Marketing Assignment Five Guys Burgers
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Added on 2020-05-11
Marketing Assignment Five Guys Burgers
Added on 2020-05-11
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Running head: Five Guys BurgersMarketing AssignmentFive Guys Burgers: Case Study
Five Guys Burgers1Executive SummaryGlobal fast food industry is has been gaining ground since the last decade with immense number of organized and unorganized players joining the league. The report throws light on one such player Five Guys Burgers which was established in 1986 and since then has shown over 700% growth. The industry analysis shows the current ongoing trends in the industry as well as the threat of new entrants and substitutes along with bargaining power of buyers and suppliers. The fast paced lifestyles of the consumers has led to the growth of this industry (Sorokina, 2015). A significant part of the fast food industry still continues to be unorganized, however, the organized sector is becoming a global cuisine.This report lays emphasis of Five Guys Burgers’ strengths and weaknesses. The company has a strong brand name and hence it was not difficult to find information on the same. Also the company has a unique policy of not investing on advertising at all but paying their employees very high (Keiningham, 2014). They believe that if their employees are satisfied then they will automatically work harder to please consumers.Five Guys burgers expansion plans have been considered and new markets including China, India, Japan and Singapore have been analyzed in this report. Expansion to India has theoretically proved to be a better opportunity for the brand. This is because of high population and low competition existing in the subcontinent.
Five Guys Burgers2ContentsExecutive Summary.....................................................................................................................................1Introduction.................................................................................................................................................5Global fast food industry.............................................................................................................................5Factors affecting global fast food industry..............................................................................................6Fast paced lifestyles.............................................................................................................................6Low cost of products...........................................................................................................................6Increasing obesity and health consciousness (Appendices 6)..............................................................6Easy availability....................................................................................................................................6DeMarketing........................................................................................................................................6Global cuisine......................................................................................................................................6Porter’s five force model.........................................................................................................................7Threat of new entrants........................................................................................................................7Threat of substitution..........................................................................................................................7Bargaining power of buyers.................................................................................................................7Bargaining power of suppliers.............................................................................................................8Industry rivalry.....................................................................................................................................8Internal company analysis: SWOT analysis..................................................................................................8Strengths.................................................................................................................................................8Weaknesses.............................................................................................................................................9
Five Guys Burgers3Opportunities..........................................................................................................................................9Threats.....................................................................................................................................................9Potential markets: Japan/India/Singapore/China......................................................................................1012 C analysis..........................................................................................................................................1012 C Analysis......................................................................................................................................10China..................................................................................................................................................10India...................................................................................................................................................10Japan.................................................................................................................................................10Singapore...........................................................................................................................................10Reasons for selecting India....................................................................................................................11Mode of entry to India..............................................................................................................................12Franchisee model..................................................................................................................................12Marketing mix for five guys burgers in India.............................................................................................13Product..................................................................................................................................................13Price.......................................................................................................................................................13Promotions............................................................................................................................................13Place......................................................................................................................................................14References.................................................................................................................................................15Appendices................................................................................................................................................17
Five Guys Burgers4IntroductionThe fast food industry of the world has been growing at a rapid pace. This is potentially due to increasingdemand, changing lifestyles and sundry availability of options to consumers. Since 1970 till 2016 the revenue of the industry has grown over 30 times (Welch, 2010). Globally, the fast food industry generates more than GBP 433 billion annually and is expected to generate GBP 493 billion by 2020 (Appendices 1). The burger industry alone contributes to GBP 30 billion of the revenue generated. Predominant players of the burger industry are McDonalds, Burger king and Wendy’s (Wilk, 2006). This report throws light on Five Guys Burgers which is a leading burger joint founded in 1986 by Jerry Murrell, his wife and his five sons. At present, the brand operates via 1039 stores across US and 41 stores spread over UK. Since 2006, the company has shown a stupendous growth of 792%. Their motto is “To perfect and serve” and this is exactly what they promise to their customer every day (Lang, 2015). Currently, the brand is looking at further international expansion plans to the Asian market. The details of which are shared below. Global fast food industryGlobal fast food industry generates over GBP 433 billion annually and continues to be moving on a growth trajectory with an expected compounded annual growth rate of 4.2% in the forthcoming years (Pre Newswire, 2017). According to recent survey, the industry is expected to hit the target of GBP 493 billion by the end of 2020 (Globe newswire, 2017). However, it has been established that the actual datais difficult to estimate due to the increasing number of roadside vendors. Also the nature of market being predominantly unorganized, makes it even more tedious to grab accurate data.Fast food is basically empty calorie food which has a bulk of calories and few or no micronutrients at all. This fast food is served by QSR (Quick service restaurants) and roadside vendors. A number of trends have impacted the industry and helped reach the strata it has achieved today. Increasing urbanization, globalization and privatization has made it easier for brands to conduct international expansion (Baggaley, 2014). Whereas, rapid paced lifestyles and convenience accompanied by fast food has helpedthe industry created a vast market of consumers.
Five Guys Burgers5Factors affecting global fast food industryFast paced lifestylesThere has been a significant shift in the lifestyles of people. The excessive work load and other commitments have left people with less time to spare. Therefore this fast lifestyle of people provides fora perfect opportunity for the fast food industry to market their products (Nestle, 2013). Low cost of productsBesides less time, the products also cost less and are pocket friendly. A five guy’s burger would cost a lotlesser than an Indian or Italian meal eaten at a restaurant. This low cost is hence able to serve to a largertarget market and leads to increased demand (Belasco, 2014).Increasing obesity and health consciousness (Appendices 6)Increasing obesity and health consciousness among people has adversely impacted the growth of the fast food industry (Smith, 2015). People are becoming increasingly health conscious and focusing on a healthier diet. This is impacted the industry as now the players of the industry need to innovate and include healthier options in their menus to avoid losing base. Easy availabilityFast food joints are easily available in every nook and corner of the globe. The number of both organizedbrand outlets and unorganized roadside vendors have increased (Walker, 2014). This easy accessibility has also given a boost to the industry. DeMarketingDue to increasing obesity, governments of various countries have started DeMarketing the fast food items and started spreading awareness about the ill effects of consuming them excessively (Medina, 2016). This is an important factor affecting the fast food industry.
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