N (2001) hospitality Management, 1st Edition, New Delhi Globalwww.netmba.com/strategy/pest/ Accessed on 2/01/2011http//dspace.dial.pipex.com) Accessed on 2/01/2011