America is finally being struck by the fact that over one-third of adults are obese, so a certain ewe of them want to take action. Obesity leads to diseases, which then could lead to an easily prevenTABLE death. With that in mind, ifs going to cause a nice driver of change for some restaurants. In this analysis, will consider my key survival factors along with my drivers of change to predict what some of these major fast food restaurants should either do or keep to increase their potential returns or at least maintain them.
First, I will analyze this industry with my key survival factors and follow-up with my drivers of change; both of which, will include some PEST factors along with some of the Five Forces where applicTABLE. The most important key survival factor is the dollar menu. It’s a very predicTABLE factor considering the state of economy which America is currently in. Some people believe it’s a whole lot cheaper to buy groceries and cook, but there are a few that believe that going to a fast food’s dollar menu will save them money. Either way it goes, it’s limiting the potential profit of this industry.
When people grocery shop instead of eating out, that’s a complete loss for the fast food industry. Now, when customers eat out, it’s bringing in money, but because everyone is trying to get the most bang for their buck, they’re going straight to the dollar menu. Although, the fast food restaurants aren’t getting as much of a profit on dollar menu items as they would on a whole meal with fries and a drink, it’s at least bringing some money in. With that said, every fast food restaurant should have a dollar menu, because those that don’t will lose customers to their competition.
An important driver of change in this industry relates to the social factor of our PEST analysis. Obesity, as mentioned before, is equal to about 35. 7 percent in America. And because obesity is serious and not to mention costly, Americans are now taking more precautions. Since the fast food industry is growing aware of this, they are thinking of new ways to regain some of the lost customers who’ve departed because of the nutritional quality of fast food. According to the Yale Rude Center for Food Policy and Obesity, “less than 1 percent of all kids’ meal combinations met recommended nutrition standards”.
That gives an idea Of what nutritional value some Of these menu items hold. Because health consciousness is increasing, some of these restaurants should extend their menus and offer more salads, turkey burgers, or sweet potato fries, all of which are a healthier alternative to what they already serve. Some restaurants have already started offering sweet potato fries, while other restaurants have added turkey burgers, but it’s not long until every fast food restaurant has all of these items on their menu.
Baked fries would be a great addition, but the time it would take to make those would cause a delay and defeat the purpose of ‘fast’ food, but if it is Seibel it would definitely be worth it. The fast food industry is extremely attractive; especially considering how lazy America is becoming. Although, believe the fast food industry should consider the health consciousness of people, there are many restaurants that already revolve around that type of food. There are different types restaurant for all the different types of people.
If people want to be healthy, they have options such as Subway, Chic-fill-A, or Season’s Deli. If some people don’t care and just want food, there’s Pedicures, Five Guys, or Burger King. If money just wants something cheap, McDonald’s is the ‘king of the dollar menu’. Each of these restaurants attract different customers, so the profitability is there. According to an article on Forbes, Chic-fill-A averages over $3. 1 million a year per store. McDonald’s is in second with $2. 6 million per store.
These are great numbers and shows how this industry can definitely be profiTABLE. And the fact that this industry is growing backs that statement even more. Whenever there’s a Wall-Mart in a certain location, (which usually has a McDonald’s in it) and another McDonald’s is built within a ill that definitely says something about growth. McDonald’s is doing so well that they have to put another location to attend more customers as well as increase their ease of access. With all that said, this industry is definitely fragmented.
