Descriptivo

John Ferra
Assignment 5
TodayI will be analyzing the food industry (Restaurant) because I am very involved in this industry and I believe that the food industry is one of the most competitive. The food industry will be my base to conduct my SWOT analisys. "The SWOT analysis is an extremely useful tool for understanding anddecision-making for all sorts of situations in business and organizations. SWOT is an acronym for Strengths, Weaknesses, Opportunities, Threats."(Businessballs.com) Before I begin my SWOT analysis I will do a short PEST analysis "which measures a business according to external factors; Political, Economic, Social and Technological."(Businessballs.com) I will conduct the PEST analysis because it is highlyrecommended to this analysis before completing a SWOT analysis. I will also include other resources such as Porters five forces. By combining all three of these analysis and methods I will be discussing and researching all associated strengths, weaknesses, opportunities and threats that the industry I selected has.
I will start with Porters five forces. According to businessballs.com Porters fiveforces are:
1. Threat of new market entrants
2. Existing competitive rivalry between suppliers
3. Bargaining power of buyers
4. Power of suppliers
5. Threat of substitute products
Fisrt I want to start by looking into the threats of entry that I am vulnerable in this industry. Well once again, the food industry is one of the most competitive and like Porter wrote in his fiveforces model “The more competitive the industry, the more difficult it is to generate profits.”(Businessballs.com) I believe that in my industry my business is very vulnerable to various threats of entry. For example capital requirements, I am currently making a good profit in my business, but there is an investor that wants to come in across the street from my business selling the same type ofproduct. That investor has a lot of capital besides he already owns one of the most famous businesses in the city. This means that from my profit I need to invest more in advertising, maybe lower some prices or make new specials and people always want to try the new place as well. So I am vulnerable to investors that have the capital requirements to maybe run me out. Next I will look intopotential rivals that I am vulnerable in this industry. I am vulnerable to a rival who has the ability to take me out of business. We see it all the time in the food industry and in all types of industries. I have seen big box stores taken out by new competition. For example Best Buy took out Circuit City. All industries are always vulnerable to new rivals, but we need to continue with quality service tomaintain a good business. The next threat is the power of the supplier. I am always under pressure with suppliers because prices go up. I understand that gasoline goes up, but it is hard to keep a profit when prices suddenly go up. For example I was paying for a product forty four to forty seven dollars a case and suddenly one week that product was at seventy nine dollars a case. It had almostdoubled. It is hard to keep a study profit when I have to continue with my prices because I can’t change my prices every week. I depend on my supplier to open everyday because I need their product. Next I look at power of the buyer. To me the buyer is my customer and It is very hard to keep every customer happy. I have had times when we are really busy and some customers don’t understand that theycan’t expect the same rapidness every time they come in. I give my customers the same great quality service all the time, but some still get mad. To keep my customers happy I have to keep my same prices, but I am losing part of my profit because I can’t raise prices when my supplier raises my prices. What I do know is that I check with other suppliers and see who can give me the better deal for...