Cafe de Coral

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The Hong Kong Management Association
Diploma in Management Studies

Spring Term 2013
Management Project
A Two-Year Strategic Business Plan of Café de Coral in Hong Kong Fast Food Industry.

Cover Sheet

2. INTRODUCTION
2.1 Company History & Background
Café de Coral Group (0341) is the largest publicly listed Chinese fast food restaurant group in the world. The Group is principally engaged in the operation of quick service and specialty restaurants chain, with vertical and horizontal diversification in institutional catering and food processing business. The Group was incorporated in October 1968 and went public in July 1986 on the Stock Exchange of Hong Kong, which was the first of its kind at the time of listing. In October, it was appointed as one of the top 200 constituents of The Heng Seng Composite Index Series. After 42 years of development, if has become the market leader in the Hong Kong fast food industry and the largest national brand for Chinese quick service restaurant in Canada, with over 24.8% market share in the Quick Service Restaurant segment and 4.6% of the total dining out industry in Hong Kong. Its business operation spans over 2 continents with more than 300 operating units in Hong Kong, over 100 outlets in China as well as more than 140 units in North America. Below is a Café de Coral’s organization chart.

2.2 Company Motto & Mission
The trade-name “Café de Coral” originates from the Chinese ideal of togetherness, forming a three- word logo literally meaning that both the shareholders, the customers and the staff, should be “all happy together” at “Café de Coral”. The corporate motto”A Hundred Points of Excellence” reflects their commitment to strive for excellence, as they make strategic business moves in a rapidly changing world. Profit is only a by-product of their undeviating pursuit of excellence to 100%. Their Mission is“To establish Café de Coral Holdings as a distinguished corporation in the food and catering industry as the world’s largest Chinese quick service restaurant group, maintaining a publicly recognized leadership position in the mass-market, quick service restaurant chain business, with vertical and horizontal diversification towards the food services, food processing and distribution, catering and hospitality sectors in the world arena.”

2.3 Strategies and Goals
In the past year, the catering industry has seen skyrocketing material costs, which have driven up operational costs around the world. In Hong Kong, they have also found their selves struggling under increased labour and rental costs. Recognizing that these increases will be an ongoing issue in the foreseeable future, the Group implemented a number of measures to address these impositions, such as improving the efficiency of the existing shops. Two new central food processing plants have been developed and will take over the majority of back-end food preparation. Their local businesses will be supported by the plant under development in Hong Kong, while the PRC plant and accompanying training centre currently in operation will support business development in China. Together these new plants will allow them to make improvements in product quality and implement cost control measures uniformly across brands. They will also permit to accelerate expansion. With simplified menus, the front-end can focus on improving services and generating larger sales. 3. PROJECT OBJECTIVES

With the Hong Kong economy of inflation, the unemployment rate is still high. The influences of the minimum wage imposed last year, fast food industries faced a very keen competitive situation. Café de Coral is under large chain operations, with a strong brand image. This project concentrates on improving competitiveness, assuring the quality of services, improving employee performance and workflow of Café de Coral. Moreover, new ideas and techniques are introduced to increase effectiveness. Besides, another objective is to...
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