Management of SMEs Kapai Case Study Analysis Essay Example

Management of SMEs: Kapai Case Study Analysis Essay James and Justine were intent NT on establishing a business concept that reached far beyond the confines of a traditional salad bar, and they were determined to develop their business as a leading nationwide retailer of health why fast food. Drawing on their love of New Zealand and their proud kiwi heritage, James and Justine wanted the concept to be uniquely kiwi, incorporating as much as they could into their business idea Developing the correct product has been critical to the success of Kappa. Jam sees and Justine have been keen to capitalism on the growing health and wellness trends Of consumers an d create a range of menu items that differentiates from the typical fast-food products that are alarm dead in the industry such as burgers, fries and pizzas etc. To get Kappa off the ground both men have taken separate roles within man king the business. James is currently working full-time as the General Manager running the off-site kick en whilst Justine is currently employed full-time job as a practicing lawyer and works as Business Development Manager part-time in the evenings. We will write a custom essay sample on Management of SMEs: Kapai Case Study Analysis specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Management of SMEs: Kapai Case Study Analysis specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Management of SMEs: Kapai Case Study Analysis specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Kappa is currently experiencing issues with regards to aligning their growth, ma reeking, and organizational strategies in line with their existing business plan. These issue s have been identified through internal and external analysis of the company and its external environ meet. Using a SOOT analysis and Porters Five Forces, this report will aim to illustrates e these issues providing an in depth analysis and discussion on the companys core competencies and areas of concern. Discussion is also centered around the company s business level strategies, star structure, and control systems to create a bigger picture of where alterations need to be made. Race emendations are provided at the end of this report with suggestions for improvements and chaw Eng. Page 3 2 Internal Analysis This report begins with an internal analysis of Kappa using the SOOT method t o identify the Meanys strengths and weaknesses with regards to how the company is pop aerating within its core environment. 2. 1 Strengths 2. 1. Early-Mover Advantage Kappa has the competitive advantage of being an early-mover within the health why alternative fast-food market. As discussed by Historic, Peters, Shepherd (2011), early or first-move errs within a market have the benefits of cost advantage, less competitive rivalry, securing imports NT channels, are better positioned to satisfy customers and are able to gain expertise through paretic potion. By recognizing this gap in the market and the gro wing consumer trend towards healthy eaten , Kappa has been able to differentiate and position itself as a leading healthy alternative within the Wellington region. With the growing number of stores Kappa has opened over the last seven year s, the company achieves cost advantages as it moves down the experience curve allowing the company y to achieve greater economies of scale. Apart from the likes of Subway who holds considerable s hare within the market, Kappa faces less competitive rivalry from chained incumbents such as McDonald Ids, Burger King and KEF etc. Who are yet to compete for considerable share within this space. Kappa h s also developed strong relationships with its suppliers especially with the likes of Potato an d its fruit juice provider; who both emboss Kappas logo on their packaging and have tailored products specifically to meet the needs of Kappa. This first-mover advantage allows Kappa to gain considerable expertise in this space as it learns, grows, and improves its strategies within this growing market. 2. 1. 2 Menu Design Range With its diverse array of salads, wraps, baked potatoes, soups and smoothies etc. Kappa has designed its menu to target the growing health and wellness segment within the fast-of d industry. Page 4 Compared to the majority of competitors such as McDonalds, KEF, Burger Kin g etc. , Kappa offers a distinctive alternative to traditional fast-food items like burgers and fries with creative salad options that customers can mix and match to create their own. Salads can also be up graded to Puke or Long John allowing customers to have salads in a wrap or toasted flattered. All food produce is sourced in New Zealand from local growers and is of the highest standard an d quality. These nutritious menu options provide a unique point of difference for Kappa allowing the company to et the needs of consumers wanting healthy fast-food alternatives. 2. 1. 3 Financial Management Kappas financial management strategy has proven to be effective. With the pr Mary investment to fund the initial start-up coming from James and Justine own savings albeit wit h the help of non smaller investors, James and Justine have successfully managed Kappas finance s to avoid any cash flow issues. Operational assumptions and forecasting outlined in the original busing sees plan have provided strong direction allowing both owners to re-invest the majority of profits earn deed to sufficiently fund Roth of the business and the opening of additional stores in the Wellington region. 2. 1. 4 Kappa Brand Significant effort has been made towards developing and creating a distinct N ewe Zealand identity in order to distinguish the Kappa brand against other retail competitors within the e fast-food industry. This has involved incorporating unique kiwi elements within the brand such a s the Maori term Kappa as the company name; use of the koru within the compass logo; the use of Maori proverbs and quotes as wall and cabinet art within the stores; building on the environment al image of New Zealand tit biodegradable packaging, and subtle greens and browns in the styling of stores and uniforms for staff. By carefully choosing each of these elements to reinforce and represent the b rand, Kappa has aimed to achieve a unique point Of difference within the fast-food industry, ultimate y building strong brand equity. 2. 1. Social Consciousness and Environmental Responsibility With todays consumers concerned about their health and well being, and the growing shift towards tackling obesity within society, Kappa has recognized this need and positioned itself as an alternative page 5 provider of healthy fast food. This strategy towards social consciousness not only includes providing healthy meals a t an affordable price to consumers, but also supporting the WI deer community by purchasing produce through local food producers; focusing on positive employ Yemen strategies for their staff and donating a percentage Of profits to local ventures. Latest research also indicates a rapidly growing trend in consumer attitudes t awards sustain ability and environmental responsibility. This is an important element of the Kappa p hilltops to ensure that all activities are undertaken to make as small as impact as impossible on he environment. Such activities include having biodegradable packaging, recycling, adopting a zero- waste policy and using environmentally friendly cleaning products to lessen their impact. Combined together, these strategies provide valuable competitive advantage for Kappa. 2. 1. 6 Organizational Design Informal Structure Having a strong organizational culture is key to promoting and delivering the right identity in line with the Kappa brand and its values. As discussed by Historic teal (2011), culture WI thin an organization is described as the informal Structure built around the mix Of people, their attitude sees, personalities, characters, skills, and abilities within the organization. Attaining the right mix of people to create the desired culture (informal structure), is critical in achieving the objectives and g owls of the organization as set out in the business plan. This is evident in Kappas commitment to attract the right staff for the company y who are Young, vibrant, into healthy food and the outdoors. Although this was a challenge at first with turnover relatively high, the majority Of new employees are found through word Of MO HTH from existing staff members who consider Kappa as a great place to work. Attracting these people shows strength in Kappas cultural philosophy within t he organization. 2. 2 Weaknesses 2. 2. 1 Marketing Analysis of the Kappa marketing mix identifies issues regarding the companies advertising and promotional strategies (Appendix 1). Although management feel that they ca n achieve maximum exposure for the company through the use Of guerrilla advertising tactics and unpaid public relations page 6 activities, there is questionable debate as to whether these actions alone, are enough to achieve maximum awareness in order to grow the brand. Market trends obtained from Remuneration (2012) indicate high levels of prom action throughout the fast food sector, especially from leading chained players; such activities include e extensive promotional campaigns through print, online, Was and radio. There is also a growing interest in social media through channels such as Backbone, Twitter and Youth to cap true audiences and increase awareness. Although Kappa does have a company website and has adopted a social midi a approach through the use of Backbone, this does not appear to be enough to protect its existing ma reek.