MBA 5513 - Strategic Planning: A Case Study of Chick-fil-A Company

This case study provides a strategic analysis of Chick-fil-A, focusing on its resource allocation and planning for long-term growth. It encompasses a general environmental analysis, including technological, demographic, economic, political/legal, sociocultural, global, and physical environment trends. The analysis extends to the industry and competitive landscape, followed by a SWOT analysis to identify strengths, weaknesses, opportunities, and threats. The study culminates in strategy formulation and a strategic action plan, outlining steps for international expansion, customer engagement through loyalty programs, and employee training. The report leverages the provided case study to offer insights into Chick-fil-A's strategic decision-making and competitive positioning within the food and beverage industry. Desklib provides access to similar case studies and solved assignments for students.

Strategic Resource Allocation and Planning
Running Head: Strategic Resource Allocation and Planning
Chick-fil-A Company

Strategic Resource Allocation and Planning 1
Contents
Introduction......................................................................................................................................1
General environmental analysis.......................................................................................................2
Industry Analysis.............................................................................................................................4
Competitor’s analysis......................................................................................................................5
SWOT analysis................................................................................................................................5
Strategy Formulation.......................................................................................................................6
Strategic Action Plan.......................................................................................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

Strategic Resource Allocation and Planning 2
Introduction
The aim of the report is to create a long-term strategic plan for the Chick-fil-A Company and the
details related to the company have been discussed in the case study. The report includes the
environment analysis which creates an impact on the working and decision making of the
company. Furthermore, it includes the analysis of the external factors and the internal factors as
managers perform the analysis related to both external and internal factors.
CFA (Chick-fil-A) is the southern U.S. privately held restaurant chain with headquarters in
Atlanta Georgia. The company acquired 13th rank for quick-serve restaurant franchises in the
U.S. the restaurant was founded by Samuel Truett Cathy. The products that are offered by the
company include chicken sandwiches, milkshakes and some sort of different recipe (Chick-fil-A,
2018).

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General environmental analysis
Technological Trends- Company doesn’t have any distinct or visible technological advantages
that can make the operations of company different from its competitors. CFA can also make use
of upgrading technology for promoting the products in the market (MBA Skool, 2018).
Demographic Trends- CFA customers are more affluent, more active and more educated as
compared to its competitors. The customers of Chick-fil-A website were more likely to be
female between the ages of 25 and 44 with the income of $100,000–$150,000. Most of the
people who visit restaurant are the college students who belong to Caucasian ethnicity (Hitt,
Hoskisson & Ireland, 2014). If in case the preference of these people fluctuates then they won’t
be able to make an appropriate profit.
Demographic Percentage of Customers
Age
18 and under 18%
18–24 11%
25–34 22%
35–44 24%
55–64 7%
65+ 3%
Gender
Male 43%
Female 57%
Household Income

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Demographic Percentage of Customers
$0–$50,000 13%
$50,000–$100,000 26%
$100,000–$150,000 31%
$150,000+ 30%
Education
No College 38%
College 47%
Grad School 15%
Ethnicity
Caucasian 74%
African American 16%
Asian 4%
Hispanic 5%
Other 1%
Economic Trends- Economic trend reflect the GDP, inflation, unemployment rate, the
purchasing power of the customers and many other. U.S GDP growth will increase to 2.5% in
the year 2018. The expected GDP growth rate will be 2.1% in 2019 and 2.0% in the year 2020.
Apart from this, the unemployment rate will drop to 3.9% in 2018 and 2019 but it may rise in the
year 2020 by 4.0% (Amadeo, 2018). The rise in the GDP gives an opportunity for the company
to enhance the profit and sales of the company.
Political/Legal Trends- The political and legal factors include the acts and regulations formed
by the government that create an impact on the decision of the company. The acts formed by the

Strategic Resource Allocation and Planning 5
US work as a huddle for the company while expanding the business. CFA follows the acts and
regulations introduced by the government.
Sociocultural Trends- The changes in the sociocultural trends might impact the restaurant and
its working. Most of the people visit restaurants on weekends as it became the social trend for
them. Though, the culture of US motivates the people to consume healthy products which might
change their preferences for products (Grant, 2016).
Global Trends- The changes in the foreign country creates an impact on the working of CFA as
the company has its operations in Mexico, Puerto Rico and Canada. Most of the people across
the world are becoming health conscious due to which the sales of restaurants are declining.
Physical Environment Trends- CFA Company committed its responsibility towards the
environmental sustainability journey. The company boasted a number of green initiatives that
consist of retrofit 900 restaurants in the year 2012 with the energy efficient lighting,
refrigeration, and water saving technologies (Hitt, Hoskisson & Ireland, 2014). The company
also took a step for recycling of the cups in California locations along with this company is
planning to add a new place to it. Through, this company is able to accomplish its responsibility
towards the society.
Industry Analysis
The CFA Company falls under the food and beverage industry and this industry is one of the
growing industries across the world. The profits in the “Food & Beverages” segment amounts to
the US $16,557m in 2018. In the U.S the user penetration is at approximately 40.9% in 2018 and
is predicted to hit 48.2% in 2022 (Statista, 2018). This reflects that industry is expected to rise

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but it might fall as well because maximum numbers of people are becoming health conscious in
U.S (Nicolopoulos, 2018).
Competitor’s analysis
The major competitors of the company are McDonald’s, Popeye’s, Burger King and KFC. CFA
found a rise in the sales of the company comparing it with the other companies along with this
CFA ranked second among U.S. quick-service chicken restaurants. KFC continues to cede a lot
of market share to privately held CFA. In the year 2010, CFA Company surpassed Popeye’s,
McDonald’s and burger king in total sales growth with the same-store sales growth in spite of
having far fewer locations and closing its outlets 52 days every year. CFA gave strong
competition to its competitors with the help of strong customer base (Hitt, Hoskisson & Ireland,
2014).
SWOT analysis
Strength  The company has a strong presence in the market with 320
locations in the mall with 1000 stand-alone locations in January
2013. The growth focus of the company was in Southern
California and Midwest.
 The company makes use of the effective advertisement campaign
due to which the company has the second largest market share in
the chicken restaurant market. In 2009, the chain invested $27
million on advertisement media (Hitt, Hoskisson & Ireland, 2014).
Weakness  The company has slow and steady growth in the international

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market.
 Less number of outlets comparing it with the competitors.
Opportunity  The company is getting numerous numbers of proposals for the
franchises every year (Amason, 2011).
 The company is involved in the sponsorship of college athletics in
football so the company can utilize the opportunity for the
successful and effective advertisement (Meister, Parker, Slaughter
& Underwood, 2012).
Threats  The competitors (McDonald’s, KFC, Popeyes and many others) of
the company are the biggest threat to the company (Hitt,
Hoskisson & Ireland, 2014).
 CFA finds a threat if in case the franchises policies of the company
are not followed by the franchisers.
Strategy Formulation
Strategy Formulation is the process of developing the strategy and this is the procedure through
which the chose the appropriate strategy to accomplish the goals. CFA should expand the
business in numerous countries internationally (Karami, 2012). The company should bring some
changes in their strategy as CFA did not offer any kind of frequent buyer card, the company
should provide the card so that they will be able to form the good connection with their customer

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and can also promote their brand effectively. The company can also provide the training to their
staff so that they can perform their activities effectively.
Strategic Action Plan
The strategic action plan includes what actions can be taken by the company for implementing
the particular strategies.
Strategies Start time End time Duration
Selecting the country
for expansion
Jan 2018 March 2018 3 months
Identifying the
customer needs and
opening the outlets
April 2018 June 2018 3 months
Providing frequently
buyer card
July 2018 September 2018 3 months
Training to employees October 2018 December 2018 3 months

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Conclusion
The report is based on the case study of Chick-fill-A, a well-known restaurant chain. The report
includes the analysis of the company that helps the managers of the company in forming the
strategies to face the competitors. It also includes the general environmental and industry
analysis that helps the company in identifying the impact on working of the business.

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References
Amadeo, K. (2018). US Economic Outlook: For 2018 and Beyond. Viewed on 10th February
2018, https://www.thebalance.com/us-economic-outlook-3305669
Amason, A. (2011). Strategic management: From theory to practice. Routledge.
Chick-fil-A. (2018). Food. Viewed on 10th February 2018, https://thechickenwire.chick-fil-
a.com/Food
Grant, R. M. (2016). Contemporary strategy analysis: Text and cases edition. John Wiley &
Sons.
Hitt, M.A., Hoskisson, R.E & Ireland, R.D. (2014). Strategic Management: Competitiveness &
Globalization: Concepts & Cases. 11th edition. Cengage Learning.
Karami, A. (2012). Strategy formulation in entrepreneurial firms. Ashgate Publishing, Ltd..
MBA Skool. (2018). Chick-fil-A SWOT Analysis, USP & Competitors. Viewed on 10th February
2018, https://www.mbaskool.com/brandguide/food-and-beverages/3344-chick-fil-a.html
Meister, M., Parker, E., Slaughter, J. & Underwood, J. (2012). Situational Analysis and
Marketing Strategy. Viewed on 10th February 2018,
https://emmabparker.files.wordpress.com/2012/04/chick-fil-a.pdf
Nicolopoulos, J. (2018). Top 5 trends for food and beverage industry businesses in 2018 (Video).
Viewed on 10th February 2018,
https://www.bizjournals.com/boston/news/2018/01/29/top-5-trends-for-food-and-
beverage-industry.html

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Statista. (2018). Food & Beverages. Viewed on 10th February 2018,
https://www.statista.com/outlook/253/109/food-beverages/united-states#