Esprit Strategic Analysis Essay Example for Free

Esprit Strategic Analysis EssayIn work out to a research of microenterprise in Macau, casino and gambling enterprise is the main source of income to the Macau economy. Over 80% of income is contributed in 2012. However, microenterprise is withal taking an demand role to the healthy long-term development to the local economy.By doing so, a scrolldle of diffe prosecute strategies gather in to be conducted in all(prenominal) accompany in golf-club to achieve the goal. Strategic Management is a way to identify competitive advantage and analyze the internal and external factors which influence bingles death penalty. It also helps in making a pealdle of decisions for future direction and attaining sustainable development by formulating and implementing appropriate strategies.In this report, company background information, vision and mission, a series of dodging formulations and analysis argon provided. Further much than, applying various strategies in actions and implemen tation atomic number 18 attached in the following.INTRODUCTIONCaf siamese connection miscellany Loi Kei is wizard of the historical cafe in Macau and their exclusive hand-made pork barrel hack on bun is the icon while it leave come up in mind of locals and tourers when thinking of Macau. It was established in 1968, with nearly 50 geezerhood of history located at the Siamesepa village. The initiate owner of the cafe was Ms. Kuok Loi Ho but the handicraft is communicable to her daughter Ms. Chan Ka I and other both family members. In the 1960s, Taipa village is non healthful-developed as what good deal receive today where there were views of firecracker factories set up there. Ms. Kuok was origin every(prenominal)y operating this kind of employment but it involves highschool risks and accidents were often occurred during that time.She later transformed her business in opening a cafe which was merchandising drinks only. At that period, there were many Lusitanian w orking at the Municipal Council at Taipa conterminous to the cafe. Ms. Kuok was taught by a Portuguese to gear up a pork meat cleaver bun with special Portuguese sauce and it becomes the esteemed pork cut bun nowadays.Following the success of the business, more stores argon meat cleaver-chop opened in Macau and even Hong Kong. Besides of the flagship store at the Rua do Cunha, it can also be found in Venetian and one(a) near Ruins of St. Paul. The food items argon diversified for options which fish ball, squid, beef, and pork chop rice with onion sauce etc. are served as well. With good word-of-mouth and constitution and being recommended by many guidebooks, their main guests are tourists and it is said that the Tai miscellany pork chop bun has to be tried when every tourists come to Macau.MISSION accord to the owner of Caf Tai florilegium Loi Kei said, their mission is Whoever talks about pork chop bun, the first leaf blade light upon come up with in their mind is Ta i miscellany Loi Kei. Our group thinks that it is not unassailable enough in regard to be a good mission statement therefore, we dedicate further developed a more comprehensive mission statement downstairs. To be the sounding role of pork chop bun merchandise not only in Macau, but also carry the business to atomic number 16-East Asian countries.As a top family style pork chop bun store, we are determined to reinforce our consider by objectiveing our own logo, slogan and brand of Cafe Tai Lei Loi Kei. With the insistence of honeyed ingredients used and friendly sentimental service, we are committed to serve high value and character point of intersections to all visitors and local residents at reasonable price.In ball club to meet the customers needs and demand in the quick changing commercialize, we will continue to develop sensitive technology applying in food intersection pointion and forward-looking products. Our dedicated team is also responsive to social com munity in hiring uneducated local employees as well as contribution in charity activities, in where providing growth probability and building a more familiar relationship to employees.VISIONWe are transforming the true operation pattern to microenterprise, with regional dealership operations not only limited to Macau but also to the South-East Asian grocery. We believe that an quicken bring in will be kept over the next few years. We will constantly design and launch bleak menu items in accordance to the local appetite in the market. Our goal is to make a remarkable profit for every branch of Caf Tai Lei Loi Kei and fulfill everycustomers expectation. STRATEGY FORMULATIONi. outer element Evaluation matrix (EFE)Caf Tai Lei Loi Kei Key External FactorsOpportunitiesWeightRatingWeighted S eye ontogenesis frame of tourists coming to Macau0.1530.45Better economy in South East Asia and Mainland china0.1030.30 Increase in Macau masss purchasing power0.1030.30Promotion coupons a ttached in Macaus official tourist map out may help increase awareness0.0520.10 Cooperation with the youth correctional institution may help determination manpower0.0530.15 terrorsCustomers are easy to change another brand to consume pork chop bun0.1020.20 Increasing number of competitors in the town selling similar product0.1510.15 Increasing amount of rent in Macau may lead Tai Lei suffer0.0520.10 Local people refuse to work in small-middle enterprises0.0520.10 Negative comments from online reviews and locals0.0520.10 Negative intelligence operation in Taipas flagship store in celestial latitude 2011 (required to close by IACM)0.0530.15 People seek for correct food and beverage nowadays0.1020.20 TOTAL1.002.30Caf Tai Lei Loi Kei has a summarise weighted score of 2.30 revealing that the company is below average in its performance to implement strategies that capitalize on external opportunities and avoid threats.ii.Internal Factor Evaluation Matrix (IFE)Caf Tai Lei Loi Kei Key Internal FactorsStrengths WeightRatingWeighted ScoreOld history and estimable brand name0.1040.40Use central manufactory to produce pork chop to ensure equivalent quality and acquired ISO recognition0.0530.15 Earning profit every year0.1540.60 attractiveness to practiceors from South East Asia and Mainland mainland China0.1540.60 Strong merchandise team to develop new onward motional programs and expansion strategies0.1030.30 weaknessesLow educational aim of all level of the employee0.0520.10 Lack ofmanpower0.1010.10High selling price compares to similar products in the market0.1520.30 Limited amount of branches in Macau Peninsula0.0530.15Most products are in high calories 0.1020.20TOTAL1.002.90Caf Tai Lei Loi Kei has a total weighted score of 2.90 indicating that the company is above average in its effort to implement strategies that utilize on internal strengths and minimize weaknesses.iii.Competitive Profile Matrix (CPM)Two core competitors are identified in accordance to geographic location, product, quality and price. Caf E.S.KIMO is the first Taiwanese coffee stool in Macau (MGTO, 2012), with the immersion of local favors. It also provide famous pork chop bun with a very nice unit price of MOP 13. It has many branches across the town as well as mainland China. In the Taipa branch which just located opposite to Caf Tai Lei Loi Kei, it placed an easy-up monetary standard (see picture 1) outside of the store showing that Macaus famous pork chop bun only sells MOP 13 (see picture 2).Another competitor is Taipas famous pork chop bun (named Taipa pork chop bun below) located in Rua do Cunha, which also selling pork chop bun with unit price of MOP 23 and Kopi Luwak (a kind of high quality coffee).Caf Tai Lei Loi KeiCaf E.S.KIMOTaipa Pork Chop BunCritical Success FactorsWeightRatingScoreRatingScoreRatingScore Advertising0.1020.2030.3010.10Food Quality0.1530.4530.4520.30Dietary Consideration0.1020.2030.3020.20Service Quality0.1030.3030.3020.20Price C ompetitiveness0.1020.2040.4020.20Management0.0330.0930.0920.06 pecuniary Position0.0530.1530.1520.10Customer Loyalty0.0520.1040.2010.05Reputation0.0540.2040.2020.10Global Expansion0.1520.3030.4510.15Market Share0.0530.1540.2020.10Accessibility0.0330.0940.1210.03Atmosphere of Restaurant0.0420.0840.1620.08Total1.002.513.321.67According to the result of CPM, it shows that Caf Tai Lei Loi Kei has a total weighted score of 2.51 which is just above average. Comparing to the other two core competitors, the company is primed(p) in the middle while Caf E.S.KIMO is performing the shell among them.iv.Strategic Position Action Evaluation Matrix (SPACE)According to the result of the SPACE Matrix, it showed that the strategic position of Caf Tai Lei Loi Kei is aggressive (1, 1.11). The environment is stable, behave the strong competitiveness and financial background. The appropriate strategies are backward, forward, horizontal integration, market penetration, market development, product devel opment and diversification.v.SWOT MatrixStrength1.Old history and reputable brand name2.Use central manufactory to produce pork chop to ensure same quality and acquired ISO recognition 3.Earning profit every year4.Attractiveness to investors from South East Asia and Mainland China 5.Strong marketing team to develop new promotional programs and expansion strategiesWeakness 1.Low educational level of all level of the employee2.Lack of manpower3.High selling price compares to similar products in the market 4.Limited amount of branches in Macau Peninsula5.Most products are in high caloriesOpportunities1.Increase number of tourists coming to Macau2.Better economy in South East Asia and Mainland China3.Increase in Macau peoples purchasing power4.Promotion coupons attached in Macaus official tourist map may helpincrease awareness 5.Cooperation with the youth correctional institution may help finding manpowerS1, S4, S5, O2 draw out the business to South East Asia and Mainland ChinaS1, O1, O2, O3 vex more efforts on the publicizing and promotion in existing marketThreat1.Customers are easy to change another brand to consume pork chop bun 2.Increasing number of competitors in the town selling similar product 3.Increasing amount of rent in Macau may lead Tai Lei suffer 4.Local people refuse to work in small-middle enterprises5.Negative comments from online reviews and locals6.Negative news in Taipas flagship store in December 2011 (required to close by IACM) 7.People seek for better food and beverage nowadays-W3, T3 Acquire supplier company to lower the speak to W5, T7 Develop healthy product to capture the market share of the healthy followersi.Acquire supplier companyAccording to the W3 and T3, it shows that Caf Tai Lei Loi Kei is suffering the very high rent in Macau, especially the shop located in the Taipa ancient town which costs them al about MOP 150,000 per month. Furthermore, Tai Lei has set the selling price in a high level comparing with other si milar products in the market in order to balance their financial statement. However, it does not help with the cost issue. We suggest that backward integration strategy would be suitable for them.Caf Tai Lei Loi Kei has already taken care of their distribution therefore, they can acquire or so of the supplier companies such(prenominal) as the company which provides bread and pork chop. With the implementation of this strategy, they can have better control in the cost of their business and they might lower the price to attract more customers. ii.Develop healthier productNowadays, people concern their health more than before. The trend of the current environment is tent to corrupt healthy and green products and companyalways promotes well-being. However, the products of Caf Tai Lei Loi Kei are high calories and deeps and its not what the current market looks for. According to the W5 and T7, it indicated the need to develop healthier food. For example, Tai Lei can invest a new produ ct which claims at healthiness, such as using organic ve formables, low fat milk, vegetable oil, etc.iii. dramatise the business to South East Asia and Mainland China According to the strength 1, 4, 5 and prospect 2 and the concept of the market development, it discloses that Caf Tai Lei Loi Kei have a strong power to expand their business out of Macau. They are successful and have a long history of their business and have already accumulated a well reputation.In addition, they are famous to the South East Asia and Mainland China. Its attractiveness to the investors from those countries to invest a new business in there. Moreover, the economy of South East Asia and Mainland China are doing well nowadays, its one of the motivators that Tai Lei should expand their business to the two markets.iv.Put more efforts on the advertisement and promotion in existing market In strength 1 and opportunity 1, 2, 3, we suggest Tai Lei can create a new strategy with application of market penetratio n. Tai Lei owns two branches in Hong Kong and three in Macau. Hong Kong and Macau are popular tourism cities in the world, especially Macau the number of tourists coming to Macau is increasing rapidly. Moreover, according to the opportunity 2, there is better economy in South East Asia and Mainland China, and the main tourists of Hong Kong and Macau are come from those countries.Advertisement and promotion can help to figure Tai Lei to those tourists before the company enters to these two new markets. For example, using celebrities to promote the brand and product or distribute coupons via different channels. If Tai Lei put more efforts to do the advertisement and promotion in Hong Kong and Macau, it can attract more consumers and increase the market share.vi.Quantitative Strategic Planning Matrix (QSPM)A QSPM for Caf de Tai Lei Loi KeiAcquire supplier companyPut more efforts on the advertisement and promotion in exiting marketExpand the business to South East Asia andMainland Chin aDevelop healthier product External FactorWeightASTASASTASASTASASTASOpportunities1.Increase number of tourists coming to Macau0.1510.1540.6020.3030.45 2.Better economy in southeastern Asia and Mainland China0.1010.1030.3040.4020.20 3.Increase in Macau peoples purchasing power0.1020.2030.3010.1040.40 4.Promotion coupons attached in Macaus official tourist map may help increase awareness0.0530.1540.2000.0030.15 5.Cooperation with the youth correctional institution may help finding manpower0.05-------- Threat1.Customers are easy to change another brand to consume pork chop bun0.1020.2040.4010.1030.30 2.Increasing number of competitors in the town selling similar product0.1520.3040.6010.1530.45 3.Increasing amount of rent in Macau may lead Tai Lei suffer0.05---- 4.Local people refuse to work in small-middle enterprises0.05--- 5.Negative comments from online reviews and locals0.0510.0540.2030.1520.10 6.Negative news in Taipas flagship store in December 2011 (required to close by IACM)0. 0510.0540.2020.1030.15 7.People seek for healthier food and beverage nowadays0.1010.1020.2030.3040.40 Sub Total1.001.303.001.602.60Internal FactorWeightASTASASTASASTASASTASStrengths1.Old history and reputable brand name0.1010.1040.4030.3020.20 2.Use central manufactory to produce pork chop to ensure same quality and acquired ISO recognition0.05---- 3.Earning profit every year0.1510.1530.4540.6020.30 4.Attractiveness to investors from South East Asia and Mainland China0.1510.1530.4540.6020.30 5.Strong marketing team to develop new promotional programs and expansion strategies0.1010.1040.4030.3020.20 Weakness1.Low educational level of all level of the employee0.05-------- 2.Lack of manpower0.10---3.High selling price compares to similar products in the market0.1540.6020.3010.1530.45 4.Limited amount of branches in Macau Peninsula0.0510.0540.2030.1520.10 5.Most products are in high calories 0.1010.1030.3020.2040.40 Subtotal1.001.252.502.301.95Sub Total Attractiveness Score2.555.503.904 .55As the table of QSPM for Caf de Tai Lei Loi Kei show that the left two columns are extracted verbatim from the EFEM and IFEM of Cafe Tai Lei Loi Kei and also note that four alternative strategies 1) Acquire supplier company 2) Develop healthier product 3) Expand the business to South East Asia and Mainland China 4) Put more efforts on the advertisement and promotion in exiting market were from the companys SWOT Matrix.Moreover, the Attractiveness Score (AS) from1 to 4 is used to reveal each strategys attractiveness given the respective external or internal factor, where 4 is the best and 1 is the least attractive. Work row by row in developing the QSPM and decide which strategy is the best for the external or internal factor. after(prenominal) conducted the QSPM, the strategy of Put more efforts on the advertisement and promotion in exiting market was highly recommended based on the result of the sum total of the Attractiveness Score from QSPM and it acquired the highest score of 5.50.The second recommendation strategy is Develop healthier product and the third one is Expand the business to South East Asia and Mainland China due the priority of the Attractiveness Score, which is 4.55 and 3.90. QSPM can be important information for a firm to make decision of strategies. The strategy of the Attractiveness Score below 3 in the QSPM is not taken into the consideration.The reason of chosen Put more efforts on the advertisement and promotion in exiting market as the highly recommend strategy, the Attractiveness Score of this strategy in the sector of external factor, there are twoopportunities are rated as 4 and two rated as 3 reflecting that the strategy was attractive enough to fulfill those opportunities and one of the opportunities is not cerebrate those opportunities are related to the market trends the chance for increasing sales because the tourists, especially the South East Asian and Mainland China tourists, are flooding to Macau tourism market an d the booming economy increase the spending ability of local people as well.In addition, two threats about the competitors become more and more because of the opportunities that they can gain the market share of pork chop bun, besides two threats related to lots of negative comments, news are appeared on the internet, newspaper and magazine. Therefore, a strategy of Put more efforts on the advertisement and promotion in exiting market got the highest score on Attractiveness Score because it can against this situation by create more promotional advertisements and distributed by mass media in order to capture the largest amount of pork chop bun market share, by the way this strategy can break the negative comments and news as well.The remain one about the shortage of man power in Macau cannot solve by the firm themselves due to the government policy. On the other hand, in the internal factor, two strengths are rated as 4 and two strengths are rated as 3 to show that Cafe Tai Lei Loi Kei has the ancient and reputation brand name, the ISO recognition and the new hire marketing team so it is attractive enough to get the assist of investors all over the world, besides they had good financial report on earn profit per year.Thus, Put more efforts on the advertisement and promotion in existing market can be chosen as a tool to attract more investors so as to expand the pork chop bun market by the promotional advertisement about the ancient and reputation brand name and cooperate with the new hire marketing team, the expanding no longer steering on Macao but southeastern United States Asia. And one strength does not have any relationship of this strategy.Moreover, one of the weaknesses is rated as 2 and one is rated as 4 related to higher price and do not have enough branches in Macau, so the promotional poster or promote in the travel guide book to fury the ancient brand name with where to buy instruction that can be a good ancestor to against the weaknesses whic h already excited in Tai Lei, furthermore one of the weaknesses is rated as 3 for the less of healthier food, thus first at all, Tai Lei prove some health product accordingly use Putmore efforts on the advertisement and promotion in existing market to do more promotion of the related product. And the other weaknesses are no impacted on this strategy.STRATEGY carrying outi.Acquire supplier companyAcquisition is one of the backward integration methods. Caf Tai Lei Loi Kei could acquire suppliers such as the pork chop and bread suppliers, etc. This benefits Tai Lei because it eliminates the profit which normal suppliers get from Tai Lei, causing reduction of cost. Upon the acquisition, Caf Tai Lei Loi Kei may have to keep all the original staff of the suppliers. However, the organizational culture of the two firms may be different so it becomes difficult for Tai Lei to persuade all staff to have full commitment to the Caf. Remuneration package have to been discussed again in order to retain all experienced staff.ii.Develop healthier productInventing and creating new piquancy products will be a way for Caf Tai Lei Loi Kei to survive in the keen competition. Customers are always looking for new products and innovations, especially some healthy food. After the launch of new products, it takes Tai Lei a long period of time to test the market response and to see whether the customers deliver the new products or not. Caf Tai Lei Loi Kei will definitely bear the risk that the new products do not help them to expand the product line and obtain good response from customers.iii.Expand the business to South East Asia and Mainland China It costs Caf Tai Lei Loi Kei a lot to expand a new market, such as some South East Asian countries. They have to spend a lot on marketing campaigns and promotion methods. Tai Lei has to tolerate the heavy marketing expenses and at the same time, bear the risk that the customers from new market do not accept this kind of new products. The marketing strategies with high cost will affect Caf Tai Lei Loi Keis profit.iv.Put more efforts on the advertisement and promotion in existing market Byapplying the same concept with the expansion of new market in South East Asian countries, Caf Tai Lei Loi Kei has to spend a lot to idiom more on the marketing effort within the existing markets, Macau and Hong Kong. It will be beneficial for them to focus more on the existing market since it is easier to retain customers rather than attracting new customers. However, the high marketing cost decreases Tai Leis revenue at the same time.CONCLUSIONCaf Tai Lei Loi Kei is a local brand with long history, selling its superior pork chop bun to delight customers with most efforts. According to the reference result and data, we created a brand new vision and mission for Tai Lei. Those interview result includes its internal strengths and weaknesses, external opportunities and threats and many other factors which may affect the future develop ment and performance of Tai Lei.A number of matrixes have been conducted to better analysis the current situation of Tai Lei. After all the matrixes analysis, four strategies have been developed. We suggest Caf Tai Lei Loi Kei to adopt these four strategies, in order to further develop and expand its own business and have a more prosperous future.