Question

Your friend tells you that she is considering establishing a pizza takeout and delivery restaurant. She is in a dilemma however,because a few of her family members say it is a bad idea, and others differ.She Is banking on you, a business undergraduate, to help her make a decision. Based on an external analysis of the general environment and the industry[including threats and opportunities], offer three reasons why your friend should/should not enter the Pizza industry. Take a clear stance.Assuming she has made up her mind to enter the industry, what would be the most profitable position (in the industry value chain) to assume?

Answer 1

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Three ways are as follows:

1) High competition in the market:

This point states that it is not easy to start any business because there is already a high competition going on in the market. You need to be best to attract customers towards your restaurant. Socially you have to promote your business so that people will get to know about your restaurant and promoting your restaurant is not an easy task. You need to do proper advertisement which is a very difficult task to perform. Moreover, you need a theatre customer base which will help you to grow your business but it is a time-consuming activity. Because of the competition in the market, it will be very difficult for a new startup to survive in the market.

2) The high amount of Investment:

This point states that you need to invest a huge amount of money in your startup business as there will be a lot of expenses in starting a business. You need to hire well-qualified employees for your restaurant which will help you in your business because running a business is not a single person game. You need to have at least 8 to 10 people with you. As it requires a lot of investment, but it will not guarantee you the success you are looking for. Several things you need to take care of which will help you in increasing your business which includes a suitable location, less competition, etc.

3) Difficult to satisfy customers:

This point states that it is very difficult to provide satisfaction to the customers as they are already attracted to other restaurants and it is a very difficult task to attract them towards your restaurant. Moreover, you need to provide the best quality service to them if you want them to be your regular customers.