In: Economics
CASE STUDY:
BURGER KING OR US
You and a team of enthusiastic and budding entrepreneurs have decided to establish a fast food restaurant in the CBD.
The city centre is hustling and bustling and you are confident that your restaurant will be successful. You have decided
that your restaurant will cater for the healthy market and specifically offer a wide range of healthy take out options such
as gluten free products, healthy bite size snacks, low calorie sandwiches, a large range of healthy desserts and on the
go freshly squeezed juices.
Based on your experience and management qualification, your team has appointed you as the Managing Director of the
company. Burger King has just launched its first restaurant in the CBD. Having done your research on your
competitors, you and your team are confident that the new Burger King will not have an impact on your business. There
are a number of factors that impact on the success of a business. A business cannot operate in isolation and will
constantly be affected by some certain and some uncertain elements that may lead to business success or business
failure.
QUESTION 1
Based on your knowledge of the three environments within which a business operates, Identify and briefly explain the
THREE (3) environments within which a business operates. Make reference to the extract above.
QUESTION 2
“Having done your research on your competitors, you and your team are confident that the new Burger King will not
have an impact on your business.”
In reference to this statement and the extract, discuss Michael Porters Five Forces model and state the impact that
these FIVE (5) factors will have on your business
ANSWER 1.THREE Environment within which a Business Operates are as follows:-
a. Competitive Environment : Every business has threats from its existing competitors in the market. However, Burger King is so confident about its strategies that they feel competitors will not be able to affect their business.
b. Social Environment : Every company does SWOT Analysis and so has Burger King. The said company plans to offer to their customers a wide range of healthy take out options such as gluten-free products, healthy bite size snacks, low calorie sandwiches, a large range of healthy desserts and on the go freshly squeezed juices. This will take care of the social responsibility of the company and will try to attract more customers to their outlets.
c. Demographic: Demography may be based on age, sex, area, region, city, state, country, etc.Here, since the company is aiming to go gloabl it may offer variants in its burgers or other products in its menu as per the demand in a particular country. For, eg. Burger King is maily famous for providing Non-vegetarian Burgers. However, when it extendend its chain business in some countries like India, it found that the demand for vegetarian Burgers are more and vice-a-versa.
Answer 2. Impact of Michale Porter's FIVE Force Model on the business may be illustrated with the help of figure below.