Some approaches will add in extra factors, such as International, or remove some to reduce it to PEST.
Macro environment analysis in India After years of economic dwindling, the Indian economy is fast growing in recent years, thus impacting positively on the fast food industry.
For example, Subramanian, notes that Indian economy grows at 6. This has enhanced the rise of the middle class group after years of wide gap between the rich and poor. Also, another prevalent concept in India is the tendency to eat outside which has increased from times a week to times.
Although Indians like to have homecooked meals — a concept supported religiously as well as individually, recent years has witnessed a slight shift in food consumption patterns among urban Indian families toward eating outside owing to increasing awareness and influence of western culture.
Micro business environment in India using PESTLE The political, economic, sociocultural, technological, legal and the environment factors influencing the India fast food market is discussed here. This is because of the growing concerns of the health effect of consuming fast food Ali, et al.
For example, the fast food consumption has been shown to increase calorie intake, weight gain which exposes consumers to the risk of facing diabetes. Given this, fast food is been criticized by health practitioners and consumers activists for high calorie content and Trans fat.
However, the low setup cost of fast food outlets and franchising create rapid expansion in that operators keep prices low so as to attract customers Gilbert, Technological factor Technological advancement helps fast food companies to streamline value creation process so as to enhance efficiency Srikant, For example, through advanced food processing technology, Help Desk Service, network and application consolidation, the operations of McDonalds in India is greatly improved.
Also, just-in-time order and delivery is done over the internet and TV, social media and radio are used to advertise the products and maintain customer relationship management. For example, fast food is said to be one of the largest consumers of paper products leading to millions of pounds of food packaging waste littering roadways, clogging landfills and spoiling quality of human life.
This increasing market potential encourages many potential firms to enter the market. Given this, McDonalds, Kentucky Fried Chicken KFC and other competitors compete over customers through price reduction, product localization to suit tastes and preferences and revamping the outlets to be more convenient and smart.
While the price war attracts more customers, it tends to reduce the profitability rate of the companies since the reduced product prices would increase production costs.
However, the convenience and family dining experience associated with eating outside on fast food outlets reduce the threat of substitute.
This is because with the growing competitive supply chain alliances, supplier bargaining power appear to be limited Srikant, However, the firm to enjoy higher bargaining power depends on who has a more technology control and strategy.
The survival spectrum of the table is the survival factors. According to the table, firms can succeed if they differentiate base on product uniqueness and costs and designing products to satisfy local tastes and preference. Table 2 shows the value creation process of McDonalds in India. It shows the various stages and activities involved in the value creation processes.
For example, McDonalds purchases raw materials from its fixed, pre-defined suppliers which are subsequently prepared and served to customers in a clean and comfortable environment.
The company works with local suppliers and farmers to source all its requirements. This indicates that McDonalds has over the years streamlined its business through its strategic and threshold resources to become a key player in the India market.Management Research Library The top resource for free Management research, white papers, reports, case studies, magazines, and eBooks.
Political Factors. The political risk in Singapore is quite low. In fact, the Political And Economic Risk Consultancy (PERC) states that the country enjoys the lowest political risk in the continent.
Oct 27, · People in Vietnam, particularly in the bigger cities, tend to eat out a lot.
Places to eat, from the food cart on the sidewalk to fine dining restaurants, abound. 5 1 INTRODUCTION As two of the world's largest fast-food giants, McDonald's and Kentucky Fried chicken (KFC) are both from the United States.
Hu Wei and Xie Yuanyuan were surprised to. TERM Spring '14 TAGS Porter five forces analysis, Kadar pertumbuhan industri, tinggi utk industri, Firma industri bukan Click to edit the document details CS no 3 and 4 ashio-midori.com Northern University of Malaysia BUSINESS A BPMN - Spring CS no 3 and 4 ashio-midori.com 2 pages CS no 1 and 5.
McDonald’s Five Forces Analysis (Porter’s model), competition, power of buyers & suppliers, threat of substitutes & new entry are in this fast food service restaurant chain industry case study.