Mr. Empanada Strategy recommendations Research Paper

Mr. Empanada Strategy recommendations - Research Paper Example At the same time, the firm avoids its weaknesses by utilizing its opportunities. According to the National Restaurant Association Study, casual dining represents 31.59% of the total food service sales. To possess a significant proportion of that percentage, therefore requires unique strategies to be competitively advantageous. Figure 1. casual dining percentage of total foodservice sales For Mr. Empanada to exceed franchises and bring in new investors to exceed his business, I recommend that his company adopt a strategy that gives his firm a competitive advantage. A competitive advantage refers to the advantage a firm has over its rival firms. Competitive advantage allows the company to increase sales, profits and retain more customers than the competitors. Competitive advantage also allows the company to generate more value for its sustenance and for the shareholders. Competitive advantage is derived through the firm’s strengths that include the firms cost structure, products , distribution network and customers support. There are two main routes to options development for competitive advantage. Those that are market based and those that are resource e based. Within the market-based approach, three main routes include the generic strategies, market options and expansion methods. The three fundamental strategic options available to an organization are referred as the generic strategies and include; Cost leadership This strategy aims at placing the organization amongst the lowest cost producers in the market. Empanada, can achieve overall cost leadership through various means. To start with, his firm can take advantage of economies of scale through franchising. By doing that, the purchases for his restaurants can be affordable in low prices given by the distributors as compared to the competitors. Due to large volume of purchases, the firm ought to attract cash discounts. Secondly, this objective can be achieved through globalization of operations. Franchi sing can be done in international level to increase the market share in many countries. This is advantageous due to wide awareness created. Strategic alliances can also be fruitful in this endeavor. The firm can decide to relocate to low cost parts of the world where labor is cheap and sources of supplies are many and cheap. This strategy is beneficial in outperforming rivals and erecting barriers to entry. Differentiation This option aims at developing and targeting a product that is different in some significant way from its competitors in the market place. Uniqueness in products through emphasis upon one or more elements of marketing mix as perceived by the target market is important as it offers a scope for distancing the company from its competitors expecting competitive advantages. This objective can be achieved through creating of strong brand identities. The firm can enhance its uniqueness through product engineering and creative flare generated from strong research (Nilsson , Fredrik & Birger 412). The firm can also employ the corporate reputation for quality service through strong cooperation from all channels of distribution. Having long tradition in the field of food and beverage in the food industry can give the firm a competitive advantage. Focus Focus strategy is also known as the niche strategy and involves targeting a small market segment where