Marco’s Restaurant Competitive Strategy

Introduction

Marketing is a long trail of processes that range from drawing a raw strategy to spreading out different available concepts. The hallmark of this process is to enhance the supply of goods and services in order to meet the demand of consumers as well as to achieve both specific and general goals of a business enterprise. Virtually all organizations need rigorous marketing strategies to be put in place in order to survive in the liberal market that is highly dynamic. Marketing is an old practice but has equally withstood the test of time.

This paper focuses on an Italian restaurant that is owned by Macro, an Englishman of Italian descent and his wife Maria, from Birmingham. This restaurant is located on the High Street in Birmingham at the edge of a small town that borders a rapidly growing resort area. However, it has been operating below average. This paper seeks to identify the problems that Macro’s restaurant is facing and recommend some strategies that should be adopted by the management in order to retain its customers and be able to enjoy a competitive advantage over other restaurants in the area.

Current Problems at Macro’s restaurant

Currently the management of the restaurant is wanting; a management that does not beat an average holding other things constant proves inefficient, there is poor decision making and also conflict of interest. The restaurant is run by family members who are still the managers. A good manager should not have direct relationship with the organization so that he is able to plan for a strategic approach, which the business can follow as a way of increasing its sales revenue (Panagiotou 2005).

He is supposed to act as an eye for the business and maximize every opportunity that comes his way (Shane 2003). Macro’s restaurant relies on one line of service delivery (that is traditional Italian dishes) and is not ready to diversify or modify its products to suit the current demand. The restaurant is operating in a competitive environment and without proper management; it is at high risks of falling.

Another problem that is quite evident at Macro’s restaurant is poor customer care. Every business should understand that the customer comes first under all circumstances; it does not matter whether the customer is right or not but every business should follow the rules of customer care (Yeshin 1998). Retaining an already existing customer is more than ten times cheaper than getting a new one. One of the effective ways of winning competition is gaining customer loyalty and the restaurant is not investing in this. Instead of allocating the employees evenly in all shifts, most of them have been assigned responsibilities in the morning when the restaurant is not very busy leaving it with inadequate employees in the evening when it receives more customers.

The best way to build a brand name is to ensure that all employees and customers are satisfied and their expectations met (Cook 2008). At Macro restaurant, most employees are not satisfied with their current positions because they are hardly allowed to make their own decisions. For instance, the head-chef who happens to be qualified and experienced in his job is never allowed to make his own innovations when it comes to the product being offered. The owner (Macro) is always interfering with his work and this makes him uncomfortable. When asked about his views concerning his responsibilities he reported that, “Marco is always interfering with my cooking! I wish he would concentrate on the business and let me concentrate on the food.”

Opportunities Available

Opportunities for the restaurant are dependent on both the internal and external assessment criteria of the restaurant’s profile of operation. Similar to the problems discussed above, the restaurant can still optimize on the various opportunities available to bring about sustainable growth through effective competition. Some of the underlying opportunities for this restaurant in regard to the macro environment are the diversification of its activities. The restaurant may opt to not only rely on offering traditional Italian dishes, but also produce variety of products. This concept of variety may be approached from different angles like design and suitability (Paley 1999).

In striking for the right opportunities, the restaurant will have to analyze its main market rival. The strategies being employed by the competitor should be critically assessed and evaluated for necessary counter action. In addition, the general plan of the competitor in a bid to control the market is a vital toolkit that this restaurant can use to estimate the competitive edge of the market. Similarly, the product being offered at the market at lower price should be investigated to determine its type and nature.

Why, for instance, is Guiseppe’s lowering the price of its commodity? Do they have access to cheaper raw materials or is it that quality of the product has been compromised and can be offered at a lower price than normal market value? Finally on opportunities, the marketing department will have to investigate the restaurant’s managerial structure both current and past and give a detailed finding as well as possible conclusions on the same.

Recommendations

The following are some of the recommended strategies that the restaurant should adopt to enhance its business image consequently increasing its sales revenue.

Brand Image and Low Cost Products

Global marketing strategies call for development of strategies that build upon the brand image and customers’ loyalty. This includes developing positioning strategies as compared to the competitors’ worldwide. Branding and positioning strategies must fit the product and the restaurant across multiple countries (Stevens 1998). Organizations are formed to achieve certain goals. Macro’s restaurant is built to grow shareholder value by delivering quality products at low costs.

Low cost and quality are not normally associated with each other but through careful application of business practices, strategic alliances, and marketing initiatives, Macro’s restaurant can achieve both. To do this, the organization has to understand its critical success factors. These factors include Customer Satisfaction, Management, Finance, Innovation, Production, Distribution, Marketing, Sales and Service. More importantly, the restaurant’s success in the industry is its ability to differentiate itself from its competitors (Saad 2007).

Each producer in any industry aims at being the lowest producer at a given level of quality. Products are sold at an average price so as to attract a big market share and earn high profits (Hooley & Saunders 1993). Most customers tend to prefer the low priced products if they guarantee them of quality. If Macro’s restaurant implements the low cost strategy, it will be able to maintain its profitability during price wars because it will have already adapted the low cost production. Even when prices decline to significant levels, Macro’s restaurant will be able to earn profits because its products will always be cheaper compared to the competitors.

Good Communication and Promotion

The success or failure of any business or organization depends on the organizational behaviour perceptions (Moschis 1994). Macro’s restaurants need to set up a management team with the responsibilities of overseeing the activities of the business. Instead of allowing family members to work in the restaurant, it should advertise for vacant posts and only accept the qualified candidates. The way the management team together with the employees handles different perceptions concerning the restaurant determines whether the organization will close its operations or it will continue (Avery 2004).

This is because management and employees are responsible for the future development of the organization. This is done through motivation, communication, politics, and power (Brannan 1995). Businesses have to develop a competitive advantage if they are to continue and failure to do so will lead to deterioration. For a relationship to exist, messages have to be sent and received between people, such as, employees and companies (Bryson 2004).

Promotion is one of the four main elements of effective marketing. Every organization uses promotion as a way of making a product or service accessible for consumption by the consumer (Harvard Business School Press 2006). Even with reduced price commodity by the competitor, Macro’s restaurant can engage in thorough promotional activities of the competing product. One way of achieving this is through advertising. Moreover, reaching out to the consumers of the product through special offers over some period of time will equally ensure sustainable client base (Masterman & Wood 2006). Promotion can be through the media, such as use of TV, radio, magazines, newspaper, or the internet (Shimp 2008).

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