PEST And SWOT Analysis for Gourmet Burger Kitchen - Case Study Example

 PEST And SWOT Analysis For Gourmet Burger Kitchen PEST ANALYSIS Any company or organization has to cater to political, economical, social and technological factors when they want to establish their business in a specific company. Similarly when Gourmet Kitchen Burger will open its franchise in Switzerland then it would also have to cater to all these factors. It would need to critically analyze all the political influences, economic issues, social and cultural effects and technological progress within the hemisphere of Switzerland. Political Factors The production, processing and distribution of Gourmet Burgers are highly effected by the policies, laws, regulations of different political influences. Not only the national government or the local government is taking steps in maintaining healthy food regulations but different regulatory bodies and trade unions are also taking steps in promoting and maintaining healthy environment and keeping the track of consumer rights. Switzerland is known to have a unique political system where they practice direct democracy; they have the most decentralized power frequent referendums and encourage participation from the citizens. But one of the most unique aspects in Switzerland government is that they have no political pressure groups leaders (CIA World fact Book, 2009). Due to this GKB and all other companies like to invest in Switzerland because all the companies are given a lot of leverage to operate independently and there is least interference from the national or local government bodies. But keeping in mind the rights of consumers Switzerland government has set proper food safety regulations. Thus it has implemented both GM food safety and labeling legislations. In 1995, Switzerland was the first country who implemented a labeling regime for GM food since then revision has been taken in this (Wugar, 2006, 1). Thus now when a new company has to start its new operation is has to follow a proper procedure, first it needs authorization from federal office of Public Health, then it needs to get registered and all the legal requirements need to be fulfilled. The regulations on food and commodities and other pertinent regulations make sure that proper implementation of food laws are enacted and thus the Federation keeps a proper check on food quality and standards (Rentsoh & Partner, 2009, 1). Economic Factors Switzerland is known to have the most stable political system and due to this all companies try to take their business in this country. Switzerland is very competitive in nature in terms of new investment and thus attracts many companies and business men in setting their business. It has provided a favorable tax system, has a strong government and social organization, competitive social and labor taxes and is enriched with skilled and educated labor (Panama Offshore legal Firm, 2009). Since, GKB is a US based country so it is going to be more benefited because it shares strong relation with United States. Switzerland government policies regarding taxation and other property rights are so lucrative that some famous companies have also shifted their headquarters to Switzerland. Some of the US fast food chains who have moved their headquarters to Switzerland are McDonalds, Procter & Gamble, Colgate-Palmolive, Yahoo and Goggle. According to these company’s Geneva would be nest likely headquarters because Swiss intellectual property tax laws are very much favorable for the company in terms of profits and stability (Kollewe, 2009). Further, Switzerland is located in one of the most established country in the European Union (Trading Bock), thus operating in this country will provide a lot of benefit to GKB. Further, is a developed country thus it Swiss people have high disposable income and they have a high attend to eat and demand good quality food. Social And Cultural Factors As already mentioned early Switzerland is one of the most developed country, and thus the Swiss Population purchasing power and spending patterns are not focused on daily necessities but hey purchase those commodities that are some what new and different. According to CIA fact book, Switzerland age range is most high among the working class, i.e. 15-64 years and this comprise to approximately 68.1% of the total population. Thus Swiss population can easily purchase GKB products. We can see the spending pattern of Swiss on food items as all the famous food chains are open in Switzerland. All these international franchises are operating successfully in Switzerland because Swiss population demands such food chains. Further, due to low set up costs, franchising facilities offered from government and support from major suppliers conclude Switzerland as one of the most demanded places for investment. Thus on the basis of the previous operating UK or other country food chains we can say that Switzerland is going to be a emerging and a high demand market for GKB products. Further, Switzerland is highly influenced with United States thus the Swiss population also follows similar culture and attitudes to that of US. Thus when GKB will open its franchise in Switzerland we are likely to presume that the same spending trend are going to establish as that in US. Technological Factors Switzerland is developed country thus not alone government but other private companies also spent a lot on research and development. Swiss government believes in the fact that to remain competitive they would need to update and become technological advanced. Thus new discoveries and development are being made sooner or later, speed of technology transfer is reduces, use of internet is enhanced and information technology is encouraged at maximum. According to Global Competitive Report (2009) pp 293, Switzerland is ranked 9th in availability of latest technology, holds proficiency in firm-level technology absorption (Ranked 3rd) and high level of internet users (ranked 10th). All the companies, whether they are dealing with machinery, consumer goods or others they have high involvement and investment in technological innovation so that they remain up to date and competitive. Thus this concludes that GBK also would to make investment in latest technology so that it can compete in product, material, process, distribution and even when it is marketing its product. SWOT Analysis SWOT analysis includes Strengths, weaknesses, opportunities and threats of the company. Strengths and weaknesses are from the company’s perspective, while opportunities and threats are from the country’s perspective. Strengths GKB is a famous brand and enjoys having a brand identity, further it has maintained Quality food and international standards thus keeping and catering to a larger target market. Due to its consistent quality it has maintained a good will and good reputation hence have successful in catering international loyal customers. Weaknesses But it is also faced with some major weaknesses as this is not a 24 hours service dining restaurant. Further some population and customers also complain that they do not provide much variety in their menu or they don’t change their menus that often. Further some others also compare them with their competitors and regard GKB as not being highly competitive in nature regarding their products and offerings. Opportunity GKB should add healthier food items in their menu, and should cater to masses and attain more market share. They should do consolidation of other brands as well thus build competitive advantage in different segments. Further they should bring and adopt innovation and diversity in their product line, this way they would target more and diverse customers. Threats One of the biggest threats that GKB is facing is from the direct and indirect competitors. Nando’s and Hard Rock Café are its major competitors that are operating successfully and have created a bigger market share as compared to GKB. Further, GKB is also facing severe competition from other fast food restaurants such as KFC and McDonalds who have earned a high brand name and created a good image in terms of quality in burgers. REFERENCES Panama Offshore Legal Services, 2009, Political Considerations When Incorporating In Switzerland, accessed January 20, 2010 from http://www.offshorelegal.org/offshore-corporations/swiss-switzerland-offshore-corporations/political-considerations-when-incorporating-in-switzerland.html Wuger, Daniel, 2006, Consumer Information On Gm-Food In Switzerland And WTO Law, accessed January 20, 2010 from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1092757 Kollewe, Julia, 2009, McDonald’s To Move European Head Office To Switzerland, accessed January 20, 2010 from http://www.guardian.co.uk/business/2009/jul/13/mcdonalds-headquarters-move-geneva CIA Fact Book, 2009, The World Fact Book: Switzerland, accessed January 20, 2010 from https://www.cia.gov/library/publications/the-world-factbook/geos/sz.html World Economic Forum, 2009, The Global Competitiveness Report 2009-2010. Accessed January 20, 2010 from www.weforum.org Read More