The Importance of Strategic Management

This report emphasizes the importance of strategic management in achieving business success. By employing effective strategies, organizations can maintain their position in the market. Additionally, the study examines the benefits of penetration pricing for start-up businesses, which can attract large numbers of customers towards them.

STRATEGIC
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Business environment......................................................................................................................1
Vision, Mission and Goal............................................................................................................1
Product and service.....................................................................................................................2
SWOT analysis............................................................................................................................2
Premise, plant and equipment and Information system and telecommunications......................3
Goal, milestones, strategies..............................................................................................................3
Marketing....................................................................................................................................3
Pricing.........................................................................................................................................3
Suitable business strategy...........................................................................................................3
Business Competition......................................................................................................................3
The industry................................................................................................................................3
Target Market..............................................................................................................................4
Influence of five force.................................................................................................................4
Financial forecasts...........................................................................................................................5
Project sales figures.....................................................................................................................5
Project Income statement............................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
In the present time, there is huge competition in the market as every business unit
requires to develop effective position in the market. For this purpose, companies adopt such
strategy and practices which helps in gaining competitive advantage. Business strategy includes
those assets of an organisation which help the business unit in fulfilling its determined objective
in more appropriate manner (Achrol and Kotler, 2014). Corporation should analyse its business
environment in an effective manner so that it can sustain in the market for long time. While any
business unit enters in the market and start up its business, then it is very important to analyse
several components that affect business environment. In the present report, it is planning to start
a new business that is restaurant in the UK market under which it will serve high quality Indian,
Chinese and Mexican cuisines at affordable prices. The prices of food items will be in such a
way that can easily attract the customers in large numbers. The name of the restaurant will be
Five star food restaurant under which customer will get the chance to taste the three nation's
delicious cuisines in the excellent quality as well as affordable price.
MAIN BODY
Business environment
Vision, Mission and Goal
The mission of Five star food restaurant is to deliver high quality of three nation’s food
such as Indian, Chinese and Mexican in the affordable price. It also serves both alcoholic and
non-alcoholic drinks to its customers. The main mission of the cited venture is to produce the
high quality of food products and satisfy customer requirements (Athey, Suckling and Rogers,
2012). In the UK, travellers comes from various locations and countries whole around the globe;
thus, it is very essential for delivering the best quality of food according to taste of customers.
Vision of the Five star food restaurant is to become the first choice of customers and earn
maximum profitability in the UK market in the food sector. It also desires to expand its business
chain with the success of current restaurant. Moreover, it desires to gain effective profitability
and market share in the competitive business environment.
Goal of Five Star food restaurants is to earn the maximum profitability and market share in
the UK market and become number one food restaurant.
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Product and service
Five Star Food restaurant will serve high quality of foods such as Indian, Chinese and
Mexican cuisines at affordable prices. It will serve three nation's delicious cuisines in the
excellent quality as well as affordable price (Berthon, Pitt and Shapiro, 2012). These foods will
be available at the affordable price so that average income group customer can purchase it.
SWOT analysis
Strength
Five star food restaurant will major strength is
related to varieties of food. As it will serve
three nations’ cuisines such as Indian, Chinese
and Mexican.
Another strength is its high quality of food
products (Bickhoff, Hollensen and Opresnik,
2014). As it will serve high quality of food
product at the affordable price so that every
income group customer can easily purchase the
same.
Opportunity
It has opportunity to develop number one food
restaurant in the UK market by serving
varieties of different food and drinks.
Another opportunity which firm can have in
type of offering more advantageous and natural
dishes or servings of mixed greens in the
menu.
Finding different methods for creating a greater
amount of the movement amid moderate
circumstances. For example, the evening
session where there exists less surge. This may
speak to an open door for development for new
business start up.
Weakness
Five star food restaurant have weakness
regarding the poor budgeting as at initial level
it will not have sufficient finance to promote
its business in the market. Due to the lack of
promotion and advertisement, it will not be
able to inform customers regarding its new
business.
Another weakness will regard tough
competition in the market. As in the UK, there
is alreadyfamous restaurant available which
Threat
New eatery opening in various territories can
improve wander store network for different
client segments (Challagalla, Murtha and
Jaworski, 2014). Rising in cost of certain
potential item's crude materials can be another
risk for the said firm. This can be viewed as a
noteworthy test for the cordiality firm.
New market section and expanding client’s
requests can be likewise observed as a danger.
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have impressive goodwill.
Premise, plant and equipment and Information system and telecommunications
The Five star food restaurant will use latest and advance technology in its business operation. At
the initial level it will use the medium range and quality of system and communication sources at
internal as well as external level.
Goal, milestones, strategies
Marketing
In order to promote and advertise product and services in the market, Five star restaurants
will use social media and print media technique. With help of social media technique, Five star
restaurants can place information about commodities and services on the several channels like
Facebook, Twitter, Instagram etc (Craig and Campbell, 2012). This is one of the best channels
for promotion and advertisement that will help to restaurant in promoting services on the
internet. Furthermore, with help of print media like newspaper, magazines etc restaurant can
inform about services to its customers.
Pricing
Five star Food restaurants will use penetration pricing strategy for sale its food product
and services in the market. With help of this pricing strategy, it will easily attract the large
customer attraction and attention.
Suitable business strategy
Five star Food restaurant will set differentiation strategy through which organization can separate
its items and administrations from its rivals in showcase. With the assistance of this technique,
firm can set up an extraordinary picture in advertise by give diverse administrations to its clients.
For achieving this reason, it has upgraded its nature of item and give assortments of item as
indicated by request of clients (Evans, 2012). A separation system may acknowledge bring down
deals volume in light of the fact that a firm is charging lower costs for pull in clients.
Business Competition
The industry
In the United kingdom, there is very tough competition among the food restaurants. While any
new business enters in the new market then it should analyze the market condition of industry.
With assistance of business environment analysis Five star food restaurants can effectively
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analyze the condition of market like available competitors, customer taste, demand, economic
condition etc.
Target Market
In this case of Five Star Food restaurants, its target market will all youngsters and adults
people who travel from the other location. Its major focus on the tourist customer who come
from other country that is why it will serve three nations food to its customers. Segmentation
more often than not assumes a critical part where a specific section is chosen and association
stress on same to enhance their income and efficiency (Fullerton and Merz, 2012). The
significant centralization of the wander will be on statistic and additionally psychographic
segmentation Further, in the statistic, the principle point will be on various angles which will
identify with age, sex, pay level. Further, the proprietor of the wander will center around the age
assemble from 18-60 as this the main age where individuals have such an extensive amount
sustenance fascination. For the sex gathering, both male and female will be pulled in towards
various sorts of multi-food dishes created by the firm.
Influence of five force
In order to sustain in the market for long time, Five star restaurants required to analyze
the market condition and available competitors. For analyze competitors and their position in the
market, company have to use five force model. By use of five force analysis, company can easily
analyze the position of business within competitive business environment- The threat of new entrants- The threat of new entrants is high for the Five star food
restaurant because it is just start up business in the new market. The threat of substitution- The threat of substitution is also high because in the united
kingdom there is huge competition among the food sector (Huang and Sarigöllü, 2012.).
As there are varieties of restaurant available in the market so if five star restaurants will
change price of product and services then customer have chance to switch the brand for
their food services. The bargaining power of customers- The bargaining power of customer is also high for
the five star food restaurant because it is just start up business so customer have lots of
options available for purchase the services and products (6 Factors that Affect Your
Marketing Plan. 2016).
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 The bargaining power of suppliers- The bargaining power of suppliers is also very high
because Five star restaurants is just a start up business in the UK market. Suppliers can
charge the high prices of raw material and semi finished goods in the market because it is
new in the market.
 The threat of competition within the industry- In the United Kingdom, there is tough
competition available in the market so threat of competition for Five star restaurant is
high.
Financial forecasts
Finance is most vital and fundamental component which is required for beginning the
wander effectively. The method of reasoning behind this, there are a few costs which speciality
unit needs to acquire at introductory level, for example, authorizing, showcasing and different
costs etc. Hence, there are a few interiors and outside wellsprings of fund which are accessible to
the business element of 'Five star food restaurant (Leonidou, Katsikeas and Morgan, 2013). It
incorporates individual investment funds, offer of property, bank credit, renting, calculating and
so forth. With a specific end goal to start the matter of eatery business substance will embrace
both interior and outer wellsprings of fund are as follows:
Personal saving: For beginning the business sole merchant will utilize the individual sparing of
$50000. This interior wellspring of fund offers abnormal state of monetary advantages to the
business substance. Besides, around here substance isn't obliged to make any installment to
others. Along these lines, such source offers flexibility to the business substance from the money
related weight to the vast extent.
Bank Loan: Entrepreneur will take budgetary help from Kiwi to begin the new pursuit in the
most ideal way. It is a standout amongst the most strong wellsprings of fund which offer
abnormal state of tax reductions to the firm. Along these lines, such wellsprings of fund
improves the overall revenue of firm to the huge degree
Project sales figures
Particulars
Amount (in NZ
$)
Number of
customers
served in a day
Sales revenue
year 1 (In NZ $)
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Price per customer of Chinese dish 25 10 91250
Price per customer of Mexican dish 22 15 120450
Price per customer of Indian dish 20 10 73000
Total sales revenue 284700
Project Income statement
This announcement renders data about the inflow and outflow of the exercises which will
be performed by the company amid the year. In this, positive inflow involves that arrangement
is possible from the monetary point of view (Luan and Sudhir, 2010). Other than this, money
inflow unmistakably exhibits the income or salary will be produced by the sole broker from
changed business exercises. On the opposite side, surge gives data about the costs will be
brought about by the business element amid the year.
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CONCLUSION
From this entire report it has been concluded that strategic management is very essential
technique by which organization can easily gain competitive advantage and sustain in the market
for long time. By this study it has been also analyzed that by use of penetration pricing strategy,
start up business can attract large numbers of customer toward the business.
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REFERENCES
Books and Journals
Achrol, R. S. and Kotler, P., 2014. The service-dominant logic for marketing. The service-
dominant logic of marketing: Dialog, debate, and directions. 320.
Athey, V. L., Suckling, R. J. and Rogers, T.K., 2012. Early diagnosis of lung cancer: evaluation
of a community-based social marketing intervention. Thorax. 67(5). pp.412-417.
Berthon, P. R., Pitt, L. F. and Shapiro, D., 2012. Marketing meets Web 2.0, social media, and
creative consumers: Implications for international marketing strategy. Business horizons.
55(3). pp.261-271.
Bickhoff, N., Hollensen, S. and Opresnik, M., 2014. Step 2: Strategic and Operative Marketing
Planning—Segmenting, Targeting, Positioning. In The Quintessence of Marketing pp. 47-
110. Springer Berlin Heidelberg.
Challagalla, G., Murtha, B. R. and Jaworski, B., 2014. Marketing doctrine: A principles-based
approach to guiding marketing decision making in firms. Journal of Marketing. 78(4).
pp.4-20.
Craig, T. and Campbell, D., 2012. Organisations and the Business Environment. 2nd ed.
Routledge.
Evans, D., 2012. Social media marketing: An hour a day. John Wiley & Sons.
Fullerton, S. and Merz, G.R., 2012. The four domains of sports marketing: A conceptual
framework. Sport Marketing Quarterly. 17(2). p.90.
Huang, R. and Sarigöllü, E., 2012. How brand awareness relates to market outcome, brand
equity, and the marketing mix. Journal of Business Research. 65(1). pp.92-99.
Leonidou, C. N., Katsikeas, C. S. and Morgan, N. A., 2013. “Greening” the marketing mix: do
firms do it and does it pay off?. Journal of the Academy of Marketing Science. 41(2).
pp.151-170.
Luan, Y. J. and Sudhir, K., 2010. Forecasting marketing-mix responsiveness for new products.
Journal of Marketing Research. 47(3). pp.444-457.
Mish, J. and Scammon, D. L., 2010. Principle-based stakeholder marketing: Insights from
private triple-bottom-line firms. Journal of Public Policy & Marketing. 29(1). pp.12-26.
Online
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6 Factors that Affect Your Marketing Plan. 2016. [Online]. Available through: <
http://realtormag.realtor.org/tool-kit/brokerage-marketing/article/6-factors-affect-your-
marketing-plan>.
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