Question

Introduction to business

Section E

Case study 5

Read the case given below thoroughly and answer the questions.

An American fast-food company is one of the most popular fast-food chains all over the globe. It is also investing and trade in the stocks market having limited liability advantage features. It offers different types of fast food meals like different types of hamburgers and sandwiches with different bread types, servings of mixed greens or salad dishes and snacks with refreshments, pastries, and shakes, and light meals for breakfast. It has branches in almost every city in all over the world right of the highway. It is popular for its fast service for customers. It is very easy to order from outside with a microphone, you can go inside choosing from a very big screen even if you do not know the language pictures are helpful or you can order a pressing machine without waiting for the queue. It offers different pricing like for example 1.5 Riyal only menu and low prices based on some selected categories offering more than one product as a reduced price. When promoting their products, they used different latest communication means for advertising, provide delivery, loyalty points...etc. However, there are some environmental factors that might affect the performance of this global restaurant chain. To be successful in this fast-food chain, it is good to be aware of continuous rules and regulations of different health and diet controls that are put forward by the nations in which it runs its operation. Another challenge is the tax, duties, and charges forced by governments on the fast-food industry that can influence productivity, and consequently the profits decreases. Besides, high unemployment rates challenge and insecure economic conditions can lead to decrease the wealth of this company. Unless individuals have sufficient expendable incomes, they are not able to spend on junk fast food. But, the current drift of a youthful workforce which is diverted towards fast meals anywhere you go is the main factor for this successful business progress.

Questions:

a) Identify and explain the type of factors affecting this business operation as mentioned in the case.

b) Identify the form of this business ownership and explain three advantages of starting this form of business?

c) Explain the marketing mix as highlighted in the case.

Answer 1

(a)- factors affecting this business are-

1. Continuous rules and regulations regarding diet and health.

2. Taxes,duties and charges imposed by the government.

3. Insecure economic conditions

(b)- A large chain fast food restaurant be considered as a corporation.

Advantages-

1. Limited liability.

2. Easy ownership transfer.

3. Reduces unproductive competition.

(c)- In the case the restaurant has a branch in almost every city and promotes with different new technologies which make their business more efficient. Offering different type of fast foods and different ways to order make it more attractive so this can be considered as marketing mix. As marketing mix is simply some tools used to fulfill the marketing objectives.