Case Study Of Caf De Coral
Case study of Café de coral
Introduction
Café de coral (CDC) is one of the biggest Chinese fast-food restaurants. Since it was first incorporated in 1968, it has grown to own over 580outlets all over the world. In my following essay, I am going to analysis the strategy being used by CDC.
According to the interim report of CDC (2014), café de coral are focusing on maintain the leading market position by upgrading their product and services. This means the CDC is using the market penetration strategy to consolidate the market.
Position of CDC
In order to understand why CDC is using such strategy we have to first understand its position in the industry. We will start with analyzing the external environment.
External environment- Opportunities (PESTEL analysis)
1. Political Factor
A low tax rate brings a better environment to all different business, including fast food industry- According to the 2014 Paying tax study*, Hong Kong has one of the most tax-friendly economics in the world. (Appendix 1)
2. Economic Factor
An economic growth leads to a bigger fast food industry. This can help making more profit: According to the South China Research Limited, in the over past four years, the market share of fast food industry has increased from 16.5% to 17.4%. Moreover, the total restaurant receipts in Hong Kong have increased at an average annual rate of 4.4%. (Appendix 2)
3. Socio-cultural Factor
The diet culture of Hong Kong people are eating outside. According to the data of MasterCard Survey in 2011, consumers in Hong Kong continue to make Dinning (75%) as their top spending priority in Asia region. This Hong Kong is having a very good environment to earn profit in the catering industry. (Appendix 3)
4. Technology Factor
The convenience of technology provides more channels for catering industry to do the promotion. For example, apps like the ‘Open Rice’ can provide E-word of month for catering industry to promote itself. (Appendix 4)
External environment-
Introduction
Café de coral (CDC) is one of the biggest Chinese fast-food restaurants. Since it was first incorporated in 1968, it has grown to own over 580outlets all over the world. In my following essay, I am going to analysis the strategy being used by CDC.
According to the interim report of CDC (2014), café de coral are focusing on maintain the leading market position by upgrading their product and services. This means the CDC is using the market penetration strategy to consolidate the market.
Position of CDC
In order to understand why CDC is using such strategy we have to first understand its position in the industry. We will start with analyzing the external environment.
External environment- Opportunities (PESTEL analysis)
1. Political Factor
A low tax rate brings a better environment to all different business, including fast food industry- According to the 2014 Paying tax study*, Hong Kong has one of the most tax-friendly economics in the world. (Appendix 1)
2. Economic Factor
An economic growth leads to a bigger fast food industry. This can help making more profit: According to the South China Research Limited, in the over past four years, the market share of fast food industry has increased from 16.5% to 17.4%. Moreover, the total restaurant receipts in Hong Kong have increased at an average annual rate of 4.4%. (Appendix 2)
3. Socio-cultural Factor
The diet culture of Hong Kong people are eating outside. According to the data of MasterCard Survey in 2011, consumers in Hong Kong continue to make Dinning (75%) as their top spending priority in Asia region. This Hong Kong is having a very good environment to earn profit in the catering industry. (Appendix 3)
4. Technology Factor
The convenience of technology provides more channels for catering industry to do the promotion. For example, apps like the ‘Open Rice’ can provide E-word of month for catering industry to promote itself. (Appendix 4)
External environment-