Wits Business School
Nando’s International: Flying High with a Global Chicken Brand Josi McKenzie sat back and considered the development of Nando’s International since she had joined the company in June 1992, when there were 12 stores in South Africa, and international exposure was limited to Australia and the United Kingdom. Her role was then defined as marketing, which in Nando’s came to mean an absolute understanding of most of the business elements outside of finance. It was January 2004, and together with Robert Brozin, the chief executive officer and co-founder of Nando’s, and Mike Denoon-Stevens, the international development director, she had been strategising as to which global opportunities offered the most promise in the New Year. The company had performed extremely well once again in 2003, with the result that Nando’s had more than trebled its number of stores over the 16 years since inception. By the end of 2003, there were a total of 450 stores throughout the world, 186 of them being in South Africa. McKenzie felt good about this record, especially because the group had managed to improve market share in an extremely competitive industry and a volatile global economy. However, she felt that there was enough potential in the company to perform even better on a global basis in 2004. Since 1997, when 27% of Nando’s stores were located in international markets, that figure had grown to almost 60% by the end of 2003. Nando’s ascribed this success to two strategic approaches. Firstly, it had more recently focussed on a what it termed a hubbing growth strategy as opposed to a shotgun strategy. This meant that the company had concentrated on developing existing geographic regions, chiefly the Middle East and Asia, instead of taking any opportunity that presented itself. Secondly, it had placed a greater emphasis on the correct positioning of the Nando’s brand in each of its international markets. The critical issue up for debate for 2004 was which hub should be developed next. Should it be the United States, South America, the Eastern bloc, or the China/Japan axis? The team had learned that there was no such thing as a one size fits all approach, and had to determine how to best execute a branding strategy tailored to each country they entered. There were a number of issues to consider. Amongst them was the question of how Nando’s could improve its service delivery, recognising that customers rated the importance of service as 80% and that of product as 20%. Furthermore, how could the group polish the brand in order to maintain its positioning? The Nando’s International management team needed to make decisions quickly in order to achieve the goal they had set of 15% store growth in 2004.
This case was prepared by research associate, Tamzyn Dorfling, with lecturer, Dr. Terry Berkow. The case is not intended to demonstrate effective or ineffective handling of an administrative situation. It is intended for classroom discussion only. Copyright ©2004 Graduate School of Business Administration, University of the Witwatersrand. No part of this publication may be reproduced in any format - electronic, photocopied, or otherwise - without consent from Wits Business School. To request permission, apply to: The Case Centre, Wits Business School, PO Box 98, Wits 2050, South Africa, or e-mail firstname.lastname@example.org.
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