Levendary Café’: The China Challenge

Presented By: Ansh Aggarwal

Kuhu Pathak Varun Nigam

Difficult road for Mia Foster, New CEO

Introduction I Company Overview I Market Analysis I Industry Analysis I Problems Plan of Action I Recommended Approach I Conclusion

Lack of

internal mgt exposu

re

Wall street’

s confidence

Stock Price

Chen’s Attitud

e

China’s Local taste

GAAP Cost

Company OverviewIntroduction I Company Overview I Market Analysis I Industry Analysis I ProblemsI Plan of Action I Recommended Approach I Conclusion

- Mia replacing departing founder/CEO of the company

- 3500 quick casual

- Franchised- Publicly traded- Flexible

marketing and menus in America

- Domestic demand

- High quality fast food

- Customer oriented policies

- Risk taker - Organic

ingredients- Keeping up to

date (CCO)- Interior design

Forget today’s profit. Have a positive impact on customers

U.S.A

Market Analysis

Introduction I Company Overview I Market Analysis I Industry Analysis I Problems I Plan of Action I Recommended Approach I Conclusion

Increasing GDP

Stock Market

Speculation

Lucrative Market

Sticking to strategy of internation

al expansion

To check the

untapped potential

Success of competitors like KFC , Mc Donald

Local market

Saturation

Why China ?

Industry Analysis

Introduction I Company Overview I Market Analysis I Industry Analysis I Problems I Plan of Action I Recommended Approach I Conclusion

China :Food intake is increasingEating habits are different than AmericansLargest producer and consumer of Rice

Q1) What is your Evaluation of the way Levendary Café has entered the China Market?

Introduction I Company Overview I Market Analysis I Industry Analysis I Problems I Plan of Action I Recommended Approach I Conclusion

• The organization foundation- Blending Concepts and Operations

Operation

• Franchise • Business

development

Administrative staff groups

• Concept• Marketin

g• Food

Leaping into china

Louis Chen, a strong market position. Right concept, flexible, bright future.

Expanding: The InvestigationChina was conducive for investment, population and GDP growth

An affluent middle class, foreign fast food companies attracted the most

attention.

Serving the U.S marketCustomer delight, customer meet request

Local menu adaptions, the American consumer, evolving menu choices.

Q2) What changes should Mia Foster make? Specifically, what should she do about Louis Chen? What changes would you propose at headquarters?

Introduction I Company Overview I Market Analysis I Industry Analysis I Problems I Plan of Action I Recommended Approach I Conclusion

Changes Mia Foster should make

• Financial Reporting - There should be a China HQ to take care of the Financials reported in Chinese format.

US HQ

China HQ

China restaurant 1

China restaurant 2

China restaurant n

Changes Mia Foster should make

• Restaurant design – Restaurant design should be consistent with US restaurant designs. Restaurants can be small or big to suit the location.

• Food Menu – McDonald’s style menu design should be used.

• Louis Chen – Foster can try to make him understand that standardization is important and can be achieved.

Q3) Prepare a specific action program for Foster to help her deal with the need for continued growth in China.

What should be the agenda for her meeting with Chen?

Introduction I Company Overview I Market Analysis I Industry Analysis I Problems I Plan of Action I Recommended Approach I Conclusion

• Levendary Café is a MuR Business.• There seems a missing link between the two

cultures that is not being understood by headquarters .

• Heirarchical Structure:• USA: Top -Down Approach.• China: Bottom- UP Approach.

• The adaptation China requires for a business from the USA.

• Phase 1:• Building a team for MR. Chen.• Making Chen understand what are the Levendary Café’s core

values.• Renovating the current layout of the stores.

• Phase 2:• Invest more from USA.• Have more control on Chen from Foster.

Recommended Approach

Introduction I Company Overview I Market Analysis I Industry Analysis I ProblemsI Plan of Action I Recommended Approach I Conclusion

Follow KFC’s and other successful American restraunts approach

- Motivate & recognize - Train the employees

Transparency by setting up processes

Team for Chen

Conclusion

Introduction I Company Overview I Market Analysis I Industry Analysis I Problems Plan of Action I Recommended Approach I Conclusion

Following proposed strategyConfident about the meeting with ChenFlexible Marketing StrategySatisfying all : Wall street, Chen and

fosterTrade offs