Cpk Case Study

Topics: Economics, Pizza, Economy Pages: 5 (1638 words) Published: September 12, 2010
California Pizza Kitchen, Inc. (CPK) is a United States based dining restaurants chain. The company primarily offers a mixture of assortments of hearth-baked pizzas, a wide variety of unique appetizers, desserts, pastas, salads, soups and sandwiches. CPK operates across more than 253 locations in 32 states, the District of Columbia and 10 foreign countries. It owns 205 and 48 franchised restaurants across the world and is headquartered at Dover, Delaware. An external analysis of the California Pizza Kitchen reveals several challenges facing the business: Political, economical, social and technological changes to be specific. CPK’s communication strategy focuses on marketing the California Pizza Kitchen brand through many creative and non-traditional avenues. As one of the pioneers of premium pizza, they continue to benefit from national media attention featuring their co-founders and co-CEOs, Richard Rosenfield and Larry Flax, this is believed to provide CPK with a noteworthy competitive advantage. New restaurant openings, high-profile fundraisers and media events currently serve as the focal point of their public relations and media outreach efforts. As early as 2009 CPK landed a sponsorship agreement with the Los Angeles Angels of Anaheim and the Los Angeles Kings to promote California Pizza Kitchen at Angel Stadium and STAPLES Center, respectively. In the same year their public relations efforts led to coverage on a national level in various outlets including the Business Week Magazine, ESPN the Magazine, Los Angeles Times, USA Today, Wall Street Journal, The View, FOX National News and CNBC Power Lunch. CPK’s objective is to expand its leadership position in the restaurant and premium pizza market by selling original, high quality pizzas in addition to creative salads, distinctive pastas and related products and by providing extraordinary customer service, thus building a high degree of customer loyalty, brand awareness and superior returns for stockholders. To reach these objectives, CPK plan to increase the market share by expanding their restaurant base in new and existing markets, leveraging their partnerships in non-traditional and retail channels and offering inventive menu items. CPK is pursuing a disciplined growth strategy that, to be successful, depends on the ability and the ability of franchisees and licensees to open new restaurants and to operate these new restaurants on a profitable basis. Successful growth depends on numerous factors including: the hiring, training and retention of qualified working personnel, especially managers; competition for restaurant sites; negotiation of favorable lease terms; timely development of new restaurants, including the availability of construction materials and labor; management of construction and development costs of new restaurants; securing required governmental approvals and permits; competition in our markets; and general economic conditions. S.W.O.T. ANALYSIS

* California Pizza Kitchen, Inc. is a recognizable brand name. * California Pizza Kitchen, Inc. has a strong balance sheet and a steady reduction in long term debt. * There are a variety of different products and ways in which the CPK brand is being marketed. * California Pizza Kitchen, Inc has been able to remain competitive in pricing without having had to discount menu prices through the recession. Weaknesses

* California Pizza Kitchen, Inc has a lack of geographic diversification; currently 40% of company operated stores are located within California. As a result, CPK is particularly susceptible to adverse trends and economic conditions in California. Opportunities

* Franchised Restaurants and frozen pizzas (such as California Pizza Kitchen, Inc) have the possibility of improving overall margins in the long run. * Management has hinted there is a chance of marketing products other than just frozen pizzas through Kraft. * California Pizza Kitchen, Inc....
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