Pizza Hut Company External Environment and the Market Analysis - Essay Example

Pizza Hut Vending Machine Group leader: Alya Al-Khalifa 00556 Hissa Marafi 00461 Moza alnasser 00201 Hayfaa Al-Khalifa 201300798 Shaikha alnassr 201300734 Tamader Alkhalifa 201300174 Principles of Marketing 101-L61 (Nov 29, 2014) Phase 2 Pizza Hut Company External Environment and the Market Analysis Pizza Hut Company is a chain of Restaurant Company operating in the USA market as a subsidiary of the Yum Brand, which is the largest restaurant company globally (Seudieu, Tagne-Saha & Schweig, 2004). The company traces its history back to 1958 when the first restaurant under this name was established in Kansas, USA and has grown ever since to an international business with close to 12,000 restaurants globally, 6,000 of which are found in the USA while the rest are distributed in 94 different locations internationally (Pizza Hut, 2014). The mission statement The mission statement of the Pizza Hut Company is “We take pride in making a perfect pizza and providing courteous and helpful service on time, all the time. Every customer says, "Ill be back!" (Pizza Hut, 2014). Through the mission statement, the Pizza Hut Company expects to understand the response of potential customers during the product launch. Through the mission statement, the Company expects to understand the market and the needs of the customers that can be implemented in later stages. The statement will enable decision making purposes and understanding on how to launch the products. Therefore, it will facilitate the understanding the level of resources that are required and the utility of the resources from various outlets and joints that the company will establish within its course of existence. Through the mission statement, Pizza Hut will be at a better position to manage its market environment both internal and external. The manner in which Pizza Hut will manage its market and the external business environment as a whole is determined by the values in its mission statement. External Environment Analysis Pizza Hut Company is a company that operates both in the USA and other international locations. Within the Qatar market, the social setting and the religious setting tend to determine the products that will be marketable and will be acceptable in the market share. The social setting of Qatar appeals and welcomes the product that our Company deals in. Pizza Hut product will realize success as the need to establish employees within Qatar are exempted (Seudieu, Tagne-Saha & Schweig, 2004). Within the social setting, the country has a history of wheat products. Therefore, this will act relatively in favor of most of our products, which are wheat based. The availability of the pizza hut vending machine within various places in Qatar will be self marketable. The vending machines are labeled according to the languages within Qatar. Within Qatar, the security levels of many places are highly commendable. The Company will utilize the security level in the various places within Qatar to set up the new products. This will ensure that the products are kept from vandalism and the inputs are maximized. The Company is set to gain a deeper understanding on the secure areas by gaining the data of the crime level from the database relative to policing within the country. This facilitates the marketing process as the language barrier between vendors and customers is eliminated. The introduction of the pizza machines product will be favorable as the Companies that manufacture wheat are readily available in the country. The company’s product is likely to realize positive notes from such products the Pizza vending hut machines. This is because there are no such products within the Qatar market and our Company will be the first to introduce it within the market. Through the environment, the product will be welcomed, as the food products are already known and the presence of the machines will indicate the products availability. The disadvantageous element that the Company is likely to face is the setting up of the pizza vending machines within the places that some of the food products are not accepted. The pizza vending machines offer some based food products like bacon which is highly unacceptable within Qatar setting. This is relatively as an influence of the country’s religious setting, which comprises mostly of Islam. These products will have to be reviewed within the areas in the country that have the Christians in order to maintain the Company’s ethical standards. The Company can implement the setting up of the vending machines and limit the food products to those accepted within the local setting only (Seudieu, Tagne-Saha & Schweig, 2004. The economic cycles experienced in Qatari economy have great impact on the core operations of individual businesses (Kerin, et al, 2012). The economic crisis that affected the global economy since 1998 has seen the company’s business slow down. The country’s economic crisis has established a system through which the companies that deal in wheat product manufacture shut down. This subsequently led to the shutdown of big companies including multinationals that were set up in the country. This is likely to impact on the product as there are lesser Pizza Companies within the area. Therefore the introduction of vending machines in the Qatar setting will be an added advantage over the remaining Companies. The technological environment is particularly favorable for Pizza Hut Company, since the company has been able to tap on the advanced modern technology to establish online presence, through establishing internet business locations from where its customers can order and pay for the company’s products. Through setting up Google maps on the vending machines, customers will be able to locate the machines more easily (Pizza Hut, 2014). This implies an added advantage to the Company’s product as the advertisement and supply of the product through multiple channels can be implemented at many levels. Through the internet, the advertisement of the variety of products that the country deals in can easily ensue to enable success of several products. Similarly, it is of great advantage as the internet can offer indicators on how the new products perform and is appreciated within the existent market. This will enable the Company understand ways of regulating the available resources (Kerin et al, 2012). The current social environment enables the social interactions of different cultures and enables the country to increase international branches. Pizza hut is a company based within the United States, therefore channeling the product through the other countries will induce some problems majorly in competitiveness. Within the Qatar market, other companies deal in Pizza and other products. Within the market are companies like Yellow Can Pizza and Almaftah group. These Companies have branches set in many places across the country and imposes a high level of competition the incorporation of this has been in incorporated within the business plan (Seudieu, Tagne-Saha & Schweig, 2004). SWOT Analysis Factors Ranking Strengths Perfect pizza reputation International presence 1 3 Weaknesses Unable to meet high demand High delivery cost No product variety 1 5 3 Opportunities Increase product variety Venture into new markets 2 4 Threats Take-over of previous markets by competition High cost of raw materials Campaign for healthy foods 1 5 3 o Strengths One of Pizza Hut strengths compared to other Companies that deal in similar products includes the outstanding reputation of the product. The pizza vending machines products are located in most parts of the countries and other Companies do not have the machines. Pizza Hut has earned a valued reputation through the country that the products are sold. The reputation underlies in the health material that the products are manufactured. Through the ventures in several countries, the Company has the strength of acquiring recommendations. The products have been produced in several countries around the world and the response has been overwhelmingly positive. This adds the possibility of the product achieving success in the Qatar market because of the products excellence in the service offered. Similarly, the Company’s level of dedication is evident in the maintenance of the vending machines (Seudieu, Tagne-Saha & Schweig, 2004). Weaknesses The Company is still settling in within the Qatar market. Therefore, it is highly expected that the Company will not be in a position to understand the market share and the level of product demand in the country. Therefore it is relative to establish a closer understanding on the number of machines that should be set up across the country. The product resources will be incorporated a t a gradual level for a selected period in order to establish the correct demand level of the product in the several outlets within the country. A weakness relative to the product is the delivery cost, which might be higher than expected. The vending machines are currently not manufactured within Qatar when the demand increases, more machines will be ordered from the United States, which might take long before getting to Qatar. This effectively raise the transport cost and force the Company to shift its budget (Young, 2009). Currently, the transport costs will be met until better solution of transporting the products surfaces. The Company is not in a position of dealing in different variety of products. Therefore, it will be reliant on few products relative to the general demand of the population until it establishes an understanding of what the country needs. Opportunities The Company has the opportunity of increasing product variety within the Qatar market. The Company ventures in the United States have seen the Company introduce new products in the market. Similar products within the United States can be introduced within the Qatar market in order to maximize profits. The company has products in the United States that no other Companies within Qatar have. It can then seize the opportunity and introduce these products in order to realize success. The company is currently establishing new markets within Qatar. The Company has an opportunity of introducing channels by opening joints in various parts of the country that will enable the product marketing at a wider scale. Through maximizing in the channels, the increased resources for the production of more products will be facilitated. Threats In Qatar, other Companies have been established in the country prior to the Pizza Hut. These companies imply competition to our Company, which is forced to adjust its ventures and prices in order to remain relevant within the market. The Companies have established relationships around the country. This imposes setbacks in the ‘Pizza Hut’ ventures around the trade areas (Young, 2009). The products in the United States are readily and easily available due to the availability of the companies that produce them. Within the Qatar market, some of the products are non-existent and have to be sourced from the United States. The Pizza Hut Company has secret ingredients available in the United States. Therefore, to maintain similar standards, the company has to utilize similar products and ingredients without compromising (Seudieu, Tagne-Saha & Schweig, 2004). Conclusion Pizza Hut Company should be well aware of the external market situation in order to inform their decisions on the right steps to be taken. This external market analysis gives a summary of how they affect the business. This will offer good guidelines in their planning process. Through the evaluation of the new market and factors relative to the Company’s success, the level of competitiveness is ensured. ‘Pizza Hut’ experience in Qatar will similarly generate markers when establishing new ventures in countries that have similar background settings. Reference Kerin, R., Hartley, S. & Rudelius, W. (2012). Marketing: 11th Edition. McGraw-Hill. Pizza Hut. (2014) http://www.pizzahuthawaii.com/About-Us.aspx Seudieu, C. Tagne-Saha, G. & Schweig, S. (2004). Case Study – Pizza Hut, Inc. University of Applied Science Frankfurt. Retrieved on October 23, 2014. From http://stefanschweig.com/download.php?cat=00_Start&file=pizza_hut_inc.pdf Young, A. (2009, September 16). Pizza Hut vs. Dominos: Who Delivered the Best Media Strategy? Ad Age. Retrieved on October 23, 2014. From http://adage.com/article/media/pizza-hut-domino-s-media-strategy/139027/ Read More