Digitalization's Effect on New Hospitality Companies: Freshway

This report examines the impact of digitalization on the business performance and productivity of new hospitality companies, focusing on a case study of a restaurant named Freshway. The report begins with an introduction outlining the rationale for the business idea, the chosen scenario of increasing digitalization, and the background of Freshway, which aims to offer fresh food using digital platforms. The research aims to identify the impact of digitalization on productivity and profitability, with objectives including understanding digitalization, evaluating its impact on Freshway, and developing suitable digital strategies. The report also covers the business concept, including a description of Freshway's products and services, target market, positioning strategy, and value-added components. It emphasizes the importance of digital technologies in improving business processes and enhancing customer experiences. Finally, the report touches upon the stakeholders involved and the opportunities available to Freshway through digitalization, particularly in leveraging the health-conscious nature of consumers and utilizing digital tools for interaction and order fulfillment.

“The impact of
digitalization on
business performance
and productivity of new
hospitality
companies” . A study
on Freshway.

Table of Contents
Chapter 1: INTRODUCTION.....................................................................................................................3
Rational of business idea.........................................................................................................................3
Scenario Chosen......................................................................................................................................3
Background of Restaurant.......................................................................................................................4
Vision......................................................................................................................................................4
Mission:...................................................................................................................................................4
Research Aim..........................................................................................................................................4
Research Objectives................................................................................................................................4
Research Questions.................................................................................................................................5
Structure of business report.....................................................................................................................5
CHAPTER 2 THE BUSINESS CONCEPT.................................................................................................5
Introduction.............................................................................................................................................5
Description of Business Concept.............................................................................................................6
The product/service description...............................................................................................................6
The target market.....................................................................................................................................6
Positioning strategy.................................................................................................................................7
Value added.............................................................................................................................................7
Who is involved.......................................................................................................................................8
The window of opportunity.....................................................................................................................8
Summary.................................................................................................................................................8
Chapter 3: Literature Review.......................................................................................................................9
Industry Analysis.....................................................................................................................................9
References.................................................................................................................................................12

Chapter 1: INTRODUCTION
Rational of business idea
The main rational of selecting the existing topic is increasing popularity of digital activities in
business context. Currently, the use of digital tools and techniques has significantly increased
due to demand in market place. Post COVID-19 pandemic, the use of digital techniques is
increasing as the business organizations are likely to use more and more digital and online
platforms so that they can easily fulfill the demand at market place. Here, main aim of using
digital tools is to enhance the reach of the company in significant manner in terms of attaining
higher amount of sales and profit margin. Digitalization is all about using latest and updated
digital and online tools to get and complete the demand of buyers in significant manner.
Implementing digital techniques is one of the best and significant ideas that are used by the
companies presently to attain tremendous amount of success effectively. By using digital
techniques, it is possible to provide best possible experiences to buyers that will further lead
towards increment in the overall revenue and profit margin. By using latest and updated digital
tools, it is easy to make a unique identity of business organization in market place.
Scenario Chosen
Digitalization refers to use latest, updated and advance techniques so that a business
organization can grow faster and better. This can further offer better profit opportunities so that
the entity can succeed in future period of time. In other words, digitalization is a process wherein
information is converted from normal form into digital form to help in terms of improving
overall performance, consistency and efficiency of business. Creative digital solutions are likely
to provide competitive edge to the company and further help in developing profitability in
significant manner. After COVID-19 pandemic, using digital platform and tools has become
imperative for the companies so that they can easily present their idea to final customers
(Kharlamov and Parry, 2021). In addition to this, it also provides opportunities to individuals to
get necessary information about the products or services, they wish to purchase in future period
of time.

Background of Restaurant
In preset case, a new restaurant is going to start names as “Freshway”. As the name
suggest main aim of the restaurant is to offer fresh food to the customers. By considering the
recent pandemic impact, their business is highly based on digital platforms. They are likely to
use ample of advance, recent and updated digital techniques to grab the attention of customers
significantly. The business will be located at UK and offer ample of fresh food & beverage items
to keep the customer delight. Here, using digitalization will help the entity in terms of fulfilling
needs & requirements of customers in timely manner. Further, it will also aid in enhancing
overall productivity & profitability of the respective restaurant.
Vision
The vision of restaurant is to capture high market share by offering quality products to
the buyers. They aim to offer the best possible services and experiences to the customers by
making appropriate use of digital practices effectively. They are likely to follow all the necessary
approaches to offer the best possible experiences to buyers.
Mission:
The mission of selected restaurant is to offer fresh and quality food to customers. For this
purpose, they use fresh ingredients and raw material to produce quality food products to fulfill
the demand of customers. In addition, they also aim to make a successful restaurant by using
digitalization practices to ensure long-term sustainability.
Research Aim
“To identify the impact of digitalization on productivity and profitability on new hospitality
organizations”. A study on Freshway.
Research Objectives
 To understand the concept of digitalization.
 To evaluate the impact of digitalization on productivity and profitability of Freshway.
 To develop suitable digitalization strategies followed by Freshway in order to ensure
higher productivity and profitability.

Research Questions
 What is the concept of digitalization?
 What is the impact of digitalization on productivity and profitability of Freshway
 What are the suitable digitalization strategies followed by Freshway in order to ensure
higher productivity and profitability?
Structure of business report
The present business report is based on starting a new business named as Freshway offering
fresh food and beverages to the customers. The business is based on using digital practices to get
and fulfill the order received from the buyers. They are likely to use recent, updated and advance
digital practices in order to maintain proper interaction with customers. Here, business report is
likely to cover ample of elements along with description of products and services that are being
offered by the existing business firm. Therefore, the current project is based on business concept
and descriptions of products and services that are being offered by the new restaurant to clients
along with target market, positioning strategy and more to create opportunities of future growth
and enlargement.
CHAPTER 2 THE BUSINESS CONCEPT
Introduction
Digitalization is about the use of digital technologies to provide higher revenue and
value-adding opportunities to business organizations. In addition to this, digitalization is about
moving towards a digital business. Post COVID-19, people are likely to avoid visit physically to
particular place rather they are likely to use different digital and online platforms so that they can
easily fulfill demand of customers (Sylthe and Brewer, 2018). In current scenario, a new
restaurant is going to start based on offering fresh food items to the buyers. The existing chapter
is likely to include business concept, positioning strategy, target market, value addition and more
such components to get better outcomes in future period of time.

Description of Business Concept
Digitalization is all using latest, updated and advance techniques so that a business
organization can grow faster and better. This can further offer better profit opportunities so that
the entity can succeed in future period of time. In other words, digitalization is a process wherein
information is converted from normal form into digital form to help in terms of improving
overall performance, consistency and efficiency of business (Orji, 2019). It is analyzed that
digitalization is about the use of digital technologies to provide higher revenue and value-adding
opportunities to business organizations. In addition to this, digitalization is about moving
towards a digital business. It is analyzed that digital technologies play an imperative role in
improving the overall business process, effectiveness, consistency and more so that set aims &
objectives can be attained (Berlak, Hafner and Kuppelwieser, 2021). In present scenario,
Freshway is a new restaurant that will offer fresh food, beverages and other such items to
customers. They are likely to use various digital tools and platforms in order to offer the best
possible experiences to the customers in profound manner.
The product/service description
In terms of product or service, the new restaurant is based on offering fresh food items
including beverages. They are likely to provide numerous food products to the customers to
fulfill their needs & requirements in an efficient manner. Here, they are likely to use digital
practices so that they can easily maintain proper interaction with existing and potential customers
by making use of different digital platforms significantly. This will drive significant benefits for
the company in terms of improving their overall revenue and profit margin effectively. In this
regard, main aim of restaurant is to provide ease to customers so that they can easily chose the
products from online platforms. By leveraging the health conscious nature of people, they are
likely to offer fresh food items to maintain superior level of sales & profit margin in an efficient
manner.
The target market
Target market of freshway is health conscious people who wish to get fresh food through
minimum personal interaction. They are likely to use fresh ingredients while making food so that
more and more people get attracted towards them in significant manner. Along with this, they are
based on using necessary digital tools & technologies to make the products available to end users

within stipulated period of time. The respective market will allow them to earn significant
amount of profit margin in an efficient manner. For gaining attention of such people, they are
likely to implement digital tools and platforms such as social media platforms and more. Here,
using effective digital practices will prove helpful in terms of getting better outcomes in future
period of time. When health conscious people get the product right for their health, they are
likely to place more and more orders to increase overall level of profit margin effectively. Along
with health conscious nature, these people are tech-friendly as well hence, they are likely to use
recent and updated platforms of the company to interact with customers efficiently.
Positioning strategy
Positioning strategy is an imperative marketing plan that is useful for an entity in terms of
setting positive image of brand in market place. The main aim of using positioning strategy is to
attract more and more customers to get competitive advantage significantly (Gasparovich,
Uskova and Dongauzer, 2020). In this regard, the respective restaurant is likely to use
postponing statements, competitor’s strategies, developing unique ideas and other such strategies
to get better outcomes in terms of increment in overall sales & profitability. Here, they are likely
to use different digital tools and techniques to set unique position of the brand in market place.
Further, they will also run suitable promotional and marketing campaigns to get the attention of
potential buyers to lead towards higher productivity and profitability.
Value added
Freshway aims to deliver higher value and quality products to its customers by using
advance digital platforms appropriately. Their products is likely to fulfill needs of health
conscious individuals by offering them fresh food in an efficient manner. After the pandemic,
people are likely to look forward to get quality and fresh food to maintain better health
conditions. For this purpose, the concept of fresh food is gaining high popularity in current time.
Also, they aim to minimize personal touch by increasing use of digital tools and applications. In
this regard, they use different online and social media platforms to maintain proper interaction
with buyers. Along with this, they also have their own websites to receive and deliver the order
of customers in timely manner. Therefore, they are adding significant values in terms of offering

fresh and quality food by using necessary digital practices for getting better outcomes in future
period of time.
Who is involved
There are ample of stakeholders who are involved from emergence of business idea to its
effective implementation. The major stakeholders are vendors, employees, managers,
government authorities and other. These all parties are really imperative and play a crucial role in
successful implementation of the business idea to get pre-defined level of revenue and profit
margin in an efficient manner. Here, involvement of different stakeholders will allow the entity
in terms of attainment of pre-defined level of profit margin significantly.
The window of opportunity
There are various opportunities that can be attained by the organization to facilitate
improvements in their overall productivity (Cagle, 2020). In this regard, they are likely to
provide fresh food and beverages to gain trust of customers. Further, it also helps the new
company in terms of building higher loyalty among customer groups to increase existing level of
sales & profit margin. The main aim of selecting the existing business idea is to increasing use of
digital tools. Also, the current project is also suitable in terms of leveraging the health conscious
nature of buyers in an efficient manner. In this context, the restaurant focuses on offering healthy
food products to individuals in order to set a unique identity in market place. This will prove
useful in terms of improving overall productivity of the restaurant in competitive market to get
better results in future period of time.
Summary
After going through with above-mentioned information, it is analyzed that Digitalization
is about the use of digital technologies to provide higher revenue and value-adding opportunities
to business organizations. In addition to this, digitalization is about moving towards a digital
business. It is analyzed that digital technologies play an imperative role in improving the overall
business process, effectiveness, consistency and more so that set aims & objectives can be
attained. In present scenario, Freshway is a new restaurant that will offer fresh food, beverages
and other such items to customers. Furthermore, they are likely to provide numerous food

products to the customers to fulfill their needs & requirements in an efficient manner. Here, they
are likely to use digital practices so that they can easily maintain proper interaction with existing
and potential customers by making use of different digital platforms significantly. Additionally,
freshway has target market of health conscious people who wish to get fresh food through
minimum personal interaction. They are likely to use fresh ingredients while making food so that
more and more people get attracted towards them in significant manner. In terms of positioning
strategy they are likely to use postponing statements, competitor’s strategies, developing unique
ideas and other such strategies to get better outcomes in terms of increment in overall sales &
profitability. Moreover, there are ample of stakeholders who are involved from emergence of
business idea to its effective implementation. The major stakeholders are vendors, employees,
managers, government authorities and other.
Chapter 3: Literature Review
Literature review is about gathering the already exist information that has been gathered
by existing authors, publishers and more. The main aim of LR is to develop significant
knowledge base regarding the selected topic so that the pre-defined aims & objectives of the
project can be accomplished successfully. Further, literature review is useful in developing
significant knowledge base which leads the investigator towards writing the detailed literature in
an efficient manner. In present context, digitalization is all considering to use latest, updated and
advance techniques in business. Nowadays, it has become an imperative practice to maintain
higher amount of sales & profit margin and to deal with the competition as well (Škare and
Soriano, 2021). In present case, the new business entity, freshway is likely to use digital
techniques with an aim to run business successfully.
Industry Analysis
Porter’s Five Forces Analysis
Threat of new entrant: To enter in food and beverage industry is not easy due to
presence of ample of entry barriers such as need of high amount of investment, following
necessary rules and regulations and more. Also, it is also tough for new companies to sustain
within the respective industry as there are already ample of well-known brands are working
which further creates competitive environment for the company (Leviäkangas, Paik and Moon,

2017). Therefore, threat of new entrants is high for freshway restaurant. To earn significant
amount of profit, there is requirements to adopt effective strategies so that the new entity can
easily compete with existing companies in profound manner.
Threat of Substitute products: In the selected industry, there is huge competition in
term of presence of ample of competitors who also provide the similar products to customers.
Due to presence of other firms, switching cost of customers is also less as they can easily switch
over one brand to the other. Huge number of substitute products develops competitive
environment that will eventually hamper the brand image of the company (Paulet and Mavoori,
2019). In case of Freshway, it is a new restaurant that is offering fresh food to the customers.
Because of presence of ample of other brands, the new restaurant has to face high threat of
substitute that will affect the future performance and productivity as well.
Bargaining power of customers: In context of present industry, bargaining power of
customers is really high as the buyers have multiple options available. It creates pressure on the
new company to produce products with high quality to gain the attention of potential customers
profoundly (Gupta, S., Kadyan and Bhasin, 2021). In case of Freshway, they are facing higher
bargaining power of customers due to presence of stiff competition in the industry. To sustain in
such competitive environment, they are required to develop strong customer base to by fulfilling
their demand and expectations effectively. Therefore, it is highly imperative for the respective
entity to manage its customer base properly to get better results in future period of time.
Bargaining power of suppliers: Bargaining power of suppliers is moderate in selected
industry due to presence of ample number of vendors hence they have lower influence in the
overall productivity and profitability of the selected restaurant (Velu, 2020). In present case,
Freshway has option to buy raw products from ample number of suppliers that will lower down
the bargaining power of suppliers significantly. To ensure future growth, the respective entity is
required to maintain positive relationship with vendors.
Competitive Rivalry: In selected industry, competitive industry is really high due to
presence of numerous food and beverage organizations. Intense competition among rival firms
put direct influence on the performance & growth of business organization. Presence of higher
number of rival firms directly influences the growth potential of companies and further

minimizes their revenue & profit margin significantly (Ekinci, 2021). In case of Freshway, they
are working in highly competitive environment wherein several rival firms are present within the
industry that will create direct impact in terms of productivity and profitability of the company.
Summary
From the above-information, it can be concluded that the present organization is likely to
face several threats present within the food and beverage industry. Also, the bargaining power of
customers is high along with high competitive rivalry. Therefore, the new firm is required to
structure suitable strategies to survive within competitive environment for longer duration.

References
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