Strategic Plan Part II: SWOTT Analysis

As a business, my deli store has great potential to succeed but also has great potential to fail. This will all depend on what decisions I make as the owner and how external factors play out towards my side. In regards to external social forces/trends, there are several forces that create an overall impact on my business. For one, the grip of obesity on America has forced several individuals, especially youngsters, to eat healthy and reduce their waistlines. Indeed, one of the most successful fast food chains has not been McDonalds or Chipotle but has been Subway. With their attractive pricing and healthy options, Subway has been far more profitable where other restaurants and chains have faltered. Being that Laredo, Texas is home to Texas A&M University, we can expect to find college age kids dominating a large percentage of the customers at restaurants. Since these health trends are extremely popular amongst the youth, it makes sense that these social factors of health conformity are a huge positive trend towards the deli.

College kids are more likely to be health conscious because it is the norm to be in shape and fit at that age. Therefore, by eating healthy sandwiches provided by my deli, they are a positive external force. In addition, since Texas A&M University has its international campus in Laredo, we can expect a lot of foreign customers. Being that the largest amount of foreign students are from China and India, we can expect that Indian students will generally be more conservative when choosing to eat. For example, since beef is traditionally not something which Indians eat along with other meats, I will adopt veggie substitute for meat so I can cater to these foreign students. Competitive analysis as an external force/trend is quite interesting. Laredo is a town bordering Texas and, therefore, has a high population of Hispanics. Mexican cuisine is quite prevalent in the area and a Chicago themed restaurant would be an outlier among the usual fast food chains and the family owned restaurants.

This provides me with an advantage as I have something new, and different to offer. In addition, the fact that my restaurant is located in a downtown area gives me advantages over restaurants not located downtown. Downtown areas are usually home to many offices and small business employing workers. These businesses employ white collared professionals who would most probably leave for lunch around the same time. Perhaps some sort of discount to employees who come in large groups could give my restaurant the upper hand. The installation of flat screen TVS displaying news items and economic information is material which is, generally, attractive to white collared professionals. Being that my business will be in a location where these workers work, I have to cater to them this way and offer an attractive environment in which they can relax and unwind for lunch. Downtown areas are also hot spots for youngsters and for families who are looking to wander around the city and attend the attractions of the city.

As Texas is a state with warms temperatures all year round, I expect people to at least stop for food or for something to drink. Given that families that usually do not come downtown do not see my restaurant as often, it may be an attractive choice to those who want to try something new. External technological forces/trends can work either against me or can work for me – depending on how I start out my business. First impressions do matter – as much as they we don’t want them to; with websites like yelp.com, there are several reviews of businesses available online. I admit myself that if I see a poor review on yelp, I tend to be easily influenced by what an amateur blogger has written – be it positive or negative. In this situation, it is very important that the restaurant makes a strong first impression. Older reviews on websites are usually at the top and have the most views so it is important that the first review is written well and is in favor of my restaurant.

Also, college newspapers are a popular source of information to students and perhaps some sort of coupon or deal in the school newspaper would be a good way to lure students to the restaurant. Since the written part of paper has its counterpart on the web, online advertising would probably be a more attractive option because college students are more likely to read information online than in physical print; this is just more sensible of a thing to do. Considering the obtainment of resources for my business, a strong force which can negatively/positively affect my business is the cost of transportation of materials to my deli. Originally, I had thought of transporting fresh material daily through air from Chicago itself. However, this would be inefficient and extremely expensive. It makes more sense that I obtain these materials from a truck transporting material on a weekly basis. These materials should be things that I would absolutely have to import from Chicago because they have to be authentic Chicago food. For example, the processed meat and the hot dogs that will be used in the food should be imported from Chicago.

On the other hand, ingredients such as vegetables and flour and other raw materials can be obtained locally. This idea is similar to how Chipotle is able to obtain raw meat and raw produce; Chipotle locations around a certain area usually have the same source of raw materials so it is sensible that my business could do the same. This would also prove to be cheaper because I would not be importing materials from a long distance – like I would be doing with the processed material. Most delis bake their own bread and it would be great that this is one product that I would create in my deli. Sandwich stores such as Jimmy Johns and Subway do this to their benefit. Culture is another internal force which can make the deli a great and popular place. Keeping my business family owned and with a small group of friendly employees makes a huge difference in how a restaurant is perceived. I have noticed that the friendliest restaurants are usually those where the owners themselves work.

Hiring employees that are not affiliated with the business owners generally results in employees who do their job but may not necessarily enjoy or take part in the enjoyment that the owners may have in operating the business; in other words, these employees will do their job but they won’t have the passion that family members would have if they ran the business. Overall, the friendly service that customers will get from my deli will likely be an incentive for them to return again. The TV panels I am providing in my Deli in several corners are important because they cater to different types of people; for example, the white collared professional would enjoy watching TV programming relevant to what they enjoy while the sports fan would enjoy watching television relevant to his/her liking. By turning the deli into a place where people can go and relax, we can essentially turn it into a Starbucks type of place where people can unwind and relax. Over time, places like these become a sort of “favorite” hang out for people; This is very similar to how bars become places where people can hangout and relax while watching TV and sipping on drinks and eating.

One additional thing I want to do (which is a must) is offering Wi-Fi in the deli. Since we do live in an age where technology is so prevalent and since we know that it is a college town, it is expected that people will have laptops and other portable electronic devices. Leadership is an essential part of any business and can lead to better efficiency. It is very important for my business to have a good leader. I will probably be the leader because being that the business belongs to me, it makes more sense that I greet customers and take their orders. I have seen several businesses where employees who usually have no idea about the workings of the business or about the food being offered are taking orders. Sometimes, a customer may ask a certain question that requires a bit of prerequisite knowledge about a certain type of food or product and to answer the question, one has to know at least something. In many of these situations, where I have been the customer, I have been met with uncertainty from the cashier because they themselves may not know what “tastes good” or what “is spicy” or what is “mild” etc. Good leadership also is integral to making a business run smoothly.

There usually has to be someone “in charge” that can direct people around in case they are lost. In this case, if an employee is making a certain product and is confused on how to finish it or continue with it, the “leader” can usually step in and aid in the completion of the product. Therefore, a good leader will run the business in a smooth manner while the lack of a leader can result in the business losing money due to customer dissatisfaction (due to problems such as excessive wait for food, bad service, bad food, etc.) My overall internal strategy will be to keep consumers pleased and to keep their visit to my deli memorable so they would want to come there again. I find places memorable when I am able to spend time at those places. These places are usually sit-in places where I can sit with friends and enjoy my meal. Keeping the place sit-in allows customers to enjoy the atmosphere and savor the taste of their food in a Chicago type atmosphere. With the added flat-panel displays, they have something to keep them occupied and enjoy their stay.

To keep the menu a bit unique, I would diversify the menu by serving specific “special” on different days of the week. I would provide discounts for a large group of people so they would have a higher incentive to go. These are all things to keep people coming to my deli so it eventually becomes a favorite spot for them and they can “develop” a taste for Chicago styled food. Economic forces/trends that can benefit or work against my business most definitely include the price of oil and prices of raw materials. Since transportation is a must in any business to bring materials to the deli, rising gas prices will hurt my business and cost me more. Similarly, a drought in the area will also exacerbate my situation and raise prices of raw materials to be used in the deli. Again, this will work against me. Texas A&M University is a large university offering undergraduate and graduate level programs so in a worsening economy, we can see that many people would enroll in a graduate program. This would increase the number of potential customers around me and help my business. However, this is a speculation and we cannot truly know if this would happen. It is just a general economic principle.

I cannot really think of any legal or regulatory forces/trends that would affect my business but in the case of opening a deli, the health inspection of my deli would be subject to how they regulate how long a certain product is fresh; for example, if health regulations don’t allow beef to stay out for a certain amount of time or travel for a certain amount of time from one place to another, I might have to adopt ways that my beef can be transported faster to my deli. This may require me to use shipping through air and that would cost me more. By not following these procedures, I would be breaking the law and risk the closing of my business. Being that I am a small deli, it would not be too difficult for me to make changes to my deli unless the changes are extreme – like the change corresponding to the faster transportation of meat. Making changes to the menu or making different items is usually just a change in how a certain product is prepared. Since delis usually provide food made through the same ingredients mixed in different ways, I don’t see a very difficult change to apply here.

However, if people were to ask for coffee in the deli, then I would have to buy machinery to produce coffee related products and that could possibly take some time but no more than a week or two. Since my business is small scale, it is easier for me apply changes than it is for bigger businesses that may be spread out in several locations. The supply chain operations of the deli, as previously mentioned, refer to how I will obtain my material for the products being made. To keep the food truly Chicago style, I want to ensure that I use actual meat processed in Chicago to give it that Chicago styled taste. However, the veggies being used can definitely be locally produced. In order to buy the meat products, I would most likely contact Vienna styled beef or some company of that sort from Chicago to ship down their meat products to me once a week. Keeping these products frozen on the truck on the way down ensures that the meat products can stay as fresh as I can keep them while they are in transit. The veggie products can be locally bought from farmers in Texas and maybe from several – depending on what sort of vegetable is providing by whom.

Cheese products can similarly be bought from local companies with a supply chain in the area. The bread to be used can be baked within the deli itself. After analyzing, the main issues I see with my deli are the costs of gas and providing quality service to people. Gas is what keeps the trucks moving whether they will be carrying the meat, vegetables or cheese products and it will be an unavoidable cost. With rising gas prices, this is a real threat indeed. Providing great service seems almost nonsensical as every business strives to do so but to keep my business rolling, I have to provide exceptional service to my customers and doing so may require my deli to be consistent with service; something many businesses I have seen tend to get a little lax on as time progresses. The greatest opportunities which I see in my deli is obviously the culture shock; the people, being used to the same old type of food, will want to try something new and exciting and it will set my business apart from other businesses. This would most definitely not be the case if I was to open a deli in Chicago; due to the vast amount of delis in Chicago, I would face a lot of competition from already established delis – something not so much in Laredo, TX.

Another advantage I have is the college town and the wide variety of people who would be living around the area. As there are people at Texas A&M from all 50 states of the US, I am bound to get someone who would enjoy Chicago styled food and would want to visit my restaurant. The wide diversity would attract several people to the restaurant – something which would be difficult in a region where there are a homogeneous group of people residing sine their preferences would usually fall around the same area. A hypothesis I could generate for the issue of gas could be “Rising gas prices would hurt my business by costing me more and I could therefore pass on the cost to consumers in an effort to remain profitable.” The major questions I would ask myself here are “How are consumers reacting to the increases in prices at the deli?” Another question I could ask would be “What type of consumers are still coming to the deli?” (As in, are they white collared professionals, students, families, etc.)?

For my issue relating to consistent service, a hypothesis could be “When I provide good service and talk to people on a first name basis, I am able to see them return to my deli.” A question I could use for testing would be “With what frequency did this customer return to the deli?” The circumstances surrounding the issues of rising gas prices are things I cannot control. I classify this situation as a circumstance I cannot control so there is no way for me to really test this. The only way to really see a difference in if this truly makes a difference is to test to see if rising prices of gasoline cause me to raise prices of my products sold at the deli. Then, I can analyze daily sales and see how many people come and go as my prices rise. Also, I could informally just observe the type of customers coming and hopefully notice a trend in what type of customers are still coming and what type of them aren’t coming – if there is a change in them.

Circumstances leading up to my second issue could be a loss in interest to work at the restaurant, monotonous service and repetitious work, and just general apathy towards the customers. Since I would want to be greeting the customers, I would classify any issue regarding myself being apathetic in regards to showing enthusiasm to being something that I could change in myself. However, other employees demonstrating lax and apathetic behavior would be something I would not be able to directly control; I would only be able to prod them into being better employees and keeping up exceptional service. Perhaps the repetitious work done by one employee could be switched to different employees so one employee isn’t always doing the same thing every day and losing interest. An employee showing apathy in behavior and in work is of much more concern than if I was because I am in charge of the business and I know that I have to correct something in myself or risk damaging my business.

However, putting that thinking into a fellow employee is a bit difficult since he/she will merely be doing his/her job and it will be hard to translate the fervor with which I enjoy my job into their brains. The obvious way to test this would be to catch myself slacking off in my customer service and correcting myself and watching an employee of mine slacking off and watching how they are able to get back on the improved customer service and how long it takes them to get back on track. To further test this in regards to whether it is an issue of monotone or just a general loss of interest in the job, I would first try to switch around employees to do different jobs around the deli and would observe their behavior. A positive change would mean that they were indeed just getting lost in the monotone of their job and needed a change while if the employee continues to behave the way that he/she is doing, then they are just not willing to put in the work into being effective employees.

References
Pearce, John A. , & Robinson, Richard B. . (2009). Strategic management. formulation, implementation, and control. United States: McGraw-Hill. Thompson, Arthur A. , Gamble, John E. , & Strickland, A. J. (2006). Strategy: winning in the marketplace: core concepts, analytical tools, cases. United States: McGraw-Hill Companies.