Ruth Chris Case Study
EXECUTIVE SUMMARY
Dan Hannah, Vice President for Business Development at Ruth’s Chris, uniquely American and successful Steakhouse restaurant was responsible for the development of new business strategy focused on continued growth and company operated restaurants. Even though current restaurants were seeing consistent incremental growth, new restaurants were critical. Hannah knew that the international opportunities offered a tremendous upside. There are currently 10 successful locations internationally. These locations include Canada, Mexico, Taiwan and Hong Kong. Based on the fact that these international locations were doing well and seem to be the path to increased revenue, Hannah decided that he would adhere to the ‘market development’ model. Hannah proceeded to look at market criterias, competition and the meat/beef consumption rate per region/country throughout the world in order find the best suitable locations to grow Ruth’s Chris chain of restaurants internationally.
ISSUE IDENTIFICATION
Ruth's Chris senior team to locate new international markets to increase stores whether owned or franchised, in order to increase revenue.
ENVIRONMENTAL AND ROOT CAUSE ANAYLSIS
The criterias that have eliminated some of the potential prospects include:
Liquid net worth of at least $1US million
Verifiable experience within the hospitality industry
Ability to desire and develop multiple locations
Cost of Franchise - $100,000US
A 5% gross sales royalty fee
2% of gross sales fee as a contribution to the national advertising campaign
For Market Selection Criteria, some concerns were:
Looking for market that includes beef eaters – people who enjoy eating beef
Markets where it is legal to import beef from US
Population – high urbanization rates
High disposable income
Locations where people do
Dan Hannah, Vice President for Business Development at Ruth’s Chris, uniquely American and successful Steakhouse restaurant was responsible for the development of new business strategy focused on continued growth and company operated restaurants. Even though current restaurants were seeing consistent incremental growth, new restaurants were critical. Hannah knew that the international opportunities offered a tremendous upside. There are currently 10 successful locations internationally. These locations include Canada, Mexico, Taiwan and Hong Kong. Based on the fact that these international locations were doing well and seem to be the path to increased revenue, Hannah decided that he would adhere to the ‘market development’ model. Hannah proceeded to look at market criterias, competition and the meat/beef consumption rate per region/country throughout the world in order find the best suitable locations to grow Ruth’s Chris chain of restaurants internationally.
ISSUE IDENTIFICATION
Ruth's Chris senior team to locate new international markets to increase stores whether owned or franchised, in order to increase revenue.
ENVIRONMENTAL AND ROOT CAUSE ANAYLSIS
The criterias that have eliminated some of the potential prospects include:
Liquid net worth of at least $1US million
Verifiable experience within the hospitality industry
Ability to desire and develop multiple locations
Cost of Franchise - $100,000US
A 5% gross sales royalty fee
2% of gross sales fee as a contribution to the national advertising campaign
For Market Selection Criteria, some concerns were:
Looking for market that includes beef eaters – people who enjoy eating beef
Markets where it is legal to import beef from US
Population – high urbanization rates
High disposable income
Locations where people do