Strategic Analysis of Nando's Restaurant: Ireland Market Focus

This report presents a strategic analysis of Nando's restaurant, examining its competitive landscape and industry dynamics. It begins with an executive summary outlining the restaurant's international presence and the use of SWOT and PESTLE frameworks to analyze competitors and the Irish market, respectively. The report then delves into the strategic management process, emphasizing goal setting, analysis, strategy formulation, implementation, and evaluation. Porter's Generic Model is discussed, along with SWOT and Porter's Five Forces analyses of Nando's. The SWOT analysis highlights the restaurant's global presence, signature dishes, and marketing success as strengths, while its limited menu and controversies are identified as weaknesses. Opportunities include expansion, while threats involve increased competition. The PESTLE analysis explores political, economic, social, technological, legal, and environmental factors in the Irish market. The report concludes with a summary of findings and recommendations for Nando's to improve its profitability and market position.

Running head: STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
Name of the Student
Name of the University
Author Note

1STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
Executive Summary
This report is based on the analysis of the competitors and the industry of Nando’s restaurant.
This is an international restaurant with casual dining facilities. The restaurant was established
in the year 1987 in South Africa. The restaurant has expanded its operations since then in
more than 40 countries. The analysis of the competitors of the restaurant is done with the help
of the SWOT framework and the industry in which the restaurant operates is analysed with
the PESTLE framework. The report suggests that the competitors of the company have
increased in the recent years and this has an effect on the profitability of the restaurant.
However, Nando’s has the opportunity to increase its profitability by expanding its operations
in the other cities of Ireland.

2STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
Table of Contents
Competitor analysis of Nando’s restaurant based on SWOT Framework.....................3
Strengths.....................................................................................................................3
Weaknesses................................................................................................................4
Opportunities..............................................................................................................4
Threats........................................................................................................................5
Industry analysis in Ireland for Nando’s based on PESTLE Framework......................5
Political factors...........................................................................................................5
Economic factors........................................................................................................6
Social factors..............................................................................................................7
Technological factors.................................................................................................8
Legal factors...............................................................................................................9
Environmental factors..............................................................................................10
Conclusion....................................................................................................................11
References....................................................................................................................12

3STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
1. Strategic Management Process
Strategic Management Process is essential as this helps the organization in defining
their strategy. It is the continuous process wherein the organization decides proper
implementation of the strategies as this will keeps on appraising the success as well as
progress of the implementation through proper assessment (Yüksel, İ., 2012). Proper strategic
management steps have to be followed by Nando’s restaurant as this will help in:
Setting of goal is essential in nature for the respective restaurant as this will provide
clarity of vision and this step helps in identification of three different factors that
includes proper definition of long as well as short term objectives. Proper
identification of the process is essential in nature to accomplish the objectives. Lastly,
proper customization of process for different hotel staffs is essential in nature as this
will help the restaurant in succeeding against the competitors.
Proper analysis has to be done by the respective restaurant as the proper information
gathering is essential in completion of the next two stages. The proper focus on
analysis is required as this will help in providing proper understanding of the
requirements of the respective business as the entity that is sustainable in nature. The
proper identification of internal as well as external issues has to be analyzed in order
to understand the affect of such issues on the objectives and goals of the business.
Proper formulation of strategy has to be done by Nando’s restaurant as this will help
in determining the resources that are required in defining the goals as well as
objectives (Yüksel, İ., 2012).
Proper implementation of strategy is essential as well as this will help in gaining
success for the entire business. This is basically the action stage of the process of
strategic management. This will help in proper analysis of the different
responsibilities in the entire business as well.

4STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
Lastly, proper evaluation of strategies as well as control actions has to be analyzed by
the respective restaurant and this will help in analysis of the external as well as
internal issues in the management process. Proper corrective actions has to be taken
whenever it is necessary and define the parameters that are required as well as
measured.
The Porter’s Generic Model is properly used by the respective restaurant as this will
help them in gaining proper competitive advantage and their performance will be improved
as well. The generic strategies that are applied by the respective restaurant in order to provide
focus on the cost leadership, differentiation strategy, focus on cost as well as on the cost
leadership.
Proper research has to be conducted as this will help in proper innovation as well as
development. This will enhance the strategy and this will help in delivering high quality
products as well as services. Similarly, proper focus strategy has been applied by the
company as this will help them in understanding the dynamics of the market as well. Proper
SWOT analysis has to be conducted by Nando’s restaurant as this will help them in analyzing
the strengths as well as weaknesses of their restaurant and apply different strategies to
improve the quality of the restaurant.
2. Competitor Analysis
Porter’s Five Forces Analysis of Nando’s restaurant
Force 1
Rivalry in the market – The rivalry of between the organizations in the market is the
most important force of the Porter’s five force model. The level of the rivalry between the
organizations is an important factor that determines the pressure of the competition. The

5STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
industry is considered to be a disciplined industry if the level of the competition between the
organizations is low. The high level of competition in the market results in the extreme
rivalry between the organizations. The more number of organizations of the same kind in the
market increases the competition between the organizations(Afonso and Vieira 2012). The
growth of the market in which the organizations are operating results in the fight of the firms
for acquiring their share in the market.
The higher the fixed costs of operating in the market, the greater are the competition
between the firms. The barriers related to the exit of a product and the rivals who are diverse
in nature increases the competition in the market as well. The service sector is the fastest
growing in the recent times. This has led to the entry of many organizations in the market.
The Nando’s restaurant also has many rivals in the market(Agarwal, Grassl and Pahl 2012).
3. Industry Analysis
Porter’s Five Forces Model
Supplier power - The suppliers are an important factor for Nando’s restaurant. The
suppliers have the power to decide the price of the raw materials that are required by
Nando’s. The cost of the raw materials decides the ultimate price of the products of the
restaurants. The restaurant industry is considered to be in the service sector. The services
provided in the restaurants are directly dependent on the prices decided by the suppliers of
that restaurant. The other factor that affects this sector is the power of the staff or the labour
of Nando’s. The costs associated with the labour of the restaurants are another important
factor that affects its operations. The power of the supplier is more if the number of suppliers
of any particular product is less in the market and the costs related to the switching of the
suppliers is more (Afonso and Vieira 2012). This situation makes the suppliers much more
powerful.

6STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
Power of the buyers – The customers of the Nando’s restaurant are considered to be
the buyers of the services provided by the owners. The power of the customers influences the
operations and profitability of the restaurants. The customers are more powerful if the same
type of services is provided by the other restaurants. The customer has the power to choose
and this determines the profitability of the organization. On the other hand, if the number of
restaurants is less in the same sector the customer has less choice and hence the prices can be
controlled by the restaurant owners. The prices are regulated by the choice of the customers if
they have more choices of restaurants (Al-Araki 2013). The power of the buyer to set the
price is more if the competition is less and the power of the buyers is less if the competition is
more.
Threats related to the substitutes – The third force in the Porter’s five force model
is the threat that is posed to the owners of Nando’s restaurant due to the presence of their
substitutes. The availability of the substitutes contributes to the changes in the cost related to
the service of the restaurants. The threat related to the substitutes is more prevalent if the
demand of the particular service changes with the change in the price of that service. The
price elasticity of the services is affected by the substitutes available in the market. The
increase in the substitutes of the service increases the demand for that service as well. The
reason being the availability of that service is more in the market. The closest substitute of
Nando’s, for example in the same cuisine, contributes in the change in the prices of the
services of that restaurant (Babatunde and Adebisi 2012). The threats related to the
substitutes of a particular company that endangers the competition of that organization arises
from outer industries.
Threat related to new entrants in the market– The entry of new restaurants in the
market is another threat for Nando’s that is taken into consideration. The new entries in the
market have an effect on the level of competition between the organizations. However, there

7STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
are many barriers related to the entry of the new firms. The barriers to the entry in the market
are the factors that define the characteristics of the industry itself. The rate of the entry of the
fresh organizations is reduced due to the barriers that are present in the market. This helps the
old firms to maintain their profit levels (Dimitrova 2016). This theory holds true for the
restaurant or service industry as well. The barriers in the market are related to the policies
made by the government. The policies made by the government sometimes restrict the entry
of the new organizations.
Competitor analysis of Nando’s restaurant based on SWOT Framework
Strengths
The restaurant has global chain in many countries around the world and operates more
than 750 restaurants. The countries in which the restaurant has its branches include,
Botswana, Namibia, Zambia, Asia, UAE, Europe, including Ireland, United Kingdom. The
other countries also include United States and Australia. The restaurants are spread in more
than 40 countries. The most famous dish of the restaurant all over the world is the Grilled
PeriPeri Chicken. This is the signature dish of the restaurant and they are famous in the
market for this particular dish. The food of this restaurant is healthy in nature and the taste is
also superior as well (Nandos.com, 2017). Nando’s was named as the world’s topmost
marketing brands by the magazine named Advertising Age. Nando’s opened its branches in
Ireland in the year 2008. The restaurant was opened in the technological hub of the country
Dublin. The other branch was opened before this in the year 1992 in United Kingdom. The
style of the restaurant changed in the United Kingdom. The takeaway style was changed and
a mixed service was started. The décor of the restaurant in this area was changed. Nando’s
won the award of the best place to work in the year 2010from the Sunday Times (Abraham

8STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
2013). The sauces and the marinades made by the restaurant were sold in the markets of the
United Kingdom.
Weaknesses
The main weakness of the restaurant includes its focus towards only the chicken
related items. This reduces the opportunities of the company in the vegetarian market. The
restaurant chain operates its branches only in the metro cities all over the world. The
restaurant had to face many controversies during the phase of its operations in many countries
(Adl et al. 2013). The advertisement that was run by the restaurant in the year 2002 in
Australia had been related to a political controversy. In the year 2009 Nando’s had to face
another controversy in South Africa related to the political situation in the country. The
restaurant faced another controversy in the year 2011 in South Africa itself which was related
to the shows of a famous celebrity. Another big controversy that was faced by the restaurant
was due to the “Black Card” that they offered to the celebrities so that they could be offered
free food from the restaurant along with their family. These controversies had an adverse
effect on the reputation of the restaurant and acted as a weakness in their expansion
operations (Afonso and Vieira 2012).
Opportunities
The restaurant chain has many opportunities in this area as the service sector is
experiencing huge growth in the recent years. This growth can be encashed by Nando’s.
Ireland is also a growing economy and the restaurant can plan for expansion of its operations
in the other cities of this country as well. The people of the country are fond of eating and are
welcoming towards any type of cuisine. This is great opportunity for Nando’s to grow in
Ireland. The restaurant can grow further by adding items in its menu including vegetarian
items as well. The technological environment of Ireland is strong and Dublin is the

9STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
technological hub of the country. Nando’s needs to plan for an ecommerce expansion in the
country (Agarwal, Grassl and Pahl 2012). This will increase the visibility and the reach of the
organization as well. The digital platform can act as a huge opportunity for the restaurant and
its growth in the next few years as well.
Threats
The competition in the market of Ireland has increased in the recent years, which has
led to intense pressure on the profitability of the restaurant as well. The increase in the
number of restaurants in the country has led to the decrease in the revenue of restaurant and
thereby reducing its profitability as well (Al-Araki 2013). The competition of Nando’s in
Ireland include restaurants like, Kai Café and Restaurant, Farmgate Café, An Port Mor,
County, Gregan’s Castle, Mourne Seafood Bar, Newforge Dining Room, The Brewer’s
House, The Fumbally. These restaurants offer both take away as well as dining facilities,
which is offered only in some of the restaurants of Nando’s. The restaurants also provide a
vegetarian menu which is required to increase the customer base of any restaurant. Nando’s
has to face tough competition of this type in the Irish market which has led to the decrease of
its profitability and the revenues (Ayub et al. 2013).
Industry analysis in Ireland for Nando’s based on PESTLE Framework
Political factors
The political environment in Ireland is unstable and this has been a negative factor in
the growth of the industries in this country. The establishment of a government that has
stability has become an important issue even after the general elections that were held in the
year 2016. This help the country to increase the cost-competitiveness. The exit of UK from
the European is another factor that is likely affect the political condition of Ireland
(Babatunde and Adebisi 2012). The implications of the exit of United Kingdom from EU will

10STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
be quite high on Ireland. The Irish industries will be hugely affected in the process. The two
main political factors that will affect the environment of Ireland in the current times are the
effect of Donald Trump’s new policies for the American government and the Brexit effect.
The decision that will be taken by Trump regarding the trade related factors with America,
will have huge effects on the rest of the world as well. The second most important issue in
this case is the decision of United Kingdom to make the British Exit or Brexit. The policies
and the conditions which will be related to the exit will have an effect on the rest of the
members of the European Union (Clardy 2013). The Brexit effect will thereby influence
Ireland and the various industries of the country as well. The fall in the economy of the
country due to this effect will influence the restaurant sector as well.
Economic factors
The economic factors of Ireland are heavily dependent on the international trade
related to the country and it is influenced by the global markets as the economy of Ireland is
of small size. The economy of Ireland was totally based on the agricultural income of the
country before it joined the European Union in the year 1973. The Ireland economy was
totally dependent on the UK market (Dimitrova 2016). After the country became a member
of the European Union, the trade rules of the EU related to the members and the decision to
build IDA or the Industrial Development Agency to endorse Ireland was a boost to the
economy. The economy of the country managed to grow mostly in the 90’s. The economy
was strengthened with the financial assistance of the European Union. The global financial
crisis from the year 2007 had led to a fall in the financial systems of the European Union as
well. Ireland was also a victim of this financial crisis which had spread globally. The dealings
between the banks from all around the world had stopped and the credit facilities were no
more available (Fleisher and Bensoussan 2015). The Irish banks had invested huge amounts
for giving loans to the property dealers and this had left the banking system in a huge mess.

11STRATEGIC ANALYSIS OF NANDO’S RESTAURANT
The crisis was strongest in the year 2010 and thereby the government appealed for financial
assistance on an international basis (Whelan et al. 2015). The falling economy of the country
had an adverse effect on every industry in the country and thereby the service sector was also
affected. Nando’s had opened its branch in Ireland in the year 2008, which was the time of
acute financial crisis in the country. The revenues of the restaurant in Ireland after the
establishment of its flagship restaurant was high, however, the restaurant had to cut their
profits to remain in the market (Franek and Zmeškal 2013). The economic situation of the
country therefore had an effect on the profits of the restaurant.
Social factors
The Irish people are fond of the Italian and French cuisine. Nando’s is a restaurant
that originates in Africa. However, their famous dish PeriPeri Chicken is liked by the people
of every culture and from any region as well. The Irish cuisine is majorly affected by the
Italian and the French style of cooking. The people of this country are passionate of their
food and they are welcoming towards any type of cuisine. The African style of food of
Nando’s restaurant has been welcomed in this country and the restaurant has flourished its
operations (Frynas and Mellahi 2015). Ireland has a mix of different cultures and the people
of this country represent these cultures and their style of cooking.
Technological factors
The technological growth of Ireland in the past few years have affected the business
enterprises of the country. The analysis of the data of the customers, the systems of managing
customer relationships and the communications related to social media has changed a lot.
Ireland is a small country however it has become the hub of creativity of the human brain
(Gander 2017). Ireland has proved to be the most important technology hub of Europe in the
recent years. This feature of the country is attracting more and more foreign companies to