The ways and solution to reposition Sylvias bar - Essay Example

? Marketing Contents Background 3 Issues 3 Objectives 4 Problems of Sylvia’s bar 4 Ideas and Information 6 Recommendation 6 Reference 9 Background Sylvia’s Bar was one of the renowned high street bar and a night club which was situated in Birmingham on the High Street. Sylvia’s Bar was founded way back in the year 1986 and was segmented as fashionable wine and a cocktail bar and mainly targeted the local bank workers. The Sylvia’s Bar was able o generate profit and was performing well with a healthy turnover. However in the recent few years the bar has not been performing up to the expectation and as a result there has been a decline in the profits of the bar and at the same time has become less popular. Sylvia’s bar which once gathered about 400 to 500 customers on regular basis, but in recent years it has been able to gather on an average 100 to 150 customers. Since Sylvia’s Bar targeted the higher income level of people, there rates were also high as compared to any other bar in the town. Sylvia hired the best bar staffs and in addition two of Sylvia’s friend had also joined the business as assistance manager and claimed ?20 per hour. Over the years, many late night bars and clubs were opened which made the competition tough for Sylvia’s bar. As a result the customers preferred the other night clubs over Sylvia’s bar which resulted in loss for the club. The staffs were also not satisfied with the management and wanted new changes to be implemented. Issues The case deals with Sylvia’s bar which once was the most popular bar in Birmingham but due to shift in the customers taste and preference has been suffering from losses. The main issue includes Positioning of the bar: The bar has been positioned in the scenario of 1986, which tends to serves the customers with cocktail and wine and playing music of the 1960s to 1990s. With a change in the consumer mindset and with the introduction of more bars in other parts of the town, the visitors have decreased rapidly. The rates of the products are quite high as compared to other night clubs and bars in the town The ambience which is considered to be stuffy and pretentious The young generations are not interested to come to the bar because the club is mostly filled with aged people and it’s situated far away. Objectives The objective of the management report is to find ways and solution to reposition Sylvia’s bar and to observe the problems that lead to the failure of the night club. Problems of Sylvia’s bar Sylvia’s Bar had encountered problem which lead to its failure. One of the main problems was that of operational factors. The profits of the firm tend to decline at an increasing rate. In the financial year 2011, the profit of Sylvia’s bar stood at negative balance. Sylvia’s bar was performing well till the financial year 2008 but in 2009 there was a sharp fall of profit and the last two financial years has experienced a declining profit rate. Year Monthly profit / loss (in Pounds Sterling) 2011 -400 2010 -250 2009 325 2008 1200 2007 750 2006 2800 2005 3500 Another problem was that of menu and cost of the products in Sylvia’s bar. The bar was established targeting the high class people of the society which included the bankers and as a result the prices were charged high. The cocktail menu started with a price range from ?8 to ?12. The wine was also costly and was imported from across the world. Bottles of wine which included the champagne started at about ?25and went up to ?250 while glasses going from ?6 to ?45. The pricing of the wine were seemed to be costly by the visitors and claimed that there were better wines at a cheaper rates in other night clubs. The food menu of Sylvia’s bar was also expensive and was served during the day. The price starts from ?23 for the main course and the most expensive dish cost ?35. But during the recent years there has been a fall in the demand for the food and as a result the bar often had to throw away ingredients. The bar hired classically trained cocktail bar staffs who normally charged ?12 per hours as compared to average charge of ?6.50 per hour. The bar hired a band, Razzle Dazzle who was quite popular during the initial days but latter lost the charm to attract more customers. They charged ?1200. But due to loss the bar remains closed from Monday to Wednesday as the rate of customers were very low. The staff of the bar did not like the dress code imposed over them and as a result they did not enjoy their work. The male staffs were dressed in white shirt and black ties and the females were dressed in white blouse and black skirt. According to them the uniforms were dated and formal. Ideas and Information Analysing the case study of Sylvia’s bar it has been understood that the bar targeted higher class of the society and aimed to serve the customers with a high class food, wine and cock tail. Since the wine was imported from across the world, they had to charge a higher price for it. The food though was charged a bit higher than the usual price. The nightclub was doing pretty well before the establishment of other night clubs in the city. The competition became fierce between the night clubs and as a result people opted for the other night clubs in the town which offered good ambience, good food along with some good music which Sylvia’s bar lacked. The main problem was that the bar did not change when change was needed. They played the music of the 1990s which was not accepted anymore by the people. The people wanted new and exciting things which would attract them towards Sylvia’s bar but it lacked proper positioning and promotional methods. For any business to succeed it is always necessary to keep modifying the marketing mix and achieve success through it. One of the important facts of business life is that marketplace tends to change at a constant rate which changes the customer’s interest, new competitors enter the market. In short almost everything can change within a short period of time (Harper, 2003, p.122). Recommendation It could be concluded that the bar was having a tough time to survive with the competitors around the city due to lack of change management. The firm went on with the old look and scenario that once was liked by the customers but as said, change is the only constant thing and therefore business must adapt to the changes and work accordingly. The firm needs to reposition itself in order to attract more crowds and especially the youths. According to a survey conducted on the customers depicted a result which stated that the customers were not happy with the kind of weekend party the bar conducted. The music was not good; it was old which did not attract most of the young crowds. Thus it is suggested that the bar should reposition itself and target more of the younger generation. But it is also important not to forget the middle age people who have high disposable income and are ready to spend. The band should be changed, and the nightclub should appoint a band who could play music of all types this would attract the young crowd and also retain the old crowd. The main attraction was the band so once that is changed people would surely want to explore new things and thus Sylvia’s bar would be able to generate at least 10% of the crowd. Since the bar is going through a tough time it would be advisable to lower the rates of its product and close off the food section because less people would turn up and it cost the bar ?350per month in wasted food. The firm would be able to compensate for the loss by not wasting on the food and could spend on other things. The bar should cut cost in every possible way and spend it on the repositioning of the brand. If compared with other night clubs they provided a better ambience with right music and price. Ambience is regarded as the important thing when it comes to night clubs. People go to relax and have a gala time in nightclubs thus the ambience should be in accordance with the taste and preference of the target audience and potential customers. With respect to the staffs, dress code should be made much more relax so that the staff can enjoy their work. And most importantly the management should apply the concept of change management in order to keep its business going and to survive in the competitive market. With increasing competition, the firms need to cope up with the change and adapt itself in the new environment. Thus it is recommended to apply change management. To monitor the changes a balance score card can be implemented which would monitor all the changes that takes place and would help in analysing the result thereof. Reference Harper, S. C., 2003, The McGraw-Hill guide to starting your own business: a step-by-step blueprint for the first-time entrepreneur. McGraw-Hill Professional. Read More